Dealer-manufacturer relationships are inherently complicated.
Dealers and OEMs share many of the same objectives. Both want strong brands, loyal customers, healthy sales, successful service operations and sustainable businesses.
But they don't always approach those objectives from the same perspective.
After working across multiple luxury automotive brands, I've come to believe that the strongest dealer-OEM relationships begin with something relatively simple:
Understand what the other person is trying to accomplish.
Start With Their Objectives
When meeting with manufacturer representatives, I try to understand not only what the OEM broadly wants to accomplish but what our individual sales and after-sales representatives are responsible for within their markets.
They have objectives too.
The first question should not always be, “Why won't this work at retail?”
It should be, “How can we help accomplish this, and how can we get to an outcome that works for both of us?”
That requires an open mind.
There is a temptation in any business relationship to try to demonstrate that you understand your part of the business better than the other side.
At the dealership level, we obviously understand the realities of retail extremely well.
But walking into every conversation determined to be the smartest person in the room rarely creates a productive partnership.
Sometimes the best answer is somewhere in the middle.
Implementation Is Usually Harder Than It Looks
I don't subscribe to the common dealer complaint that manufacturers simply don't understand retail.
Most of the OEM professionals I've worked with understand the dealership environment.
Where there can be a disconnect is the difficulty of implementation.
A dealership is an active operating business. Customers are arriving. Vehicles are being delivered. Service departments are repairing cars. Phones are ringing. Employees are managing dozens of immediate priorities.
A new initiative that sounds relatively straightforward on a conference call may require significant behavioral and operational change inside the dealership.
You try not to assemble the airplane while you're flying it.
Good communication between the dealer and OEM helps both sides understand what a reasonable implementation looks like.
Credibility Compounds
One of the most valuable things a dealer can develop with its manufacturer partners is credibility.
That does not mean agreeing with every initiative.
In fact, thoughtful disagreement can strengthen the relationship.
If something isn't working, say so.
Give specific feedback. Explain the facts. Avoid turning the discussion into an emotional argument.
There isn't inherently good news or bad news. There is information, and then there is how we choose to respond to it.
Dealer councils provide an important feedback mechanism, particularly for high-volume retailers. I also think tools such as the NADA dealer surveys give smaller dealers an important opportunity to have their experiences represented.
Good OEMs listen.
Good dealers make sure the feedback they're giving is useful.
Consistency Doesn't Mean Sameness
One of the additional challenges for multi-brand dealer groups is that every manufacturer is different.
And every customer is different.
At the group level, you can establish an overarching promise about how customers should be treated.
But the execution should change depending on the brand and the individual.
A Range Rover customer and a Defender customer may walk into the same franchise with very different expectations.
The same is true between a Mercedes-Benz SUV customer and someone purchasing an AMG performance vehicle.
Brand standards provide the framework.
The retailer's job is to understand the person inside that framework.
Technology will increasingly help us scale this kind of personalization, but it still requires strong local management and employees who understand their customers.
Great Field Representatives Make Things Easier
We are fortunate to work with an excellent group of OEM field representatives.
The best representatives I've encountered tend to share a few characteristics.
They listen.
They communicate clearly.
They respond quickly.
And when something goes wrong—a program isn't understood, an incentive payment is missing or a problem requires additional support—they engage rather than simply pointing the dealer toward another department.
Responsiveness creates enormous trust.
Over time, that trust makes difficult conversations much easier.
Simplicity Comes With Accountability
One trend I have been pleased to see from several manufacturers is movement toward simpler dealer objectives.
After years of increasingly complicated scorecards, programs and measurements, there seems to be more focus on a few fundamental questions:
Are we selling cars?
Are we servicing cars?
Are customers having an experience that makes them want to return?
I welcome that simplification.
But dealers have to accept the other side of the bargain.
If we ask manufacturers to give us fewer obscure metrics and more freedom to operate our businesses, we should expect them to hold us accountable for the results.
Market share matters.
Sales objectives matter.
Parts and service performance matter.
Customer retention matters.
Dealers cannot reasonably say, “Let me run my own business,” and then object when the manufacturer evaluates whether that business is performing.
The best relationships aren't created through blind compliance.
They are created through alignment.
Understand what each side needs. Communicate honestly. Give useful feedback. Execute on your commitments.
And over time, earn enough credibility that when you disagree, the other side knows it's worth listening.