Monthly Archives: April 2016

2 Reasons For Completing A Degree


I’ve always been a believer in “attitude and aptitude” when employing but I also recognize that those two attributes can’t be measured when culling from opening letters and resumes. Sometimes having a degree and even a post graduate degree can be the difference.

It was with this that I undertook a Masters post graduate degree as a mature age student at Monash University whilst being CEO of Digital Motorworks during a growth period.
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Yes it was hard work.

No it hasn’t made a material difference to what I’m doing (that I’m aware of).

Yes it was worthwhile.

There were two main reasons I completed a Masters degree as a mature age student:

1. Insurance. What if I was in a competitive process for a job that I wanted/needed and I didn’t get past the resume cull because I had no tertiary qualifications? We all get told that loading up on super, life insurance, income protection and an up to date will is a prudent personal financial strategy. I believe you should add education to that list to help with “job insurance” if you are a white collar worker.

2. You don’t know what you don’t know. What if you actually learn something that could help you? I am tipping there is some value or there are a lot of very silly people in high paying professions. It was certainly good for me to get an academic spin on the practical stuff I had learnt and was putting into practice.
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Now before you point out all the successful people who don’t have degrees remember the first point above – insurance. Very very few of us are college drop outs and go on to found a Microsoft, Facebook, Oracle or Dell and become billionaires (yes they were all drop outs).

Those guys don’t need life insurance or income protection either.


I Think I Was Bullied



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Last Friday morning I walked past a building site around the corner from the carsales office where a young guy was loading “boulders” onto the back of a truck.

Another guy was saying to him as I walked past “I’m going to make you cry every day, how does that make you feel? You are going to cry every day until you show me you won’t”. Really?

I wanted to step in but didn’t. Should I have? It wasn’t any of my business and it could/would have been ugly, especially with nice shirt and shoes in. After all they may have been joking. What it did is remind me of an incident when I started out (not that I am comparing the two though).

This hasn’t scarred me (really, it hasn’t) but thinking back through my business journey, I actually think there was a time where I was bullied and I think it actually helped me in the way I deal with people today. Let me explain.

“Then one of them started laughing…”

I started my first software development job at Reynolds & Reynolds just shy of my 20th birthday when they hired two of us straight out of a 6 month computer programming diploma. It really was learning on the job and very early in the piece my manager grabbed the two of us saying he had a great project for us to really get our teeth into.
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The project was very simple (in hindsight) – it was a parts inventory input screen that worked off a template to hide fields that weren’t required. One of us had to write the program for setting up the template and the other had to write the inventory input program that read the template.
“…embarrassing and certainly belittled the two of us…”

The problem was that neither of us had a clue what he was talking about. We were lost. As our manager tried to walk us through the requirements, a few of the more senior developers stood behind our back to watch and listen.

Then one of them started laughing. Not just a little giggle, a big boisterous laugh while spluttering out “that’s easy, that’s easy, too easy, let me do it, I can do it”. It was embarrassing and certainly belittled the two of us. Is this what is considered bullying today?
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That was 27 years ago now and I can still see him laughing and hear what he said. I can also still see “the laugher” heading out the door with his head down when he was caught up in a round of redundancies a couple of years later. As I said though, it didn’t scar me. I wonder what he is doing now?

I think they call this “passive bullying” now and in the scheme of things it wasn’t too bad for me, in fact I like to think that it helped me in my attitude to the way that I treat people, especially in the office environment. That is “do unto others” and one of my favourite sayings is “people do business with people they like (and respect)”.

I never did see or hear of him after he was made redundant.

There is no place for bullying anywhere. It is weak and a cover for another’s insecurities.


The Power Of A Resume, Beyond A New Job



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Beyond the search for a new job, I’ve always felt a resume can be a great tool to measure progress in your employees and your current employment. Stay with me on this.

How many times have you had the thought or had one of your employees come to you and say “I think it’s time that I move on, I’m just not making any progress here”? It might be that they think they aren’t learning anything new or they haven’t felt they are achieving anything or they might feel that since they are still reporting to you after all these years then they must not be progressing.

“…even though I was still reporting to him after 6, 7, 8, years I was in fact still growing…”

I’ve heard these things a number of times before and in fact I might have been guilty of saying them one or twice. When I was a software developer early on I remember resigning on a couple of occasions and my manager had the knack of making me realise that it probably wouldn’t be the smartest move. He never offered me more money as he always said that everyone can always get more money elsewhere but at some point you will reach the limit of your abilities and start to go backwards.

What he did was make me realise that even though I was still reporting to him after 6, 7, 8 years I was in fact still growing, learning and achieving so much. It is very easy to forget.
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One way that I overcome this with my employees is encouraging them to update their resume. When I do it, I guarantee to them that they will sell themselves short in their current roles and that I will be able to improve it.

Working on your resume even when not looking for a new job, provides a great insight into the achievements and skills you are collating right now, especially when your manager/boss can review and provide feedback on it. After all it should be in their interests for you to grow.

I realise that this approach is probably not for everyone. What if you help your employee update their and improve their resume and they leave? But then again what if they stay when they want to leave? I’ve only had one person as a result of helping them improve their resume and to be honest, I don’t regret it and was happy that they moved on.

