WHY A DEALERSHIP’S SUCCESS HINGES NOT ONLY ON HAVING THE RIGHT STAFF IN PLACE BUT ALSO THE STRATEGIES REQUIRED TO INVEST IN THEIR PROFESSIONAL AND PERSONAL GROWTH
Brian is a 40-year veteran in the dealership world and turned 60 years old a few weeks back. To the outside world and his colleagues Brian has always been on top of the world: a good dealer. Deep down however, Brian’s stomach is churning. He worries constantly about the store and is first to admit that it is easier to travel and play golf than face the issues head on.
Brian, by his own admission, lives the good life. There is not a square inch on this earth that Brian and his wife Betsy have not travelled to. Betsy was a full-time teacher but managed to accompany Brian on most OEM trips in the early days, when OEMs still did this sort of thing routinely. She retired 8 years ago and their lives have been a travelogue since then.
Changing times
Brian did not worry about the store much in years past. He showed up regularly when he was in town and always drove the latest demo. To his credit, it would take him at least an hour each morning to get to his office. He would stop and visit with each employee, listen to what was going on in their lives, and showed a genuine interest in their well-being. This extended to helping with their children’s university tuition, vacations, and cars.
In turn, these employees gave back tenfold to the company. The store was very profitable and Brian was very generous. It seemed like a terrific formula.
In recent years, with Brian not there as much, things have begun to slide a little. The dealership staff is aging — some critical employees are approaching 70 years old. Profits are half of what they used to be and customer retention has taken a nosedive.
Brian, to say the least, has relied on key people to run his dealership and is the first to admit the business is passing him by. He has not kept up his personal skills nor kept up with changing technologies. He still attends dealer functions but is more interested in the social aspects of these meetings than the business ones. His right-hand person — his general manager — has been as loyal as the day is long. Originally hired by his father, for years they were on the same page. In the last few years the general manager has become more secretive and grumpy.
Always a solid performer by OEM metrics, the dealership is now middle-of-the-pack and is trending the wrong way. Brian finds himself constantly worrying about the dealership these days. His eldest son, now working part-time in the business, is very critical of the way the company is being run and quite appalled by what he hears from employees and customers.
Brian wants to keep this dealership in the family, the same way his father did. Tradition is very important to him, as is loyalty and honesty. But the reality is that he has let his personal dealership skills go. He does not really like email, prefers face-to-face or over-the-phone communication, has no idea about Facebook and Twitter, nor how social media works or why it was even invented. Heck, he can’t even turn on the DMS system, nor has any idea how to cut himself a cheque.
His good friend and former fellow dealer Budd, who recently sold out to a large dealership group, harps at him to sell his store and continue to enjoy life. Brian however does not want to do that. The family legacy is very important to him and his sons are just starting to enter the working world. Brian believes that now is not the correct time to think about selling. In fact he has never thought about selling out.
Identifying problems
Brian has decided that he needs to jump back into the dealership in order to right the ship. His first step is to interview all employees and learn firsthand from the front line how the business is operating. He quickly learned that most employees have been feeling very stressed and not really enjoying their jobs. Many were thinking of retiring or leaving.
Brian began to walk around the dealership with a critical eye. The place was starting to look run down lending it an aura best described as “lack of pride.” New inventory was mixed in with used inventory in the showroom. Desks were messy. He could not find any brochures. The receptionist had her head down and was busy logging in vehicles and chasing service and body shop accounts receivables. She was no longer a greeter and had become a miserable part of the overhead. In the service department there was customer tension like never before.
Brian was stunned by what he had learned. Angry with himself more than anything, he knew he had to make some changes. At the same time Brain was electric with anticipation. “I can fix this place.” he said to himself.
He went home one evening and dug out some of the old family photos. It was very noticeable to Brian that most of the photos centred around the dealership. Many were from staff outings and activities.
Back on track
The next day Brian went back and started formulating a plan. He needed to prioritize.
In short, he held an employee meeting at the dealership to let the staff in on what he had learned. One week later, on a Sunday, he held a family barbeque at his home and invited all his employees and their immediate families. At the barbeque he handed out service awards to long-term employees and began the slow rebuilding process to increase morale and job satisfaction. He and Betsy had a really good time. They both realized there had been too many years of cost containment on the backs of employees.
Brian reinitiated weekly staff meetings and started a weekly newsletter to staff, keeping everyone current on happenings in and around the dealership.
One very important thing also happened. Brian sat down with his trusted general manager to work out a retirement plan for one year down the road. Brian was smart with money. Back in the early days, he had purchased a whole life insurance policy on the general manager. He had also funded the GM’s annual RRSP contribution. There was significant cash value to fund a retirement plan for the general manager. He also decided to start an advisory board and asked the general manager to be a member.
In the weeks that followed Brian worked with employees to develop job descriptions. He hired an HR company to develop a performance feedback system and a career plan for each individual. He began meeting with all customer-facing staff on a weekly basis to share with them his vision of customer service.
He also got to grips with the importance of technology. He ordered DMS retraining for all staff, including himself and hired a website/social media person to ramp-up that end of the business. Brian made one very important decision: to keep the dealership. That led to another important decision: less time away from the store. His father built the business by being fair and honest with employees and customers. In recent years, Brian had gotten away from his roots. Brian had relied too heavily on his general manager and as a result, the dealership had started to slide downhill.
Back in the saddle, Brian knows that he needs good people to be successful. The saying goes that success in retail is all about location, location, location. However Brian knows, that for his dealership, it’s also about people, people, people.
