As much as we appreciate that the majority of senior professionals based at European manufacturers, working in European markets, will not give the UK new car market much thought on a daily basis, with used car markets in Europe now evolving at a pace, we think there is much to be learnt from the market in the UK, in terms of how we feel the dynamic of European markets will change, if used car markets continue to evolve and therefore then mimic the market in the UK.
And more, there are some warnings for European manufacturers to be taken from the UK market; those of not preparing for this evolution in the market and therefore ensuring the survival of their current trading model.
Why do I say this? Well with the new car registration figures for the UK now out for September, the overall decline in the new car market this year in the UK can no longer be under question; for sure and as ever there are winners and losers, (and some even bigger losers), within the market, but as a whole new car registrations in the UK were down by 20% when compared to September 2017 and year to date new car registrations are down by 7.5%.
Now this article is not being written to tear into the minutia of the figures nor is it meant to be doom and gloom; I have been working in the automotive sector for over 25 years and there have always been peaks and troughs in new car registrations, (as I’m sure there are in European markets), and guess what, we will have them again in the future! However unlike previous down turns, today manufacturers and their franchised dealer networks in the UK face an array of different challenges, in terms of the evolution of the market, and for some in the UK their current model may be under threat.
By that I mean the traditional model that manufacturers employ in all markets, that of being supported in their aims by a network of heavily invested franchise partners in order to retail, service and support their new car product, and in truth, I wonder how sustainable this model will be for some manufacturers operating in the UK? Now this concern has nothing to do with the quality of the product they may be producing but everything to do with the challenges that the evolving trading landscape in the UK will bring to their franchise dealer networks and how some of the investors required may then question the model and whether to invest in their franchise at all?
Now this is a big statement but one I think some manufacturers in the UK will need to begin to address, as well as those manufacturers in European markets. Reading the new car registration figures supplied by the SMMT I think the UK market is becoming split between the “Haves” and the “Have Nots” in terms of their ability to survive the challenges coming to the market. Some of these are fiscal but the majority of these challenges come from the combination of the fiscal challenges and surviving in the evolving new car market in the UK, a subject that has also been covered for European Manufacturers in many of our articles, (some of which are below), as the aggressive models changing the trading landscape in the UK begin to target European markets;
Internet New Car Sales 2, Judgement Day!
“Wow An Internet Company Got Me Over 10,000:00 Euros Off My New Car!”
Now, if we accept that European used car markets are evolving and that this in turn will affect the new car market, (which it will), then how much at threat you are will then, (over time), depend on the strength of your total franchise package and the ability to continually attract investment in your franchise partner programme. Now in the UK there’s no doubt that for many manufacturers, this will not be a problem; many manufacturers have an established brand, consumer desire on their side and will have built a financially resilient franchise dealer network, strong enough to ride the peaks and troughs of the new car market and in supporting the their product after the sale; servicing, warranty etc.
But, and even in the UK, for many I fear there could be some problems as the trading model continues to be evolved by the aggressive independent technology based businesses targeting the sector, both for the sale of new cars and the servicing of their vehicle park.
So, as we have done for our UK based manufacturer audience, I thought it worthwhile looking at the likely considerations that investors in your franchise are going to look at in the future, (in terms of their decision to invest and to take your franchise model on board), should European used car markets continue to evolve into markets akin to the used car market operating in the UK.
In our opinion this could well be the challenge for some European manufacturers moving forward; the building of the franchise dealer network required in order to ensure your long term success.
In other words the perennial problem for all franchisors for years, that of attracting investment from the right investors, something that has always been of paramount importance to the success of your business model, but which might be about to get a lot harder for some manufacturers. Those manufacturers that may lose some franchise partners over the next 12 to 24 months and will therefore need to plug new gaps in their network before they can then go on to expand.
In our opinion, (for many manufacturers), potential investors in the UK will now begin to look more forensically at a plethora of new concerns when looking at which franchises to invest in and it will take a lot more than an exciting range of new car product to tempt people and institutions into investing. With new car margins in the UK under threat from the curse of the internet new car supplier and more competition for servicing revenue once warranty periods have expired, the financial model for the franchisee is becoming a lot more challenging. But as the manufacturer you need a franchised dealer network to survive, after all who is going to service your cars, support your warranty programme and sell your product, if you are unable to attract the right quality of investor into your franchise model.
Now if it were me and I was investing in a franchise, as much as this post is not designed to go into this in great detail, at the very least the issues below would be going through my mind;
-
The strength of the new car model range both now and in the medium term.
- The length and depth of the warranty cover.
- How susceptible is the new car retailing model to the aggressive internet based new car supply companies and how will this affect my margin retention.
- What is the manufacturer doing to protect residual values?
- What is the strength of the manufacturer’s customer finance programme?
- What guaranteed servicing model do I need to support?
