1. business and industrial

An Official Publication of the Maryland Automobile Dealers Association
SPRING 2012
The “How To” of
Inventory Management
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T: (301) 986-0600
F: (301) 986-0432
www.cbmcpa.com
Councilor Buchanan Mitchell
CPAs and Business Advisors
For three generations, Councilor Buchanan Mitchell has been a leader
in providing dealers with:
; Audits, Reviews
and Compilations
; Business Succession
Planning
; Business Valuations
; Cost Segregation
; Fraud Prevention
Analysis
Techniques
; Tax Planning
; Factory Consolidations
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Members of the National Alliance of Auto Dealer Advisors (NAADA) and the
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For more information on our dealership business services, visit our website
at www.cbmcpa.com or contact:
James A. Tortorella, CPA Ü [email protected]
John R. Comunale, CPA Ü [email protected]
Keith A. Laudenberger, CPA Ü [email protected]
1921 – 2011
Celebrating
90
YEARS of
EXCELLENCE
SPRING 2012
COVER STORY
11 The “How To” of
Inventory Management
19
24
Inventory is your most valuable
asset. It also uses up most of your
working capital. Carry too much,
and you risk cash shortages and
astronomical interest charges on
your floor plan and line of credit.
FEATURES
13
14
16
17
18
19
22
23
24
2012 General Session Wrap-Up.
2012 Auto Show Features New Highlights
Legislative Reception Highlights.
Support MADAF
MADA Dealers Honored at 2012 NADA/ATD Convention
Tax Implications of Dealership Facility Image Upgrades
Two Maryland High School Students Take 6th Place in
National Automotive Tech Competition
MADA Dealer Receives 50-year Dealer Award from
General Motors
MADA Summer Convention Returns to Maryland
MARYLAND AUTOMOBILE DEALERS ASSOCIATION
DEPARTMENTS
5 Chairperson’s Message
7 President’s Message
8 Director of Dealer Services’ Message
16 2012 Upcoming Events
4
CHAIRPERSON’SMessage |
MARISA A. SHOCKLEY
T he Best Offense is a
Great Defense
A
s we close a very successful first quarter and begin gearing up for a busy
selling season, I have complete confidence that this will be a tremendously
successful year for the New Car Dealers of Maryland. We are seeing continued economic improvement. This, combined with a return of consumer confidence,
has resulted in a lot of activity in our showrooms and service drives.
On the legislative front, we have just
closed another session. As the saying
goes, “the best offense is a great defense”
and your Association staff proved that
once again by successfully defeating numerous bills that threatened our industry,
many before they reached final vote on
the floor. Although this is good news, we
must remain vigilant. The session closed
without a compromised budget, and I
expect that the Governor will call for a
Special Session this summer. I’m sure that our industry will be examined as a source
of revenue. To prevent any negative consequences, we will need our legislators to
hear our collective voices loudly and clearly.
I strongly encourage
each of you to join us in
Cambridge, as we have a
special itinerary planned
for you and your families.
Enclosed you will find information about our Summer Convention. I look forward
to returning to the lovely Hyatt Regency Chesapeake Bay Golf Resort, Spa & Marina.
After two years of sharing the spotlight with Virginia, it will be good for MADA to be
back on its own and coming home to Maryland. I strongly encourage each of you to
join us in Cambridge, as we have a special itinerary planned for you and your families.
Your Association staff and Board of Directors are committed to providing you the
resources to help you gain success in 2012. MADA provides a wealth of information
and guidance; I hope that you will take advantage of these resources. Please feel free to
contact Peter Kitzmiller or myself with questions or concerns. On behalf of the Association, your continued support is appreciated. ”
Sincerely,
Marisa A. Shockley
2011 MADA Chairperson
5
Official Publication of the Maryland
Automobile Dealers Association
Maryland Automobile Dealers Association
7 State Circle, Suite 301
Annapolis, Maryland 21401
Phone: 410-269-1710 or 301-261-1717
Fax: 410-269-1549
E-Mail: [email protected]
www.mdauto.org
OFFICERS
Marisa A. Shockley, Chairperson
Tom Walls, Vice-Chairman
BOARD MEMBERS
Robert Adams
Bill Aschenbach
Kevin Bell
J.P. Bishop
Marc Cohen
Jerry Dillard
Michael Lynch
Jack Saum, Jr.
