Born-again Christians Graham Dacre, founder and chief executive, and Brian Fawcett, managing director, believe their values should underpin the entire group ethos. So, each member of staff receives a handbook explaining the company culture and every customer is given the ‘Lind A-Z’, a book of proverbs extolling Christian virtues.
They’re in good company: Sir Peter Vardy, Inchcape’s Graeme Potts and Lookers’ Fred Maguire, for instance, all make no secret of their religious leanings.
Wisdom and understanding
The Lind A-Z, which covers everything from achievement, power and wisdom to death, humility and responsibility, is not an attempt to foist Christian beliefs on to customers, according to Dacre.
He admits that many of his closest friends do not share his faith, but says: “They do value wisdom and understanding.”
Dacre established Lind in 1992, taking the name from Dr Robert Lind Gordon, who helped the new business find its footing. Dr Gordon felt that Lind stood for ‘Life in New Dimension’ for customers, associates and stakeholder partners.
The philosophy works: from 1992 to 2003 the East Anglia and Kent-based group experienced stable growth in turnover and profits every year. Last year, the pressure of absorbing new franchises and acquired dealerships into the 19-outlet business, combined with a stuttering new car market, triggered a slight dip in profits, despite rising turnover. But it is a temporary blip, according to Fawcett, who points to the group’s successful track record.
“The original plan was to become a top 25 group specialising in the prestige market,” he says. “We got there quicker than expected. We achieved our five-year plan within two years and our 10-year plan within five years.
“Now it’s time to consolidate our position, but that doesn’t mean we won’t consider other opportunities to acquire if it is right for the business.”
Lind has earmarked £20m for new projects this year, including an £8m BMW/Mini showroom in Norwich, rebuilds for Honda, Mitsubishi and Mini showrooms and refurbishment of the VW dealership in Colchester, and a new aftersales facility and revamp of the BMW dealership to a sales-only site in Ipswich. The reason is a mixture of carmaker standards and a need for larger, better equipped premises.
“Relocating the business creates a huge buzz for customers and staff,” says Fawcett. “Volumes increase because we have better facilities and more space while staff are more motivated because of the improved working environment.”
Finding the right sites is not an issue. Lind has its own property division, while Dacre also owns a separate property company. Both play a key role in sourcing new premises – the strategy is to buy sites first and acquire the franchise second.
“We buy property if we see an opportunity in the future,” says Fawcett. “That means we have a lot of property on our balance sheet. We decide where the property sits best: within our division or in Graham’s company with us paying rent.”
From retail to fleet?
Over the past three years Fawcett has started transforming Lind from a retail-only group to one with a presence in the corporate user-chooser market. He set up a central corporate division with specialist departments in each dealership, which has resulted in fleet sales accounting for almost one third of Lind’s new car business.
With retail sales down year-to-April by 13% as corporate business rises by 10.6%, the timing has been perfect. “We now deliver the level of service that appeals to the corporate market,” says Fawcett.
He predicts the market will pick up on the back of forthcoming launches like the Range Rover Sport, BMW M5/M6, VW Passat and Polo facelift, and Audi A6 Avant.
While Lind does not rule out further acquisitions, particularly with existing partners, Fawcett is wary of adding unnecessary cost. He believes that once a group reaches 25-30 sites, the business model needs to be refined to form a different structure and process, one that includes an additional layer of management.
“It’s much harder to have a consistent message that filters down to all staff,” he says. “The challenge is to grow and ensure that everyone operates within the framework we want.”
After surpassing its previous business plans ahead of schedule, Lind now operates a three- to five-year rolling plan. Fawcett is looking to raise turnover to £425m this year (2004: £380m) with increased margins to around 1.5%. Profits, at just below £5m last year, are forecast at £6.6m.
“With the franchises we have, 2% is a good performance,” Fawcett says.
And he re-emphasises the group’s values when he adds: “We want to make money, but we do not want a dishonest penny in the business.”
Lind turnover 1999-2004
Figures taken from the AM100 show that Lind has steadily increased turnover over the past five years, with a spike in 2002 after a number of acquisitions. Profits have also risen year-on-year except 2004. Lind is No 27 in the AM100 published in June 2004.
It’s about personal relationships that need to be developed on a one-to-one basis at all levels, from the board to the dealership. Our objectives are the same, and that’s to sell more cars. The issue is doing it so we both profit.
They don’t offer carmakers synergies, but we get them from working as a team to offer the same level of service for new, used and aftersales. They doesn’t deliver cost savings, they generate more income.
If a group is established and strong in its territory, why would anyone want to go into that area? It would have to be a very long-term strategy, and they would have to accept the fact that they will initially lose money.
There will be more consolidation, but it goes in cycles. You get large groups that then diversify and break up.
The biggest change in business over the past 10 years. Dealer management systems help us communicate with customers much better now.
Artist’s impression of Lind’s £8m BMW/Mini showroom in Norwich, due to open soon
Lind in detail
Turnover: (2004) £380m
New car sales: (2004) 9,045 (6,200 retail; 2,845 corporate)
Used car sales: (2004) 6,480
No of staff: 930
No of sites: 19
Key franchises: Audi, BMW, Honda, Land Rover, Mitsubishi, Porsche, VW