- How is the manufacturer supporting approved used car networks?
By the nature of what we do, we speak to a lot of motor trade professionals now questioning the financial success of the current model and for many manufacturers in the UK, “Rome Is Burning” because some networks are questioning the current franchise business model and what manufacturers are doing to ensure their on-going success? And one area that is becoming critical is the area of approved used car programmes and what manufacturers are doing to support growth in the used car market.
I
nvesting franchise partners in the UK understand the weaknesses of the current model, they appreciate that new car model ranges, along with the new car market, go in cycles and to reassure you all, most accept that the trading model is evolving because the purchasing behaviour of consumers is evolving. They also accept that the servicing model is under threat, consumers expect more when it comes to warranty cover and the servicing market is becoming a lot more competitive. Consumers in the UK have the luxury of an app on their smart phone for both the cheapest price for supplying their new car and then the cheapest price for the servicing it; technology has targeted our trading model and it, (as well as margins), will probably never be the same again!
But their salvation in the UK, and therefore the salvation for the manufacturers, lies in the used car market; it is both the hardest market for the third party independent businesses to target and unlimited, in terms of potential and therefore the profits that can be made. So my recommendation to European manufacturers, those not currently running successful approved used car programmes, would be to not make the mistakes of some of your UK based counterparts and under invest in the programmes required to ensure that you can build successful used car networks, because in the near future these will be paramount, in terms of the franchise partners you attract and therefore the future success of your business model.
But of course there is a problem; unfortunately building successful approved used car programmes and franchise dealer networks that are successful at retailing used cars, is not a 5 minute job, and then there is the issue of the professionals with the skills required, to deliver your used car success, both at manufacturer and franchised dealer level, as explored in the recent articles below;
Do Successful Used Car Professionals Exist For European Manufacturers?
Successful Used Car Professionals Exist For Franchised Dealers?
Now we appreciate that finding genuinely successful used car professionals is very difficult for both manufacturers and their franchised dealer networks but luckily help is at hand. If this post has resonated with you and you would like to know more about our used car business development consultancy programmes, because you would like to partner with an organisation of professionals who have faced the challenges of fast paced evolutionary markets and know how to develop a successful and profitable used car dealer network programme on your behalf, (in order to keep your new car and total business objectives growing and on track), then we would very much like to hear from you.
The owners of Autoformance have owned and run successful used car operations and been at the forefront of the development of approved used car programmes for a host of manufacturers both in the UK and in Continental Europe. For an exploratory conversation regarding our services and how we can develop bespoke used car business development and consultancy programmes on your behalf, please do not hesitate to contact one of our Used Car Business Development Directors; Andrew Banning at ajb@autoformance.com or Malcolm Thomas at mgt@autoformance.com
Alternatively please feel free to call me on 0044 7796 260261.
For more information about our services please visit our website at www.autoformance.com
Andrew Banning.
Used Car Business Development Director.
Well with the new car registration figures now out for September, the overall decline in the new car market this year in the UK can no longer be under question; for sure and as ever there are winners and losers, (and some even bigger losers), within the market, but as a whole new car registrations were down by 20% when compared to September 2017 and year to date new car registrations are down by 7.5%.
Now this article is not being written to tear into the minutia of the figures nor is it meant to be doom and gloom; I have been working in the sector for over 25 years and there have always been peaks and troughs in new car registrations and guess what, we will have them again in the future! However unlike previous down turns, today manufacturers and their franchised dealer networks face an array of different challenges, in terms of the evolution of the market, and for some their current model may be under threat.
By that I mean the traditional model that manufacturers employ, that of being supported in their aims by a network of heavily invested franchise partners in order to retail, service and support their new car product, and in truth, I wonder how sustainable this model will be for some? Now this concern has nothing to do with the quality of the product you may be producing but everything to do with the challenges that the evolving trading landscape will bring to your franchise dealer network and how some may then question the model and whether to invest in your franchise at all?
Now that is a big statement but one I think some of you will need to address. Reading the information supplied by the SMMT I think the market is becoming split between the “Haves” and the “Have Nots” in terms of the ability to survive the challenges coming to the market. Some of these are fiscal but the majority of these challenges come from the combination of the fiscal challenges and surviving in the evolving new car market, a subject that has been covered in many of our articles, some of which are below.
Internet New Car Sales 2, Judgement Day!
“Wow An Internet Company Got Me Over £5,000:00 Off My New Car!”
Now how much at threat you are does depend on the strength of your total franchise package and the ability to continually attract investment in your franchise partner programme. Now there’s no doubt that for many of you reading this article this will not be a problem; you have an established brand, consumer desire on your side and will have built a financially resilient franchise dealer network, strong enough to ride the peaks and troughs of the new car market and in supporting the your product after the sale; servicing, warranty etc. But for many I fear there could be some problems as the trading model continues to be evolved by the aggressive independent technology based businesses targeting the sector, both for the sale of new cars and the servicing of your vehicle park.
