Car dealers have had to take a number of different measures to balance out the financial impact of Covid-19, according to new research from Close Brothers Motor Finance.
Two in three (66%) dealers introduced a delivery service in response to social distancing restrictions, or increased publicity of an existing service. And half (50%) of dealers changed their stock sourcing strategy.
Pushing more dealers to make use of online services has been an important outcome of the pandemic. Half (50%) of dealers had to adapt their social media offering and 43% spent time building up the online presence of their dealership in order to attract more customers and allow them to access the showroom from their homes.
Dealers have also made use of Government support with over two thirds (68%) saying they had to furlough staff as a result of the pandemic.
Dealers have taken a significant hit to their finances as a result of Covid-19. 43% of dealers had to amend profit targets, while two fifths (22%) had to take out finance or additional finance to stay afloat. A smaller but still significant number, 15%, said that they had to let staff members go.
Despite the various measures and financial impact, 89% of dealers remain confident in the outlook of their business over the next 6 months.
Seán Kemple, Managing Director at Close Brothers Motor Finance commented: “The last few months have been nothing short of disruptive for car dealers, and it doesn’t look like the dust will be settling any time soon. Dealers have had to make big changes to survive during the pandemic and adjust to a new retail environment. This means furloughing staff, but also introducing new measures to ensure customers can still get their hands on their next car. Digital transformation has also been vital to maintain engagement with customers and be more resilient in an ever-changing retail world.
“Despite the introductions of local restrictions, and now a national lockdown, dealers are feeling confident that their business will survive further hurdles. Dealers are making positive changes to complete sales in a totally different car-buying landscape and continuing to attract customers. But with dealerships again facing closure, it’s important that the Government continues to provide support for those that will find themselves set back financially. Dealers need to keep adapting and improving their stock and sales strategy to meet customers’ needs and keep afloat during further restrictions.”
