We’ve already seen localised lockdowns brought in after an easing of the national restrictions announced on March 23. Government officials have since been ordered by the prime minister to work up a plan for avoiding a second national lockdown, according to reports.
Boris Johnson is said to have held a ‘war game’ session with Rishi Sunak to run through possible options for averting another nationwide lockdown that could stall any potential economic recovery.
We’re not looking to be alarmist, but we want to ensure that car dealers are in the best possible position if the worst comes to the worst and there is another UK-wide lockdown, so that they know what to do to ride out a possible fresh storm ahead of it arriving.
Well, the good news – if there can be such a thing in such a crisis – is that whereas before it was all unknown and uncertain, dealers now have an understanding of what to expect, so it’ll be easier to implement measures.
Firstly, do not panic. While many within the industry reckon a second national lockdown will have a devastating effect on the outstanding work that dealers across the trade have done, if it happens, it happens. Should a lockdown as severe as the first one occur, everyone within a dealer’s business will know the drill. And, judging by the first lockdown, there is the positivity of knowing that if people still wanted to buy a car as soon as restrictions were lifted after the first lockdown, there’s every chance they’ll want a new car the second time around.
It’s no exaggeration to say the pandemic proved a real wake-up call to dealerships to get their websites sorted. Whereas beforehand they may have just been seen as a showroom window, if forecourts are closed and people’s movements are restricted, then the internet is really going to be the only way dealers will be able to make sales.
GForces chief executive Giles Smith told Car Dealer: ‘Without a doubt, I would recommend dealers to have the ability to transact online via their website. Customers using our NetDirector Auto-e platform during lockdown were able to continue to trade despite their showrooms being shut. Whilst many chose not to deliver the vehicles during this period, they built up strong order books which they later fulfilled.’
James Tew, chief executive of online motor retail technology specialist iVendi, told us: ‘The central question dealers probably need to answer is, “How would we keep trading as effectively as possible if we get hit by a second wave?”
‘The government’s local lockdown strategy could present difficult problems to solve. Across a dealer group, you might find that some of your showrooms can stay open but not others, and you could potentially switch business to other areas.
‘However, if you are a single-site business in the middle of a lockdown area, life is going to be more difficult and it could mean considering solutions including online tools such as vehicle reservation and end-to-end online finance solutions that generate leads and applications, taking consumers out of market even while your physical showroom may be closed.
‘Certainly, we would advise all dealers as a minimum to ensure that they now have an online reserve-and-collect option in place, as this seems to us to be the model that provides the most complete yet cost-effective solution to different forms of restricted trading.
‘This kind of activity can certainly produce results. In recent weeks, including during the original national lockdown period, dealers using our Transact platform, which was designed to develop online consumer interest in a specific vehicle through to a final transaction, generated £80m of digital deals.’
Keeping people informed has a huge part to play. Facebook says that WhatsApp, Facebook Messenger or Instagram direct messaging gives people an ‘emotional and authentic’ connection with a dealership. So make sure that not only is your website up to date with information, but you keep your social media platforms current as well.
It’s not all about the hard sell, either. Reassure your customers about the steps you’ve been taking to keep things Covid-secure, for example. You could also lighten things by uploading puzzles or pictures to colour in for youngsters to enjoy. And make sure you engage with your community by offering help – for example, during the first lockdown, some dealerships let the NHS and voluntary groups use their demonstrator cars.
Maintaining sales and deliveries
Seán Kemple, managing director at Close Brothers Motor Finance, said: ‘There are several lessons that dealers can learn from recent months to prepare and ensure that sales can continue throughout very restricted circumstances.
‘Digital channels play a vital role in the car-buying process, and this has escalated massively during the pandemic where more people turned to the internet.
‘This is hugely positive for dealers, who can use their online footprint – whether through a website or social media channels – to reach a wider audience, including people that wouldn’t have otherwise visited that dealership, for example, those who may live further away.
‘By offering an accessible and up-to-date digital forecourt where drivers can access the showroom from the comfort of their homes, this could lead to an uptake in custom down the line.
‘If using social media, dealers need to have a consistent presence, as it won’t work if you just dabble. It’s worth making a member of the team responsible for the social media strategy in preparation of a second lockdown.
‘Dealers can go one step further than utilising websites and social channels by guiding customers to the next stage of the car-buying process, even from a distance. Many of our dealers, for example, have utilised the remote quote-and-apply functionality within the Showroom platform, which works in tandem with a dealer’s website.
‘It helps their customers to choose the perfect vehicle and the finance option most suited to them. Through the platform, dealers can email vehicle quotes directly, which are then stored and visible in the customer area.
‘Having this type of software is another step to reaching customers and bringing the personal in-showroom car-buying experience into the online world.
‘To prepare for a return of social distancing measures, dealers need to think about how they will get stock to buyers. There are many features available to support responsible buying and selling, such as introducing home delivery and live video viewings.
‘Some dealers set up click-and-collect approaches and designated collection bays to give buyers greater peace of mind when collecting their new car.
‘Ultimately, if a second lockdown is imposed, car dealers are in a position to learn from recent months and act quickly to keep business going and meet the needs of customers.’
Keep cash flowing
An easy thing to say but a harder thing to do. During the first lockdown, it was clear that the dealers most able to take advantage of showrooms reopening in June were the ones who had tried to keep cash flowing as much as possible.
Just like the first lockdown, if a second one were to occur, keeping cash moving is hard, with one source telling Car Dealer ‘it’s the key thing dealers should focus on’.
Review your communication with staff
With one national lockdown already under dealers’ belts, a second one should be easier to cope with. And ‘should’ is the important word here. During the first lockdown, dealers should have been giving furloughed and non-furloughed staff members regular updates via text, email, WhatsApp, or even by speaking to them on an actual telephone. If dealers didn’t do this then it’s vital they get up-to-date contact details for all their staff now should a national lockdown occur so that they can keep them updated. When we say updated we mean with any developments on a national and local level, and ones that are business-related – not the test match scores.
Can staff work from home?
At the height of the last lockdown, people were forced by law to work from home if possible and encouraged to get back to work as soon as they could. Should the prime minister order a second lockdown, businesses will have to try to keep up the momentum they’ve made during June, July and August, with staff operating from home as much as possible.
Now’s the time to make sure those already working from home have the tools they need, that they’re covered by company insurance (where necessary) and are happy. Or perhaps a second lockdown will be the first time a business will need people to work from home. If that’s the case, the business needs to make sure employees are properly prepared, set up and understand what’s expected of them while working from home.
Motor trade legal specialists Lawgistics advise dealers to review all of these in readiness. Lawgistics solicitor Nona Bowkis told Car Dealer: ‘There are definitely more consumers buying online and dealers will want to continue to review how they move into the future to be able to keep trading remotely should we all go back into a lockdown situation. In short, it is a good time to review costs, processes, insurance cover and get all the right legal procedures in place to future-proof the business.’
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