Sam Weaver, Immediate Past Chair
David Williams, Jr., NADA Director
ASSOCIATION STAFF
J. Peter Kitzmiller, President
Ethel Biensach, Director of Operations
Albert Scrimger, Director of Dealer Services
Travis Martz, Director of Government
Industry Affairs
Katie Jones, Public Relations Coordinator
Charlotte Rutkowski, Membership/PAC
Coordinator
Questions and comments regarding this
publication may be directed to Katie Jones
at the Association office, 410-269-1710
or via e-mail, [email protected].
The Maryland Automobile Dealers Association provides
IN GEAR as a benefit of membership in the Association.
The statements and opinions expressed herein are
those of the individual authors and do not necessarily
represent the views of the Maryland Automobile Dealers
Association or its publisher, Media Communications
Group, Inc. Any legal advice should be regarded as
general information. It is strongly recommended that
one contact an attorney for counsel regarding specific
circumstances. Likewise, the appearance of advertisers
does not constitute an endorsement of the products or
services featured by Media Communications Group, Inc.
©2012 Media Communications Group, Inc. All rights reserved.
SPRING 2012 | www.mdauto.org
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PRESIDENT’SMessage |
J. PETER KITZMILLER
Have a Prosperous Summer
T
he 2012 Maryland General Assembly has just ended
and MADA had an extremely successful session. With
your help, we defeated numerous bills that would have
threatened the stability of our industry in Maryland.
forward to a great 2012. I look forward to seeing you in
June at our Summer Convention in Cambridge, MD. We
return home to our Eastern Shore to host the event and I am
confident that everyone who attends will come away with
valuable business insights and strengthened industry ties.
While we had a strong Legislative Session, some serious
issues still remain. The Session ended on April 9th without
a budgetary compromise. We fully expect that Governor
O’Malley will call a Special Session to address the State’s
budgetary needs. Again, there is a strong possibility that
there will be bills introduced that may negatively impact our
industry. MADA will be prepared to address these, but we
will need your help in order to protect our interests.
On behalf of myself and the staff of MADA have a safe
and prosperous summer. ”
Sincerely,
J. Peter Kitzmller, President
This year has gotten off to a strong start and I look
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7
SPRING 2012 | www.mdauto.org
DIRECTOR OF DEALER SERVICES’Message |
AL SCRIMGER
Providing Individuals and Families With
Affordable Insurance Plans
M
ADA understands that many employees are
choosing to purchase individual insurance
due to a variety of reasons. That is why we are
pleased to tell you about one of our long standing Associate Member’s, Steve Salamon’s, new affiliation with
HealthPlan Headquarters.
HealthPlan Headquarters team of professionals can help
you. Contact Steve Salamon at [email protected]
or Julia Salamon at [email protected]. ”
Sincerely,
Al Scrimger
Director of Dealer Services
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MARYLAND AUTOMOBILE DEALERS ASSOCIATION
A Dealership Management System
Designed By Car People, For Car People™
8
We offer more than products.
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Like you, we believe in doing the right thing for the customer. Help
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Contact Protective’s Maryland representative, John Bartlett at 866.927.5448
Lifetime Engine Warranty, Limited Warranty, Vehicle Service Contracts (VSCs) and GAP are backed by Lyndon Property Insurance Company in all states except NY. In NY, VSCs are backed by Old Republic Insurance Company. GAP, Lifetime Engine
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From driving operational efficiencies
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Market Executive
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BY THE NUMBERS |
KEITH A. L AUDENBERGER, CPA
The “How To”
of Inventory Management
I
nventory is your most valuable asset. It also
uses up most of your working capital. Carry
too much, and you risk cash shortages and astronomical interest charges on your floor plan and
line of credit. Carry too little, and you risk losing
business to competing dealers and independent
service stations.
Manufacturer relationships call for both give
and take. Sure, everyone has to accept some
less-than-desirable items allocated to them by
the factory. But stores with high volume, strong
Customer Service Index ratings, and amicable
relationships with factory representatives have
the greatest leverage and are rewarded with the
option of building more of their own vehicles.
Many dealerships order vehicles, parts and accessories using gut instinct. But more scientific
techniques for managing inventory can minimize inventory carrying costs.
Whenever possible, try to order the inventory
you want (a “pull” ordering system) rather than
accept every item the factory “pushes” onto you.
Pull, not push
Find the method to the madness
Start with an honest evaluation of your relationship with your franchisor: Is the factory
pushing you to accept vehicles you don’t want
– say, a large quantity of undesirable models or
colors? Does your dealer operations manager
aggressively talk you into buying parts and accessories every time he or she visits?
