Service plans fundamental to the future
Stenning admits the group was a little late to market with service plans but said the product is now fundamental to the future of its service departments. Conversion rates from service plan quotes to customers is at 20% and the business wants to push this further. Arbury has found that once service plans have been explained properly, the second service plan is always a much easier sell.
“Service plans and the support of the manufacturer campaigns are key elements of selling a car now,” said Stenning.
“Our service departments are up in retail hours, they’re up in overall hours and revenue, so we’re making progress.”
The biggest change for the business this year will be moving from its current dealer management system to ADP across all of its sites.
The group researched the market and the different systems thoroughly for more than six months before choosing ADP.
“We’ve been and seen the systems working,” said Stenning.
“We’ve had the involvement of our own managers, so it has been a team decision.”
The group expects to limit disruption within the business by training all staff before the new system goes live.
Arbury expects the major benefits of ADP will be integration of systems and databases across the group. The management team is planning to run the business manually for two days, while the switchover takes place.
Acquisitions and further growth
Arbury is likely to grow to become a bigger regional player in the future, but the process will be controlled.
“We’re not reckless,” said Stenning. “We will not make any acquisition that will put the rest of the group at risk and it has to fit with our strategy. It has to fit with our market area plan.
“If we see a site which we consider as an underperforming business in a market which we feel we can make some money out of, then we look at it. We have had several offers for us to take on businesses this year.”
Stenning believes it takes at least a year to fully understand how a new franchise works, how the bonus schemes are structured, fully working out the quirks and opportunities within the brand.
He said: “We’ll carry on growing organically, but we’re not on a mission to hit 20 sites by a specific date.
“It’s about taking advantage of opportunities that come up and there are still, even in the 21st century, lots of businesses that are underperforming and still operating like they’re in the 20th century.”