CHICAGO — Dealer software provider MAXDigital released new dealer research on the subject of turnover and sales processes. In conjunction with Erickson Research, MAXDigital surveyed nearly 400 dealers across the U.S. in January 2018.
Among other key findings, analysts said turnover remains a problem for dealers. Nearly 80% of dealers in the study said turnover is an issue affecting their business, with 23% saying it’s a major issue. Respondents cited inadequate or lack of training and ineffective hiring processes as the biggest factors leading to turnover. Seven in 10 dealers said their salespeople have told them they don’t have enough training or information.
Nine out of 10 dealers said hiring good salespeople is difficult. Seventy-six percent of dealers said they’ve hired people without automotive experience, and 62% said they’ve hired people without sales experience of any kind. Ninety percent of dealers surveyed rely on high-commission compensation, with 42% offering no fixed salary at all.
Finally, analysts said, dealers are looking to change their sales process. Four in 10 dealers said they’re considering changes to their sales process in the next 12 months. Moving to a more consultative sales process was the top change considered, followed by adding technology. Seventy percent of dealers in the study believe technology makes salespeople more successful and builds trust and confidence with customers.
The top drivers for a new sales process are higher close rates and increased CSI scores. Employee turnover is also a driving factor, with more than 50% saying a change in sales process would help retain staff. Many dealers are looking to adopt a low- or no-haggle pricing strategy. Four out of 10 in the survey said they are looking to adopt a low- or no-haggle pricing strategy.
“This study shows how dealers are re-examining their sales processes in order to align with the way customers want to buy,” said MAXDigital CEO Steve Fitzgerald. “Adopting a process that provides a streamlined car-shopping experience will help dealers increase sales and profits and improve employee satisfaction and retention.
“When salespeople are trained and equipped with product information, they’re more confident and able to do their job well. They’ll feel good and be more likely to stay long term,” Fitzgerald added.
Nearly 400 U.S. dealers completed the survey in January 2018. Six 30-minute phone interviews were also conducted in February 2018. Respondents included owners, dealer principals, general managers, used-car managers, and internet managers.
To read the report in its entirety, including an infographic, click here.
