Dealer Insight: Drive Motor Retail

Drive Motor Retail has worked its way to the top of the Vauxhall lead tables in a year fraught with closures, social distancing, and changes in customer behaviour.

Drive Motor Retail Group recently announced a strong performance in the Vauxhall dealership 360 performance rankings for 2020 with its Hartlepool showroom ranked first out of 170 dealerships.

Five of Drive’s dealerships secured places in the top ten. Redcar and Stockton-on-Tees branches were ranked third and fourth, respectively. Drive’s Bury St Edmunds and Leicester dealerships came ninth and tenth, making up half of the top ten showrooms in the country. It was also named Opel Group’s European Dealer Group of the Year in 2019, and the Bury St. Edmunds dealership was named 2019 Dealer of the Year.

In the wake of such success, Motor Trader spoke to joint managing directors of Drive Motor Retail Group, Rob Keenan and Stuart Harrison, on how they manage their network of dealerships, the pandemic experience and plans to expand.

“It is just about keeping the focus in the right direction,” said Harrison. For the MD, success in motor retail is about keeping things simple in an industry that can be complex. He said: “It is a complex industry with a lot of things happening, and there is a lot of things that you can very easily get distracted by that are not the key points. So, it is about trying to keep things as simple as we can and making sure that the sites are completely focused on what really matters.

“Generally, these things seem to be the bits that align with the scorecards that the manufacturers keep. Customer satisfaction, market share and performance, and we have been focusing on those areas. We have been looking to achieve some good results, but even by our standards we were delighted with five of the top 10 dealership spots.”

Keenan added that they are not looking to add unnecessary concerns to an already complex job. He said: “Looking after customers and selling lots of cars is what we focus on. We delegate and absolutely trust our leaders on site to deliver. We genuinely empower our business leaders to run their businesses like it is their own.”

Harrison added: “It is not wildly complicated, but if you employ the right people, give them the right level of power to make decisions and do the right things and correctly reward and recognise that outstanding performance, then lo and behold you, you get good results.”

From panicked to prepared

Like all dealers, Drive Motor Retail was taken off guard at the start of the pandemic, but it soon found its feet. Keenan said: “Like everybody else we had a panic week at the start of the pandemic where we struggled to reconcile what on earth was happening. But we came out of the gates quite quickly with this wonderful process of selling cars via Zoom, Skype, and WhatsApp. We very quickly figured out that there was a good market there and if it were done properly, with a great deal of hard work, we would be able to implement a click and collect, omni channel approach.

“We got going very quickly and we had a great month in May 2020, relative to the fact that we were in lockdown. And it never really stopped. Of course by the time we got to November it did not really matter that much. It has become quite normal.”

Harrison added: “And the great thing is that the industry has shown a great deal of resilience and adaptability, which I think is a credit to a lot of people in the sector. For us it is just about being fleet of foot and quick to react. You need to not be afraid to evolve and change.”

Like most, the group has implemented many changes over the past year, providing staff with training and adapting their job roles to better suit the new environment. Keenan said: “We implemented a lot of training, among all our teams, all the way down to sales exec level and even our ecommerce staff. We adapted our call centre too. A year ago, it was a call centre with people answering the phone and sending messages. But now it has become much more of the sales centre. Our call centre operatives have become very integral to the sales process, and that is a significant shift from where it was a year ago. And that applies to both sales and aftersales.”

The group also made sure to keep pushing the business during the pandemic. Keenan said: “The two things that people generally do in a downturn is pull back on marketing and training, and we did not do either. We pushed on in both respects and believe we got the results because of that.”

Harrison added that the group did have to use the furlough scheme but did not back away from its marketing or training and structured its people to accommodate this. He said: “Unfortunately, you can’t get away from the fact we did have a complete shutdown for the start of the first month in April and then a fairly staged return. Like everyone else we had to use the furlough scheme to protect the business, but we were always very keen to try and make sure that we got everyone back in as quickly as possible when we could open. And when people were off, we made sure that they were well communicated with and knew what was happening.”

Some areas of the business were affected more than others, as Keenan explained. “Our business is built up of various sales functions. We have 10 sizable bodyshops and crash repair operations, and those sites are very much a reflection of how many cars are on the road. So, last year when road traffic fell, we needed the furlough scheme in those operations perhaps more than we did in some of our other channels.”

A new environment

And how has the new sales environment affected the group? Keenan told Motor Trader that he thinks that both customers and staff are now used to the new normal and are comfortable with the restrictions.

He said: “The reality is, everybody has gotten used to it. In terms of the business, since the beginning of April, it has been simply outstanding. In May I expect that it will be our biggest ever used car month in the history of the group, but I suspect that is reflected across retail, particularly used cars. We have got an absolute wave of sales opportunity.”

Harrison added: “When we did go into lockdown, we put a lot of time and effort into getting all the right sort of systems and processes in place and we made sure that all of our sites were independently audited, and then accredited. What that did is enable us to instil a lot of confidence in our customers and employees that everything was being done properly. A big pool of customers are now coming back in because they feel safe, and it was a seamless transition between being open and closed.”

The group has not seen the big surge in online sales seen by some in the industry, but it has seen its online enquiries grow over the period. Harrison said: “We have not got a truly end to end sales process online. We have a deposit function, which is not used as much as we thought it would be. However, we convert our internet inquiries at a high rate because people are engaging on the phone or on live chat and we use it now as a tool, which has worked very well for us, and customers seem to like that. They do not necessarily want to visit the dealership, but they want the communication. Buying a car and it just turning up at your doorstep is okay for some but probably not all.

Keenan added: “I think before COVID an online transaction and a normal transaction would be seen as two distinct and separate processes. I think the reality is that it is about having the ability to mix them all together and deliver the communication in a way that the customer wants, and if they want to go backwards and forwards on email you can do that. If they want to come into the dealership, they can come into the dealership. In effect, you dip in and out of all communication methods throughout the process.”

Continuing to grow

The pandemic has not stopped the group from continuing with its expansion goals. Drive Motor Retail has recently taken on the MG franchise at three locations – Leicester, Bristol North and Darlington.

Keenan said: “MG is an exciting brand. In each of the sites we have the space and the resource in the facility to put it in multi franchises and we have been thinking about attracting a new and broad portfolio into our business for some time, using existing resources that we have and that is exactly what we are doing in with MG.”

Harrison concluded: “We have been in an extremely fortunate position of having quite a strong balance sheet and being a company that has delivered sustainable returns. We are backed by supportive shareholders who are very keen for the company to grow and expand. Like everyone we have paused a little bit over the last 12 months just to assess what was happening with the market, and where everything was going, but we are now very much on the route to grow and acquire. But it has got to be the right franchise partners and the right opportunity and the right fit with the pre-existing business. Whatever we buy is adds value.

“There are opportunities out there, it’s just a case of finding the right fit.”