So I thought it worthwhile looking at the likely considerations that investors in your franchise are going to look at, in terms of their decision to invest and to take your franchise model on board. In my opinion this could well be the challenge for some manufacturers moving forward; the building of the franchise dealer network required in order to ensure your long term success. In other words the perennial problem for all franchisors for years, that of attracting investment from the right investors, something that has always been of paramount importance to the success of your business model, but which might be about to get a lot harder for some manufacturers. Those manufacturers that may lose some franchise partners over the next 12 to 24 months and will therefore need to plug new gaps in their network before they can then go on to expand.
In our opinion, (for many manufacturers), investors will now begin to look more forensically at a plethora of new concerns when looking at which franchises to invest in and it will take a lot more than an exciting range of new car product to tempt people and institutions into investing. With new car margins under threat from the curse of the internet new car supplier and more competition for servicing revenue once warranty periods have expired, the financial model for the franchisee is becoming a lot more challenging. But as the manufacturer you need a franchised dealer network to survive, after all who is going to service your cars, support your warranty programme and sell your product, if you are unable to attract the right quality of investor into your franchise model.
Now if it were me and I was investing in a franchise, as much as this post is not designed to go into this in great detail, at the very least the issues below would be going through my mind;
-
The strength of the new car model range both now and in the medium term.
- The length and depth of the warranty cover.
- How susceptible is the new car retailing model to the aggressive internet based new car supply companies and how will this affect my margin retention.
- What is the manufacturer doing to protect residual values?
- What is the strength of the manufacturer’s customer finance programme
- What guaranteed servicing model do I need to support?
- How is the manufacturer supporting approved used car networks?
By the nature of what we do, we speak to a lot of motor trade professionals now questioning the financial success of the current model and for many of you, “Rome Is Burning” because some networks are questioning the model and what manufacturers are doing to ensure their on-going success? And one area that is becoming critical is the area of approved used car programmes and what manufacturers are doing to support growth in the used car market.
Investing franchise partners understand the weaknesses of the current model, they appreciate that new car model ranges, along with the new car market, go in cycles and to reassure you all, most accept that the trading model is evolving because the purchasing behaviour of consumers is evolving. They also accept that the servicing model is under threat, consumers expect more when it comes to warranty cover and the servicing market is becoming a lot more competitive. Consumers have the luxury of an app on their smart phone for both the cheapest price for supplying their new car and then the cheapest price for the servicing it; technology has targeted our trading model and it, (as well as margins), will probably never be the same again!
But their salvation, and therefore yours, lies in the used car market; it is both the hardest market for the third party independent businesses to target and unlimited, in terms of potential and therefore the profits that can be made, so my recommendation to some manufacturers, those not currently running successful approved used car programmes, would be that these will be paramount, in terms of the franchise partners you attract and therefore the future success of your business model.
But of course there is a problem; if ever your franchise dealer network needed the ability to support their business via the benefit of a growing and successful used car business, it has been this year, and it will be in the years to come as well. Now unfortunately building successful approved used car programmes and franchise dealer networks that are successful at retailing used cars is not a 5 minute job, and then there is the issue of the professionals with the skills required, to deliver your used car success, both at manufacturer and franchised dealer level, as explored in the recent articles below;
Do Successful Used Car Professionals Exist For Manufacturers?
Do Successful Used Car Professionals Exist For Franchised Dealers?
Now we appreciate that finding genuinely successful used car professionals is very difficult for both manufacturers and their franchised dealer networks but luckily help is at hand. If this post has resonated with you and you would like to know more about our used car business development consultancy programmes, because you would like to partner with an organisation of professionals who have faced the challenges of fast paced evolutionary markets and know how to develop a successful and profitable used car dealer network programme on your behalf, (in order to keep your new car and total business objectives growing and on track), then we would very much like to hear from you.
The owners of Autoformance have owned and run successful used car operations and been at the forefront of the development of approved used car programmes for a host of manufacturers. For an exploratory conversation regarding our services and how we can develop bespoke used car business development and consultancy programmes on your behalf, please do not hesitate to contact one of our Used Car Business Development Directors; Andrew Banning at ajb@autoformance.com or Malcolm Thomas at mgt@autoformance.com
Alternatively please feel free to call me on 07796 260261.
For more information about our services please visit our website at www.autoformance.com
Andrew Banning.
Used Car Business Development Director.
Well with the new car registration figures now out for September, the overall decline in the new car market this year in the UK can no longer be under question; for sure and as ever there are winners and losers, (and some even bigger losers), within the market, but as a whole new car registrations were down by 20% when compared to September 2017 and year to date new car registrations are down by 7.5%.
