Jim Ziegler is the founder of Ziegler SuperSystems and a nationally recognized trainer, consultant, speaker, author, and industry forecaster. Agent Entrepreneur caught up with Ziegler shortly after he accepted the first-ever Edward J. Bobit Lifetime Achievement Award to learn how his company and training philosophy has evolved, what advice he has for agents, and why it’s wise to hold your sneezes when the Secret Service is on high alert.
AE: Jim, how did you break into the car business?
Ziegler: I walked into a car dealership in 1976 looking for a part-time job as a salesman.
AE: Why a dealership?
Ziegler: Because I was divorced, depressed, and wimping out a little bit. I thought, “I’ll just do this until I find a good job.” That was 42 years ago. In my third month, I made $4,500. In 1976, nobody made that kind of money. I had been the general sales manager of a radio station — the top-selling salesman in that industry — and never made that kind of money.
AE: Did they give you any training?
Ziegler: They threw me in a room with some Jackie B. Cooper Betamax tapes and said, “Don’t come out until you’re trained.” I picked up some word-tracks. I got the gist.
AE: When did you first encounter F&I?
Ziegler: Not at that first job. The salespeople did it themselves. My bank at the time was GMAC. You would call the bank and read the credit app to them. An actual person on the other end of the line would take it all down.
AE: What happened on weekends?
Ziegler: They worked half a day on Saturdays, as I recall. No dealership was open on Sunday. And there was no such thing as spot delivery. You would have a one-, two-, or three-day wait for approval. GMAC would call back and say, “Get the contract. Now write $6,000 on Line One. Now write down the payment, tax, and interest rate, now the credit life and service contract.” And we would handwrite the contract.
AE: When did you switch to F&I full-time?
Ziegler: I didn’t become an F&I manager until 1982. I had moved to Atlanta and met my future wife. I was the top salesman at my dealership, Banner Ford, and she was a customer. I was making a lot of money, which is good, because my credit was terrible. When Debbie and I decided to get married and it was time to meet the parents, we went to a very exclusive restaurant in Atlanta. At the end of the meal, I pulled out my wad of cash. Her mother said, “He doesn’t have a credit card!”
AE: She said that aloud?
Ziegler: Right there at the table. Later, Deb said, “My parents have a problem with me marrying a car salesman.” I said, “Well, what if I was a manager?” and she said, “That’ll work.” I went in the next day and said, “I’ve got to be a manager.” So I became an F&I manager.
AE: How far had the technology come by that point?
Ziegler: We still didn’t have fax machines, and there were only three or four computers that could do F&I. We used the Quip. It was a a big cylindrical machine connected to a dial-up phone-line modem. Once you connected with the lender, it would start spinning. It took about six minutes to send a credit app. Later on, somebody invented a state-of-the-art three-minute Quip machine. We thought we’d died and gone to heaven.
I thought, ‘I’ll just do this until I find a good job.’ That was 42 years ago.
AE: What were you selling?
Ziegler: All we had was credit life and service contracts. At some point, we added tire-and-wheel and environmental protection. By that time, I had moved on, because around 1984, the yuppie movement hit Atlanta hard. We had the No. 1 and No. 2 BMW dealerships in the country. Volvo fell right into that. I was working at Banner Ford when Richard Dyer, a big dealer from South Carolina, bought the local Volvo store. It was a small dealership with a three-stall service department. But he was pumping out 40 or 50 units a month, and they recruited me as an F&I manager.
AE: How did it go?
Ziegler: It was Camelot. We grew that dealership so fast we had to buy a Greyhound bus station and convert it. There was a gymnasium for the managers, baby rooms. We had plenty of space. And one of the innovations Richard Dyer invented was the “Aftermarket Personalization Center.” It was state-of-the-art. You’d walk in there while you waited for F&I. Mickey Roth was the manager. He had slot walls lined with Volvo accessories. Mickey was creative. He put a premium seat on a swivel chair base. He would sit a customer down and say, “You like that chair? I can put that in your new Volvo.” Everybody got a wind deflector for their moonroof. He sold wheels. He would add $2,000 or $3,000 to the sale, and we’d get it financed.
From there I went to the Potamkin group, where I was F&I director for five stores. I was also doing the sales system, running the show from the F&I department. At the end of that year, they decided I was making too much money. I left and went to a small dealership, Stovall Nissan. Robert Stovall was the dealer and he was a nice, decent guy. I think he had his hand on the Bible when he said, “I’ll never cut your pay plan.” Three months in, I was making $17,000 a month, and he cut my plan. I went home and told Deb, “We’re done. I’m starting my own company.”
AE: The timing was right. You had more experience than most in an exploding profit center.