Manufacturers have used cost accounting to
improve operating efficiency for decades. Only
recently have dealerships begun to look at their
businesses in other terms:
11
Product-by-product margins. Analyze your
gross profit for each product line, and stock
SPRING 2012 | www.mdauto.org
With less working capital tied up in inventory, you’ll need
to borrow less and possibly have more cash for rainy day
projects, such as sales training or remodeling.
more high-margin items. Accessories – navigation and tire
package upgrades, for instance – are known to be money
makers. Fuel-efficient new and used cars also sell for more
today.
Before eliminating unprofitable products, evaluate why
margins are low. For instance, a dealer discovered he was
losing money on a hot new model with limited availability.
Turns out, his salespeople were selling this vehicle below
invoice, because his pay plan offered bonuses based on volume, not gross margin.
High demand, limited supply models should bring a premium price, if your salespeople know their stuff and your
pay plan motivates the right behaviors.
Product mix. Next, evaluate whether your product
mix is sufficiently broad and in tune with customer demand. New car buyers often access online inventory lists
MARYLAND AUTOMOBILE DEALERS ASSOCIATION
Turnover. Consider, too, how quickly each product line is
selling. Stop ordering slow moving items, especially if they
can be restocked quickly by the manufacturer. If you have a
used car that’s been on your lot longer than, say, 45 days, it
may be time to discount the sticker price or sell it at auction.
Whenever possible, return excessive supplies of slow
moving parts and accessories to the manufacturer. Often
factories allow some returns within a prescribed time frame.
If you install 25 air filters each week and it takes two
weeks to process an order of filters, for example, you’d reorder anytime there are fewer than 50 filters on the shelf.
Retake your inventory
> Stephen M. Garton
Senior Vice President
Indirect Retail
Sales Finance
National Sales Manager
1-800-433-0067
©2010 The PNC Financial Services Group, Inc. All rights reserved.
PNC Bank, National Association. Member FDIC
Also, stock a sufficient supply of aftermarket parts in
addition to OEM parts. You may lose service revenues to
independent service shops if you don’t offer cheaper fixes
using generic aftermarket parts to customers after their
warranties expire.
Reorder point. Estimate a reasonable reorder point for
every inventory item. That’s the quantity level that triggers
a new order. Reorder point is a function of your volume
and the purchase order lead time.
You know
your dealership.
You need a banker
who knows
everything about
financing it.
> James Engel
Vice President
Commercial and
Floor Plan
Relationship Manager
301-493-5900
w vehicle specs
and contact a store that has their new
i
hi with
ith
already on the lot. Foster your relationships
neighboring dealers to expand your inventory base. If you
can swap with another store quickly, you may prevent lost
sales just because your inventory is lean.
When sales are down, every sale must count. Inventory carrying costs include interest, storage, insurance,
obsolescence and pilferage. These can quickly add up.
With less working capital tied up in inventory, you’ll need
to borrow less and possibly have more cash for rainy day
projects, such as sales training or remodeling. Imagine
the possibilities! ”
Keith A. Laudenberger, CPA is an accounting and audit manager
at Councilor, Buchanan & Mitchell, P.C. (CBM), and serves on
CBM’s Automotive Industry Committee. He has more than 12
years of public accounting experience providing services to
automotive, construction, real estate and technology companies as well as not-for-profit organizations and government
contractors.
BB PDF 1210-038
12
2012 General Session
Wrap-Up
P
rior to the 2012 legislative session of the Maryland
General Assembly, Governor O’Malley announced
a plan to raise $800 million for transportation infrastructure through a 6% sales tax on gasoline purchases. The
elevated price of gas and political displeasure over any sort of
gas tax pushed the introduction of this proposal to late in the
Session. While the Governor, County Executives and road
development contractors all strongly favor a gas tax, the majority of the General Assembly was not able to justify voting
for a gas tax in this economic climate. With all that being
said, legislators acknowledged that money for transportation
improvements must be raised.
• Luxury Tax - This bill would have applied an additional
1-2% tax on all vehicles over $35,000. The threshold of
$35,000 set in this bill would have impacted practically all
vehicle models sold in Maryland. Result: Defeated.
• Dealer Location Fee – MVA proposed a bill that would
require each dealer location to pay a $500 license fee as opposed to current law which requires one fee for principal
place of business. Result: Defeated.
• Motor Vehicle Towing Practices & Procedures – This bill
attempted to prohibit a dealer’s use of dealer tags on a tow
truck. Result: Defeated. ”
Protecting dealers from any tax/fee increase and/or vehicle trade-in tax difference repeal was the number one priority
for MADA during the 2012 Session. As gas tax opponents
argued against any gas tax, legislators needed to compensate
for lost revenue from a lower gas tax proposal with other revenue measures that were not so politically volatile. MADA
spent all 90 days stressing the importance of vehicle sales to
the current tax revenue of the State and how any additional
tax burden will make vehicle sales decline.
