Survey shows improvement in franchised dealer/manufacturer relationships

Franchised vehicle dealers believe there has been an overall improvement in the day to day relationship with their manufacturer. Sales incentive programmes and improved profitability boosted partnerships, according to the National Franchised Dealers Association (NFDA) Dealer Attitude Survey Winter 2012/2013 results.

The NFDA 2012 survey, published on Monday 4 March 2013, shows that there has been an increase in the overall value of the franchise. When asked about the overall value of the franchise, the all dealer average increased from 6.6 to 6.9. Land Rover, BMW, Kia, Mini and Audi were recorded as the top 5 franchises and the least valued franchises by respondents are Alfa Romeo, Renault, Mitsubishi, Subaru and Seat. However, the trend towards diminishing dealer/manufacturer relationships, highlighted in the Summer 2012 Dealer Attitude Survey, took a turn for the better:

When questioned about the partnership with their manufacturer 62 per cent of dealers increased their rating. When dealers were asked to rate their manufacturer’s sales incentive programmes the results showed an increase of 0.2. In addition, 86 per cent of respondents scored on or above this mark. 

Also profit and profitability ratings have improved slightly in this survey with dealers showing less concern about the standards imposed on their dealerships: when rating the profit return by representing their franchise, 63 per cent of networks improved their score and, when asked about the future profitability of their business 67 per cent of dealers increased their score. 

When questioned about the dealer standards set by manufacturers compared with the return on investment/reward, the all dealer average increased from 2.9 to 3.0 with 67 per cent of dealers increasing the rating since the last survey. 

Sue Robinson, director of the National Franchised Dealers Association, commented: “Manufacturer/Dealer relationships appear to have improved in recent months with new models and sales incentives boosting dealer profitability. Despite ailing sales in the rest of Europe the UK car market remains buoyant and manufacturers are keen to bolster through rewarding higher sales volumes. 

“However manufacturers continue to take an aggressive stance when setting targets. Many dealers feel they have little ability to negotiate with manufacturers on targets.”