Ziegler: Exactly. And we’d made a lot of money, but we didn’t have a lot of money. We’d been trying to have a baby. This was 1986, when in vitro fertilization cost about $8,000 a shot. Ultimately, we adopted Zachary, and that was expensive too. So we agreed that, if I didn’t make it in 90 days, I would find a job at a dealership.
AE: What was your first move?
Ziegler: I went into a recording studio where Baptist ministers made their church tapes. I went in and recorded a half-hour presentation on cassette. We had a couple hundred run off with a label on it that said, “I can increase the profits of your dealership by $100,000 a month immediately.” I sent it to every dealer in Georgia with no return address or phone number on the label. They had to listen to the whole tape to find out my name and contact information.
AE: Did it work?
Ziegler: Instantly. And one of the first calls I got was from Dick Spreen at Spreen Toyota in Atlanta. I met with him. He said, “Jim, I’m not a car guy. I’m an accountant. My brother owned the dealership and he died. I need what you’re offering. What do you charge?” I hadn’t worked that out. But I said I would charge $8,500 a month, and I needed an office with a dedicated phone number, and the receptionist had to answer with “Hello, Ziegler SuperSystems.”
So I set up shop in that store for about six months. My second customer was Michael Jordan at Stone Mountain Ford — not the Michael Jordan, but he had an easy-to-remember name. Now I’ve got two clients and I’m back to making $17,000 a month. Then I met Lee Evans with Ford Motor Co. He was Stone Mountain’s factory representative. He came by and said, “I love what you’re doing. I’ve got to get you to Detroit.”
At the time, Ford was headquartered at the Renaissance Center. Not a lot of people know that. They were in Tower One, the big tower, on the 30th-something floor. Dick Fenstermacher was head of Ford Credit. Rusty Restuccia and Ross Roberts were in the room. Tony Majors was in the room. I think Edsel Ford was there. They didn’t introduce me.
AE: Were you just there to talk or did you have a presentation?
Ziegler: I was presenting. I wanted to get the contract for Ford’s minority dealers program. I also had a deal I put together for the parts and service division. And I wanted to make training videos for F&I and go around the country as the F&I school for Ford. So I came out of that meeting with three deals. They needed the help, particularly for the new dealers. Their goal was to bring on 300 minority dealers, and they needed training. But that Ford program was not a charity.
AE: The dealers had to invest.
Ziegler: They had to invest, and for many, it was their life savings. So I made it my personal responsibility to make these guys successful, and I made a lot of lifelong friends. One of those dealers was Delmont Dapremont. He was from New Orleans. In 1987, he was heading to San Francisco for the National Black Dealers Association meeting, which was held one day before NADA. He said, “Jim, you need to sponsor a table.”
Now, I had just cashed a $40,000 check, and I had just bought my big, five-carat ring, and for Debbie we bought a floor-length mink coat with a matching beret and gloves. It was probably a $12,000 ensemble. So I’ve got the killer ring and she’s got the mink outfit and we bought a table right up in front, and I had invited some of my dealers to sit with us. We were waiting for Jesse Jackson to deliver the keynote speech, and next thing I know, a man and woman come by and say, “We’re with the U.S. Secret Service, and we need to put an agent at your table.” It was a good spot because we were only 10 feet from the stage.
Somebody invented a state-of-the-art three-minute Quip machine. We thought we’d died and gone to heaven.
The female agent sat down with her back to us. Jesse Jackson took the stage and started speaking. Out of nowhere, I sneezed, and that woman wheeled around and pulled a gun on me! I held my hands up and said, “Sneeze! Sneeze!” while all the other agents swarmed our table. Jackson paused, looked down at us, dressed to the nines, sitting there with 300 dealers and hardly another Caucasian person in the room, and we’re causing a scene. He just smiled.
There was so much going on at that time. NADA got wind of me. I spoke at the main convention that year. My speech was “Working Creatively With the Lenders.” They didn’t like my original title. And I received the highest grade a speaker received, and I became sort of instantly famous. Our business exploded. I was busy as a one-armed paper hanger. I was traveling all the time, visiting two or three dealerships a week. My wife barely saw me, but the money was exceptional.
AE: When did you start hiring?
Ziegler: Right around that time, I hired my first employee, Rusty Gentry. He taught the sales classes while I was doing the F&I school and teaching management classes. Rusty went on to own Toyota of Plano, in Texas, and he’s now retired. But by 1991, we had 40 employees in 8,000 or 9,000 square feet of office space. But that was the year the car business crashed, hard. When the first Gulf War began, cars stopped selling completely. It was like turning off a faucet.
AE: How bad did it get?
