Automotive

Challenge

The founder had fallen ill, which led to operational inefficiencies, outdated systems, and declining sales and profits. The dealerships in Maryland and Virginia were dated and the OEMs had threatened to cancel the franchises, which would have resulted in material losses for the owner.

The project required:

• The development of new facilities and a restructuring of its operations.

Contributions

New Facilities

• The development and execution of a plan to construct new dealership facilities in Maryland and Virginia, which required searching for new locations in designated territories.
• Worked with engineers, architects and construction companies to design and build new facilities that met OEM’s requirements.
• Filed permit applications and presented and negotiated with local government agencies to obtain required licenses and permits to construct the new facilities.
• Arranged financing for construction of new facilities.
• Arranged and managed the sale of existing properties in Maryland and Virginia.

Refresh Operations

• Redeveloped departmental responsibilities.
• Reviewed and updated existing IT and data systems (sales, inventory, parts, service, and F&I) to determine efficiency and identify needs for upgrades.
• Developed business plans for each department to set goals, establish responsibilities and monitor progress and efficiencies.
• Coordinated with OEM’s representatives to arrange marketable inventories.
• Renegotiated floor plan terms to finance inventory.
• New facilities were constructed and made fully operational.
• The OEM confirmed the franchises would remain effective.
• Overall morale and productivity materially improved.

Conclusion

The owner was able to maintain and expand the number of franchises from two to three with the new dealership in Maryland. As a result, the Virginia dealership became the top U.S. Saab dealership within two years.

Joe Zappulla: jzappulla@dutchesscapital.com