Author: efgmarketing

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Industry Trends

2023 – Focus on the Need

Retail automotive dealers are gearing up to face a variety of challenges in 2023. From economic uncertainty, fluctuating profitability targets, changing sales models, and the persistent overhang of compliance regulations, the ‘good times’ for dealers could come to a screeching halt. While some dealers will manage the transition smoothly, others will be caught off-guard. Successful agents will need to be nimble, focusing their client service models on what each dealer needs. A one-size-fits-all model will not work as the industry evolves.

Need for Consumer confidence

Over the past few years, car buyers gravitated towards the vehicle they ‘wanted’, focusing on the features and benefits of the latest models. With a recession looming and inflation rising, car buyers in 2023 are expected to scale back those aspirations and focus on the features they ‘need’ because it’s likely their current vehicle is on its last leg. This transition from ‘want buyers’ to ‘need buyers’ involves a different sales mindset for the dealer. Agents can smooth this transition for dealer clients, by providing the tools and resources they need to tap into those need-based buyers.

For example, F&I managers will need to be prepared to present the value of consumer protection products in terms of saving consumers money throughout the life of the vehicle.  By adding $25 to their monthly loan payment today, the educated consumer could save hundreds – if not thousands – of dollars tomorrow.

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Economy Industry Trends

2023 – Firing On All Cylinders

2023 will require dealer principals and their teams to fire on all cylinders to successfully weather the numerous challenges on the horizon. Economic uncertainty, evolving dealership sales models, fluctuating profitability targets, persistent staffing challenges, and continued growth in electric vehicles (EVs) are just a few of the issues which will impact retail automotive dealers.

There is plenty room for optimism for those dealers who put strategic plans in place, implement focused training protocols, bolster pricing models and fixed operations, and keep an eye on compliance. Let’s break down some of the opportunities for dealers to succeed in 2023.

EVs, sales models and customer connections

Growth in EVs and the hybrid instore and online sales model has highlighted the issue of strengthening and maintaining customer connections at the dealership. As more EV manufacturers sell direct to consumers, and consumers become increasingly comfortable buying a vehicle online, dealerships face challenges communicating with customers before, during and after the sale. Dealers who invest in implementing targeted sales processes and training will exit 2023 with more profitable businesses, greater employee retention, and stronger customer relationships.

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Recruiting

End the Year on a Hiring High

According to the most recent jobs report from the Bureau of Labor Statistics (BLS), the United States job market continued to grow steadily, with 261,000 jobs added in October 2022. This shows a slight decrease in the jobs added compared to the previous month, while the unemployment rate increased to 3.7 percent. Conversely, many high-tech companies have signaled – or already implemented – layoffs or hiring freezes. Could this mean a larger pool of potential recruits for dealers to scoop up?

With continued signs of strength in retail automotive and strong revenue potential, dealerships have some strong selling points to attract the best candidates. But don’t rush to hire the first available candidate. Successful hiring at the end of the year should be strategic. Hiring the right candidate is very different today. Let’s look at some of the challenges and opportunities dealers face when hiring.

Hiring Five Generations Deep

For the first time in modern history, there are currently five generations active in the workforce. Each generation brings a unique perspective to their job, providing an employer with a rich, cultural microcosm that can relate to every type of customer. Although the pandemic accelerated changes to the traditional workplace, many of today’s workers have reassessed their relationships with work, placing a priority on work/life balance as well as company culture. Making those diverse perspectives work effectively can be challenging for any employer.

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