Why Many Franchised Dealers Are Going To Fail In 2020!,,,,,

In terms of the long term survival of the traditional new car sales, parts and servicing business model, 2020 will be the year of being at the crossroads for many automotive manufacturers and their associated franchised dealer networks; so we thought the best way for our articles to prepare many for the used car business development challenges being faced by the sector this year, is to get everything out in to the open at the start. 

For many running franchised dealer networks reading this, ours will be an antagonistic approach but we are confident enough to offer no apology for any bruising of egos this article may provoke; after all we are not “Vanilla” in our approach so therefore we will not be a good fit for many of you reading this; that said we respect everyone’s right to run their business as they see fit, and within the limit of their own immediate ambitions. 

We know our target audience and the customers we would like to work with and this is liberating for us as a business, just as this enlightened approach should be for everyone reading this who runs their business, because the success of our customers is a shared success and therefore our marketing programme in its entirety. So moving forward, (and as much as we publish content and used business development advice for free), we accept that should our messaging not be losing a proportion of our audience, we will not be encouraging debate strong enough for us to convince our target audience that we are the organisation for them, in terms of our core objectives; “Helping Manufacturers and their Franchise Partners make more money selling used cars!” 

So bearing in mind that we struggle to expand, (we find it harder to find the used car professionals required for our expansion than you do for yours), we know our maximum level of capacity, therefore we are also totally aware of the point when we are “Fully Subscribed” as a business and will never look to risk the quality of our consultancy and training services in the pursuit of the ego that is turnover, thus why some find us politely declining to work on the wrong projects or with those where the right commitment is lacking. 

So where are we starting 2020, in terms of the used car business development content we give away for free in our articles and on Europe’s most read Used Car Business Development Blog? Well we thought it best to advise on the subjects we will be covering this year and, as much as we remain flexible, the lack of change and forward thinking in the sector will dictate that we will be unlikely to deviate from the topics below. 

So let’s start with some feedback and some impactful statements for you all to ponder on; statements that we will expand upon during the on-going publication of our content articles this year. Essentially below is a list of observations as to why many of you will continue to fail, when it comes to protecting your new car sales, parts and service model, as well as the financial stability of your franchised dealership and/or group. 

The statements below are our genuine feedback and based on our experience when meeting representatives from franchised dealer networks in the UK; in doing so we accept that this is a joint journey involving yourselves and the manufacturer you represent, and that there is a lack of commitment from the parent manufacturers perspective as well. Those wishing to see our observations for manufacturers, need only following the link to the article on our Used Car Business Development Blog. 

Those for whom these observations resonate, perhaps seeing themselves in the statements below, but who wish to change their direction of travel and look to expand their used car offering and therefore increase their levels of success, you can feel free to contact either of the founding Directors of Autoformance, Malcolm Thomas or myself, Andrew Banning, when we will gladly discuss the strategies required to meet your used car objectives and to explore whether we are going to be the “Right Fit” in terms of being your used car business development partners on this journey? 

• Too many of you don’t like to be challenged in your thinking; in fact many will not have read to this point. 

• Few realise that the secret to new car success is used car success; so whilst you are being kept awake at night worrying about the fracturing and evolving new car market, you ignore the biggest car market in the UK; the used car market. 

• Worse than this is the fact that this constant focus on a single market place opportunity, (the new car market), has led to a situation where you are actually growing the businesses of disruptors and competitors in the sector. It is a fact that some of the most successful businesses that are actually targeting yours, have been handed their business to them on a plate; by you! 

• Too few franchised dealer networks are set up for used car success, in terms of their personnel and operational structure. Those that accept that the used car business is a completely different business to the new car business aren’t ready to accept that you don’t know what you don’t know, and are still reticent to either invest in their used car education or to employ the professionals with the skills sets required to drive used car success. 

• No one is prepared to pay the used car professionals required what they are worth! We have a suspicion that for most this is because they cannot countenance paying someone more than themselves; this is backward thinking in the extreme and will lead to your demise. 

• None of the PLC’s owning vast swathes of UK based franchised dealer networks, or the associated parent manufacturers, have the programmes of used car business development and/or the personnel training programmes required. 

• Unfortunately for you, those manufacturers that do look to offer used car business development training, look to deliver this as cheaply as possible; to many all their used car development challenges can be solved in one day by someone, (invariably someone who has never grown a successful used car business themselves), standing in a room with their whiteboard. However, you accept this and do nothing to develop yourselves by investing in your own used car education. 

• Many make the mistake of thinking that the same technology and operational set up being leveraged to drive their new car business can then drive their used car business; failing to realise that this is not the case. 

• Too many view problems as hurdles not opportunities and will hide behind geo-political events, (Brexit), before making investment decisions for your business. For sure the negotiation process for our eventual trade deal with the European Union will involve uncertainty, but only for the new car market. The used car market is both fluid and adaptive and you can ALWAYS make money if you are a successful used car retailer; unfortunately the opportunity to take advantage of other peoples’ intransigence will pass you by. 

• Those with successful new car model ranges are sitting back thinking everything will be OK, and not planning for the day when existing model ranges won’t be the shiny new cars on the block! If you want to build the foundations required to secure the financial resilience of your franchise dealership; this can only be achieved from a platform of successful used car retailing. 

Just like any other business, but especially one that is capable of securing the future of your business, growing a successful used car business will take the right people, the right training on a continual basis and an awful lot of hard work. 

However it can be done; the owners of Autoformance have owned and run successful used car businesses and been at the forefront of the development of approved used car programmes for a host of manufacturers. Those looking to explore how we can help you and your franchise partners make more profit from selling used cars, need only contact Andrew Banning at ajb@autoformance.com or Malcolm Thomas at mgt@autoformance.com in the first instance, in order to arrange a no obligation exploratory discussion. 

We look forward to hearing from you. 

Andrew Banning. 
Used Car Business Development Director.