This month Hyundai revealed it is looking to recruit up to 50 more dealerships to bolster its UK network to cope with new product launches, which will see the brand introduce eight cars and vans in the next 18 months. The Chrysler, Jeep and Dodge brands have embarked on a similar product offensive to drive up sales which has resulted in ongoing network expansion. Michael Trood, the group's market representation manager insisted there was huge potential for dealers. “The investment and desire to expand with our existing partners is testament to the franchise opportunity with more than £10m invested in the past two years and the commitment of a further £20m-£30m from dealers in their facilities,” he said. The right dealerships Dealer networks are obviously fundamental to supporting manufacturers target their customers. But the key to taking on an extra franchise is not just a question of investment for the carmaker and its sales partner. Targeting the right kind of potential dealers is crucial for manufacturers operating in the UK's varied and sophisticated retail market. “Quite simply dealers are the route to the market. We prefer individual businesses, somebody that has a strong reputation and presence in the local market,” said Paul Hegarty, Daihatsu's operations director. Independence is key to new franchises according to Hegarty. “We want people who are independent operators and have businesses in which money has been invested. The dealers have to want to make the business work.” The Chrysler Group stressed the importance of diversity in its three-brand network. A spokesman said: “We are targeting professional dealers with existing franchises looking to develop their portfolio. The diversity of the dealer network is an important factor in the success of the Chrysler Group with single-site operators, regional groups and multi-national plcs all successfully representing the brands.” Ex-used car business owners are another popular option for manufacturers to consider as new franchise dealers. Their experience and knowledge of buying the right cars for the used market is expected to be reflected in trading new cars. Ford, the UK's largest carmaker, is looking to recruit new rural dealers to expand its current network of 550 sales points. “Small, regional, family and individual operators are what we are looking for – quality representation with good operators that complement our existing dealership networks,” said Stuart West, manager of market representation.” Customer service is vital In relation to retailer standards, Daihatsu lists customer service as one of the bases for success in its franchises. A high level of commitment to provide the best service means taking responsibility for any problems the business may face, said Hegarty. “If a customer comes in and sees ‘Mr Smith' above the door, he should be able to speak to Mr Smith and should be able to deal with him direct,” he said. LDV dealer development manager Mike Berry agreed. He said:?“When choosing a new partner for open points, one of the most important attributes we look for is demonstration of a customer comes first approach to business, coupled with a desire to grow as we increase sales and market share.” “Our franchise has a low cost of entry and works on both solus and multi-franchise sites, and once we have identified suitable partners we have a structured and easy to follow appointment process,” he said. Chrysler emphasised the importance of dealer standards, “The correct facilities are a vital component in presenting the correct brand image and, while solus sites do increase the brands' presence in a location, dealer profitability is of primary importance in considering any new facility.” Daihatsu increased UK sales by almost 15 per cent to 2,333 in the first half of the year but although the brand is expanding Hegarty said there is no set number of open points. “Daihatsu has not got a set number of open points available. We simply appoint a good franchise where there is a good opportunity and help it to grow on that basis,” he said. “We want to recruit new customer-focused appointments in the right locations and generate new business in areas where good local dealers have been culled by other manufacturers. By working in partnership with our expanding dealer network we can both enjoy growth and profitability.” Daihatsu's current biggest selling dealer is in rural Wales, not a location you would necessarily expect. But, as a dynamic brand seller, it is able to obtain a very high market penetration through being a small, independent operation. Looking to the future Increasing consumer concern with the environment has seen a rise in demand for smaller, greener cars – a trend Daihatsu feels it is well placed to exploit in both sales and dealer recruitment. “A dealer has to predict the future. We are selling the smaller, more efficient cars which people want to buy now and in the future,” said Hegarty. “Therefore we are uniquely placed in the market.” l For a roundup of which brands are looking for dealers to fill open points turn to our open points directory which starts on page 60.