Every three months we ask dealer bosses about a range of topical issues impacting on their operations. We also ask them how confident they are about their retail environment and which franchise they currently think has the most profit potential.
Each time the questionnaires for Motor Trader's franchised dealer opinion surveys are sent out they feature the same opening questions:
1. Compared to three months ago, are you more or less optimistic about your business's prospects?
2. Which new car franchise do you most admire in terms of its profit potential?
BUSINESS CONFIDENCE
Business confidence is expressed as the balance between those respondents who are feeling more optimistic about their prospects compared with those who are feeling less confident. In this latest survey the indication is that business optimism remains subdued at a similar level to those recorded previously, with an index of minus 35 — just 21 per cent of the sample is more optimistic compared with 56 per cent that is less so (see chart one and line graph).
Our second rolling question in this series of surveys looks at how dealers perceive franchises in terms of their profit potential (chart two). BMW unsurprisingly still dominates the rankings, mentioned by 54 per cent of the sample. Porsche and Audi's second and third placings in this latest poll are the same as for the previous edition, although their share of the vote has increased — by two and three percentage points respectively.
Among the marques that make up the 23 per cent other responses, only Lexus (4 per cent) and Mercedes (3 per cent) recorded a response of more than 2 per cent.
INTERNET IMPACT
Our theme for this survey is the marketing impact of the internet for franchised dealers. Our first question (chart three) simply asked whether or not franchised dealers have their own website. If it appears surprising that 4 per cent still do not have their own website, it should be remembered that the survey sample spans every size of franchised dealer, from the supergroup down to the local retail dealer. Additional questions asked whether the respondents' manufacturers have their own site to which they are linked. Of the 89 per cent who did, 92 per cent said they actively participate in programmes operated through the manufacturer sites.
Chart four shows that the majority of franchised dealers are also using third party websites to provide a wider platform for their marketing. Seventy-one per cent of the sample uses third party web sites, such as www.autotrader.com. The fact that 29 per cent of the sample does not use third party sites suggests there remains a sizeable market that the third party service providers still have to tap in to. Or perhaps for some franchised dealers, having their own website and a link through the manufacturer site is seen as a sufficient internet presence?
The next question (chart five) attempts to qualify rather than simply quantify internet activity. Respondents were asked how significant they regard the volume of enquiries they receive. With 70 per cent of the sample saying enquiries were either “very significant” or “significant” the result clearly shows that having an internet presence does a lot more than simply encourage the cyberspace equivalent of the forecourt tyre kicker.
A subsidiary question (not charted) found that sales — as distinct from aftersales — is the area to benefit most from internet activity. Just three per cent of the sample said that either service or parts benefited most.
The final question in the survey (chart six) suggests the internet's impact is set to increase markedly in the future, with only four per cent believing it is unlikely to play a major part in their business. Overall, then, the survey reveals a vast majority of franchised dealers having an internet presence and benefiting significantly as a result.