It may be considered almost too apt that a company called Progress made it into the London Stock Exchange’s ‘1,000 companies to inspire Britain’ report.
However, under managing director Terence Byrne, Progress has more than lived up to its name – he started the venture with six staff in 2006 and today it employs 70, with an annual turnover of £40 million.
Being listed in the LSE report, alongside bigger turnover groups such as Lookers Colborne, Snows Group and DM Keith, has been followed by even more opportunities for growth, with two requests to take on additional dealerships. Byrne hopes at least one of those deals will conclude in the coming weeks.
“Getting our name out there is now more important than ever,” he said.
One of the areas which Byrne feels can inspire other British businesses is how Progress treats its staff and the resulting levels of customer service they deliver.
“I write very few customer letters, which, to me, is a good indication that things are being dealt with and are going well,” he said.
Byrne gives staff the power to deal with and resolve complaints when they come in, not refer them up the corporate ladder. The company prides itself on its non-hierarchal structure, with managers at each location given autonomy. Successful processes are buttoned down as the ‘Progress way’ of doing things.
“Recruitment and getting that ‘can do’ attitude is important for us. Getting it right first time ensures that we don’t have a revolving door of staff. It seems to work for us. We generally want people that understand customers and the customer-facing experience.
“We also maintain a good rewards scheme. One thing that big motor dealers fall foul of is apprentices. They continue to treat them like the little apprentice trainee that first graced their doors – we are very quick to react to how they’re developing, to make sure we keep them.”
Family businesses can learn from PLCs
“I also look favourably on candidates that have PLC experience because they tend to understand how things should be. Even though we are effectively a family business, I have implemented processes which I have picked up having worked at PLCs previously,” said Byrne.
He started selling cars when he was 18 at Henleys in Northampton. Between 1989 and 1997 he rose through the ranks of trainee salesperson, salesperson, dealer manager, eventually to dealer principal.
“I have always been in the motor trade; I live and breathe it, but, I have to say, I’m not a petrolhead, and I’m not into motorsport either. It’s the business side of things that does it for me,” said Byrne.
He also had an 18-month stint with the Hartwell Group: “I was out on the road troubleshooting problems and dealing with senior levels of car dealers and manufacturers. I learnt a lot there and built good relationships with various different franchises.”
"I have always been in the motor trade; I live and breathe it, but, I have to say, I’m not a petrolhead, and I’m not into motorsport either. It’s the business side of things that does it for me"
Between 1998 and 2006, Byrne ran Volkswagen businesses for a privately owned business called Spirit.
With the help of the Volkswagen Group, Progress was started in 2006 as a sponsored Škoda retailer in Bedford.
In 2007, Progress opened its Letchworth premises, filling an open point and making a good link-up to its original dealership. Progress expanded again in 2011 and opened a third dealership, in Northampton, giving the company representation across three towns.
“The timing of joining the Škoda franchise was very good, as it was growing and still is – recording record numbers of sales year on year. Škoda is a mainstream player, a brand that people recognise. With its growth in recent years, it is quite a compliment that it has invested in me,” said Byrne.
The price of Škoda’s success
That growth has come at a cost, however – Škoda came bottom of the most recent National Franchised Dealers Association (NFDA) Dealer Attitude Survey.
“Škoda has had a huge amount of success and growth in the past few years,” said Byrne. “When you’ve got a brand that’s grown as quickly and as much as it has, I would say maybe people haven’t wanted to grow that much or that fast, which is the reason for the low score. Škoda needs to be supportive of it and work it out.”
He compared Škoda’s score with that of Suzuki, the most recently acquired franchise in his four-site group.
“Suzuki scored very highly. It has more standalone sites, dare I say ‘mamma and papa’ businesses, whereas Škoda are more of a mainstream big group kind of franchise.”
Byrne’s target for the group is to make it a regional motor group, but he plans to expand nearby first, so the sites are easier to manage.
“It is important to get the sites you have right, then you can keep expanding across the country.