Now this article is not being written to tear into the minutia of the figures nor is it meant to be doom and gloom; I have been working in the sector for over 25 years and there have always been peaks and troughs in new car registrations and guess what, we will have them again in the future! However unlike previous down turns, today manufacturers and their franchised dealer networks face an array of different challenges, in terms of the evolution of the market, and for some their current trading model may be under threat.
By that I mean the traditional model that manufacturers employ, that of being supported in their aims by a network of heavily invested franchise partners in order to retail, service and support their new car product, and in truth, I wonder how sustainable this model will be for some? Now this concern has nothing to do with the quality of the product you may be retailing but everything to do with the challenges that the evolving trading landscape will bring to your franchise dealership and how some may then question the model and whether to invest in the franchise model again?
Now that is a big statement but one I think some manufacturers will need to address and some investors in franchise dealer models will need to think about. Reading the information supplied by the SMMT I think the market is becoming split between the “Haves” and the “Have Nots” in terms of the ability to survive the challenges coming to the market. Some of these are fiscal but the majority of these challenges come from the combination of the fiscal challenges and surviving in the evolving new car market, a subject that has been covered in many of our articles, some of which are below.
Internet New Car Sales 2, Judgement Day!
“Wow An Internet Company Got Me Over £5,000:00 Off My New Car!”
Now how much at threat you are does depend on the strength of the total franchise model you are operating and the ability of the associated manufacturer to continually invest in the franchise model and the franchise partner programme.
Now there’s no doubt that for many of you reading this article this will not be a problem; you have invested in an established brand, have consumer desire on your side and will have built a financially resilient business, strong enough to ride the peaks and troughs of the new car market and in supporting the product after the sale; servicing, warranty etc. But for many I fear there could be some problems as the traditional trading model continues to be evolved by the aggressive independent technology based businesses targeting the sector, both for the sale of new cars and the servicing of your vehicle park.
So I thought it worthwhile looking at the likely considerations that investors in the franchise model should now be looking at, in terms of their decision to invest and to take a franchise model on board; and in my opinion this could well be the challenge for some manufacturers moving forward, the building of the franchise dealer network required in order to ensure their long term success. In other words the perennial problem for all franchisors for years, that of attracting investment from the right investors, something that has always been of paramount importance to the success of their and your, (as the investor), business model, but which might be about to get a lot harder for some manufacturers. Those manufacturers showing some of the largest declines in new car registrations this year, those that therefore may lose some franchise partners over the next 12 to 24 months and will therefore need to plug new gaps in their network before they can then go on to expand.
In our opinion investors should now begin to look more forensically at a plethora of new concerns when looking at which franchises to invest in and it will take a lot more than an exciting range of new car product to tempt people and institutions into investing. With new car margins under threat from the curse of the internet new car supplier and more competition for servicing revenue once warranty periods have expired, the financial model for the franchisee/investor is becoming a lot more challenging.
But as the manufacturer you need a franchised dealer network to survive, after all who is going to service your cars, support your warranty programme and sell your product, if you are unable to attract the right quality of investor into your franchise model.
Now if it were me and I was investing in a franchise in the near future, as much as this post is not designed to go into this in great detail, at the very least the issues below would be at the forefront of my mind;
- The strength of the new car model range both now and in the medium term.
- The length and depth of the warranty cover.
- How susceptible is the new car retailing model to the aggressive internet based new car supply companies and how will this affect my margin retention.
- What is the manufacturer doing to protect residual values?
- What is the strength of the manufacturer’s customer finance programme
- What guaranteed servicing model do I need to support?
- How is the manufacturer supporting approved used car networks?
By the nature of what we do, we speak to a lot of motor trade professionals now questioning the financial success of the current franchise model being run by some manufacturers and for many manufacturers’ business models, “Rome Is Burning” because some investors are now questioning the model and what manufacturers are doing to ensure their on-going success? And one area that is becoming critical is the area of approved used car programmes and what manufacturers are doing to support the growth of their heavily invested franchise partners in the used car market.
By and large, investing franchise partners understand the weaknesses of the current model, they appreciate that new car model ranges, along with the new car market, go in cycles and most accept that the trading model is evolving because the purchasing behaviour of consumers is evolving. They also accept that the servicing model is under threat, consumers expect more when it comes to warranty cover and the servicing market is becoming a lot more competitive. Consumers have the luxury of an app on their smart phone for both the cheapest price for supplying their new car and then the cheapest price for the servicing it; technology has targeted our trading model and it, (as well as margins), will probably never be the same again!
But your salvation lies in the used car market; it is both the hardest market for the third party independent businesses to target and unlimited, in terms of potential and therefore the profits that can be made, so my recommendation to some manufacturers, those not currently running successful approved used car programmes, would be that these will be paramount, in terms of the franchise partners you attract and therefore the future success of your business model.