Ziegler: We almost lost the company. I laid people off and downsized the office. But when I tried to let one of my employees, Al Aderhold, go, he refused. I said, “Look, Al, I can’t even pay me.” He said, “Don’t worry about it, Jim. I’m going to stay with you and we’re going to resurrect this company.” We started making 100 calls a day. Al was standing there, going into the database and handing me customers’ names. At 9 o’clock in the morning, we were calling dealerships on the East Coast, and by 8:00 p.m., we’d be calling dealerships in Hawaii.
Between the IRS, American Express, and a number of other creditors, I owed close to half a million. But Al and I sold our way out of that and, in 14 months, we were debt-free. We built the company back up to 12 employees, then 40 employees, and moved into a bigger office. There’s nothing on Earth you can’t sell your way out of.
AE: Did you still have the Ford contract?
Ziegler: It ended when the program “matured,” as they called it, and Ford Credit wanted their trainers to be in the videos. And on the parts and service side, the Ford ESP service contracts shifted their administration to Ford Credit, and I was out. But we were back in business, and every dealership I touched showed profitability, and the biggest and most successful ones still do. And the internet was coming about. I had income-producing websites as early as 1998.
AE: Producing income how?
Ziegler: Selling seminars and books. But I railed against the internet then and sometimes I still do. I’ve got to tell you, it’s the worst thing ever happened to the car business. The internet has not created one additional customer. All it did was lower our profits and put vendors between us and the customers. The internet redistributes who gets the deal. But it can also be a giant killer. Stealth advertising can turn a little dealership in Oregon into the No. 1 Chrysler dealer in the world.
AE: As you often say, Google is the battleground.
Ziegler: Google is the battleground. I’ve been saying that for years.
AE: I think a lot of people who only know you as a sales trainer would be surprised to learn what you’ve done in F&I and digital marketing over the years.
Ziegler: All the records I set were in F&I. When I was in the business, I held all the numbers.
AE: Did you work closely with agents?
Ziegler: I did business with a lot of agents, and I still know most of them. Randy Cameron is a dear friend of mine, still in business in Atlanta, doing service contract and credit life administration. Kevin O’Brien, also in Atlanta, was with Pat Ryan. O’Brien was the first guy to look at my numbers and say, “This can’t be real.” That led to a lot of good relationships.
AE: What would you say to an agent who said, “Jim, I need a spark. Give me some advice.”
Ziegler: Agents need to respect people’s time. You can’t just show up and demand all operations cease while you’re there. One thing I tell agents is you have got to be able to show dealers the improvement. The old saying was, “Agents are here to change your pay plan and get you fired.” People didn’t want to deal with them. They weren’t constructive.
Three months in, I was making $17,000 a month,and they cut my plan. I went home and told Deb, ‘We’re done. I’m starting my own company.’
AE: So if you were an F&I manager, the agent was your adversary?
Ziegler: There was a time. Then, through the years, they got friendlier. They started working with the F&I guys, hosting F&I schools. I tell small agencies to align with an F&I trainer and run your own school. Every agency has to have F&I training available, and they have to be able to supply dealers with an F&I manager if they suddenly lose the one they’ve got. The sales manager is not a backup for F&I. If sales is flooded, they haven’t got time. At every dealership, there is at least one salesperson who is a wannabe F&I manager. If they’re qualified, send them to F&I school and put an extra, fully functional F&I office in the dealership. In overflow periods, that salesperson takes that office.
AE: Where do you stand on digital F&I?
Ziegler: I see it as a threat that wants to be a threat. It’s honestly not working. A couple years ago, they were telling dealers to let the salespeople do F&I. Bad idea. Now they say artificial intelligence can do it. I think it’s a vendor plot. They’re not doing it for our benefit or the customer’s benefit. I always have a jaundiced eye when a vendor calls themselves a partner. Partners don’t steal your business.
AE: They’ll say that’s what customers want.
Ziegler: Some people will buy a car from Carvana. It absolutely will work with a small number of people. But most people won’t buy F&I without a presentation. You need persuasion, finesse, objection-handling skills —
AE: Critical thinking.
Ziegler: Exactly. The so-called experts thought subscription cars would work. Sure enough, Cadillac has closed “The Book” and the others are bleeding. I’ve often said I can predict this industry with pinpoint accuracy not because I’m so smart but because some others are so stupid. I know what customers are and are not going to do.
But the thing is, a lot of the vendors are going for the total transaction. F&I was the holdup. Once they can do that, I predict they’ll try to do the entire sale, keep the profits, and use the dealers as their warehouse. They’re already talking about the obsolete dealer model. You’ve heard it at every convention. Some pipsqueak is going to reinvent the business. And what exactly are you going to replace it with?