PITCHER Partners has been told that some OEM franchisors have misinterpreted our analysis in the recent article ‘Property, the dealer’s largest and least measured asset’, which was published by GoAutoNews Premium particularly regarding the performance of the average car dealership. 

Best practice property KPI revealed

Part Two: Putting property KPIs into practice

Steve Bragg

To clarify our position, the term “average” was not intended to suggest that this level of performance is acceptable, nor should it be seen as the benchmark for success. It is quite the opposite.

An average-performing dealership is not an indicator of sustainable or profitable operations. 

The figures referenced in the article highlight the significant strain that property costs and other overheads place on dealerships. 

If a dealership is performing at an average level, it is, by definition, barely keeping pace with the costs associated with running the business — particularly with property being the largest and least measured asset.

This should be concerning for both dealers and OEM brands. When the economics don’t stack up, dealers are faced with the real uncertainty of having to reconsider their representation of OEM brands altogether. No dealer can afford to remain complacent with average results when margins are shrinking and fixed costs such as property are rising.

Franchisees who aspire to continue representing leading OEM brands must strive for excellence, surpassing average performance levels to ensure both profitability and long-term success. 

Anything less puts them on a trajectory toward financial difficulty, ultimately undermining the OEM network as a whole. The industry demands a higher standard, and it is crucial that both dealers and OEMs work together to achieve it.

The article was intended as a call to action, encouraging dealers and OEMs to take stock of their performance and push beyond mediocrity.