Laura Sandle, Director,
Sandles Car Supermarket
22nd October 2020 | 5 minute read
Having worked with dealers throughout the pandemic, we’re committed to sharing their experiences of COVID-19, both on their businesses and the industry as a whole. We hope their insights will put your own situation into context and provide food for thought to help you continue adapting.
In the first of a series of conversations with dealers, we spoke to Laura Sandle of Sandles Car Supermarket, a mid-size dealership usually offering 500-600 cars from their base in Kings Lynn. We interviewed her in late July 2020 about how the business has been faring both during and after lockdown.
- Post-lockdown surge in sales is easing
- Inflated auction prices are a big challenge
- Furlough scheme continues to allow staffing flexibility
- Some COVID-19 safety measures actually boost customer experience
- Online propositions such as CarZam are a concern
How has COVID-19 affected sales?
Obviously the loss of two months worth of sales and finance commissions has been a huge hit for the business. Since reopening at the beginning of June there’s been a surge due to pent-up demand - we’ve seen the best June for sales and finance turnover ever - but that hasn’t made up for the previous loss in revenue. That surge is starting to ease now, so whereas in June you would have to wait a week for an appointment you can now get one same day or next day.
“We’ve seen the best June for sales and finance turnover ever - but that hasn't made up for the previous loss in revenue.”
There’s been little visible change in the type of customer, type of cars purchased or types of financing. If anything, people are spending a bit more as a result of lockdown savings and are treating themselves to cars.
Most of our leads now begin with an email, followed by a call with a sales representative. The only real new behaviour asked of customers is the handover process. Some customers get quite stressed by having to sign forms without a sales representative present as they prefer to be more guided through the process. However, the SignIt Anywhere system was delivered just in time for the pandemic and has significantly streamlined the process for customers.
"SignIt Anywhere system was delivered just in time for the pandemic and has significantly streamlined the process for customers."
How have you adapted your operations during and after lockdown?
From a staffing point of view, everyone was furloughed for the first four or five weeks. It’s been helpful to have the flexibility to bring some staff back to prepare the dealership prior to opening and then re-furlough them. Currently half of our staff (30 people) are furloughed as we wait to rebuild our stock, so we’re working with a streamlined team.
In terms of working practices, we implemented click and collect during lockdown but this is dialling down now that our dealerships have reopened. We also did a few home deliveries to help customers who needed access to their vehicle but were unable to come into the dealership.
We‘re currently operating on an appointments-only basis, with non-accompanied test drives and a more streamlined handover process. Overall we’re seeing the value of these practices in the customer experience. So for example, cars wanting to be test driven are ready and waiting in special bays. We’re considering keeping the appointments system for busy periods in the future as this helps not only with customer experience but also with managing staffing levels.
"We’re considering keeping the appointments system for busy periods in the future as this helps not only with customer experience but also with managing staffing levels."
We have strict procedures in place to control infection. Sanitiser and gloves are available to all staff and customers, while cars are valeted prior to customers looking in them or taking a test drive. Keys are left in the vehicle so the cars are not touched by anyone but the customer on the day of the appointment. We also have screens on the front desk and active sales desks, along with floor markings, banners and information boards to direct customers and staff. The only situation where social distancing could be crossed is if two mechanics are working on one vehicle; in this instance they have been provided with facemasks. Valets were always wearing facemasks anyway.
Overall there’s not been a massive cost involved: around £600 for sanitisation and £500 for protective screens. All the floor markings, banners and information boards were produced internally with no significant cost.
What are the main challenges your business is facing post lockdown?
Access to stock is proving a massive challenge (at around 160 cars, current stock is less than a third of normal levels). This is due to the backlog in the auction system rather than an actual market shortage. It's causing unmanageable price inflations at auction, up to 75% in some cases. The risk is that dealers purchase stock at these inflated prices and then can’t sell them for a profit and become stuck with the vehicles. We’re doing a lot of work to be mindful of the market bubble, keep an eye on pricing trends and only buy when the price is right. At the same time, employees who are still furloughed are beginning to worry about job security and redundancy. Many want to come back sooner rather than later so we’re keen to build stock to allow them to return.
The rise of online businesses like CarZam is a concern (CarZam offers a ‘mouse-to-house’ proposition including next-day home delivery, online transactions with finance approval and a “seven-day no quibble” return policy). There’s no way we can physically or economically compete with that, so we can only hope customers wanting a test drive limits uptake.
How have Black Horse supported you through lockdown and beyond?
Matt from Black Horse has been incredibly helpful with SignIt Anywhere, from training to quickly responding to messages. Matt has also been supportive through emails and phone calls and he has switched seamlessly to phone review processes to replace review processes which used to be done face to face.
We‘re not too worried about a need for retraining when staff return, but it’s good to know they have access to LetsULearn so they can maintain and develop their knowledge and skills in the meantime if they want to.
What do you think the outlook is for the industry as a whole?
In the short term the market is looking very good, although I’m more cautious of the longer-term situation once the recession bites, since money will run out for customers and government support will cease for businesses. Smaller dealers who are having to pay increased prices for stock now may not survive in the long-term. My advice is not to panic and to stand your ground as the bubble will pop; stay flexible in how you respond to the market and in the meantime follow government advice to the letter.
"My advice is not to panic and to stand your ground as the bubble will pop; stay flexible in how you respond to the market and in the meantime follow government advice to the letter."
We hope Laura’s insights offer some inspiration as you work with your team to take your own dealership further down the road to recovery. Look out for future Dealer Conversations, and in the meantime explore our Dealer Resource Hub for other useful articles.