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Nissan targets specialist dealers

Nissan GB is creating specialisms within its network to better target its market segments. 

The carmaker has been working with its network to identify market opportunities and agree a three year business plan with each dealer. 

Managing director Paul Willcox has a target to increase the brand’s share of the UK new car market from 3.5% to 5% in 2012 through driving improvements in five areas: product, brand perception, quality, operational processes and dealers.

This includes a roll-out of specialisms within the retail network. Among its 185-strong network most will have 4x4 specialists, 60 will have fleet and LCV specialists and up to 25 will be
designated high performance centres. 

“We’re doing this to enable the network to right-size their businesses. Every dealer will get everything in our range, but specialist means that those dealers that have a particular market opportunity will invest at a higher level for that and will get a higher level of margin to support them in meeting the expectations of their customers,” said Willcox.

Dealerships with specialist status will add branding and a dedicated section of the showroom to promote that fact. The system will be flexible – should the market for 4x4s decline further the network might have fewer 4x4 specialists, he said, although Nissan would want to maintain its share of the segment. 

These changes will be accompanied by a reduction in network size to around 165 locations by 2012. Willcox is keen to improve the reputation of Nissan. More than half of the network is hitting every KPI. Ignore the bottom 40% of its network and its remaining dealers would equal Toyota on CSI scoring, he insisted.

But he wants consistent satisfaction and performance across the country, so Nissan has informed its bottom 40% of the improvements necessary by 2012. Those that are unwilling or unable to do so will have their franchise terminated.
All dealerships should achieve at least 1% return on sales, he said.

Nissan commissioned an independent study into the costs of the franchise in Q1 which put it “about average” compared to other volume brands. However, it is taking action to reduce dealers’ costs, such as reducing demonstrator requirements, and to improve cashflow. 

Margins and incentives have been simplified for 2009 – there is a fixed trading margin, quality margin and a retail share bonus, and the held-back element is paid quarterly rather than half-yearly.

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