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Movassaghi drives Skoda's five-year Simply Grow plan

After almost a year in the job, Skoda UK head of operations Duncan Movassaghi has been implementing a five-year growth plan across the dealer network which will see sales double by 2015.

AM caught up with Movassaghi at the brand’s Milton Keynes headquarters and asked how this growth would affect the network.

 

AM: Is the entire network in profit?

DM: “Not every single business is, but the network is on average. Our year-to-date average return on sale for established dealers that have been with us for more than a year is 1.4%.

“The other thing you’ve got to keep in mind is that a lot of these businesses have got owner operators who are taking a good salary out before they’re declaring that profit.

“We have an initiative called Simply Grow, which is a five-year growth plan for our network and our target for the end of this year is to get average RoS to 1.5% and I’m very confident we’ll do that and be ahead of that by year end.

“If you look at our top quartile their average RoS is 3.2%.”

 

AM: What is your current market share and where do you want it to be in the future?

DM: “Last year was a record for us a 2.04% at 41,000 units and that was the first time we’d gone above 2%. Year-to-date market share is at 2.4% and we’ll end the year on that figure with 45,500 units which is our Simply Grow target.

“The target for next year is 48,000 units and I think we’ll beat that, then we’ll get to 58,000 and then 69,000 each year after that. By 2015 we want to get to 78,000 units.”

 

AM: How are you going to deliver this growth?

DM: “We want to be a 3% and then 4% brand over the five-year period to 2015 and we need product to have that share of voice, so there’s a lot investment in the new products coming through.

“We’ve got a new small family model, the Citigo, coming in the middle of 2012, which is a new segment below Fabia. We’ve got a new model, based on the concept MissionL, which will sit between Fabia and Octavia which will launch in January 2013. The next-generation Octavia will also arrive in 2013, including estate and VRS versions. We’ll get a heavily facelifted Superb too.

“We’re pushing through the channels, so our fleet business is growing and will grow very significantly. We’re a 2% player in the fleet market for the first time this year. We’ll be keeping our focus on good quality value pro-duct and we’ll be keeping the pricing right for that market with strong tactical offers.

“We’re not blowing our brains out with pack car deals or doing masses of self-registrations.”

 

Skoda MissionL Nov 2011

 

AM: How will this growth affect dealers leading up to 2015?

DM: “Clearly to reach the volumes we’re aiming for the network needs to be selling more cars and it does mean investment in many cases. We’re very advanced in our planning with dealers and we’ve used a very structured approach with a growth planning model that allows them to look at the volumes they need to do and all our dealers have already put in their five- year numbers and committed to that.

“Our model then works out what sort of facility that dealership needs. The guys on the ground will probably already know in many cases, but we’re coming up with a number of outcomes for them in terms of how they need to prepare for growth.

“One might be that they’ve already got the right facility, the other might be that their needs to be some redevelopment or even a relocation.

“There’s a business management side of it as well where we look at what they need in order to sell twice as many cars for us and not just new cars, but twice as many used cars too to double the throughput in the workshops. We’re helping them to calculate what they need in their business in terms of people, processes and funding.”



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