Legislators closed the 2012 Session without passing any
transportation revenue package. While it was another
hard fought win for MADA, it is expected that a revenue
proposal will be submitted again during a Special Session
of the General Assembly or the next General Session.
MADA will spend the interim educating legislators on
the financial importance of car dealers to the State and
local community.
Other important pieces of legislation lobbied and soundly
defeated by MADA included:
• Tire Age Disclosure - This bill would have required dealers
to provide a notice to all consumers buying tires and retain
documentation if a tire was over three years old. This bill
created great legal exposure for dealers. Result: Defeated.
• Sales Tax On Services - This would have expanded the tax
code to include sales tax on vehicle service work. This bill
disproportionably impacted low income Maryland residents. Result: Defeated.
13
SPRING 2012 | www.mdauto.org
2012 Auto Show Features New Highlights
T
he 2012 Motor Trend International Auto ShowBaltimore welcomed the return of MINI, a crowd
favorite, and exciting, new models from Fiat. Attendance at this year’s show was good and we received
reports from dealers who sold cars as a direct result from a
customer having attended the show the previous day!
A popular feature, the GM Ride & Drive, returned this
year. As an added bonus and to great excitement, we also
welcomed the Chrysler Drive Experience! Both features
were a huge hit, as customers test drove various models from
Chrysler, Dodge, Jeep, Fiat, GMC, Buick, and Chevrolet.
Passers-by loved checking out the vehicles as they sat on display in front of the Convention Center on Pratt Street each
day. We certainly hope that these two features will remain a
MARYLAND AUTOMOBILE DEALERS ASSOCIATION
permanent fixture with future shows, as one of the best ways
to decide upon a new car is driving it yourself!
The 2012 show also highlighted two very popular features
on Saturday, WWE Diva Beth Phoenix and King Robota.
Fans eager to meet Ms. Phoenix lined up at least two hours
in advance to get an autograph and a photo. The Diva was
friendly and welcoming to her fans, particularly the youngest
in the crowd. She even hung around for a little flirting and
photo opportunity with King Robota, the eight foot tall “music-bot” that sang and danced in front of large crowds several
times over the weekend.
We look forward to sharing the latest and greatest with
you next year! ”
14
Legislative Reception Highlights
M
ADA hosted yet another
successful Annual Membership Meeting and
Legislative Reception on January 17,
2012 in Annapolis. MADA Chairperson, Marisa Shockley, addressed our
membership, noting that her first year
serving as Chairperson increased her
appreciation for the Association and
the power we represent as a group.
During the meeting, we were
pleased to welcome Maryland’s 20112012 Teacher of the Year, Joshua
Parker, a middle school English
teacher from Windsor Mill Middle
School in Baltimore County. Mr.
Parker was gracious as he told us, “I
bring thanks on behalf of all members
of the #1 public school system in the
country, your support means so much
to all of us.” This marks the 11th year
that MADA has served as a sponsor
of the program and has awarded the
gift of a new car to the winning teacher. When asked about the car, Mr.
Parker said, “I ride in style and I ride
in pride, because I’m riding in service
to our community.”
We also heard from local political
guru and WBAL commentator, Blair
Lee. Mr. Lee predicted that the recent
2012 General Session would be marked
by budgetary concerns and attempts
to reconcile the budget — a prediction
which came true in several instances.
Regarding the Transportation Trust
Fund and expected talks of a gas tax increase, Mr. Lee indicated that the ability
to pass the tax increase would depend
largely upon the price of gas.
During the business portion of the
meeting, we approved Director, JP
Bishop, to serve a second three-year
term. We voted in three new Directors
for a three-year term: Robert Adams
of Adams Automotive in Annapolis;
Kevin Bell of Win Kelly Chevrolet
in Clarksville; and Michael Lynch of
Academy Ford Sales in Laurel, MD.
We also recognized Brand Fowler and
Vincent Trasatti, Jr. for their service
on the Board and De Willard, who
represented Maryland in February
as our 2012 TMQDA nominee at the
NADA/ATD Convention.
We thank everyone who attended
this year’s meeting and reception and
we look forward to seeing you at an
upcoming Association event! ”
2012 UPCOMING EVENTS
JUNE 2012
SEPTEMBER 2012
17-20
11-12
MADA Summer Convention, Cambridge, MD
NADA Washington Conference, Washington, D.C.
