When COVID-19 reached pandemic scale in March 2020, Barrie, Ont.-based dealership group AutoIQ fast-tracked quite a lot of methods, together with some which defied typical knowledge.
These strikes have been carried out after Andrew Ojamae grew to become president of the 16-store group in 2019. They featured an in depth omnichannel technique, which not solely carried the corporate by two robust years but in addition completely modified lots of its enterprise practices.
AutoIQ’s mix of collaboration amongst its group leaders and what Ojamae calls “semi-democratic” decision-making led to some dangerous strikes, in some instances defying accepted auto retail knowledge. However the outcomes converse for themselves.
From 2019 by 2022, the group elevated same-store income by 28.5 per cent to $1.17 billion and before-tax earnings by 86.4 per cent to $53.6 million, the corporate acknowledged in a submission to the Canadian Vehicle Sellers Affiliation (CADA). AutoIQ additional famous that these efficiency enhancements enhanced its enterprise worth and internet price.
On account of these efforts, CADA named AutoIQ its 2023 Laureate within the business-innovation class.
NEW BOSS, NEW MANDATE
In 2019, the corporate underwent a restructuring that included appointing Ojamae, bringing all its dealerships underneath one organizational umbrella and creating the corporate’s model identify — AutoIQ. Earlier than then, every dealership operated just about independently, Ojamae stated.
With a mandate from firm founder Mike Stollery, Ojamae stated, he got down to “harmonize” the operation whereas nurturing its entrepreneurial spirit.
For the primary time, the leaders of every dealership met on-line — as typically as weekly — exchanging concepts and debating technique. When COVID hit, AutoIQ’s omnichannel strategy had been mapped out however not absolutely launched.
Some Canadian dealerships have reported being hit exhausting by the pandemic, however Ojamae stated, “COVID has been very beneficiant to our business.” With autos briefly provide, margins went up whereas bills went down. Many shoppers migrated to on-line buying, and Ojamae stated gross sales by this channel spiked.
By September 2021, the corporate had unveiled AutoIQ.com, a totally digital buy expertise the place prospects may conduct the complete transaction from dwelling and settle for supply of the car of their driveway. They have been additionally given the choice of a hybrid on-line/in-store expertise.
To advertise its omnichannel providing, AutoIQ licensed the Journey track “Any Means You Need It.” To offer patrons consolation in buying a car they’ve by no means pushed, the corporate broke business custom and provided a seven-day money-back assure, Ojamae stated.
“We took a flier on that,” he stated, noting fears that this system may change into pricey. “Now, I don’t see us ever dropping it.”
Though Ojamae didn’t have exact numbers, nicely beneath one per cent of autos offered are returned, he stated, and plenty of of these are exchanged for one more car.
SELLING THE SKEPTICS
One other initiative, nonetheless, bumped into severe preliminary skepticism from the group’s sellers. Ojamae stated that when he floated the thought of “shared inventories” — basically obligatory dealership car trades — he encountered plenty of naysayers. Regardless of some severe hesitation, “We simply turned it on,” Ojamae stated, and shortly elevated gross sales.
The key to supplier acceptance of the trades was a bifurcated revenue mannequin, he stated. The revenue on the automotive sale stays with the supply dealership, and the receiving dealership will get to maintain F&I and different income streams.
AutoIQ stated that by the top of 2022, greater than 28 per cent of its gross sales of pre-owned autos have been derived from intracompany car transfers.
Ojamae “harnessed expertise and information to distinguish their organizations from the competitors,” stated Kirk Kristofferson, a professor on the Ivey Enterprise College at Western College in London, Ont., and a choose for the CADA Laureate competitors.
AutoIQ, he wrote, had unified the group’s dealerships and greater than 1,200 staff with a set of core organizational values, recognized worker potential and developed 5 worker professional-development applications.
Different initiatives that CADA acknowledged embody CarLoanIQ, which helps purchasers with poor credit score rankings safe financing; 360-degree on-line movies of autos; one centralized auto service name centre; three tiers of used autos, starting from absolutely reconditioned to “as traded”; and centralized car supply companies.
CHANGE NOT AN EASY SELL
Ojamae credit fixed collaboration among the many dealership leaders for producing and executing so many initiatives.
“We don’t at all times have all people on board,” he stated. “We’ve got positively accomplished some issues our senior leaders haven’t been snug with.”
Ojamae — a graduate of the Automotive Enterprise College of Canada at Georgian Faculty in Barrie — stated he appears to be like to that college to recruit the very best graduates. When promising grads are recognized, AutoIQ aggressively courts them with guarantees of ongoing skilled growth and alternatives to develop their careers.
“Expertise and profession growth is all the things in our enterprise,” Ojamae stated, a philosophy that drew reward from the CADA competitors choose.
“Andrew’s give attention to worker development and growth is really admirable,” Kristofferson wrote.
Ojamae stated his aim is to “lower out mediocrity in all places we are able to.” Doing so will foster natural development over time, he stated.
“We don’t need to be the largest; we need to be the very best.”