New customers can present a challenge to a dealership as well as profit opportunities. Understanding their needs is a key part of making sure they are sold the right product and, just as importantly, should mean they keep coming back.

The Government’s recently introduced scrappage scheme was designed to bring new custom into dealerships.

Many of these people may have never stepped foot inside a franchised showroom and it could have been years since others have bought a new car.

This presents added challenges for dealers to keep these customer who could be unaware of the services offered or assume dealerships charge high prices, which is not always the case. 

Ensuring they understand what services and offers are available is crucial as they are more likely to come back once they have realised what a dealer can do for them.

Felix Serrano, managing director of automotive consultancy MSX International, said dealerships need to ensure they have sufficient staffing levels to cope with any customer influx.

“We had one case where people were waiting so long in a dealership they walked out,” he said. 

“Make sure you have enough literature and demonstrators so cars are available and fin-ance offers are up to date. A lot of these people will be looking for finance, so have you got enough finance options?

“The older the customer the less likely they will need finance.
“Conversely, young people may think this is a chance to upgrade and get a new car, but they may have credit history and might need protection payments, so you need a wide range of offers to suit everybody.

“The opportunity is about having a range of offers to suit every customer and eventuality.”

John O’Hanlon, chief executive of Ridgeway Group, felt its dealerships were in a strong position to cope with any increase in demand because they had enough front facing staff.

But he felt the £2,000 a customer could save on a new car through the scrappage scheme was not necessarily going to stimulate sales.

O’Hanlon said: “The amount of money is not going to make people buy a car. “It is more about how you deal with these customers when they come in.”

Dealers AM spoke to agreed customer service and chasing up people who leave without buying anything are essential methods of trying to retain customers.

Warren Brearley, managing director of Mercedes-Benz and Smart of Milton Keynes, said customers were introduced to its service team as part of the sales process which included discussing a discount service package priced to compete with independents.