12
MADA Annual Golf Outing Crab Feast, Queenstown Harbor
MARYLAND AUTOMOBILE DEALERS ASSOCIATION
16
SUPPORT MADAF
If you would like to make a financial contribution to MADAF in honor of someone who served Maryland’s automobile industry,
please use the form below and return it to MADAF’s offices in Annapolis, MD.
Please accept my gift in support of MADAF and its mission to support automotive education in the State of Maryland.
Gift of $ _____________ (Your contribution is 100% tax deductible). Name(s): ____________________________________________________________
Company: ______________________________________________ Address: ________________________________________________________________
City/State/Zip: __________________________________________ Telephone: ________________ Email: _________________________________________
Payment Information
Name: _________________________________________________ Charge: † Visa
Card Number:
† Master Card
† AmEx
Expiration Date: ______ CID#: ________ Signature: ____________________________
† Check Enclosed. Please make your check payable and mail to: Maryland Automobile Dealers Association Foundation
7 State Circle, Suite 301, Annapolis, MD 21401
MADAF’s mission is to provide educational benefits to those wishing career opportunities in the Maryland
automobile industry. MADAF will fund such benefits through charity events and memorial opportunities in
the name and memory of Maryland automobile industry leaders and pioneers.
Test drive a
proven performer.
A safe workplace saves your dealership money down the road.
Make sure you’re getting the most mileage out of your workers’ compensation insurer. IWIF Workers’ Compensation
Insurance works with businesses all over Maryland to provide safe workplaces that reduce the number of accidents,
increase productivity, and save money along the way. To learn more about workplace safety and to see how IWIF
can partner with your dealership, contact your agent, call 800.264.IWIF or visit us at iwif.com.
17
SPRING 2012 | www.mdauto.org
MADA Dealers Honored
at 2012 NADA/ATD
Convention
T
he 2012 MADA/VADA/WANADA Reception at the
95th Annual NADA/ATD Convention event was hosted
on February 4, 2012 at the brand-new Chateau Nightclub
at Paris Hotel in Las Vegas, NV. Special guests included De
Willard and Geoff Pohanka who were both nominated for the
2012 TIME Magazine Dealer of the Year Award. De Willard,
of Ideal Buick GMC Hyundai, represented Maryland and Geoff
Pohanka, also a MADA member, represented the Washington
Area New Auto Dealers Association.
The TIME Magazine Dealer of the Year award is one of
the automobile industry’s most prestigious and highly coveted
awards for new-car dealers. Recipients are among the nation’s
most successful auto dealers, but they must also demonstrate
a long-standing commitment to effective community service.
We congratulate De and Geoff on this honor! ”
We would also like to thank all of our generous
sponsors for their support of this year’s Reception.
When making business decisions, we strongly
encourage you to support those businesses that
support your Association.
•
•
•
•
•
•
MARYLAND AUTOMOBILE DEALERS ASSOCIATION
18
ADP
Charapp & Weiss, LLP.
Chesapeake Petroleum
CVR
Dixon Hughes Goodman
Helion
• JM&A Group
• LoJack
• Rifkin Livingston
Levitan & Silver, LLC
• Rosenfield & Co.
• SunTrust
Tax Implications of Dealership
Facility Image Upgrades
DAN THOMPSON & JAY GOLDMAN
W
ith the worst of the economic downturn hopefully in our rearview mirror,
many dealers are considering renovations to their facilities. In a growing number of
cases, the motivation is a factory mandated image
program. If a dealer chooses to participate in one
of these factory programs, there is likely to be a financial benefit to the dealer in the form of per car
bonuses, additional allocations and/or financial
assistance payments.
Dealers frequently ask what the proper tax treatment is for this factory assistance. Many dealers
are inclined to reduce the cost basis of the fixed assets. The consequence of this approach is reduced
depreciation expense, which in essence spreads the
income recognition of the assistance over the 5, 7,
15 or 39 year depreciation period. Unfortunately,
19
in the vast majority of fact patterns, it appears
the IRS will conclude this is not the proper tax
treatment. Building subsidies from your OEM
generally are taxable as ordinary income in the
year received or earned.
The good news is that tax deferrals can be
achieved two different ways — deferring income
or accelerating deductions. By accelerating deductions, it is quite possible to end up in a similar
tax position as deferring income. In addition, the
deduction acceleration methods that are discussed
below apply to any projects, whether they are subsidized by the manufacturer or not.
