Momentum and agility: Australia’s automotive industry motoring forward

From profitability to productivity; from staff turnover to staff engagement – these are just some of the strategies being realigned within Australia’s automotive industry in response to an ever-changing, digital world and industry.

Deloitte Motor Industry Services’ partner Stephen Timperley and I will discuss elements required for dealerships to be race fit, as well as the current state of the industry and how to create momentum, in a presentation at the 2016 Australian Automotive Dealers’ Association (AADA) National Dealer Convention.

AADA, an independent body within Australia’s motor industry, hosts the annual Convention (this year taking place at the Melbourne Convention & Exhibition Centre from 6- 8 September) for automotive dealers and franchises to gather with local and international subject matter experts and industry figures.

The theme of this year’s Convention is ‘Building Better Outcomes’, and as the AADA Chairman Terry Keating and Acting CEO David Blackhall note1: “Better outcomes flow from better processes – processes that are consistent, managed, focused and results driven.” Attendees at the event will share best practice, discuss the key challenges and opportunities likely to impact the future of the industry and provide tools and materials that will help build better outcomes.

Knowledge is power

In line with this theme, Stephen and I will take the audience at the Convention through the current state of the industry, leveraging the data-driven insights obtained from Deloitte’s eProfitFocus platform – which is currently celebrating 20 years of data.

The key performance indicators of today’s motor industry, that assist dealerships and franchises to be well structured and prepared for success, are very different from the drivers of the past. For example, until recently the industry has placed importance on the gross profit per vehicle sold. But with gross profit margins in decline this is no longer a defining indicator of success – now it is about how many vehicles each salesperson can sell. Similarly, the industry has tended to look at the rate of staff turnover but now the focus is on staff engagement, creating a prospective, rather than retrospective, measure.

For the best performing operators in the market, there is a focus on creating momentum around how to make the industry an employer of choice; how to give customers the best experience possible; and how to become a dealership of the future, rather than wait to be disrupted. Best-practice dealers are optimising their operations across all departments, and ultimately, maximising the value of their enterprise.

There is an opportunity for those currently underperforming to learn from these best-practice dealers. It is events like the AADA National Dealer Convention that allow this transfer of knowledge to occur and I look forward to participating in these discussions. As Keating and Blackhall state1: “A sure-fire pathway to superior results is to study what the best and most successful practitioners do – and then copy with pride.”

Deloitte will also host a booth at the Convention’s Trade Expo over the three days.

1For more information on the Convention and to download the brochure go to: http://aadaconvention.com.au/

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