But of course there is a problem; if ever franchise dealer networks needed the ability to support their businesses via the benefit of a growing and successful used car operation, it has been this year, and it will be in the years to come as well. Now unfortunately building successful approved used car programmes and franchise dealer networks that are successful at retailing used cars, and therefore financially resilient in the current trading conditions, is not a 5 minute job. Then there is the issue of the professionals with the skills required to deliver your used car success, a subject that was explored in the recent article below;
Do Successful Used Car Professionals Exist For Franchised Dealers?
So as a potential investor in the franchise dealer model there is a potential problem and therefore a very important consideration; what is the strength of the manufacturer’s used car business offering? And this will lead to many other questions and considerations, in terms of the support and initiatives required in order to support your success, key to which will be the professionals required in order to secure your success in the used car market.
Now we appreciate that finding and/or training and developing genuinely successful used car professionals is very difficult for both manufacturers and their franchised dealer networks, and the fact that building strong, resilient and successful used car operations does not happen by accident, but luckily help is at hand. If this post has resonated with you and you would like to know more about our used car business development consultancy programmes, because you would like to partner with an organisation of professionals who have faced the challenges of fast paced evolutionary markets and know how to develop a successful and profitable used car operation on your behalf, (in order to keep your new car and total business objectives growing and on track), then we would very much like to hear from you.
The owners of Autoformance have owned and run successful used car operations and been at the forefront of the development of approved used car programmes for a host of manufacturers. For an exploratory conversation regarding our services and how we can develop bespoke used car business development and consultancy programmes on your behalf, please do not hesitate to contact one of our Used Car Business Development Directors; Andrew Banning at ajb@autoformance.com or Malcolm Thomas at mgt@autoformance.com
Alternatively please feel free to call me on 07796 260261.
For more information about our services please visit our website at www.autoformance.com
Andrew Banning.
Used Car Business Development Director.
As we approach the time of year when our thoughts begin to wander towards the objectives for 2019 and budgeting for growth, I thought it prudent to revisit Einstein’s famous quote on the definition of insanity; “Doing The Same Thing Over And Over Again And Expecting Different Results!"
Unashamedly I quote Einstein regularly on this as I feel it can bring some clarity to the whole process of planning for growth year on year, and in terms of the focus that that planning process requires. I work on the premise, (quite rightly), that if you continue to do the same things in your business, you will continue to achieve the same results, thus the fact that expecting the outcome to be any different, is madness.
I’m sure that every manufacturer, just like every dealer network and franchised dealership, will have a different set of objectives, (and therefore a different focus), but the one thing that remains constant between us all, is the importance of understanding what is happening in the used car market and how that is going effect your new car objectives; and as used car markets continue to evolve across Europe this understanding is going to become critical to the on-going success of European manufacturers.
Moving forward what is happening to your product in the used car market place is going to directly affect your new car aspirations, because what happens here will do more to effect the future residual values of your product range than any manipulation of future residual values attempted within your organisation, or indeed your in-house finance company, and as such, it will directly influence the cost of ownership of your new car product in the future.
So although it may not be the first priority for the manufacturer planning their immediate growth in their new car sales volumes and profits, if you want to succeed on a continual basis, the performance of your franchised dealer network, (in terms of their used car remarketing and sales performance), is going to be of paramount importance in dictating the future cost of ownership for your new car product in the future, and therefore your new car performance as a whole.
The importance of supporting the marque and controlling, (as much as is possible for any market), the used vehicle park as it returns from its first period of ownership, really is the future shared objective between European manufacturers and their franchised partners, the importance of which, must not be overlooked. Therefore if I was responsible and/or involved at a senior level with the new car sales strategy within a European manufacturer, my thoughts would be turning to what is happening within my dealer network at this time of year, how my franchise partners will be supporting our shared on-going new car objectives, (by planning for, building and securing their success in the used car market), and what we, as the manufacturer, are doing to support this?
The importance of your franchise partners now planning, (both financially and operationally), for the growth of their used car operations must never be underestimated. If the success of your new car business and your total business as a whole, is dependent on enjoying a growing and successful network of used car operations, (and I promise you it is), it is important that time is now taken by your franchise partners to think about their used car growth objectives for next year, (and thereafter), and what will be required, in terms of financial and operational investment, in order to ensure that their objectives for growth in the used car market are going to be achieved.
However aligned to this process and just as important, is what you as the manufacturer will be doing to support these initiatives? The Senior Management at Autoformance know the used car market and how fickle and cruel a mistress it can be; and it will take much planning, resilient approved used car programmes, adequate and cost effect manufacturer warranty programmes, as well as successful used car operations within your dealer network, if the foundations are to be in place, and your used car remarketing initiatives are going to support your new car aspirations.
