Optimistic predictions and the same old mistakes

Whilst many car manufacturers are predicting growth this year, the franchised dealer network is nervous at the prospect of having registrations forced upon them in order to enable their car making masters to achieve these growth forecasts.

There has been much said in the trade press along the lines of it being hard in retail sales but there still being a potential in used and fleet operations to remain profitable, which kind of flies in the face of what the car makers are predicting.

With the car parc down to around 1.9m units last year predictions range from 1.80m to 1.85m for 2012 the lack of 3 year old cars in the market as a consequence have shrunk by around 500,000 units.

It stands to reason that car buyers who find their own pockets squeezed are likely to put value for money at the top of their buying criteria when searching for their next car. However car dealers can still do a lot to attract buyers in 2012.

For example with dealers social media presence up some 60% from 2010 it seems that they may finally be getting the message that interacting with their customers in this way might just give them a competitive edge. The crux however is that as much as any car retailer can do to generate leads it is what happens to those potential buyers when they are actually in the business that really matters.

We are still seeing and hearing too many instances in car showrooms where sales staff have a “hands off” attitude towards customers and do not seem to understand the need to demonstrate that this is a great place to buy your next car.

As dealers have looked to cut costs sales staff have inevitably felt the brunt of those savings in lost commissions and tighter margins, and with most execs in the motor trade on relatively low basic salaries the good ones often leave for pastures new or even leave the industry altogether, leaving less experienced and amateurish staff to try and take up the slack.

Unfortunately in order to get the best staff, as in any industry, you have to pay the money and the old adage you don’t get a champagne job for beer money is certainly relevant in the car industry. Nevertheless with the conundrum of cutting costs but not offering reduced services being a familiar topic in government as well as in car sales it is a situation which clearly needs resolving fast if we are not to see more disgruntled customers opting to spend the money on doing up their existing cars.

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