How to make it in the car business

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Hey Freddy crew,

For all the grief the car business gets, it’s a pretty incredible economic ladder.

People from virtually every background have walked into dealerships with no degree, no connections, no idea what F&I stands for, and built six-figure careers.

But getting in is the easy part. This week, we’re looking at what it takes to make it to the top.

Let’s go.

Javuan Banks might have the most well-known forehead in the car business.

This is not an insult. At this point, it is basically intellectual property.

Javuan sells cars at Premier Auto Dallas, but his first exposure to the business came from his father, who bought cars at auction, fixed them up, and flipped them. Javuan eventually landed at a Nissan dealership and realized he preferred selling the finished product over rebuilding it.

Then he started posting.

At first, the goal was to use social media to sell more cars and become known as “the car guy.”

After moving to Dallas, he met a cameraman who also worked in car sales. The two spent their free time making skits, testing ideas, posting consistently, and waiting for a video to go viral.

Then, one hit. And another. And another…

At the end of the day, Javuan started with the exact same asset every salesperson gets on day one: access to customers, inventory, stories, and a front-row seat to a very weird industry.

He just happened to capitalize on the opportunity sitting in front of him.

Eric Gentry bought his first dealership job back this summer… sort of.

In 1994, fresh out of college, Gentry started selling cars at Hulett Chevrolet Buick GMC in Camdenton, Missouri. He spent eight years there before moving to Kansas City, eventually working his way up to general manager at Randy Reed Buick GMC, according to Lake News Online.

By then, he knew how to run a dealership.

The problem was buying one.

This is one of the stranger realities of the car business. You can spend 20 years becoming extremely qualified to own a store and still be several million dollars short of the admission price.

Gentry eventually met Premier Automotive Group founder Troy Duhon, who backed him financially on his first acquisition in 2014, reports Wards Auto. Later that year, another Ford store came available and Gentry needed $750,000 to buy in.

So, his aunt borrowed the money against the family farm.

Yes, Eric Gentry literally bet the farm on becoming a dealer, and it worked.

He and Duhon eventually built Victory Auto Group to ten stores across Kansas and Missouri. Earlier this year, Gentry sold his stakes in most of those dealerships, bought Duhon out of their Smithville Chevrolet store, and became a full owner, says Wards.

Then in June, he bought Hulett Chevrolet Buick GMC.

The same store where he sold his first car 32 years earlier now has his name on the building.

There are easier ways into dealership ownership if your grandfather happened to buy a Chevy point in 1967. For everyone else, the path often looks more like this:

> Learn every part of the business
> Find somebody willing to bet on you
> And eventually accumulate enough capital to place the bet yourself

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Roger Penske still carries a coin in his pocket that says effort equals results--a lesson he said his father taught him when he was a kid.

If little Roger wanted a $10 radio, Dad would put up five and make him find the other five. Want a bicycle? Go sell enough newspapers to pay for it.

By his mid-20s, Roger had applied that mentality to racing and became one of the best drivers in America. He won an SCCA national championship. Sports Illustrated named him Driver of the Year (and more importantly for this story), racing introduced him to Chevrolet.

In 1963, Roger was brought on as the general manager of a Chevy dealership in West Philadelphia. Two years later, he wanted to own it.

“At that point, I made the decision to stop racing,” he told the NASCAR Hall of Fame. But more importantly, I needed $50,000 to put the final piece into the dealership on top of what the banks would loan me.”

So his dad emptied the money out of his account and told him to go do the deal.

That dealership did more than make Roger a dealer. It taught him how to run an operation where tiny mistakes eventually become expensive ones.

And he kept putting those lessons (and the money they produced) back to work.

He expanded into rental cars, sold that operation and reinvested the proceeds. In 1969, he bought a three-location car and truck leasing business that became Penske Truck Leasing. He added dealerships, tire distribution, commercial vehicles and logistics. Racing came back too, except now he owned the team.

But even though the businesses got considerably more complicated, Roger’s management philosophy really didn’t. The aim has always been to set an exacting standard, build capable people around it, and execute relentlessly.

Effort equals results after all.

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