SKODA has targeted a two per cent market share in the UK by switching its strategy from retail to business car sales.
Martin Burke, head of business sales, Skoda UK, explained to Car Dealer that this will help the brand achieve its goal of 34,300 sales in 2009. Over half of these will go to the fleet market.
‘In May 2008, Skoda moved away from retailer-led business sales, by launching Skoda Agency. This is a direct buying channel from Skoda UK, meaning all sale negotiations are carried out by a central team in Milton Keynes.’
Car dealers become the customer interface of this operation.
‘This national focus allows the brand to build relationships, and strike deals, with key fleet operators.’
The brand has 90 dealers in the scheme. They receive training on taxation, funding methods, customer qualification and legislation. ‘They are effectively agents, processing customer orders.’
What’s in it for dealers? More sales, that’s what. ‘We are working with individual retailers on long-term plans to improve their capacity with growing volumes.’
‘The retailer does not own the entire relationship with a business customer. Their focus is on service delivery rather than financial negotiations.’ But, by building a relationship with business customers, Burke says there’s the opportunity to become a direct supplier in the future.
There are also significant aftersales opportunities. ‘Business customers have their vehicles delivered and serviced at retailers local to them.’ This will be a profit stream in the current climate.
The brand is not stopping retailers from selling directly to businesses, either. ‘Our retailer training prepares partners for both kinds of relationships.’
Burke says used values won’t suffer. ‘We work very closely with industry influencers and implement their feedback at every stage of the product cycle.
‘We also have a repatriation process in place. Our vehicles are purchased back on our behalf and resold to our franchise network – guaranteeing a quick sale for fleet customers, at a better price than at auction.’ This, he says, will help secure RVs ‘among the best in the industry’.
The Czech brand reckons it can bring plenty that’s new to the business car world. ‘We are innovative in our approach to the customer,’ says Burke. ‘Most makers have a product-centric approach… Skoda prides itself on being a customer-centric brand.’
He says proof of this is the brand earning top spots in customer satisfaction surveys. ‘Our contract hire and leasing partners now also have a dedicated point of contact in our business sales team, to ensure problem resolution is dealt with swiftly.’
Skoda wants to grow, and sees the current market as ideal for its ‘attractive price to value ratio’ proposition.
‘In the current market, fleets are desperate to cut costs. Skoda has irresistible ‘spreadsheet appeal’. You won’t find another brand that delivers the same quality for less.
‘We are referred to as a ‘budget premium’ brand.’ Dealers will be hoping this new strategy does the business for them.
Exclusive by Richard Aucock
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