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Welcome to NCM's Up to Speed Blog

What Have You Learned From COVID-19?

Written By: Jerry Powers
Posted on May 21, 2020

In the past couple of months, the retail automotive world has been turned upside down. Suddenly, showrooms were closed, and walk-in traffic was nonexistent. The only business most of us experienced during the pandemic was through digital retailing or by appointment only. Service departments went from having appointments scheduled for weeks out, to appointments dropping off as much as 60% in some cases. It’s been a roller coaster of emotions, and many professionals in our industry are wondering, “What’s next?”

Through the entirety of the pandemic, we at NCM have maintained contact with our clients through regular video conference meetings. Personally, I’ve held a weekly meeting with each of my seven 20 Groups and have heard the challenges and successes from a diverse set of automotive groups. This past week I asked them a very important, yet fundamental question: “Through all of this, what have you learned?” I asked them this question for a couple of different reasons. First, it’s important to recognize your own successes during inevitable downtime. Second, we can learn a lot from the various failures we made, and learning not to replicate these failures can lead us to future successes. Finally, I wanted to get my 20 Group members thinking about the future, and how they can implement what they have learned going forward.

What Dealers Have Learned

While there are plenty of great ideas and situations not mentioned on this list, I wanted to make sure I share with you all some of the more universal themes being discussed between dealers nationwide. Here is a synopsis of their responses:

  1. E-commerce: If you were behind in this area of the business, then you, like many looking to emerge from this pandemic, will be forced to adapt quickly to the change. If you chose to not invest in an e-commerce solution, you were essentially closed off to your customers.

  2. Dealership Efficiency: Many dealers are reporting an increase in total dealership efficiency, much of which is due to necessity.  

  3. Staff Productivity: With the loss of staff, it has created an urgent need to do more with the remaining team you have. Many dealers have shared stories of their managers digging in and going back to work in numerous positions around the store.

  4. Employee Commitment: Dealers have found out which employees were really invested in the dealership and which ones were not. The staff who stepped up to do whatever it took to make things happen are set to shine, and those who wanted to sit this one out have made lasting impressions. This, of course, makes it easier to see who will be returning to work as hiring picks up.

  5. Character: I am proud to report that many dealers spoke to how astounded they have been by the character and loyalty of their core staff. They also reported that this new core has come together to become an authentically talented and collaborative team.

  6. Employee Value: Many people have been working in retail automotive and have slid by without pulling their weight. This situation has highlighted those employees who had lost their value and demonstrated their true work ethic.

  7. New Processes: With the need to keep social distancing measures came new processes throughout our stores. One great example of this was shared by a dealer who changed the relationship between parts and technicians. They had to deliver parts to the technicians to promote distancing and congregating at the counter. This change proved more efficient!

  8. New Rotations: Half-staff rotations in the service area gave a road map to the future for a few of my dealers. They are no longer afraid to try three 13’s or two shifts per day. They’ve overcome the big hurdle of work being passed from one tech to another, and it wasn’t the monumental task they all thought it would be. This allows them to maximize their facility before they add more bays.

  9. Customer-focused: Being a customer-focused business pays, and those who went the extra mile to provide service pickup and delivery, as well as no-contact and remote delivery on new sales are cleaning up.

  10. Slowing Down: Although it was forced upon us, slowing down the process and doing things correctly actually increased sales closing percentages for many of my members. How many processes are you moving too quickly on, and how much is that costing you?

  11. Community Involvement: Rather than running more commercials or radio ads, many businesses saw success by being a community presence. These efforts have shown a tendinous effect on morale and the bottom line.

  12. Cost Control: When times were good, many departments and mangers grew lazy, and it was easy to cut the fat on staff and outside vendors. Just like in 2008/2009, that lesson was harder for those new to this business; but those who lived it reverted right back to what kept them viable.

  13. Inventory Management: Lower inventories needed to become more streamlined to quickly adapt to the pending Used Vehicle late-model glut that is coming.

  14. Recognizing Emotions: One of my 20 Group members shred how he made sure to “add to the employee’s emotional bank account instead of always doing withdrawals.” Being there to support your team emotionally has led to much happier and productive employees in his store.

  15. Training Opportunities: Many dealers shared how grateful they are for having the time to cross-train their personnel. Many training providers have adapted to offer free or discounted training sessions, offered virtually for dealership staff.

  16. Communication: As the number of staff decreases, it highlighted the need to communicate everything more effectively. As the leader, you can’t do this enough. There is no harm in overcommunicating what’s needed, what challenges we are facing, or ideas on how to solve our problems.

  17. Preparedness: This pandemic has changed our attitudes toward our business. Together, we may never take good times for granted again as things can change in an instant.

  18. Phone Skills: This was especially true in many fixed operations, but the entire dealership should know how to adequately answer and work the phones.

  19. Adapt: The ability to adapt, sometimes hourly and on the fly, is a skill that many of us didn’t know that we had. While we shouldn’t change everything frequently, overcoming unexpected challenges shouldn’t be as terrifying going forward.

I’m sure each of you can come up with more to add and have very unique perspectives on what your big takeaways are from the pandemic. So, what’s my takeaway? I feel very strongly about #17, and never let us take good times for granted again. Going forward, I will always suggest you make informed decisions and only add expenses if you see a real ROI. Only add to your employee count if they will either improve CSI or Gross. Be mindful of Gross/Employee and Total Absorption: Service Gross + Parts Gross + Used Vehicle Department Gross / Total Expenses. We want this to be 100%. As always, we at NCM Associates are here for you, and if there is anything that our team can do to help, please don’t hesitate to ask.

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