By Chris Saraceno
“The speed of the leader determines the rate of the pack.”
–Ralph Waldo Emerson
When selling a dealership, the company’s health is a main factor in determining its value. Location, franchise, size and other elements enter into a buy/sell agreement, but a thriving business is much more attractive for potential buyers than one barely able to keep the doors open. When appraising a dealership, one valuable asset — or downfall — is the current general manager’s track record of success.
In my experience, I’ve found there are seven skills, attitudes and behaviors great GMs have that lead to profitability and excellence for the dealership and everyone around them.
They Meet and Exceed Agreed-Upon Dealership Forecasts and Objectives — Effective GMs make sure their team not only hits this month’s OEM numbers but put themselves into a position to exceed those goals. These leaders read and interpret financial statements to get a clear view of what’s working and what needs immediate attention. By focusing on important future-facing metrics such as net profit, customer satisfaction scores and market share, a great GM builds on today’s success, rather than scrambling to keep up.
They are Aligned with and Promote Dealership Values — Successful dealerships are founded on values that serve not only the consumer but also protect the dealership’s team members. General Managers who exemplify these values in their leadership style build teams who can meet challenges and thrive in their marketplace. The tone of the team when interacting with customers is directly impacted by the tone of their own leadership. Strong leaders make it clear what they expect of their team, and what customers should expect of the dealership.
They are Exceptional Coaches, Recruiters and Leaders — Outstanding GMs are skilled at finding new talent who build successful careers that benefit both themselves and the dealership. Once in place, true leaders constantly monitor and measure their team’s performance. Exceptional team members getting “caught” doing the right things will feel valued and remain with the dealership. These GMs understand that what gets recognized and rewarded gets repeated. For team members not meeting expectations, the GM is ready to coach and train them to constantly improve their skills and processes. They will also be ready to make a change once all other options are exhausted.
They Know the Business — An effective GM must have intimate knowledge of the departments he or she leads. In addition to recruiting, hiring and coaching their team members, they need experience in areas such as managing inventory, understand how to market and how to optimize CRM use. They are masters of buying, selling and managing the day-to-day operations of a used vehicle department. They recognize how each department supports and grows the others. In today’s world, they need to have expertise both in the day-to-day operations of the dealership as well developing a long-term vision.
They Have Outstanding Communication Skills — Knowing the business isn’t enough for elite GMs; they must clearly and passionately share their vision with their team. They must also be able to describe to the owners and investors the steps their team has taken to reach those goals, the challenges they face and the support they’ll need for future success.
They Focus on Improvement and Growth — Automotive retail sales is a rapidly evolving industry, and those who aren’t willing to learn new technology, embrace fresh ideas and meet current marketplace challenges will fall behind. Outstanding GMs make sure their people are prepared to meet the needs of their clients. This means taking part in continuing education, training and building the daily, weekly, monthly and yearly habits that set them apart from the competition. This also means the GM is willing to keep their own training up to date, learn from other leaders and make sure their mindset is one of a “constant learner,” rather than the “veteran who has seen everything.”
They Work Well with Dealership’s Leadership and Other Managers — It’s tempting for some “leaders” to build an “Us vs. Them” mentality (“We’ll hit our numbers if Service gets their act together”), but this attitude benefits no one. Healthy dealerships achieve success because the departments come together as a whole. Each supports the efforts of the rest, and all work with the dealer and company leaders to achieve the dealership’s overall vision. Leaders in thriving dealerships understand that cooperation, rather than competition, is key to success.
A quality general manager can take challenging situations and make them great, while a sub-par GM will take potentially great situations and consistently find overwhelming challenges. Having the right GM in place — one who knows the business, builds a winning team and makes the dealership’s vision a reality — not only builds value and profit today, but earns your dealership a much better valuation when you decide it’s time to sell.
Chris Saraceno, vice president and partner of the Kelly Automotive Group, is also a speaker, mentor and author of the book Theory of Five. He can be reached at email@example.com and 1-321-960-6133.