CATA News

A merchant surcharge is an additional fee that businesses may charge when customers choose to pay with a credit card. This fee helps merchants cover the cost associated with processing credit card payments. Our Merchant Surcharge fee is 3% of the total sale being charged to the customer.

At Cost Advisor, we exclusively represent CardConnect/Fiserv for processing financial transactions such as credit cards, debit cards and ACH payments. Our merchant facing portal is CardPointe. Within this portal, we can always keep our merchants 100% compliant. The regulations surrounding this topic are rapidly evolving and it is essential that our merchants always remain protected from liability. Currently, merchant surcharging is not allowed in Connecticut, Massachusetts, Puerto Rico and Armed Forces Locations (Domestic, EU, Pacific and US – AA). As a result, any customer that presents a credit card with a registered address in one of these locations is NOT allowed to be surcharged. CardPointe screens all customer cards that are entered into the system to ensure compliance. If there is a conflict, the system will not surcharge that card.

Is this right for my dealership?

Many factors should be considered before implementing a Merchant Surcharge Program. It ultimately boils down to weighing the pros and cons of those factors when considering the program for your specific situation.

1. Evaluate Customer Impact: Consider how your customers might react to a surcharge. In industries where high-ticket items are sold, the additional cost from a surcharge can be significant. Transparent communication about why the surcharge is being implemented can help mitigate negative reactions.
2. Cost vs. Benefit Analysis: Analyze the financial impact of accepting credit cards without a surcharge versus implementing one. Consider the processing fees you are paying and weigh them against the potential impact on customer satisfaction and sales volume.
3. Competitive Positioning: Look at what your competitors are doing. If other local dealerships do not add surcharges, implementing one might put you at a competitive disadvantage. On the other hand, if surcharges are common in your market, customers might be more accepting.
4. Clear Communication: If you decide to implement a surcharge, communicate clearly and transparently with your customers. Explain why the surcharge is being added, how much it will be, and on what types of payments it applies. This can help maintain trust and prevent customer dissatisfaction at the point of sale. Written communication of the fee is mandatory at the point of sale and at the entrance of the dealership.
5. Consider Alternatives: Evaluate other ways to mitigate transaction costs, such as offering discounts for cash payments or using different pricing strategies that might absorb or offset processing fees more effectively.
6. Technology and Compliance: Ensure your payment processing system is equipped to handle surcharges correctly and that it remains compliant with payment network regulations as well as local and federal laws.

Discussing these points with an industry professional can help your dealership make an informed decision about whether to implement a Merchant Surcharge Program.

If you have any questions about merchant surcharging or if it is right for your dealership, please contact Bill Brudenell at 847-505-9210 or Bill@CostAdvisor.us.

Allen was born in Romania in 1932. During the Russian occupation, Allen fled to Israel at the age of eleven. After a one and half year journey, Allen arrived in his beloved Israel to begin a new life of freedom and hope. After helping Israel fight to become a state, he made his way to America in search of education and opportunity. He also proudly served in the American army. Through extremely hard work, determination and sheer doggedness, Allen was able to achieve the American Dream. From the time he started in 1960, Allen built Imperial Motors, along with his family and cherished employees, into a thriving business that fueled his life until the end.

Always thoughtful and generous, Allen extended a hand to anyone who needed it along the way. He was a man of honor, integrity, loyalty, and dignity, and loved his family and friends fiercely.

To proudly carry on his legacy are his wife, Lana, the love of his life for 62 years, his three children, Lisa, Jordan, and Andi, daughter-in-law, Alyson, son-in-law, Bill, grandchildren, Josh, Naomi, Madison, Bryce, Kaya, and Jesse, nieces, Lea, Vered, Mirit, and their families in Israel.

In Lieu of flowers contributions may be made to Magen David Adom www.mdais.org/en/donation.

Tuesday, May 7, 2024

The CATA is proud to announce Hilb Group as a new Recommended Consultant. Hilb Group is the go-to partner for CATA business owners who need help controlling costs and navigating the complex world of healthcare and human capital management.

Specializing in the auto dealership business for more than 30 years and serving 1500 dealerships, Hilb Group knows the industry and can help dealers pay for and manage employee benefits more efficiently. Hilb Group’s proven process collaborates dealers every step of the way to develop a customized strategy that fits your business’ unique needs. Hilb Group was built by dealers, for dealers to ease the administrative burden of employee benefits and to create pathways for you to decrease healthcare cost while simultaneously improving benefits for your employees.

