The 20 club difference: Growing revenue in a challenging market
New Garage Composites' multi-brand dealer: "It’s amazing to see how the composite changes after one year of being a part of a 20 club"
Kevin Pate, general manager of a multi-brand metric dealership, encountered a difficult situation last year. His Texas dealership was seeing a definite decrease in year-over-year in-store transactions.
In fact, the number of in-store shoppers was dropping by a double-digit percentage.
But using strategies he discovered in one of Garage Composites’ peer dealer groups (20 clubs), Pate and his managers at Lone Star Yamaha were able to outmatch total store revenue from a year ago despite a 14 percent drop in in-store transactions.
“It’s amazing to see how the composite (the dealership’s Garage Composites data report) changes after one year of being a part of a 20 club,” Pate said. “We have covered a huge deficit and are looking for 2020 to be the year.”
How did the Dallas-area store overcome a double-digit percentage decrease in the number of in-store shoppers to actually increase total store revenue? Several ways, including:
* Taking better advantage of the customers that were in the store. The Lone Star sales department had twice as many trackable conversations – referred to as “greets” on the Garage Composites’ data report – than the prior year. That led to more write-ups and eventually an improved transactions to unit sales ratio. Pate and other Garage Composites’ dealers track this ratio to realize what their store’s unit volume potential is based on the number of in-store shoppers. Watching key Garage Composites’ sales department analytics, Pate’s dealership saw a 21 percent improvement in its transactions per delivery ratio versus the prior year. “Watching our greets to closes is something we had never tracked before the Garage Composites’ peer group,” Pate said.
* The “doing more with less” strategy also was successfully implemented in the parts department. After Pate discovered “how much we were losing” on parts and accessory sales vs. other dealers in his peer group, the Lone Star team made changes to their dealership tour, the exercise of showing a unit buyer different shopping opportunities within each department. As a result, the store’s accessory sales at the time of the unit purchase rose by more than 40 percent versus a year ago.
* Taking a look at manager payplans and understanding a key way to fuel department revenue increases is with smart, incentive pay programs. “They’ve started driving the bus,” Pate said of his department managers’ efforts in building store revenue, “and we’ve been marching our way up.”
Your experience?
If your store is suffering a similar trend to Lone Star Yamaha and you would like to find out more about Garage Composites' peer groups, contact Neil at neil@garagecomposites.com