Cost Segregation Studies
The cost segregation study is a very valuable
tool available to dealers to accelerate depreciation
SPRING 2012 | www.mdauto.org
on major capital expenditures. A cost segregation study can
be performed on any newly constructed buildings, major
renovations or purchased facilities. It does not need to be
performed in the year of construction, renovation or acquisition. It can be performed in subsequent years and previous
years missed depreciation will be deducted in the year of the
study. The purpose of a cost segregation study is to carve
out components of a project that are eligible for the shorter
5, 7 and 15 year depreciable lives as opposed to the default
39 year life. The benefits of a cost segregation study can be
compounded when used in conjunction with Section 179
expense and Bonus Depreciation elections discussed below.
Up to 20%-40% of the building costs are typically segregated to shorter lives as a result of a cost segregation study.
Section 179 Expense
For 2012, Section 179 of the tax code allows eligible businesses to deduct up to $139,000 of qualifying property in the
year of acquisition rather than depreciating the item over
its statutory depreciable life. Assets classified as 39 year
property (i.e. non residential buildings) do not qualify for
Section 179 deductions. There are limitations in terms of
total acquisitions and taxable income and many states have
lower limits than the Federal Tax Code, but if you are eligible, this expense can have a significant impact on taxable
income and cash f low.
Air conditioned showrooms.
Brightly illuminated lots.
How much do you spend on energy?
Bonus Depreciation
Bonus depreciation has been around, sporadically since
2001. In 2012, 50% bonus depreciation is available for assets
placed in service this year. Unlike Section 179 expense, bonus depreciation is only available for purchases of new (not
used) assets and assets classified as 39 year property do not
qualify for bonus depreciation. Bonus depreciation does
not have thresholds or phase outs, but is not recognized by
many states.
Repairs Expense
Unlike fixed assets, repairs are deductible in the tax period incurred. Historically, there has been something of a
fine line, or a gray area, between what is a fixed asset and
what is a repair. The Treasury Department has issued temporary regulations that provide some clarity to this topic. It
is widely believed if the expenditure does not materially add
to the value of the property, does not appreciably prolong
the life of the property, and does not adapt the property to a
new or different use that it is a repair and as such can be expensed. It is possible many “image” upgrade programs will
meet this definition of a repair.
Qualified Leasehold Improvement Property
For 2012, qualified leasehold improvement property is
depreciated over 39 years; however it is eligible for bonus
depreciation but is not eligible for Section 179 expense. In
general, the property must be Section 1250 property, relate
to the interior of a nonresidential building, made pursuant
to a 3rd party lease, occupied by the lessee, and placed in
service at least 3 years after the original placed in service
date of the building. Examples of property that might qualify include electric, plumbing, doors, ceilings, lighting, etc.
Entity Selection
Before signing any contracts with contractors or agreements with the manufacturer, consider the tax consequences
and which of your entities will be paying for and ultimately
owning the improvements. Issues such as taxable income,
residency, passive losses, tax basis, etc. may impact which
entity is preferable.
The majority of your energy bill is negotiable.
EnerNOC is proud to serve the members of the Maryland
Automobile Dealers Association. Our team of energy consultants
have helped hundreds of companies throughout Maryland better
understand their energy purchasing options and get the best
possible deal for their business.
Naturally your objective is to maximize cash flow, particularly in the year you have incurred a significant investment
in facilities. Many dealers are disappointed when they learn
that the assistance payment from the manufacturer is taxable
immediately. However, using the strategies outlined above,
you may be able to accelerate sufficient deductions into the
current tax period to effectively offset a substantial portion of
the taxable income generated by the factory assistance. ”
Contact us today to learn more.
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www.enernoc.com/solutions
MARYLAND AUTOMOBILE DEALERS ASSOCIATION
Daniel P. Thompson, CPA is a partner with Boyer & Ritter, CPAs and Consultants and is the partner in charge of B&R’s Dealership Services Group.
Dan can be reached at 717-761-7210 or [email protected]. Jay A.
Goldman, CPA is a senior manager with Boyer & Ritter, CPAs and Consultants. He is a key member of the Dealership Services Group. He can be
reached at 410-790-6928 or [email protected].
20
Two Maryland High School Students Take 6th
Place in National Automotive Tech Competition
C
ongratulations to Parkside High
School seniors, Brent Horner
and Ryan Murray, and their
instructor, David White, who recently
competed in the prestigious National
Automotive Technology Competition.
MADA sponsored the team, the first in
many years to represent Maryland. The
competition was held during the 2012
New York International Auto Show
from April 9-12. Out of the 30 teams
competing from around the country and
Canada, Brent and Ryan finished in 6th
place!
