The growth of Auto Groups has and is changing the car business. What was once a large network of individually owned and operated car dealership locations, is in the process of being dominated by what we call Auto Groups.
When the organization operated under one rooftop, opportunities for advancement for middle managers were limited. There were only so many senior managers (GMs, Controllers, Office Managers. etc.). If a Sales Manager or Service Manager wanted to advance and grow, they most often had to look outside the organization.
That has, and will, continue to change as Auto Groups expand.
The advancement of this trend is creating more and more opportunity for mid-level dealership managers to advance their careers while working for the same owner… just in a larger organization.
The AG owners require new business structures to effectively capitalize on their growing enterprise. Managing a group of 3, 5 or 10+ dealership locations does not take the same business skills that were sufficient in a stand-alone dealership location.
Alan Haig of The Haig Partners presented this chart (sourced from NADA) demonstrating the impact of AG growth and consolidation over the last 10 years.
Growing Influence of Auto Group Consolidation:
Observations Related to this Graph…
In 2008 there were roughly 10,500 “Owners” of new car dealerships. Of that number 7,500 represented single point operations.
In 2018 the number of “Owners” dropped to almost 7,700 while at the same time, single point dealers dipped below 5,000. There are 2,700 fewer single rooftop owners.
The red-dash chart line for Rooftops per Owner shows an interesting trend, but we need to remember that Auto Groups come in many sizes. Some are just two locations, while others can be as many as 100 or 200+ rooftop operations.
Where is the Biggest Opportunity for Dealership Middle Managers to Grow and Advance their Automotive Careers?
Since an Auto Group does not describe just one type of business organization model, let’s further segment AGs into several types.
There is nothing official about these designations and they simply are the result of DealersEdge’s role as an auto industry observer.
Small Auto Groups - For the purpose of this article, we define Small AGs as managing 4 or fewer rooftops.
While the management of 4 locations is more complex than a single rooftop, it is often not so complex that the owner must revamp organization structure to do the job effectively.
Hiring a GM to manage each location, and then just managing the manager can be an effective strategy. As with single rooftop businesses, the owner and GM create the process and then lead middle managers to effectively and routinely follow the steps.
Mid-Size Auto Groups- When the AG grows to a larger number of locations… and possibly a wider geographical footprint… new management structures start to become necessary.
What you can achieve in a small group, or single location, becomes difficult when trying to manage many diverse and individually located businesses.
For many AGs this has resulted in new layers of management hierarchy. These larger AGs typically have central management “teams” made of new positions like…
Corporate Controller or CFO
Corporate Service or Fixed Ops Director
Corporate Marketing or Sales Manager
Corporate HR and/or Training Manager
The Mid-Size Auto Group is often in an awkward management position. They are too big to simply operate like a single point dealership. They are also too small to have the budget and organization of the Ultra-Large organizations, like AutoNation, Sonic, etc.
Ultra-Large and Public Dealer Organizations- These organizations tend to have highly detailed organization charts and detailed procedures. They also have the centralized budget that allows for more complexity.
Opportunities for career growth exist with the Ultra-Large groups, but the number of these companies and those positions is limited.
Seeking advancement and opportunity in Mid-Level Auto Groups holds much promise to today’s ambitious dealership managers.
As the Auto Groups grow to Mid-Size they naturally produce an increasing number of opportunities for the manager to advance career prospects.
Whether those opportunities come from opening positions in sister dealerships, or from becoming a member of the “Corporate-Level”… it still represents a better opportunity for career development than existed prior.
How to Better Prepare Yourself to Take Advantage of These Opportunities.
It all starts with Skill and Motivation. We have mentioned this matrix before…
See the entire article here: https://www.dealersedge.com/post/growing-a-team-of-super-stars-skill-and-engagement-required
As the matrix suggests, advancement to “Star” performance is a combination of your Skill and your Motivation. One without the other results in just being average. Being average is no way to win the advantage when opportunity knocks.
Improvement of your skill level requires that you be a “learner.” It must be evident that you are continually seeking a better understanding of how the business works well and how to find and implement improvements. It is about the “quality of your efforts.”
Simply following the “process” routinely and efficiently is not enough. That may work well in smaller organizations but is not enough for you to stand out as the AG gets larger.
Here we are looking at the “quantity of your effort.” Don’t be a plodder! Be someone that truly exemplifies the concept of being a “Self-Starter.” You just don’t follow the process… you strive to make the most of every opportunity.
If You're Ambitious You Have More Opportunity Than Ever
If you can position yourself as a “STAR,” your chances of advancement improve dramatically.
Work on improving your Skills and demonstrate a high level of Engagement. It will pay life-long benefits.