I’m in multiple dealerships almost every week. I get to see it all. The big ones, the little ones and bunches of in-between. I’ve seen 15-car showrooms and I’ve seen some that have zero cars in their showrooms.
In the big picture I realize dealers have to build what the manufacturers require them to build in order to acquire, keep and maintain the franchise. But, do you really need the size facility that some require you to have? Expensive real estate and expensive buildings may one day be the kiss of death.
Take a look at the banking industry. They are stuck with some serious “legacy buildings” that at some point are going to come home to roost. ATMs have turned into online banking. Online banking could turn into a thumb-print and you’re done.
Who needs to take a check to the bank when you can make the deposit with a photo and a few clicks on your phone? Go into any bank today and you will see very few staff members. What the heck are they going to do with all those buildings as we move into the new era?
Every piece of research indicates the car buying consumer wants to handle more and more of the purchase online.
In a recent article in Automotive News, Tom Kinney, manager of the General Motors Pre-Owner Collection Division, while discussing the Collection strategy stated, “The way the dynamics are changing in the marketplace, consumers are clearly demanding this type of a process, on a large scale, all in one place and more of it online. We’ve built this to keep us and our dealers relevant so we can be ahead of that curve.”
Sounds like they know the curve is moving more to online yet they want you to build and maintain big facilities. You can replace the words GM with Toyota, Honda, or Mercedes. They are all the same when it comes to facilities requirements.
Think about what’s happening right now with Cadillac. In the not too distant future, some of the smaller Cadillac stores won’t have any inventory and will order cars online for their customers. Push a button and maybe the car will show up before they buy something else.
What size is your current store? What size does it need to be? Makes you wonder how much longer you’re gonna need that big expensive showroom, doesn’t it?
I think the factory is speaking out of both sides of its mouth. That’s all I’m gonna say. Tommy Gibbs