Among the long list of prizes they
received included a Snap-On Tools
Bag and a Snap-On cordless screw gun
kit. They also received prizes from
General Motors, Subaru, and Universal Technical Institute. The greatest
prizes, though, came in the form of
scholarships. Various schools such as
University of Northwestern Ohio, Automotive Training Center, and Lincoln
Technical Institute provided scholarships worth $35,500 in total amount!
The students competed with a 2012
Chevrolet Malibu; the competition
began with a list of problems and troubleshoots for which they had three hours
to properly identify and correct them.
Leading up to the competition, the boys
had the use of a 2012 Malibu for practice purposes. Many thanks to Courtesy
Chevrolet, of Salisbury, who graciously
provided the vehicle. ”
Congratulations Brent, Ryan, and
Dave!
Tom Cush
Financial Advisor
(410) 263-0177
Merrill Lynch
One Park Place
Suite 350
Annapolis, MD 21401
Federated Mutual Insurance Company
Federated Service Insurance Company*
Federated Life Insurance Company
+RPH2IILFH(DVW3DUN6TXDUH‡2ZDWRQQD0LQQHVRWD
3KRQH‡ZZZIHGHUDWHGLQVXUDQFHFRP
Merrill Lynch Wealth Management makes available products and
services offered by Merrill Lynch, Pierce, Fenner & Smith Incorporated,
a registered broker-dealer and member SIPC, and other subsidiaries
of Bank of America Corporation.
© 2012 Bank of America Corporation. All rights reserved.
AD-03-12-1308
ARM313M5-08-11
Code 444608PM-0312
MARYLAND AUTOMOBILE DEALERS ASSOCIATION
*Federated Service Company is not licensed in the states of NH, NJ, RI, and VT.
22
MADA Dealer Receives 50-year
Dealer Award from General Motors
M
ADA is proud to recognize
Conrad V. Aschenbach, of
King Buick GMC in Gaithersburg, upon reaching 50 years in service
as a dealer. General Motors honored
Mr. Aschenbach, in November 2011
with the 50 Year Dealer Award. In addition to this notable accolade, November
16, 2011 was also declared “Conrad V.
Aschenbach Day” by the Mayor and
City Council of Gaithersburg.
In recognition of this rare and milestone achievement, we wish to include
a portion of the letter which Conrad
received from Mark Reuss, President
of GM North America. We believe it
speaks volumes to the character and
legacy of Conrad:
“The 50-Year Dealer Award award is an
achievement reached by few, and is an
acknowledgement of your commitment,
perseverance, and your humble approach to
a leadership in your market.
Over the past fifty years as a General Motors Dealers, you have been responsible
for the sale of nearly 100,000 new General
Motors cars and trucks, and the service and
care of countless thousands of General Motors owners. Furthermore, the King Buick
GMC dealership has remained a pillar of
the Gaithersburg and Montgomery County
communities, and to this day, stands as
a proud testimonial to your dedication
toward your customers, your employees,
and your family. On behalf of the entire
General Motors organization, we congratu-
late you on this esteemed milestone, and
are truly grateful for your representation of
General Motors.” ”
Congratulations Conrad, you
stand out amongst your peers!
CHEAPSKATE CAR BUYERS
ARE DOWNRIGHT PLEASANT COMPARED TO INFERIOR I.T. SYSTEMS.
OUR AUTOMOTIVE I.T. EXPERTISE CAN HELP YOU SAVE MONEY. AND YOUR SANITY.
You can deal with the occasional tough customer. But if your I.T. system hits a major snag, you could lose a lot of
time and sales—and that’s something you certainly don’t want to deal with. Let our team of Automotive Business
Technology consultants evaluate your systems and make it all work better—like we’ve done for dealerships across
the country for more than a decade.
Automotive Technologies
Contact us to schedule your complimentary assessment.
443.541.1520 / [email protected]
23
SPRING 2012 | www.mdauto.org
MADA Summer Convention
Returns to Maryland
PROVIDING LEGAL SERVICES
TO AUTOMOBILE DEALERS
M
ADA is excited to return home and host our annual Summer Convention at the Hyatt Regency
Chesapeake Bay Golf Resort, Spa & Marina
in Cambridge! Please mark the dates and join us in June,
from the 17th-20th on Maryland’s Eastern Shore!
Automobile manufacturers, dealerships and
franchises turn to Freeman, Wolfe & Greenbaum,
P. A. for legal counsel in business transactions,
franchise and dispute resolution.
We have arranged for two well-respected speakers to
join us. Chip Thomas has over 30 years sales experience
in a Tennessee dealership and is now the owner of a sales
training and consulting company. He has hosted sessions
at previous NADA Convention and will share his sales
insight and expertise with our members. Our second
speaker, Bill Acheson, is a professor of nonverbal communications. He will instruct you in how to project your best
image and the benefits that nonverbal communications
can have on your bottom-line. In addition to our business
speakers, we will also cover industry and legislative news.