Adding to the complexities for you as the manufacturer though, is the fact that all your franchise partners will be at different stages in their evolution as a used car retailer and the more successful their individual used car operations become, the more involved this planning process becomes. To compound matters for your franchise partners, the focus for growth and the investments required to deliver growth over and above their current level of performance, will change year on year dependent on where they are in their used car growth journey.
Unfortunately your franchise partners can’t take it for granted that any of the processes and operational procedures that got their used car operations to where they are today, will necessarily be the focus and operational procedures required for where you need them to be operating at tomorrow. For sure we mustn’t be in a rush to change what has got both you, as the manufacturer, and your dealer network to where you are today, (it has worked after all), but the operational structure and financial investment in used car operations that got your franchise dealer network to where they are today, are likely to be unrecognisable compared to the operational structure and financial investment required, in order to get the used car operations contained within your franchised dealer network, to where you need them to be!
So quite understandably this process of used car business development and growth can take much thought as well as a level of strategic knowledge and experience, and once your franchise partners have identified what is required, in order to meet their used car growth aspirations for next year and support their, (and your), new car aspirations, they are going to have to make sure that all the components required to achieve the objectives, are in place within their business before the year begins.
They may need more staff, they may be at the stage where they need to split their sales teams and amend their operational procedures within the business; they will certainly need more used car stock and more money and/or improvements in their current rate of stock turn, in order to be able to run with the stock levels required to achieve their growth objectives, and perhaps much more?
Unfortunately there is also the inconvenient truth that the professionals required, those with the skills and experience required to plan these strategies of used car development for both you as the manufacturer and your franchise partners, are unlikely to be employed within your organisation or within the businesses contained within your franchise dealer network; a fact that was covered in our recent articles; Do Successful Used Car Professionals Exist For European Manufacturers? And; Do Successful Used Car Professionals Exist For Franchised Dealers?
So at this critical moment for the sector in Europe, many manufacturers and their franchised dealer networks are finding that the professionals required to begin to plan and deliver success in the used car market are not available, and worse, you don’t know where to find them either.
Luckily help is at hand because this is where Autoformance can help, with our Strategic Budgeting Review Consultancy Day. Normally this bespoke consultancy module would be delivered as part of our Used Car Business Development Consultancy Programme, but it has proved to be so popular and requested year on year by our clients, that we have decided to offer this service as an individual days consultancy for new clients and the used car networks of manufacturers.
Delivered by one of the founding directors of our business, during the day on site we will review the key business areas of attention required in budgeting and planning, for the growth of used car operations, including;
- Stock Turn Review.
- Adherence to manufacturer core standards.
- Staffing structure including departmental and individual targeting.
- Used car stock acquisition.
- Current budgeting review.
- Cyclical demand.
- Stock levels and profiling.
This day on site will also encompass a presentation to the senior management team and a written report including our recommendations, aligned specifically to their growth aspirations for next year.
So if this post has resonated with you and you would like to know more about our Strategic Budgeting Review Consultancy Day, as well as the opportunity to work with an organisation of professionals who have faced the challenges of fast paced evolutionary used car markets, and know how to develop a successful and profitable used car dealer network programme on your behalf, (in order to keep your new car and total business objectives growing and on track), then we would very much like to hear from you.
The owners of Autoformance have owned and run successful used car operations and been at the forefront of the development of approved used car programmes for a host of manufacturers. If you would like to explore how our Strategic Budgeting Review Consultancy Day can be offered to your dealer network, you have any questions about this initiative, or you would like to have an exploratory conversation regarding our services and how we can develop bespoke used car business development and consultancy programmes on your behalf, then please do not hesitate to contact one of our Used Car Business Development Directors; Andrew Banning at ajb@autoformance.com or Malcolm Thomas at mgt@autoformance.com
Alternatively please feel free to call me on 0044 7796 260261.
For more information about our services please visit our website at www.autoformance.com
Andrew Banning.
Used Car Business Development Director.
As we approach the time of year when our thoughts begin to wander towards the objectives for 2019 and budgeting for growth, I thought it prudent to revisit Einstein’s famous quote on the definition of insanity; “Doing The Same Thing Over And Over Again And Expecting Different Results!"
Unashamedly I quote Einstein regularly on this as I feel it can bring some clarity to the whole process of planning for growth year on year, and in terms of the focus that this planning process requires. I work on the premise, (quite rightly), that if you continue to do the same things in your business, you will continue to achieve the same results, thus the fact that expecting the outcome to be any different, is madness.
I'm sure that every manufacturer, just like every dealer network and franchised dealership, will have a different set of objectives, (and therefore a different focus), but the one thing that remains constant between us all is the importance of understanding what is happening in the used car market and how that is going effect your new car objectives.
What is happening to your product in the used car market place is going to directly affect your new car aspirations, because what happens here will do more to effect the future residual values of your product range than any manipulation of future residual values attempted within your organisation, or indeed your in-house finance company, and as such, it will directly influence the cost of ownership of your new car product in the future.