“I am keen to make sure we keep the elements and processes that are in place today.
“Last year, we acquired a Suzuki business in Kettering. It isn’t too far away from our original sites, so it made sense for us to expand, but not jump out of our depth.
“Suzuki always scores high on franchising awards, dealers love it and there is a very good return to be made. We bought the property and took the business over, and it has been a very good addition to the group.”
Progress has appointed customer loyalty managers at all three Škoda sites, who manage customers through their PCP change cycle. Byrne said Volkswagen supports its initiatives and programmes, with VW Financial Services helping the group to employ its finance processes.
“We have seen an uplift in finance renewals just by having these dedicated customer staff – they’re at a 75% renewal rate now. It’s good for us in that we are generating extra business, registrations and retaining the customer, but also bringing in good quality part-exchanges.”
The Kettering site has also enabled Progress to develop its used car business further.
“Used car business is a big part of what we do, and a lot of our non-Škoda used cars are retailed through the Kettering dealership,” said Byrne.
“We were Škoda’s used car retailer of the year last year and the opening of our Suzuki franchise in Kettering has enabled us to expand upon that and allow lots of other makes. Our Škoda sites are solely Škoda new and used.
“We are also a big purchaser from Škoda used cars – we will have around 600 used cars direct from them this year.”
Byrne said Progress competes with fast-fits by making sure service plans are incorporated into the sale. Its service plans are with Škoda directly.
“We have thousands of plans running and we have a process to contact the customer when that plan is coming to the end of its cycle. Service plans will always be a big part of any sales conversation,” he added.
Bringing new buyers to the brand (and the showroom)
To attract new customers, Progress has been placing cars in popular locations. It said this is very helpful in getting the Škoda and Suzuki brands into buyer’s minds.
It has also had success with its VIP events, to which customers are invited by email.
“Our VIP events are very successful, with those who are coming up to the end of their contract with us,” said Byrne. Progress sells more than 100 cars at each of its VIP events.
Progress is putting more of its focus and its money into digital rather than press advertising
The group has historically kept marketing pretty simple, but Byrne said he has realised it needs to work harder to meet its target of becoming a regional buyer destination.
Progress is putting more
of its focus and its money into
digital rather than press
advertising (click to zoom)
To achieve that, Progress is putting more of its focus and its money into digital rather than press advertising.
“Marketing, for us, is in renewal programmes, events and PR. Reliance on retailers to put ads in newspapers doesn’t really happen anymore,” said Byrne.
Progress is still at the beginning of its social media journey, but it does have a dedicated marketing department working on developing its overall presence.
“If you’re speaking to customers too often they switch off, but it’s a great place for news stories and dealer relationships. We just have to find that balance to translate interaction into sales.”
Škoda is currently undergoing a global corporate identity (CI) update and Progress’s Bedford site has already been through the process, costing in the region of £250,000. It plans for Northampton and Letchworth to follow shortly.
Byrne believes Škoda’s cars are ahead of the dealership environment and thinks the CI update will change things for the better.
Other future upgrades include the revision of its current dealer management system, which Byrne said is “just OK”.
Where is Progress going from here?
Byrne said Progress had a strong first quarter “with a cracking start from Suzuki”.
On pre-registering, he said: “The market is currently too reliant on pre-registrations. The market in the UK is inflated and cars are built to that market. Ultimately, those cars do find a place on a customer’s drive at some point, but that’s at a price and that’s not the dealer or the manufacturer that has decided that – the customers decide the market.”
The main target for Progress this year is growing fleet sales.
“We are actively trying to grow this side of the business. I think it is important for all retailers to capitalise on fleet sales; there is really no reason why all car dealers aren’t getting fleet deals.
“The plan is to have a centralised dedicated fleet person in our group. Not only is the new Superb coming, the newly revised Octavia is also coming later this year, which we also expect to be a big player in the fleet world.
“Due to our positioning, we plan to employ one central specialist for our fleet work to look after the whole group, with Škoda’s support and help.”