There’s no business more native to Detroit than the automotive industry. And there’s no small business more sales-driven than the dealership. While many people think of dealerships as an extension of the corporate entities of Ford, GM, and FCA, in essence they are small businesses that are actually separately run from “The Company.” Many of these dealerships, these metro Detroit small businesses, fight tooth and nail to stay afloat. There are a lot of lessons that your metro Detroit small businesses– whether from Southfield, Livonia, Canton, or Novi- can learn right in their backyards.

Leaders Hunt Down Leads

Dealerships use all types of lead generation. Whether it’s from a personalized pop-up ad, a test-drive event, or an informative live chat, dealership employees are on the hunt for a hot lead. This lead is powerful: it has a possible customer’s name, email, phone number, something identifiable to contact a consumer who is interested in a specific vehicle. Leads are knowledge, and knowledge is power. Knowledge is the thing that is going to get you that sale. Whether it’s through email newsletters, local events, leveraging paid search, or being aware of your interactions on social media, small businesses need to treat leads as gold. For more ideas on how to generate leads for your small business, check out this article. 

Leverage the Internet

Remember those leads we talked about a second ago? Most of those are compiled on the internet. There are many creative ways to get a consumer to engage with your website and willingly give his or her contact information. And the way to reach these people who wouldn’t normally swing by your local Canton dealership? The internet. Users are constantly searching for the best deal, and it is done almost exclusively online these days. Most often, consumers are tagged for their intent before entering a dealership website; that is, if a consumer previously searched for a vehicle model (or a competitive model), they will automatically be shown those vehicle models on the website. This prompts the viewer to be more likely to click on the images/content shown. This is another tactic that dealers (and many other digital marketers) use to increase the likelihood of a purchase. And the reason the user clicked on their site in the first place? Unless they expressly knew the dealership they wanted to help support with their hard-earned Michigander dollars, the answer is because of SEO and SEM. Organic and paid search. While the dealer may not always be technically savvy, they are leveraging the Internet more and more each passing day. You may not be moving metal, but whatever you are moving sure as heck better have a presence on the internet with tactics in place to close with the customer.

Reduce, Reuse, Recycle

Used cars, or their glow-up name, “pre-owned,” are actually more profitable for the dealership than the new vehicles. One of these reasons is because they require more service and parts needs than new vehicles. And if a dealership does service right, that owner will keep coming back to their service department to fuel the cycle. This is an important lesson for small business owners: refurbish assets that can be refurbished. Not everything new and shiny ends up being more profitable than tried and true. And if you can create a product that keeps the consumer coming back for more, than you’ve got a spinning cash wheel. 

Hustle, hustle, hustle

Dealers clock in around 7 a.m. (and that’s just the salesmen, servicemen are in earlier), and sometimes don’t leave the dealership until 8 p.m. or even later. Now, I’m not suggesting that your small business requires employees to stay over 8 hours a day, as work-life balance is a huge priority in today’s society. What I am trying to illustrate is the art of the hustle. In metro Detroit, life can get a little slow sometimes. The snow shuts us in for essentially 4 months, when you walk in and then walk out of work it’s a shroud of black, and we lose the motivation to get ish done. Dealerships truly depend on the hustle. A perfect sale is never just going to walk through those doors: the whole dealership as a unit needs to get after it. They need to hunt down leads, accurately assess customer needs, woo said customer, and then keep the customer for aftersales. Then repeat the cycle when they track that it’s time for the customer to buy a new vehicle. It’s a lot of work, and it’s not going to get done unless you get it done. No matter what community you’re in, whether it be Livonia, Southfield, or Novi, the art of the hustle will never go out of style.

Do the small things well

Where would you guess that most dealerships make their money? New vehicle sales? Financing? Most people have the image of a scummy car salesman who cheats naive consumers out of their hard-earned cash, but the typical profit made on the sale of a new car is only around $400. Oftentimes, dealerships lose money on the new vehicles they sell. In fact, according to edmunds.com, the new vehicle department accounts for less than 26% of a dealership’s total profit. You know what actually brings home the bacon? Service and parts. Service and parts make up about 49.6% of a dealership’s gross profits. The service department does the menial jobs day in and day out, and that’s what ultimately keeps the business running. And those dealerships that embrace doing these small things well are the ones that end up flourishing. As a small business, you need to do the small things well to succeed: in fact, your business just might very well depend on it.

Sometimes renting is better than buying 

Sometimes, people do it better than you. Whether “it” is managing a website, CRM, doing your taxes, or littering your pages with keywords to improve SEO, some tasks just aren’t worth your time or the hassle to your small business. Taking time to poorly perform these items often loses you money and gains you a headache in the long run. Dealers very seldom handle their own websites or even marketing. They know their strong suit: selling cars. They’re salesman, but they’re not marketers. Dealerships outsource to plenty of vendors, like their websites, chat boxes, and SEO. Learn this lesson from the modern-day dealer: if you don’t do it well, find someone who does it better. 

Dealerships are a misunderstood business, which is an interesting notion considering we as Detroiters live in the heart of all things automotive. They work hard in every aspect of their business, whether it be hunting down leads, leveraging market trends, or outsourcing when they need to outsource. Like a Livonia dealership, you need to be hungry to make the sale. Like a Canton dealer, you need to be smart in your targeting tactics. And like a Novi dealership, your small business marketing team needs to hustle day in and day out to succeed.