Franchised and independent dealers from across Scotland met in Glasgow for AM’s roundtable event, which was hosted with the Scottish Motor Trade Association (SMTA).
The roundtable discussed the pressures on dealers and how to address these challenges.
Paul Barnett, of Barnetts Motor Group, said: “There is a problem with staff attitude, both young and older. When they leave, many think it’s their right to take us to a tribunal.”
Ian Grieve, of Ian Grieve (Falkirk), added: “The emphasis seems to be all on the employee and not the employer.”
However, Douglas Robertson, chief executive of the SMTA, allayed fears when he said: "There are changes on the way to employment law where it will not be cost-free for employees to go down this route. I think this will reduce the number of such cases.”
Jim Smith, of Kerr and Smith, said: “We’re being asked by government to create employment to stimulate the economy, but this is the wrong way round.
"We need to get the economy going first. Unfortunately, some young people have no commitment to work.”
Marcus Wang, of Eastern BMW, qualified the feeling of the group: “Many young people don’t see the motor trade as an attractive industry. We need to make it a sensible choice for them to work in.”
The conversation was far from all negative. John McGuire, managing director of Phoenix Car Company, commented: “I find most youngsters are very motivated. We’ve been involved in a project to set them the challenge of designing a campaign to sell cars.
They have to speak to everyone involved. What a buzz – the ideas they have are fantastic and the kids know the prize for succeeding is getting a job.”
The other big pressure discussed was working with banks.
Paul Nelson, of Allied Vehicles, summed up the group’s feeling: “Businesses are wary of approaching banks for loans at the moment because they don’t want their other finance arrangements reassessed.
"If you go to the bank, they are much less willing to offer the full amount needed and that makes it difficult to grow a business.”
Discussing consolidation within the industry, John Chessor, of John Clark Motor Group, said: “There are owner/operator businesses that have to decide whether to invest, look to be bought or simply retire.”
Smith added: “Smaller independents need to deliver service above and beyond to compete with larger groups. Manufacturers are assisting to help independents survive.”
Talk moved on to how dealers perceived their customers’ behaviour during the past three years of recession.
McGuire said: “The media doesn’t always help by overplaying the bad news. Sure, customers are holding on to their cars for longer and not spending as much in the service department, but we need to be there to support them.”
Smith said dealers had to be prepared for when the economic upturn took hold.
He said: “I describe it to my staff as being like the safety car period in a Grand Prix.
"If we’re not ready for when that safety car goes back into the pits, we’ll be left behind.
"Consumers are still spending money, but much more carefully.”
Smith also pointed out that the commercial vehicle sector was suffering far more, with sales down 75%.
He also highlighted council budget cuts having a big impact on commercial vehicle sales.
Wang reckoned service plans were a ‘no-brainer’ for dealers looking to keep customers, while McGuire said: “A service plan is the most important add-on for any car purchase.”
Chessor believes technology can help: “If you want to improve sales and performance, you need to be able to measure it. Better databases are essential.”
Smith agreed and added: “We need to look for opportunities within our own databases as well as looking for new opportunities.”
Wang added: “You need someone in the dealership to be a champion of technology, to invest the time and effort.
"This should be treated like a CRM relationship, but one where the customer can ask a question in the middle of the night.
“Customers want to know more about how their car is progressing through a service and we need to improve our online technology to offer this.”
There was enthusiasm for what new online technology can offer dealers. Chessor said:
“Many dealers are miles behind the times, with customers dropping off a car at 8.30am and collecting at 6pm.
"The cost of a loan car, collection and delivery all add up, so it would make more sense to offer more specific service times.”
Coming full circle in the discussion, Chessor asked: “Should we be inviting younger people into our businesses and asking them how to run the technology for dealing with customers?
"These youngsters understand the technology and we can learn a great deal from them.”
Attendees
Paul Barnett Barnetts Motor Group
Sandy Burgess SMTA
John Chessor John Clark Motor Group
Ian Grieve Ian Grieve (Falkirk)
John McGuire Phoenix Car Company
Paul Nelson Allied Vehicles
Jim Smith Kerr and Smith
Magnus Wang Eastern BMW
Douglas Robertson SMTA
Terry Abbot Supagard
James Smyth Supagard
GrahamKinnear - 11/01/2012 14:26
There are numerous things that dealerships can offer that create additional revenue streams. Service plans are primary but how many offer other bolt on products like air conditioner anti bacterial services or Emission control services. There are numerous companies out in the market place for example Fortron and some manufacturers have their own products. Very few dealers offer these as additional options.