Our firm’s franchise law practice encompasses a
full spectrum of business transactional and conflict
issues for car dealers and other motor vehicle
franchise owners.
We all know that business is a focus at the Convention, but what would it be without a little F-U-N? To that
order, we will host a Golf Tournament on Monday afternoon. If a day of golf isn’t to your liking, then how about
an afternoon spent by the pool? The resort features a children’s pool with a waterslide, but there is also the serene
Infinity pool complete with chaise lounges and umbrella
drinks. Both Monday and Tuesday evenings will feature
themed parties, “Margaritaville” on Monday and a “Monte Carlo” casino night on Tuesday complete with games
and prizes! As an added treat to our memebers, MADA
has arranged for a 15% discount at the Sago Spa during
our stay, so please indulge!
Q
DEALERS I AC UISITIONS
Q
Q
LEMON LA
Q
Q
Q
RODUCTS LIABILITY
Q
ARRANTIES
RANC ISE ISSUES
ROUTINE O ERATIONS
LITI ATION
We look forward to joining our members for some
Eastern Shore hospitality. It’s the perfect place to share
camaraderie with your fellow Association members and
spend time with your family. For registration information, please contact Ethel Biensach or Katie Jones at
MADA, 800.526.7423. We’ll see you in Cambridge! ”
Register Today! June 17-20, 2011
Contact us for a case evaluation
410.321.8400
410.321.8407 fax
www.fwglaw.com
409 Washington Avenue
Suite 300
Towson , Maryland 21204
FREEMAN, WOLFE & GREENBAUM, P.A.
MARYLAND AUTOMOBILE DEALERS ASSOCIATION
24
How can we help you
focus on the road ahead?
With SunTrust, you get a team of professionals who understand the needs of auto
GHDOHUVLQ\RXUFRPPXQLW\:KHWKHU\RXQHHGWRÀQDQFHYHKLFOHLQYHQWRU\UHQRYDWH
\RXUGHDOHUVKLSSURYLGHÀQDQFLQJIRU\RXUFXVWRPHUVRUH[SORUHVXFFHVVLRQSODQVIRU
\RXUEXVLQHVVZHNHHS\RXUIXWXUHPRYLQJ How can we help you? Contact Dennis
L. Stough, Senior Vice President, Commercial Auto Division, at 301.497.3447.
For Indirect Financing, call Dealer Financial Services at 800.821.7006.
Treasury and Payment Solutions
Financing Solutions
Advisory Services
Debt and Equity Capital Raising
Financing subject to normal credit criteria.
SunTrust Bank, Member FDIC. © 2012 SunTrust Banks, Inc. SunTrust and Live Solid. Bank Solid. are federally registered service marks of SunTrust Banks, Inc.
25
SPRING 2012 | www.mdauto.org
Advertiser Index Spring 2012
Attorney
Charapp & Weiss, LLP .......................Page 25
Freeman, Wolfe &
Greenbaum, P.A. ...................................Page 24
Auto Auctions
Bel Air Auto Auction ............................Page 18
Banking/Finance
Bank of America ....................................Page 10
BB&T Sales Finance ............................Page 26
M&T Bank .................................................. Page 7
PNC Dealer Finance ............................Page 12
SunTrust Bank ........................................Page 25
Car Rental
Enterprise Rent-A-Car .........................Page 13
Certified Public Accountants
Boyer & Ritter........................................... Page 6
Councilor, Buchanan & Mitchell ........ Page 3
Computerized Vehicle
Registration
New/Used Car Advertising
Baltimore Sun/CARS.com................. Page 15
CVR ............................................................. Page 28
Computers and Technology
Helion Automotive Technologies........ Page 23
Dealership Management Systems
AutoMate Dealer Services .....................Page 8
Energy Advisory Services
ENERNOC ................................................. Page 20
Finance & Insurance
Atlantic Dealer Services ....................... Page 21
Financial Advisor
Merrill Lynch ............................................. Page 22
Insurance
Federated Insurance Companies ...... Page 22
IWIF Workers’ Compensation ............Page 17
Protective .....................................................Page 9
Zurich American Insurance ....................Page 2
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Our clients trust us to provide the financial products they need. But our superior client service –
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BB&T is a Member FDIC. Loans are subject to credit approval.
© 2012 Branch Banking and Trust Company.
MARYLAND AUTOMOBILE DEALERS ASSOCIATION
26
Woodstock
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