Despite enjoying all-time record UK sales, the German premium car firm is planning to force outlets it believes are under-performing to sell up by the end of 2008. Warning letters have been sent to the dealers BMW (GB) regards as incapable of meeting its future retailing standards.
“We sold 102,000 new cars and 75,000 used models last year but we could have had at least 25% more volume with a better dealer network. I’m afraid our dealers have had it too good for too long,” managing director Jim O’Donnell told AM.
He says he has been urging his 156-strong network to make investments in line with expectations for the brand. “But I’ve been so disappointed with their response,” says O’Donnell.
“Twenty of our dealers lost £400,000 worth of bonuses last year because they failed to meet the standards we set for them concerning recruitment, training and the provision of facilities.
They have been given the equivalent of a yellow card and been told their next letter will be a red card. Some of them are too lazy and achieve only the minimum they need to get by.”
O’Donnell says a move to lift standards will get under way next month when the network receives key performance indicators to identify problem areas.
“We want to work with them to get things better but there’s no doubt some will have to go,” says O’Donnell, who has sacked more than 50 outlets since becoming responsible for dealer development in 1990.
“I want to increase our network to 160 outlets by the end of this year but I don’t want to appear to be toothless. If you make statements and don’t follow them with action you lose credibility,” he adds.
He adds: “Our performance in following up less than 50% of leads is well below par and unsatisfactory to put it bluntly – we’re not capitalising on opportunities.”