AMID the closures, administrations and sob stories hanging over the motor trade like a toxic smog there are some businesses that are flourishing — and this month I had the opportunity to peek inside one. Nestled next to the expanses of asphalt that make up Cambridge Airport, Marshall Motor Group’s head office is in a small, unassuming office complex.
In fact I had trouble finding it. When I did, there was no receptionist to point me in the right direction, just the chief executive officer, Daksh Gupta, there to greet me as I poked my head through the door to check I was in the right place.
Gupta joined the company less than five years ago and in that time he’s transformed the business from also-ran to one of the largest dealer groups in the UK. While his acquisitions have been plentiful and well documented, his dealer disposals haven’t had the same level of publicity. Slowly and steadily he’s sold off the poorly performing sites and those that didn’t mix well with his portfolio.
In 2008 he had, he says, an ‘unbalanced’ portfolio — seven were prestige makers, seven alternative premium like Volvo and Alfa Romeo, and 28 volume players like Ford and Peugeot. All were based in the rump of Britain, around East Anglia, and with group turnover at £380m the turnover per site was £9m. At the time, Pendragon was turning over £15.5m for each of its 326 locations.
It was clear to Gupta that change was needed and he could see that coming in one of three ways: downsize, sell out completely, or scale up. We all know he chose the latter.
In what Gupta calls the ‘land grab years’, he went on a buying spree — snatching dealer groups that were hitting troubled times as the economy squeezed the motor industry. It was a masterstroke. Sites were cheap as no one wanted to invest in dealerships and this allowed Gupta to achieve his goal of extending the Marshall footprint across the UK. Mercedes sites were bought in the northwest, VW sites acquired and more recently Audi franchises in the southwest.
While the purchases grabbed the headlines, Gupta quietly disposed of under-performing sites. He asked me how many I thought he’d got rid of in the last five years. I guessed seven. The figure is 18. A variety of smaller player makers were given the boot alongside some volume franchises too — they either didn’t fit the group’s portfolio or simply weren’t performing. In 2013 the Marshall portfolio looks very different. Prestige sites number 19, with more Jaguar, Land Rover and Volvo franchises joining the group. Alternative premium is up to 23 while the volume sites remain static at 28.
The headlines of change at Marshall look particularly impressive: Headcount has grown from 800 to 2,200, two thirds of the group’s 70 franchises are new and, most impressive of all, turnover is up from £250m to nearly £1bn — a 400 per cent growth in sales. Incredible stuff.
Gupta is enthusiastic as he charts the group’s moves over the past few years. It’s clear he loves what he does and won’t be taking his foot off the accelerator any time soon. As we’re chatting he checks his phone. Throughout our 40-minute chat his phone has been constantly buzzing. All were ignored, apart from this one. ‘Really?’ he asks, in surprise to the caller. ‘Now I’m REALLY excited about that! It’s £1m? Do it.’
Gupta explains it was an offer too good to turn down, but won’t go into detail. ‘It’s nice to be in the position to push the button on spending £1m,’ he smiles. And at the rate Marshall is growing, it seems £1m may soon be small change…