I am a firm believer that we should all be aware of the way we are growing in our professional careers and keeping an updated resume is a great way of tracking your progress.


Webmotors Spreads It’s Wings


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carsales.com’s investment in Brazil, Webmotors, last week announced it was acquiring seven automotive websites – all of them market leaders in the South of Brazil – from RBS Group, a Brazilian media conglomerate, operating under the brand BuscaCarros.

This makes it the third acquisition of a regional online leader that Webmotors has made since carsales made its investment in July 2013 following Meucarango (North East Brazil) in 2013 and Compreauto (São José do Rio Preto, Sao Paulo and region) in 2014, both market leaders in their respective regions.

Brazil is very parochial to regional plays both from a dealer and consumer perspective so these acquisitions are important in establishing Webmotors as the clear number 1 automotive website group in Brazil.
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Changing the brand in the local region is not in the plan as each brand we have acquired has enormous equity that we do not want to lose. The key to success for Webmotors is using our world class platform to provide dealers and consumers a great experience and ensuring we benefit from the economies of scale that are available.
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BuscaCarros has online brands in the following locations: state of Santa Catarina (BluCarros), Porto Alegre (PoaCarros), Florianópolis (FloripaCarros), Joinville and region (JoinvilleCarros), Itajaí and region (ItajaíCarros), Alto Vale do Itajaí (RiodoSulCarros) and Criciuma and region (CriciúmaCarros).


6 Latin America Factors for carsales.com


carsales.com has investments in online automotive businesses in the two largest economies in Latin America – Webmotors.com.br and Soloautos.mx. They both represent good value for future long term growth for carsales.com yet they are very diverse in a number of ways.

I’m not trying to find a winner here…….it is just interesting to look at the dynamics of each business in comparison to the other in terms of country, city of origin, language, carsales involvement, partners and the positions they occupy in their respective markets.
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1. Brazil vs Mexico – The key difference is the maturity of online automotive classifieds where Brazil is some way ahead of Mexico. Webmotors in Brazil, is now a relatively clear number 1 in the online automotive space with more traffic and over twice the number of vehicles online than it’s next auto vertical competitor. There is no real clear leader in Mexico with our business Soloautos on the road to staking a claim.

2. Sao Paulo vs Guadalaraja – Both businesses have strong positions in the cities they are based in and this goes someway to explaining why one is number 1 on a country basis and the other isn’t (just yet). Webmotors is based in Sao Paulo, Brazil’s biggest city with 11m people in the city region and over 21m people in the metropolitan region. Soloautos is based in Guaralajara which is Mexico’s second largest metropolitan area with ~4m people. It’s interesting how regionalised the online market can be in Latin America compared to Australia.
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Sao Paulo, Brazil

3. Spanish vs Portuguese – I don’t speak either language (unfortunately); the real difference for carsales is that only Brazil speak Portuguese whereas all other countries in Latin America speak Spanish. This isn’t an issue technology wise as we are working with consumable API’s to give us economies of scale and we can get synergies at the product end where what we do in Mexico can be used in any other country in Latin America (i.e. Chile where we have just entered).

4. Control vs Minority – We have a 65% controlling stake in Soloautos and a 30% minority stake in Webmotors. This hasn’t altered the way we have worked with either business as a strategic partner. We don’t mind being a minority stakeholder as a starting point and as we put more IP in to drive the growth we’d like to see that change.
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Guadalajara, Mexico

5. Large partner vs Individual partner – This is really the difference in governance. Our partner in Webmotors is Banco Santander who by virtue of being a bank, can bring some governance an online company wouldn’t normally see at Webmotors size. We have an individual partner in Soloautos which is quite the opposite. It is fair to say there are pros and cons both ways.

6. Market Leader vs Number 2/3 – We are a clear leader in Australia and South Korea whilst Webmotors has been able to gain a nice lead over the competition since we’ve been involved. It is a whole new game doing the chasing with Soloautos and it is a task that our team is really enjoying. The basics remain the same for both though so I will say we don’t mind where we are to start with as long as we know where we need to be.

One thing is for certain, we are loving working with the people from Webmotors and Soloautos!


Sales History Should Not Set Retail Pricing


Selling anything at retail seems like a pretty uncomplicated business doesn’t it? You acquire the product for a price and sell it for another price with the difference being your profit, right? Yes sort of. What about all the overheads involved in making that sale?

One of the overheads commonly forgotten is the daily cost of holding the stock. Some years ago I was with a car dealer as we were trying to promote our newly created LiveMarket product which gives the dealer a look at the competitive position of each of their used vehicles for sale using live market data.

“Paul this is a great product but….”


Once I was finished showing the product, the dealer to me “Paul this is a great product but you see that Landcruiser out there, I’m going to make $5,000 profit on it whether I sell it tomorrow or in 5 weeks time so I don’t need this”. I bet a lot of car dealers, or retailers of any sort for that matter, would think the same.
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His logic was that he didn’t have to alter the sell price based on the competitive market because eventually someone would come and pay that price. He had history to prove it. What he wasn’t factoring in was that that $5,000 profit he might get tomorrow wasn’t really worth $5,000 in 5 weeks time. What he also wasn’t counting on is the new Internet age where buyers have as much information and in most cases, more information than the seller (i.e. competitive information at their fingertips).