So although it may not be the first priority for manufacturers still coming to terms with the reductions in new car registrations seen so far during 2018, (and therefore needing to redress large declines in year on year new registrations), but if you want your new car business to succeed on a continual basis, both your performance at manufacturer level, and the performance of your franchised dealer network, (in terms of your combined used car performance), is going to be of paramount importance in dictating the future cost of ownership for your new car product of the future, and therefore your new car performance as a whole.
The importance of supporting the marque and controlling, (as much as is possible for any market), the used vehicle park as it returns from its first period of ownership, really is a shared objective between the manufacturer and their franchised partners, the importance of which, is sometimes overlooked. Therefore if I was responsible and/or involved at a senior level with the new car sales strategy within a manufacturer, my thoughts would be turning to what is happening within my dealer network at this time of year, how my franchise partners will be supporting our shared on-going new car objectives, (by securing their success in the used car market), and what we, as the manufacturer, are doing to support this?
The importance of your franchise partners planning, (both financially and operationally), for the growth of their used car operations must never be underestimated; if the success of your new car business and your total business as a whole, is dependent on having a growing and successful network of used car operations, (and I promise you it is), it is important that time is taken by your franchise partners to think about their used car growth objectives for the next year and what will be required, in terms of financial and operational investment, in order to ensure that their objectives for growth are going to be achieved.
Adding to the complexities for you as the manufacturer is the fact that all your franchise partners will be at different stages in their evolution as a used car retailer and the more successful their individual used car operations become, the more involved this planning process becomes. To compound matters for your franchise partners, the focus for growth and the investments required to deliver growth over and above their current level of performance, will change year on year dependent on where they are in their used car growth journey.
Unfortunately your franchise partners can’t take it for granted that the processes and operational procedures that got their used car operations to where they are today, will necessarily be the focus and operational procedures required for where you need them to be operating at tomorrow. For sure we mustn’t be in a rush to change what has got both you, as the manufacturer, and your dealer network to where you are today, (it has worked after all), but the operational structure and financial investment in used car operations that got your franchise dealer network to where they are today, are likely to be unrecognisable compared to the operational structure and financial investment required, in order to get the used car operations contained within your franchised dealer network, to where you need them to be!
So quite understandably this process of used car business development and growth can take much thought as well as a level of strategic knowledge and experience, and once your franchise partners have identified what is required, in order to meet their used car growth aspirations for next year and support their, (and your), new car aspirations, they are going to have to make sure that all the components required to achieve the objectives, are in place within their business before the year begins.
They may need more staff, they may be at the stage where they need to split their teams and amend their operational procedures within the business; they will certainly need more used car stock and more money and/or improvements in their current rate of stock turn, in order to be able to run with the stock levels required to achieve their growth objectives, and perhaps much more?
Unfortunately there is also the inconvenient truth that the professionals required, those with the skills and experience required to plan these strategies of used car development for both you as the manufacturer and your franchise partners, are unlikely to be employed within your organisation or within the businesses contained within your franchise dealer network; a fact that was covered in our recent articles; Do Successful Used Car Professionals Exist For Manufacturers? And; Do Successful Used Car Professionals Exist For Franchised Dealers?
So at this critical moment for the sector, many manufacturers and their franchised dealer networks are finding that the professionals required to begin to plan and deliver success in the used car market are not available, and worse, you don’t know where to find them either.
Luckily help is at hand because this is where Autoformance can help, with our Strategic Budgeting Review Consultancy Day. Normally this bespoke consultancy module would be delivered as part of our Used Car Business Development Consultancy Programme, but it has proved to be so popular and requested year on year by our clients, that we have decided to offer this service as an individual days consultancy for new clients and the used car networks of manufacturers.
Delivered by one of the founding directors of our business, during the day on site we will review the key business areas of attention required in budgeting and planning, for the growth of used car operations, including;
-
Stock Turn Review.
- Adherence to manufacturer core standards.
- Staffing structure including departmental and individual targeting.
- Used car stock acquisition.
- Current budgeting review.
- Cyclical demand.
- Stock levels and profiling.
This day on site will also encompass a presentation to the senior management team and a written report including our recommendations, aligned specifically to their growth aspirations for next year.
So if this post has resonated with you and you would like to know more about our Strategic Budgeting Review Consultancy Day, as well as the opportunity to work with an organisation of professionals who have faced the challenges of fast paced evolutionary used car markets, and know how to develop a successful and profitable used car dealer network programme on your behalf, (in order to keep your new car and total business objectives growing and on track), then we would very much like to hear from you.
