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Joe Marconi

Declining OE Dealerships; Good or Bad?

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Declining OE Dealerships; Good or Bad?

 

There are numerous reasons for the decline in the number of the new car dealerships in the past few years particularly with GM, Ford and Chrysler. Reasons include; there were too many dealerships, intense competition from the foreign car market, today’s cars last longer, new car warranty is down, the great recession, on and on. But is this a good thing for the independent shop owners or not?

 

One of the predication a few years back from some was that the aftermarket will see a boom in sales, as the motoring public flocks to the independent to get their aging cars repair and serviced. Well, many of the independents are still waiting for that boom. Actually many shop owners along with business in general had a tough time the past few years. I am not going to make today’s column a preaching article, but will only say that opportunity is always there and will always be there, in spite of the economy, government, weather and anything else that life throws our way. But now we need to contend with what I call, “The thinning of the heard theory”.

 

Yes, the number of dealers has declined but the ones that have remained are stronger, just like in the wild, and realize a few things and we need to take notice. The new era of car dealerships understand what WE, the independents shop owners, have known for the past 100 years. And that is simply; establish a neighborhood based business that has its roots in the community, offer people on-on-one world class service and build a long lasting relationship with your customers.

 

The new era of dealerships, especially the big 3, has come to the realization that new car sales per dealership will not be like it was. New cars last longer, do not break down as often and the OE manufacturer has either removed from the car and the owner’s manual any hint of periodic maintenance.

 

The OE dealerships are coming after our business, that’s a fact. They have been for years, but now they have a viable plan and the backing of the manufacturer. Their goal is to still sell cars, but they also understand that if they keep the customer as a service customer, the chances of that customer buying another car from the dealership is greatly increased.

 

Let’s not bury our heads in the sand on this one. Let’s not fall into the trap that all the dealers offer horrible service and that no one really wants to go to the dealer, that old and foolish thinking. We need to recognize the fight that we are in.

 

What we have in our favor is one of the laws of marketing, and that is, “Always be first in your market”. This law is based on the concept that people remember whatever is first of perceived as first. For example, “who was the first U.S. President? Washington. “Who was the second? Not so easy to answer. It was John Adams. Being first in your market is a powerful position.

 

Because we, the community based independent shops, were first in our market as the number one choice of the motoring public we have the advantage, but do not take that advantage for granted. We need to work harder than ever to secure and anchor this position. Concentrate on your top customers, continue to build strong relationships and find ways to reach into the community and make every customer experience so enjoyable and memorable that your customers would not think of anywhere else to go for their automotive needs.

 

Are you ready for the challenge, I know I am!

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  • By Joe Marconi, in Automotive Management,

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