The CATA Member Benefits committee, chaired by Dan Heller, Heller Ford in El Paso and Heller Lincoln & Chrysler Dodge Jeep Ram in Pontiac, reviewed several candidates in the healthcare field and selected Hilb Group because of their overall track record and familiarity with new-car dealer operations.

“Born out of the Virginia Auto Dealers Association, the Hilb Group has experience lowering employee benefits costs while maintaining or increasing benefit offerings,” says Dan Heller, CATA Member Benefits Committee Chairman and Dealer Principal Heller Auto Group. “Hilb has helped more than 1500 new-car dealers reduce prescription drug costs by an average of 42% and medical costs by 10%-23%. Hilb Group has done this while simultaneously easing the administrative burden of employee benefits and HR.”

The Chicago Automobile Trade Association Member Benefits Committee works to establish and maintain preferred partner relationships with allied members with programs offering unique value to our dealer members and the CATA.

CATA Approved Member Partners are thoroughly reviewed by the Member Benefits Committee and have proven track records of benefiting CATA member dealers. The vendors work with the CATA to offer these programs to our entire membership. Remuneration to the CATA may also be part of these agreements.

The aim of the CATA Recommended Consultants program is to identify and recommend organizations that have a proven track record of helping dealers in areas of the business that can be particularly challenging to navigate and manage. In recognizing these organizations, the CATA believes that all dealer members can benefit from the expertise and services that the selected organizations provide. CATA Recommended Consultants are independent organizations not tied to the sales process of any individual product or service and have agreed to offer special pricing to CATA member dealers.

For more information about CATA Approved Partners, please visit https://www.cata.info/partners. For more information about CATA Recommended Consultants, please visit https://www.cata.info/service-providers.

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About the Chicago Automobile Trade Association

Founded in 1904 and located in Oakbrook Terrace, the Chicago Automobile Trade Association is comprised of more than 400 franchised new-car dealers and an additional 150 allied members. The group’s dealer members employ about 19,000 people in the metropolitan area. The association has produced the world famous Chicago Auto Show since 1935. For more information, please visit www.CATA.info.

Eight cars, including a rare 2023 Dodge Challenger Demon SRT 170 valued at $158,000, were stolen from the North County Ford dealership in Arab, Alabama, and investigators are still trying to piece the whole thing together. AL.com news reports that two of the vehicles—a Jeep Wagoneer and Ford Bronco Raptor—have since been recovered.

While they aren’t Fort Knox, generally speaking, car dealerships have very robust security measures in place. It’s not uncommon for a large dealership like North County Ford to have millions of dollars in inventory on its lot at any given time, so major security measures are a must. With that being said, how did these criminals manage to get past North County Ford’s extensive camera system, alarms, and the individual alarms of each vehicle they stole? Well, it all started with a rock.

According to the report, at 12:28 am on April 9, the thieves used a rock to break a window in the service bay to enter the main building. Once inside, they found the security camera hub, turned off all the cameras and erased several hours of footage.

The dealership said the thieves plugged a laptop into the key safe and managed to hack it open like a scene out of a '90s heist film. They stole 330 keys from the safe and put them all in a bag. Since many modern cars use keyless entry and have push button start, the thieves simply jumped into different cars with the key bag in hand, started each of the eight cars, and drove them off the lot.

The only physical evidence left behind was broken glass from the window found by the cleaning crew in the later morning hours.

North County Dodge is now going through the tedious task of reprogramming replacements for all the keys that were stolen but have taken to Facebook to appeal to the thieves for their return. Offering a $10,000 reward for the return of the keys “no questions asked.”

Topics include:

The Illinois Treasurer requires all businesses and not-for-profits to file annual unclaimed property reports, due on May 1, 2024. Even if an entity is not holding any unclaimed property, it must still file a negative (no unclaimed property) report.

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The U.S. Department of Labor (DOL) has released the anticipated final rule defining Overtime Exemption requirements, including guaranteed salary requirements, for the White-Collar Exemptions: Executive, Administrative, Professional, and Highly Compensated.

Key provisions of the final rule are as follows:

1. Effective July 1, 2024, the new guaranteed salary level to be exempt is $43,888.00.
2. Effective January 1, 2025, the salary requirement will be increased to $58,656.00.
3. The salary requirement will then automatically increase every three (3) years.
4.  For the Highly Compensated Exemption. First, on July 1, 2024, the salary threshold will rise from $ 107,432 to $132,964 per year. Second, on January 1, 2025, it will rise to $151,164 per year. The threshold will also be updated every three years.

