By Debbie Kirlew
Supplying the franchised automotive network is big business. Finance, oil, marketing and valeting are just a few of the products and services that the sector requires to function fully and develop additional revenue streams.
Competition is fierce – price, quality, lead times and service all form part of the equation. Yet for a sector largely governed by rigorous, sophisticated and even highly regulated processes, its overriding approach to appointing suppliers is surprisingly informal.
Family-owned group Swansway Garages’ director Peter Smyth acknowledged that the group does not have a robust procurement process and opts for manufacturer-approved suppliers as well as appointing its own, while services such as valeting are handled by individual general managers at dealership level.
Smyth recognises its procurement is at odds with other elements of the business:
“My cousin supplies John Lewis and the hoops they have to jump through are immense. Unfortunately, the motor trade by comparison is somewhat haphazard. Just recently, we were looking to incorporate video health checks and we simply asked a current supplier, only to find a better product available and so did a complete U-turn, which costs both time and money.”
However, Swansway is not alone. This relatively relaxed relationship between dealers and suppliers belies their professionalism and, perhaps surprisingly, mostly works.
Arron Brown, general service manager at Charters Peugeot, in Aldershot, said: “Communication is key. We stay in close contact with all our suppliers via telephone, email and face to face. We’ve worked with most of our suppliers for years and have never had a problem. If anything should arise, then I’d pick up the phone and have a conversation.”
At Donalds Volvo in Ipswich, marketing manager Benjamin Grant agreed: “It’s imperative we retain a close relationship between our suppliers that includes having regular site visits. In this digital age, it’s very easy to limit communication to electronic methods – but by taking the time to meet face to face, it ensures both parties are fully focused to assess the relationship of dealer and supplier without distractions. That being said, a healthy balance of the two ensures there is a suitable record of previous conversations and activity, allowing both parties to follow a line of a job and detail any areas of improvement.”
Appointing suppliers is a straightforward process for Brown: “Whatever product you are purchasing, you have to look at the price, profit potential and customer benefits. We see every relationship with a supplier as a partnership. That means laying your cards on the table while recognising that everyone involved needs to make a little bit.”