John Edwards, Land Rover UK managing director, says the changes are intended to bring its network up to the same level. “We probably have more variance in the standards of dealerships in our network than any other manufacturer,” he adds.
Pendragon’s new Solihull facility and Beadles showroom in Dartford are an indication of the design blueprint Land Rover expects the rest of the network to meet by 2008, with the bulk of focus on internal design improvements.
“We want a clean, contemporary look that follows Land Rover cues,” says Edwards. “But we might be guilty of worrying dealers that it’s a bigger investment than it will be.”
Investment will vary depending on the state of dealers’ existing facilities. Some will need to put aside less than £20,000; for others the cost will exceed the £70,000 quoted in the last issue of AM. Edwards adds: “Dealer profits are important.”
Network return on sales averaged just over 2% in the first quarter, compared to 1.8% for the whole of 2005, with more than 90% of dealers in profit. The margins target is 3.5%, with top performers exceeding 5%.
Land Rover supports its retail network through training, helping retailers to understand key business drivers like analysis of the income statement on new and used cars, aftersales, overhead absorption, parts and customer loyalty.
It is also looking to get processes under control.