Of noted importance, is the ability for employers to apply Non-Discretionary Bonuses and Incentive Payments (including a valid commission payment) to satisfy up to 10% of the guaranteed salary level requirement of $43,888.00 and then against future salary requirement increases. Please note that Non-Discretionary Bonuses and Incentive Payments, such as commissions, must be well defined and meet the DOL’s requirements under the regulation.

Have your HR contractor conduct an audit of all pay plans and subsequent exemption compliance. With this news, employees will be interested in challenging their pay plans and eligibility for significant overtime payments.

Consider pay plan options:

1. Increase the current salary in one fell swoop to the new required level and in future years.
2. Consider the use of the Fluctuating Work Week method of payment. Strongly recommended for consideration.
3. Revise the current salaried pay plan to a hourly plan, with overtime paid at 1.5 times the regular rate for hours worked over 40 in a workweek. Work schedules must be challenged to avoid significant increases in labor costs, re, overtime.
4. Consider commissioned based pay plans or salary/hourly plus commissions to avoid overtime requirements, re: Retail 7i exemption. In states where allowed.
5. Apply other available overtime exemptions.

If you have further questions, SESCO clients receive a wage and hour compliance assessment at a CATA member discounted rate. Feel free to contact their experts at 423-764-4127 or email sesco@sescomgt.com.

On April 23, 2024, the Federal Trade Commission (FTC) voted 3-2 (along party lines) to issue a final rule banning employers from using noncompete agreements. The final rule bans new noncompete agreements with all workers, including senior executives, after the effective date 180 days after publication date (which is expected to be soon). Existing noncompete agreements may remain in effect for senior executives but will be unenforceable for all other workers after the effective date. 

The new rule will prohibit dealers from imposing new noncompete agreements with workers or to enforce or attempt to enforce such agreements after the effective date.

The U.S. Chamber of Commerce immediately sued the FTC on the grounds that it exceeded its authority—the same basis that the two dissenting commissioners voted against the rule. The Chamber described the rule as an “administrative power grab.”

Area new light vehicle registrations increased 17.1% during the first three months of 2024 vs. depressed year-earlier levels. The national retail market was up 6.9%. Note: reported registrations in the First Quarter of last year were especially weak, likely due to registration processing delays. This contributed to the sizeable percentage increase in Q1 ‘24.

2024 Forecast: According to Auto Outlook’s forecast, registrations are now expected to exceed 318,000 units this year and increase 6.7% from 2023. That projection is 15% higher than the total in 2022 when the market was significantly impacted by product shortages but is still below the pre-pandemic level of 354,256 units in 2019.

Key determinants for the market: The shaded box on the right reviews the primary forecast determinants. Pent-up demand is still significant, and the area labor market is strong. Vehicle affordability is still a concern but should improve as the year progresses. As pointed out in the previous release of Auto Outlook, barring any unforeseen negative shocks (such as the possible escalation of conflict in the Middle East), we think the new vehicle market could be stronger than expected in 2024.

Tracking alternative powertrain sales: Area BEV registrations were up 6.6% in the First Quarter of this year versus a year earlier, and market share increased to 7.8%. Gains have levelled off during the past few quarters, however. Hybrid registrations exceeded 7,400 units in Q1 ‘24 and improved 81% versus year earlier. Plug in hybrid market was up 8% (see page 6).

Brands that fared best in early 2024: Among the top 25 sellers in the area market, Buick, Lexus, Honda, Mazda, and Cadillac had the largest percentage gains in the First Quarter of this year. Honda, Toyota, Chevrolet, Ford, and Hyundai were market share leaders.

Top 10 selling models in the Chicago area so far this year include: Honda CR-V, Toyota RAV4, Tesla Model Y, Honda Civic, Mazda CX-5, Hyundai Tucson, Ford F-Series, Nissan Rogue, Honda HR-V and Chevrolet Equinox.

Download the complete Q1 2024 Chicago Auto Outlook

Dealerships are always looking for ways to improve profitability in their stores with a trusted partner. Many of our current and past board members are leveraging services from Dynatron Software to increase their profitability in fixed operations, and they report that the results are outstanding.

With today's margin compression on the variable side and an increased focus on fixed operations, Dynatron has been proven to be the preferred partner to generate an increase in profit and retention to reinvest in your dealership(s) and people.

The document shows how Dynatron improves customer pay ELR revenue for their customers. From there, dealerships can take advantage of opportunity to file for a significant warranty labor rate or parts margin increase with Dynatron’s FileSmart solution.

You can schedule your 30-minute Zoom call to learn more by clicking on the QR Code on the attached or visiting Dynatron Software for CATA members.

Sincerely,
Jennifer Morand
CATA President