Wednesday, 10 June 2020

The retail revolution putting car dealers in jeopardy

Car dealerships could become places of 'try' rather than 'buy' as more and more customers turn to online purchasing.
As dealers threw open their doors to welcome a surprising number of eager customers back into showrooms, so the bosses of dealer groups and car companies accelerated their plans to offer end-to-end digital sales channels. That could see dealers becoming 'try' rather than 'buy' outlets, and customers - if they want - only interacting with retailers over the Internet. A few dealer and car company bosses have admitted that they had been "caught napping" when it comes to their digital offerings during lockdown. Many, however, jumped onto various online sales channels - which could mean job losses in the retail business, with some dealers saying, "Do I need all these sales staff any more on the basis that I'm so digitally enabled in a way that I never was before?" Of course, not everybody wants to buy online - and plenty of people much prefer real face-to-face contact (now at a social distance) at a dealership, rather than doing a deal via a video link. There is a growing concern, though, that your local dealer might not be very local soon. Put simply, many of the biggest dealers are in trouble, admitting to being vulnerable right now, with the value of dealer businesses at a real low. That could play into the hands of industry disruptors - out to revolutionise the automotive retail sector.
A quarter of SA’s motor dealership employees may lose their jobs this year because of the impact of Covid-19...

A major franchised dealer group confirmed at the weekend it was preparing retrenchment letters for 23% of its staff, including dealership heads.
  

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