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Jan. 19, 2009 – Recommendations for a new dealer principal

January 26, 2009
Filed under Archives

Dealership Details
This is a multiline dealership located in a city of 50,000 with a drawing area of around 400,000. It has an excellent, freeway frontage, high-traffic location. They had been a part of a group of dealers owned by a large corporation and had a poor reputation for customer service. In March, they were purchased by the current owner, who previously owned several unrelated businesses. The new owner has been remodeling and upgrading the facility and signage.
In this first part of a series on this dealership, GSA consultants report on their analysis of the overall dealership.
Background
The new owner has an enthusiast background, but has not ridden for several years. He spent considerable time researching dealerships before purchasing this one. His enthusiasm for the business pushes him to become directly involved in various department activities. Unless he filters his management through his general manager, this will have a negative effect on the department managers and staff. However, he is succeeding in overcoming the dealership’s reputation for terrible customer service. He has a desire to do it right, and has an experienced general manager and experienced department managers. The potential for growth is very high.
They have an organization chart. It was suggested all staff contact with the owner (up or down) needs to go through the general manager.
Most of the job descriptions have been completed. We discussed incorporating non-negotiable practices lists. The general manager will work on these with the department managers and review them with the consultant prior to implementation.
They are not holding regular manager meetings. It was recommended they begin weekly manager meetings with all managers reporting on their departments. Managers also can present issues, as long as solutions are also offered. Issues without solutions need to be presented to the general manager one-on-one for discussion. This will help prevent the manager meetings from becoming “bitch” sessions.
They have not established departmental budgets. It was recommended they prepare for this. It should be included in the next level of dealer development.
There were some secure business practices that were not being followed in the office. The same person was handling deposits, balancing the checkbook and doing both AR and AP. Although this person may be trustworthy, this is simply not a good idea.
Action Items

  • The same person should not balance the checkbook and handle deposits. Cash deposits need to be counted by two people.
  • The same person should not be handling Accounts Receivable and Accounts Payable.
  • Consider having an outside accounting firm review monthly General Journal entries and conduct periodic audits.
  • The owner and general manager need to become familiar with state definitions of ATV, MC, UTV and the laws affecting these products and vehicle dealers.
  • Implement one-hour weekly manager meetings. Each manager should report on the performance of their department. Issues and solutions should be discussed. Upper management uses these meetings to transfer policies and information to the departments.
  • Provide Lightspeed and Excel training for all managers who are not proficient ASAP.
  • Create a telephone answering script for all staff to utilize. It should include your store’s name, their department and the person’s name.
  • Put all processes and procedures in writing as they are developed and implemented.
  • Secure local flooring options for whole goods.
  • Consider remodeling the parts counter to include glass or plastic fronts with shelf displays of impulse items.
  • Consider adding a receptionist/greeter who also can do phone follow-ups for sales and service.
  • Remodel the service department to bring its appearance up to the level of the rest of the store.
  • Make accessories displays visible to the customer lounge area.
  • Begin working toward departmental budgeting. Utilize historical data and projections to prepare overviews. Work with department managers to refine the budget projections.

    Gart Sutton has been a leading provider of on-site dealer consulting, dealer 20-groups, online financial composites, accounting rescue services, and OEM and dealership training solutions for nearly 30 years. For additional information on these services, visit www.gartsutton.com.

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