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View from the top: Small dealers find strength in numbers

The birth of the Retail Automotive Alliance in January was a major event for the UK motor retail industry.

Formed as a joint venture limited company, its initial membership consisted of 20 individual dealer groups, each turning over between £12million and £190million. The addition of John Grose Group and Haynes of Maidstone in April increased this to 22 members, and gave the RAA a nominal combined turnover of £2.4billion.

Many of these smaller dealers feel overshadowed by the national plcs and powerful regionals. They hope to take advantage of a critical mass by joining forces to create an organization with more than 160 dealerships across the UK.

Whereas gaining negotiating power with car manufacturer partners has never been the alliance’s objective, despite every member dealer group having Ford outlets, it has support and service businesses firmly in its sights.

Philip Maskell, RAA chairman and managing director of Essex Ford Group, says: “People recognize it as an opportunity to get on board with the RAA at an early point. Most are very positive if they can get some market share, it’s very effective for them to deal with 22 individual groups through the central hub of the alliance.”

Maskell has appointed a number of project leaders to head negotiations with prospective partners. These include lubricant companies, finance houses, workshop equipment installers and suppliers of showroom furnishings.

Given the volumes involved, the RAA has a number options in order to secure discounts. For some services, partners will be offered an exclusive contract, while for others the RAA will appoint two or three approved suppliers.

Another benefit of the alliance is that member dealers still manage their own businesses independently, and are not necessarily required to participate in every initiative. Its supporters are confident they are now better placed to face the challenges of the future.

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