Don’t cut back on staff dealers warned
CUTTING jobs will hit profitability while freezing recruitment may also limit the ability to grow revenues according to an automotive consultancy.
Coachworks Consulting said that dealers are looking to cut back staff levels because of a fall in the UK new car market, describing it as a blunt instrument across the franchised dealer sector.
“It’s having a harmful effect,” said managing director Karl Davis. “We are seeing too many dealers taking the short-term option of not replacing staff when they leave and this is limiting their potential to hit quarterly targets.
“Recruitment freezes are also putting additional pressure on the remaining employees and this is prompting further staff churn. “Many car brands have lowered their volume targets because of declining new vehicle sales but we’re noticing some dealers are using this as a reason to reduce headcount.”
He added that by not replacing revenue generating staff, especially salespeople, service advisers and technicians, dealers are seriously damaging their profit potential.
Davis warned that staffing levels in some service departments are now too lean with many service adviser and technician vacancies being left open.
He added: “A failure to replace service department staff is impacting the ability of some dealers to sell enough service hours and it is damaging their profitability at a time when they are already seeing reduced chassis profits.”
In contrast, Davis said upper-quartile dealers are retaining their headcounts by refocusing sales staff on prospecting and selling used cars where demand is high and are maintaining optimum levels of workshop staff.
“You can’t just take an accountant’s view on staffing. For dealers to succeed in a falling new car market staffing levels have to be optimised not cut to make an easy saving.”
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