AM Online

Customer service at Marshalls is an obsession paying dividends

From his first steps in the motor trade when working weekends to see himself through university Daksh Gupta has been an advocate, to the point of obsession, of the benefits of customer service.

From his first face-to-face contact with showroom visitors in his teenage years to his life today in the back offices of Marshall’s Cambridge headquarters, where you will find him poring over data or emails on his BlackBerry, it is a factor that dominates and drives his strategy.

The customer service awards he has won prove it: At Inchcape in 2005 he played a part in winning an award for the best customer service team from Mercedes; in 2006 he was responsible for three market areas for the dealer group out of a total of 33 in the UK and his were ranked first, second and third for customer service.

As well as Marshall chief executive, Gupta is also a non-executive director for Ridgeway.

On his office wall are certificates acknowledging his and his then team's contribution in helping the group win the Mercedes award for best customer service in 2007, 2008 and 2009. To add to the awards this year were three from AM.

Among them was the Excellence in Customer Service award.

It came as no surprise that Gupta went to collect the award, while allowing two of his staff to collect the awards for Most Improved Company of the Year and Best Dealership.

The association Gupta has had with each brand he has worked for demonstrates that excellence in customer service is not just an ethos he is passionate about in his current role of Marshall’s chief executive.

The idea has become part of the AM100 group’s DNA. Its strategic vision is “to be the UK’s premier automotive retail and leasing group as recognised by our colleagues, customers, business partners and shareholders. To achieve our vision we will create a customer centric culture…”

But how does this translate into day-to-day operations?

“This year Marshall is on track to sell between 27,000 and 30,000 new and used cars and service around 100,000.Last year we had 294 customer complaints.

"It’s a tiny percentage, but in the past 18 months we have focused on the transactional side using a list of checks and balances,” said Gupta.

“For example, a common cause of frustration for dealership visitors is the amount of time they have to wait before talking to someone and not being offered a test drive.

“The biggest challenge for the industry is how to police that.”

Marshall has introduced a technical and process-led solution to address this. An internal system called Phoenix was designed and built in-house to measure a number of KPIs.

One of these is capturing the email address of everyone coming into a dealership. Gupta says the industry average is 10%.

Marshall is capturing more than 70%, but he is benchmarking at 80%.

Marshall Jaguar Cambridge – winner of the AM Best Dealership Award – is achieving 86%.

Gupta believes he is the only dealer to survey visitors who did not buy.

Each visitor is sent an email questionnaire based on their dealership experience.

Satisfaction

The results are then combined into a database called ‘inquiry satisfaction’.

In a sample month this year Marshall sent 1,116 email questionnaires, 215 of which were completed, with each respondent entered into a quarterly prize draw to win £1,000.

“Can you imagine the positive feeling that will generate for the Marshall brand? The winner might not have even bought from me,” Gupta said.

Phoenix went live last June.

Gupta can also see where dealerships and individuals are not meeting standards: “I can see a level of detail for my business that cannot be matched by any other manufacturer or dealer group,” he said.

He likes to be copied into the vast number of interdepartmental emails involving customer comments.

The ‘Contact Daksh’ button on the Marshall website puts him in the ‘front line’ of the business.

Intense pressure

The pressure for standards is intense.

From November Phoenix has been applied to service, with customers asked about work being fixed first time, work completed for the agreed price and recommendation to friends and family.

This attention to detail has led Marshall Honda Peterborough to enjoy a climb in CSI score from 159th in the manufacturer network in 2008 to first in 2009.

Three Marshall Honda sites were in the top 10. The Marshall Citroën business was the most improved in 2009 and its Toyota businesses were ranked first and second in the country. They had been in the bottom 10.

Gupta wants no more than four written complaints per site per year. In 2009 the average was 12. From 2008 to 2009 complaints were down 37%.

Being able to measure individual sales executives’ performance on a near real-time basis – an industry first, says Gupta – has not been without problems.

“It sends a message through our organisation that I’m prepared to put myself in the firing line and it’s what I expect of staff,” he said.

“There were some shocks when Phoenix was first introduced and we lost some salespeople, but I’m simply using data to ensure we do business properly and create a beacon of excellence for customer service.”

Gupta shares his passion for customer service with his 750 staff – as a result the company’s scores in the annual Great Place to Work survey have improved 10% year-on-year.

But does the obsession contribute to an improvement on the bottom line?

Emphatically yes, says Gupta.

January 2010 turnover was up 20% (£6 million) year-on-year. Marshall’s 2009 turnover was up 8.7%, from £408 million to £469, in a sector that suffered an average fall of 20%.

A decision to open a Volvo dealership in Nottingham and the acquisition of Francis Group in February added £50m to group turnover.

“I expect we will end 2010 with a turnover of £550m,” Gupta said.

He reveals acquisitions are planned which could push it towards £600m.

Net profit is also up year-on-year by “an eight figure sum”.

“A forecast 1.8m people will buy a car this year – that’s a lot of business to win. Our processes mean we maximise every opportunity,” Gupta said.

New acquisitions planned as group's bids to be UK's best

Marshall aims to take on a number of new franchises as well as grow the business through further acquisitions this year.

Daksh Gupta will not give details, although to any casual observer there is an obvious absence of German brands in the portfolio.

And he has no plans to drop franchises. “If we lose a franchise we are left with empty properties.

In Cambridge we have 13 franchises and 10 in Peterborough and since we own the properties it’s better to work on the businesses there to ensure profitability is good.”

The goal is to “work towards being the best retail group in the UK. Eighteen months ago I joined a company that needed to improve dramatically. We will work on the four pillars of the business: customer satisfaction, operational excellence, having the best people and building relationships with our partners,” he said.

Gupta wants to grow the business in the right locations and with the right partners, leveraging its scale, developing from a group known for its regional focus into one with a national standing – but not at any cost.

The precedents are good: 12 new businesses were added last year and each has been cash generative “from day one”.

“The historic strategy has been based on clusters of outlets such as we have in Cambridge and Peterborough, resulting in a huge market share, with 35% of the cars in Cambridge sold by Marshall.

“But, ideally I don’t want to be in competition with myself. You won’t see us adopt the cluster approach in Leicester.”

“Marshall has the best of both worlds – the combination of the processes of a plc and the culture and heritage of a privately-owned company,” says Gupta.

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