With so many changes hitting the automotive industry, it can seem as if the sky is falling. Between the battle of the internal combustion engine and its electric opponent, to the increase in ridesharing, the automotive industry seems to be taking hit after hit. Add in the trade war with China, and the outlook can seem a bit dismal.
Yet, even with these challenges we know that the economy is cyclical. There will be a light at the end of the tunnel, but how will your dealership maintain healthy operations in the meantime? Dave Cantin, CEO of Dave Cantin Group, believes that dealers can use this downturn to their advantage. “In the current economy, this is where we have the chance to turn challenges into opportunities,” he says. “This is prime time for creating habits that not only increase the health of your dealership, but will help maintain its viability for years to come.”
First Goals for your business is to plan ahead
Just as the New Year is when many people set personal health goals and resolutions, it is also the perfect time to put a plan in place to establish healthy habits for your dealership. Improving the health of your business is much like improving your own health, by incorporating tactics like planning, goal setting, and accountability.
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To make the process a little easier, the leadership at Dave Cantin Group has compiled 6 strategies to help set your dealership on the path to both health and success.
- Plan Ahead, But Be Ready to Adapt – Planning ahead for diet and lifestyle choices can determine whether or not you attain your goals, just like planning ahead can help dealership operations run more smoothly. Before the end of the year, take time to sit down and look at the calendar.
- What are your marketing strategies?
- And what inventory needs to move?
- What cost-reduction strategies can you implement?
With 60 % of the car buying process being done online, dealers need to be able to adapt. Social media is now a shopping source for 22% of car buyers. In addition, used-car sales are quickly shifting into the digital realm as new competitors (such as Vroom, Roadster, Carvana, and Shift) are simplifying the car buying system for customers.
- With more and more people spending their time shopping for vehicles online, what can you do to increase your online presence?
- Can you implement virtual appraisals to simplify the car buying experience?
Not only will planning ahead help you with short-term improvements, but it can also help long-term.
- Have you created your succession plan?
- Have you begun to implement the necessary tasks to keep your business viable in the future?
Planning ahead will give you the freedom and flexibility to adapt to changing market trends. Creating these plans ahead of time will both save you time throughout this year and future years, while keeping you on track to reach your goals.
- Set Clear Goals and Expectations – Goal setting is one of the best ways to both improve the health of your business and sustain momentum. Setting specific goals for your business leads to higher performance. Not only will setting clear goals act as a guide for driving your business forward, it will also help align your focus. First, establish your baseline. What is your starting point? Next, decide where you want to end up. While there are many different ways to map out your goals, one of the simplest formats is setting SMART goals. SMART stands for:
- Specific – Use Who, What, Where, Why, and How to determine definite goals for your business. By making them specific, you and your team are able to focus your efforts and maintain motivation.
- Measurable – Do you want to reach a profit goal? Move a certain number of vehicles? Make sure to set a number to help track your progress.
- Attainable – It’s ok to shoot for the stars, but don’t make your goal so big it’s impossible to attain. Your goals should stretch your capabilities and challenge you, yet still remain realistic.
- Relevant – Your goals should be meaningful and important to you, but they should remain relevant so that your team can get behind them and help drive your business forward.
- Time-Bound – For each goal, there needs to be a deadline. This step ensures that the tyranny of the urgent doesn’t take precedence of your long-term goals.
By setting goals according to these guidelines, you can keep yourself and your team focused and motivated.
- Invest in Your Team – Your employees are your most valuable asset. A healthy team means a healthy business, especially during challenging economic changes. When your team is dedicated to your organization’s success, productivity increases and people inspire each other to do better. In fact, engaged employees can increase sales by 20 percent.
- What are you doing to invest in your employees?
- Is there a program in place to recognize their achievements?
- Do you offer training and advancement opportunities?
Also, make sure to clearly explain the goals for your business and empower your team to take on leadership roles or individual tasks to help attain them. By giving responsibility to team members, they have the opportunity to invest themselves into your business and catch the vision you have for the future.
- Encourage a Culture of Accountability – People are twice as likely to stick to a goal if they know someone is counting on them. That’s why accountability is important to the health of your business. “The word ‘accountability’ can have a negative connotation, but in reality it’s a fantastic way to bring positivity to your business, “ states Brian Brown, COO of DCG Operations. “If you are going to take the time to create SMART goals and encourage your team to take part, then fostering a culture of accountability is a gift to both your business and your team.” When your team is assigned individual tasks to accomplish that contribute to the growth of your business, they are given the chance to shine. How do you nurture a culture of accountability?
- First, it is imperative that you honor your word. Do what you say you will. Accountability only works if it is taken seriously from the top down.
- Next, clearly communicate how each job contributes to the whole. When your team understands how important each assignment is, they can more readily take ownership of their individual part.
- Finally, allow for failure. Failure is inevitable in business. By positioning failure as a chance to learn and understand your team’s strengths, you are giving your team the freedom to fail forward and accept responsibility for the outcome.
- Focus on Adding Value – As China’s steel exports decline, “robust” western steel prices are expected to continue, which translates to higher wholesale costs and less margin for dealers. You might be thinking of cutting your marketing and value adds for customers, but DCG recommends the opposite strategy. Instead of concentrating on what you have to take away or lose to reach your goals, it’s more beneficial to put emphasis on what you can add. While price is an important driver in a car purchase, it isn’t the only one. Customers want to feel valued and treated fairly, confident in their purchase. Adding value is not only a way to gain the trust of customers, it sets you apart from other dealers. How can you add value for your customers?
- Be Generous– Did you know it’s been scientifically proven that giving back and being generous can improve your health? Generosity not only helps you personally, but helps establish your business as a positive impact on your community. Cantin supports this philosophy. “We at DCG pride ourselves on purposefully giving back. Cancer is a cause close to my heart, so we donate a percentage of all DCG revenues to a charity that fights pediatric cancer in the community of each acquired dealership.”
Implementing these 6 strategies can improve the health of your dealership, and the health of your business determines your success. And while the current economy may have its challenges, you have the unique opportunity to make changes to set your business up for a healthy start to this New Year and many more.
About Dave Cantin Group
Dave Cantin Group (DCG) is a full-service M&A firm that manages the sale and purchase of automotive dealerships throughout the United States. With over $11.5 billion in collective dealer acquisitions and $3 billion in dealership listings, DCG is one of the world’s largest automotive dealership M&A firms. Dave Cantin personally has helped raise more than $150 million in the fight against pediatric cancer, and DCG is committed to donating a percentage of its revenue to the cause. DCG is headquartered in New York with regional offices in California, Florida, Illinois, New York, and Texas. (www.DaveCantinGroup.com0