Market leaders pick their market leader: Which car dealer is in the driving seat?
Wednesday 15 September 1999
IT'S IMPORTANT to have a good grip on strategy and development plans when putting together a business in this industry. Strategy planning is vital, particularly at the moment because the market is changing vastly: consider consolidation in manufacturing and retailing, and franchising in Europe, for example. We have to steer a way through the changes and negotiate the challenges. I have been in the business all my life and am a great car enthusiast, but most important is the desire to satisfy the customer; the ability to satisfy the customer first time, every time. If I had to pick an impressive figure from the industry, I'd go for Peter Vardy, the chief executive of Reg Vardy, which is currently one of the top three groups in the motor trade. He has developed the company from a small family concern into an industry leader. Despite his business being the most successful dealership, he recognises that success is tightly tied to an ability to deal well with staff and customers - he sees the trade as being a people business. He has always kept that in the forefront of his mind, rather than the concerns of the City.
Group Managing Director
THE MOTOR distribution business is a dynamic, constantly changing environment and is reliant on good relationships between manufacturers and their dealers. Unlike other retail situations, the dealers work on margins fixed by the manufacturers within their franchise agreements. This causes huge competitive pressure within an industry, which has a particularly high profile with the end consumer.
Two people whom I have admired within the industry are Nick Scheele, until recently the chairman of Jaguar and, more recently, promoted to the chairmanship of Ford of Europe, and Peter Vardy, the chairman of Reg Vardy plc.
Under Nick Scheele's stewardship, from a relatively low base, he overcame the early problems within Jaguar and has established through his UK sales team an outstanding relationship with his dealer network. This has helped to lead Jaguar to its present high standing within the distribution industry through a process of constant communication with dealers.
Peter Vardy has driven his dealer group from a medium-size family business into a top performing plc in the distribution sector. He has achieved this by realising the huge potential of the used-car market; he is recognised by his peer group as pre-eminent in this area.
WHAT INTERESTS me in the industry at present is the transformation from being car oriented to being consumer oriented. The business is becoming much more customer driven and customer focused. We have to recognise that people are changing their expectations and habits, which has a knock- on effect on our industry. We have to reflect recognition of these changes in our premises and processes. It is important to be able to recognise and react to these changes, so I would say that a combination of flexibility and tenacity is the ideal recipe for success: flexibility to change and tenacity to effect those changes. One man in the industry who has been able to combine these attributes to great success is Sir Trevor Chinn of Lex. With his foresight, he saw that it was important to diversify into other aspects of the business as well as retaining interests in the distribution sector. It is a prime example of a company that has managed transformation to great success.
Inchcape Motors Retail
AFTER 27 years in the motor industry, I am still as passionate about the business as I was when I first joined as a management trainee. This passion remains as keen partly because I love cars, but equally because I enjoy the personal contact with employees, customers and principals. The key to succeeding is to develop and manage relationships, to motivate employees and to provide focus and direction for the business.
It is important to relish a challenge, and 1999 is certainly providing a fair few of them, including twice-yearly registrations, the pricing issue, year 2000 preparations, and radical changes in the industry. The blurring of the roles between traditional distribution and retail, and the emergence of new channels of distribution are providing both threats and opportunities for us all. Now, more than ever, success in our trade will depend on energy, innovation and, equally important, a true understanding of what the customer actually wants. We are, in fact, moving away from simply selling cars to providing customers with total mobility solutions.
I admire people with strength of vision and purpose. John Neill, the chief executive of Unipart, whose belief in the development of his employees has been key to the growth of the company; Arnold Clark, who is dominant in Scotland under his own named retail brand, which is stronger than some of the franchises he represents; and our own Peter Johnson, the group chief executive of Inchcape, who is tasked with taking the company into a new era as a motors-only group.
Chairman and Chief executive
Reg Vardy plc
I WOULD define my strategy for success in this business as possessing a clear and precise vision of what can be achieved and the ability to transmit that vision to other people. And what I most enjoy about the business is the challenge and the fact that no two days and no two customers are ever the same. One problem the industry is constantly struggling against is the image that the public often hold of the car dealer. Of course, they always think of dodgy Arthur Daley or Deals on Wheels from EastEnders. So we are continually trying to fight against that image, to change that image of what we do. It is a demanding struggle, but one that is satisfying when we make attitudes change and when we do satisfy the customer. It is vital to understand the business and the customer well. And it is important to be passionate about what you do - we work long hours and need gritty determination to work through the more difficult times. To a certain extent, I would say that you need to be passionate about cars per se, but in the long term it is the business and not the car that has to motivate you. If I had to pick an individual within the motor business whom I admire, I would choose Frank Sitner, the chief executive of Sitner, as a good example of someone running a specialist car group with great success - it seems to be growing in a good and positive way. Tony Bramall is the chairman of Sanderson Bramall and has managed to build up a successful family business, sell out, return to it and repeat his original success with it. He constantly delivers good levels of growth and profit. He's to be hailed as a bit of a hero, really. Finally, I consider Nick Scheele, who was the chairman and chief executive of Jaguar and is now at Ford, to be a figure in our business worthy of admiration.
CAFFYNS SELLS and services cars for 14 different franchises across south- east England. The company has been established since 1865 but, of course, the industry is far different now, and the challenge is constantly to adapt to suit the market. We are currently operating in extremely exciting times and the industry is changing more rapidly than at any time in our recent history. This dynamism provides us with a constant challenge and great opportunity. For me, one of the most enjoyable aspects of my profession is working in such a broadly based industry where people are the most important part of the business. The key to success is to find people who can lead and motivate teams to perform beyond the sum of their individual abilities, whilst cutting through the chaff of everyday distractions in order to concentrate on the essential priorities of the business. For me, Lord Simpson with his work at Rover and now GEC, has shown how effective this can be.
I HAVE been with Currie Motors for more than 11 years and it is just as interesting today as when I first joined. It is quite a tough environment but over the years I have adapted and learnt how to work within it. To really succeed in this business you need to be determined, commercially aware and enjoy working with people. It is a dynamic industry. At the moment it is facing major changes, and with the pressure to realign prices with Europe growing ever stronger, manufacturers will have to respond - we have to be ready to predict changes and adapt. As for whom I admire in this industry? Well, what can I say. As far as I am concerned, I admire my fellow directors and colleagues. Their commitment and dedication to Currie have played a part in building the company into what it is today - one of London's largest privately owned dealer groups. Thanks to their efforts, I think we have a brand image which no other dealer group can match.
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