What if he could sell 4 of those Landcruisers at half the profit on each unit in that same 5 week period ($10,000 vs $5,000)? Which would he rather? It didn’t take long for the penny to drop.

The premise is that by using competitive live market data to buy and sell ensures you are in touch with the market at all times and not buying or selling using sales history or “your gut”. Pricing to sell promotes velocity and helps to ensure your holding costs don’t eat into your profits.


4 Data Driven Lessons



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LiveMarket brings a live market view to new and used vehicle management for car dealers to make smarter decisions when buying and selling cars.

The beauty of LiveMarket from a demo perspective is that the data is the dealer’s actual data and it is live; no canned demo data setup to prove a point.

I was with a used car manager of a franchised dealership showing carsales’ LiveMarket product a little while ago. As I dug a little into his inventory in LiveMarket I found an interesting stat. He was only selling from 60% of his inventory, the other 40% were all well over 180 days old.

…other 20 were just a drag on net profit…

So as far as the dealer principle (business owner) was concerned, the monthly units sold, gross and turn were coming from 50 used vehicles when in fact it was coming from just 30. The other 20 were just a drag on net profit as their holding costs keep stacking up.

“why would I change it and risk not making targets?”

I focused on this as I saw it as an opportunity for the used car manager to improve his business (and his standing in the business) by pricing to the market to improve velocity (sell from the entire inventory) and ultimately improve overall gross. I was wrong.

“I’m consistently meeting my sales and gross targets with the stock mix I have now, why would I change it and risk not making targets?”. Fair point.

What would the dealer principle, the owner of the business, want though? If he could see the used car mix through the lens we were looking at I know what he’d want and so did the used car manager!

The decision was made though. LiveMarket wasn’t for him. He was happy meeting his goals and didn’t want “extra work”.

I learnt four lessons from this process:

1. Giving a more complete picture of a business through data isn’t for everyone.

2. As a business owner you need to have the data to be completely across your business.

3. As a business owner you need to ensure the people you employee and trust are driven to run the business as if it was their own with the same goals you have.

4. Data doesn’t lie so you need to ensure you are selling the dream to the right person in the business (i.e. the person who will benefit the most from the data).

I’m sure we’ve all been there before.


Great Lesson For A Startup – Realising The Real Value & Finding Your Core



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Sometimes a company’s real value is not what their core offering is. Here is the story of such company that I was involved with and was fortunate to find their niche.

In the mid 90’s there was a bit of a fad in the US automotive industry around touch screen kiosks to showcase new models and to show new and used cars they have for sale. This was particularly good for dealers with multiple sites and to place these kiosks at shopping Centres, etc. The downside with this was that they were cumbersome to update meaning as soon as they were updated they were out of date.

“it’s all about the data”

Two guys out of Austin, Texas built on the concept and made their kiosk offering Internet connected, dialing into the car dealer’s computer system to retrieve the inventory details so that no matter where the kiosks were located they were automatically updated daily. On top of this, it simultaneously gave the car dealer a seamless and integrated Internet strategy for their web site. This was cutting edge stuff in 1995 and Digital Motorworks Inc (DMI) was born.
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Their business model revolved around selling the Internet kiosk package to dealers, particularly targeting the big dealer groups who would pay monthly fees on a per kiosk and/or website basis. Not a bad model in theory especially considering there were over 20,000 car dealers in the US. By 1997 they were finding it difficult to get cut through at a dealer level “knocking on doors” and this was slowing growth (and affecting cash flow). They were doing it tough after such a promising start.

…the kiosk software was not their most valuable asset; it was in fact the software process and infrastructure they had created to automatically extract…

Through 1998 I was busy implementing the same business model for Reynolds in Australia and caught up with the DMI guys at the National Automobiles Dealers Association (NADA) conference early on in 1999. The change in their attitude from the last time I had met them was immediately noticeable and I quickly learnt why – “it’s all about the data”.

What they had discovered over the previous 18 months was that the kiosk software was not their most valuable asset; it was in fact the software process and infrastructure they had created to automatically extract the vehicle information from the dealer’s computer systems. So much so that they were no longer a touch screen kiosk provider and were now a data aggregation company! And it totally transformed the business.
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They signed a deal with cars.com to provide them with the vehicle data from all of their thousands of dealers on a nightly basis. They went from having to knock on dealer’s doors to make a ~$500 per month kiosk sale to having dealer orders emailed to them at recurring ~$100 per month – an immediate 5,000 dealers at $100 per month is a lot of touch screen kiosk sales in one hit!

Fast forward 20 years and DMI today extracts, normalises and aggregates vehicle, sales, customer, parts & service data from over 25,000 dealerships across North America for a range of different clients as a fully owned subsidiary of CDK Global (formally ADP Dealer Services).

Without realising their real value and making it their core offering, they certainly wouldn’t be around today selling touch screen kiosks.