The owners of Autoformance have owned and run successful used car operations and been at the forefront of the development of approved used car programmes for a host of manufacturers. If you would like to explore how our Strategic Budgeting Review Consultancy Day can be offered to your dealer network, you have any questions about this initiative, or you would like to have an exploratory conversation regarding our services and how we can develop bespoke used car business development and consultancy programmes on your behalf, then please do not hesitate to contact one of our Used Car Business Development Directors; Andrew Banning at ajb@autoformance.com or Malcolm Thomas at mgt@autoformance.com
Alternatively please feel free to call us on 07796 260261, Andrew Banning, or 07834 600642, Malcolm Thomas.
For more information about our services please visit our website at www.autoformance.com
Andrew Banning.
Used Car Business Development Director.
As we approach the time of year when our thoughts begin to wander towards the objectives for 2018 and budgeting for growth, I thought it prudent to revisit Einstein’s famous quote on the definition of insanity; “Doing The Same Thing Over And Over Again And Expecting Different Results!"
Unashamedly I quote Einstein regularly on this as I feel it can bring some clarity to the whole process of planning for growth year on year, and in terms of the focus that this planning process requires. I work on the premise, (quite rightly), that if you continue to do the same things in your business, you will continue to achieve the same results, thus the fact that expecting the outcome to be any different, or expecting to just deliver year on year growth to your used car operation, is madness.
The importance of planning, (both financially and operationally), for the growth of your used car operation must never be underestimated; if the success of your new car business and your total business as whole, is dependent on having a growing and successful used car operation, (and I promise you it is), it is important that time is taken to think about the used car growth objectives for the next year and what will be required, in terms of financial and operational investment, in order to ensure that the objectives for growth are going to be achieved.
And the more successful your used car operation becomes the more involved this process becomes and to compound matters, the focus for growth and the investments required to deliver growth over and above your current level of performance, changes year on year dependent on where you are in your growth journey.
So we can’t even take it for granted that the process that got you to where you are today, will necessarily be the focus for where you want to go tomorrow; for sure we mustn’t be in a rush to change what has got you to where you are today, (it has worked after all), but the operational structure and financial investment that got you to here, may be unrecognisable compared to the operational structure and financial investment required, in order to get you to where you want to go!
So quite understandably this process can take much thought as well as a level of strategic knowledge and experience, and once you have identified what is required for the growth aspirations for next year, you have to make sure that all the components required to achieve the objectives, are in place within the business before the year begins. You may need more staff, you may be at the stage where you need to split your teams and amend your operational procedures within the business; you will certainly need more used car stock and more money/improvements in your current rate of stock turn, in order to be able to run with the stock levels required to achieve your growth objectives, and perhaps much more?
Unfortunately there is also the inconvenient truth that the used car professionals required, those with the skills and experience required to plan these strategies of used car development for your business, and then deliver on them are unlikely to be employed within your organisation; a fact that was covered in our recent article; Do Successful Used Car Professionals Exist For Franchised Dealers?
So at this critical moment for your business and the sector as a whole, many franchised dealer networks are finding that the professionals required to begin to plan and deliver success in the used car market are not available, and worse, you don’t know where to find them either.
This whole process can be bewildering but it is where Autoformance can help, with our Strategic Budgeting Review Consultancy Day. Normally this bespoke consultancy module would be delivered as part of our Used Car Business Development Consultancy Programme, but it has proved to be so popular and requested year on year by our clients, that we have decided to offer this service as an individual days consultancy for new clients.
Delivered by one of the founding directors of our business, during the day on site we will review the key business areas of attention required in budgeting and planning, for the growth of your used car operation, including;
-
Stock Turn Review.
- Staffing structure including departmental and individual targeting.
- Used car stock acquisition.
- Current budgeting review.
- Cyclical demand.
- Stock levels and profiling.
This day on site will also encompass a presentation to the senior management team and a written report including our recommendations, aligned specifically to your growth aspirations for next year.
So if this post has resonated with you and you would like to know more about our Strategic Budgeting Review Consultancy Day, as well as the opportunity to work with an organisation of professionals who have faced the challenges of fast paced evolutionary markets, and know how to develop a successful and profitable used car operation on your behalf, (in order to keep your new car and total business objectives growing and on track), then we would very much like to hear from you.
The owners of Autoformance have owned and run successful used car operations and been at the forefront of the development of approved used car programmes for a host of manufacturers. If you would like to book your Strategic Budgeting Review Consultancy Day, you have any questions about the day, or you would like to have an exploratory conversation regarding our services and how we can develop bespoke used car business development and consultancy programmes on your behalf, please do not hesitate to contact one of our Used Car Business Development Directors; Andrew Banning at ajb@autoformance.com or Malcolm Thomas at mgt@autoformance.com
Alternatively please feel free to call us on 07796 260261, Andrew Banning, or 07834 600642, Malcolm Thomas.
For more information about our services please visit our website at www.autoformance.com
Andrew Banning.
Used Car Business Development Director.
