Jackson insisted she didn’t take a laissez-faire attitude to the bottom third – or immediate wish to terminate them.
“We try and work with them to improve because clearly it’s not helpful for me because I need them to be profitable to be able to invest,” she said.
If there is a consistent factor in many dealers running at a loss it is related to people and the loss of key staff or the wrong people in key positions.
Citroën has a team visiting the poor performers to explore profit opportunities.
The top 25 performers in 2012 made 2.4% on average; the top 50 1.6%; the top 75% 1.1%. Jackson didn’t have figures for the bottom quartile, but said the average return on sales was 0.7%.
Her aim is to get the overall average to 1.2% return on sales in 2013, 1.5% in 2014 or 2015 and then 2%/2.5% by 2017.
The means to achieve this, Jackson said, are through:
- Increasing market share
- Growing the DS share of sales from 30% to 35% in 2013
- Increasing finance penetration
- Aftersales initiatives, including expanding the penetration of service contracts take-up and vehicle health checks to increase the number of retail hours sold
- Growing its fleet business.
“The success of any one of these could provide the growth in return on sale we are targeting.”
The impact of the DS range
Concerns have been expressed the success of the DS range was to the detriment of the Citroën’s core models, the C line cars.
But Jackson refuted this: “The percentage of conquests is
about 65%, a considerable amount of new Citroën customers coming from a wide range of premium brands.
“We’ve taken business from BMW, Mini and Audi and from the whole range of competitors.
"Until the DS we didn’t have the product to tempt them.
“We’re using DS to build the whole Citroën brand too. We have C line customers who aspire to a DS, but it’s not quite in their budget at the moment. So, they come in on the DS and then they buy a C line.”
There has been some loyalty deals too which see C1 and C3 customers being able to move to a DS.
The success of the DS range has gone beyond expectations said Jackson. “In 2011 we were selling something like 11,000 DS3s. We will, hopefully have sold close to 18,000 in 2012.
"We’re aiming to sell twice that so doubling volume in just two years. We thought it was a great vehicle.
"Did we think it was that good?
"Probably, yes.
"But we had to face the question: ‘why are Citroën doing that?’”
The UK’s position as the only growing European market also helps the case for exploiting the possibilities of growing market share here.
So, simply supply in the UK will meet the demand – Paris has increased investment in right-hand drive production for Citroën product where it’s
called for.
Jackson denied Citroën was party to the squeeze on margins last year which dealers felt was a factor in the resurgence of new car registrations that went unacknowledged in the general media.
“When the exchange rate improved, customer offers reduced and we didn’t change the dealer bonuses in any way.
"And the year before when the exchange rate went in the other direction, we still didn’t.”
Corporate identity
By the end of this year the new corporate identity will have been adopted by all but 10 dealers, where major refurbishment is required.
About 70% of the network has completed the update, all have architectural approval where necessary.
The visual impact is staggering, said Jackson, providing a “clean, vibrant” environment.
“Customer expectations are that this will be a positive experience.
“When I visit and talk to staff who are working with the new CI there tends to be an enthusiasm that is actually motivational, which will have an impact on performance and customer
satisfaction.
Jackson has given dealers assurances on her long-term plans.
“I’m here for the time being – several more years,” she said.
“I’ve told my boss I want to be here to see the 5% all-market share.
We have plans now for 2020, but I want to be here to achieve this 2015 goal.
“I love my job. And we’ve achieved a lot: continued building the network and market share and I’ve got a lot more
to do.”
Jeremy has been a journalist for 30 years, 20 of which have been in business-to-business automotive. He was a writer and news editor on AM-sister brand Fleet News for three years before setting up the AM website. For the last five years he has been Bauer B2B’s head of digital helping to manage the digital assets of AM, together with Fleet News, Commercial Fleet, Rail and Smart Transport.
iceage - 10/05/2013 17:16
Dreamers... if they want to go from 3.6% to 5 or 6% who will they take the sales from? Kia? Hyundia? Honda? Coz those guys arnt going to give it up! If we added up all the manufacturers aspirations the market would total 160%!! The looser of course is the poor dealer pressured to the point of bankrupsy to invest in dud brands.