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Muppet family' insists it will evolve with market

Small family-owned dealerships are better placed than large groups to react to market changes, said Ian Owen, managing director at Moss Pit Garage, Stafford.

“We are playing the same game as larger groups, just not on the same scale,” said Mr Owen, whose business holds the Renault franchise.

His family has run the business for 40 years, Mr Owen's brother Phil is bodyshop manager and their sister Linda Upton sales manager. Mr Owen contacted Automotive Management because he was irritated by an article (August 18).

Colin Haig, business recovery national director of accountants and business recovery specialists Baker Tilly, wrote about family retail automotive businesses going into receivership.

The Muppet analogy had become shorthand for some second- or third-generation management, he wrote. They expected the business to run itself while they played golf.

Mr Owen, dismissing Mr Haig's views as “twaddle”, said: “It is a generalisation that second generation managers only got their job through family lineage and not on ability.

“The plcs and their professional managers have not been without their casualties in recent years, in spite of having accountants and business advisers on board. The size of the losses incurred by some of these failures seems to me to be the result of spectacular incompetence.” Mr Owen puts his dealership's success down to “delivering the service that the customer wants - they will happily pay for it and keep coming back”. Moss Pit Garage was founded by his father, Mike, 40 years ago as a Renault dealer. Mr Owen, who left school at 16 and gained technical and IMI qualifications, took over the loss-making dealership in 1992. Turnover has grown from £6m in 1996 to a forecast £10m this year. “We have achieved small but consistent profits for the past three years,” he said. Moss Pit will retail around 300 new and 650-700 used cars this year, employing a workforce of 28. The Owen family also makes up the board, though the business also has non-family managers. “We take a holistic approach to car sales - if we are to provide a service, customers expect it to be a complete service, where we sell new and used cars, buy them back, mend and fix them,” said Mr Owen. “Communication is important - you must use the power of the people around you to keep abreast of what's going on. We created a company culture to get people pulling in the right direction by recruiting on attitude first and training the aptitude into them. “No matter which member of staff speaks to customers I am confident they will be dealt with properly and given the best possible service.” Industry experts believe smaller dealerships like Moss Pit will suffer from Trade and Industry Secretary Stephen Byers' new car pricing ruling, which makes fleet-type discounts available to dealerships that buy in bulk. Mr Owen claimed the potential effect had been exaggerated. “We anticipated the likelihood of buying in bulk and started doing it 18 months ago,” he said. “Larger dealers buy in bulk to meet their targets and we buy from their wholesale departments. We've developed deals with several dealers who are willing to pass on cars with little or no mark-up.” Moss Pit stocks its forecourts with delivery mileage stock, enabling it to compete with local used car supermarkets. “We have become a small used car supermarket - we can do what they do, only we can do it better,” said Mr Owen. “In the past 18 months we have taught ourselves to compete.” Mr Owen is confident about Moss Pit's future despite Renault's development of a hub structure, where territories consist of a central dealership surrounded by smaller satellite operations. “Our days may be numbered as a franchised dealer, but we will evolve with the marketplace,” he said. “People will still need finance, servicing and repairs.”

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