An Ontario dealership group attributes its robust development to cracking the code on the right way to preserve small-market patrons buying regionally. 

With two latest acquisitions in southern Ontario — bringing the whole within the area to seven — the 401 Group of Corporations now has 16 automotive franchises and 23 recreational-vehicle, marine and power-sports shops throughout the province. 

Automotive manufacturers embody Kia, Hyundai, Subaru, Volkswagen, Nissan, Honda, Chrysler, Dodge, Ram, Jeep and Mitsubishi. 

The group, based mostly 100 kilometres west of Toronto in Cambridge, employs practically 1,000 folks and expects to promote 14,000 to fifteen,000 autos, mentioned Ted Lancaster, 401’s govt vice-president of enterprise growth and mergers and acquisitions. 

The key to the 11-year-old firm’s success? 

“We perceive the small-market mentality,” Lancaster instructed Automotive Information Canada. 

BUILDING RELATIONSHIPS 

The technique begins with automobile pricing that’s corresponding to that of metro markets, which have extra competitors, Lancaster mentioned. 

“We don’t have the angle that we’re the one recreation on the town — take it or go away it.” 

However that’s just the start: 

• The 401 Group’s dealerships additionally help native charities and causes and use social media to “present our shoppers we’re engaged locally.”
• The group ensures its dealerships are trendy and have up-to-date service expertise.
• Consumers in small markets usually tend to go to dealerships sooner than metro patrons do to speak via the acquisition, Lancaster mentioned.

“They actually wish to construct the connection. I can’t think about [them] making a 20, 30, $40,000 buy with out coming in and having private contact.” 

• When the 401 Group buys dealerships, it goals for seamless transitions of possession so prospects won’t discover a dealership has been bought.

“An enormous a part of our success is as a result of we actually put large worth on what the [previous] proprietor has carried out to construct the enterprise,” Lancaster mentioned. “We don’t wish to tarnish what the proprietor has carried out.” 

• Current workers are saved on as a lot as potential so prospects see acquainted faces. “We don’t lose folks. We strive our greatest to retain all our workers,” Lancaster mentioned. Usually, workers have gone to highschool or performed hockey with prospects.
• Workers are taught to not upsell in the course of the gross sales course of however to make sure the automobile matches the client’s wants.

‘HIRE FOR PERSONALITY’ 

Throughout possession transition, Lancaster mentioned, workers at a newly acquired dealership are educated within the 401 Group’s “top-tier” strategy to enterprise and buyer care. For brand new workers, “We rent for character, and we prepare for effectivity.”

The dealership group is continually on the lookout for methods to enhance, together with studying from the corporate’s RV gross sales expertise, Lancaster mentioned. 

Individuals who purchase RVs usually purchase them as “reward” autos, and the acquisition comes with pleasure and pleasure. Automobile patrons ought to really feel the identical method, he mentioned. 

“We wish prospects to have the [most fun] expertise potential.” 

Metro dealerships might be taught priceless classes from the way in which small dealerships deal with their prospects, mentioned Dominic Sigouin, a Quebec-based automotive retail guide who caters to small markets. 

“Folks wish to be acknowledged and well-served,” he mentioned.

When metro dealerships compete intensely on value, the flexibility to create a constructive shopping for expertise can get misplaced. 

“You’re speaking about value whenever you don’t have anything,” Sigouin mentioned. 

Larry Lantz, who owned Hanover Honda in Hanover, Ont., (pop. 7,700) 180 kilometres northwest of Toronto, mentioned he at all times saved centered on a golden rule.

“I’d not deal with a buyer some other method than they needed to be handled.” 

Lantz retired in 2021, passing the shop to his sons. 

Sellers in metro markets who minimize the acquisition value to the purpose of minimal revenue usually say they will make up floor on quantity, Lantz mentioned, however “that is unnecessary to me.” 

To make up for it, they’ll usually set excessive store charges, which flip off service prospects, he mentioned. 

Each purchaser needs the perfect value, Sigouin mentioned, however they need the non-public contact of acquainted workers members being concerned in supply and possession experiences.

The one-contact strategy, he mentioned, is rather more frequent in smaller markets the place dealerships have smaller groups.