When it comes to determining the future of your dealership, there is no exact formula. No one can possibly predict what is in store for the auto industry, politics or the economy. Even more difficult than predicting those changes is knowing the impact they will have on your bottom line.
While you can’t predict the future, you can arm your dealership with key strategies to be prepared for what’s to come. One major factor to consider when it comes to future-proofing your dealership, is to understand the role of cyber security in keeping your business safe.
In the realm of cyber security, there are several simple steps you can take to get started. Educating your entire staff on cyber security do’s and don’ts is crucial. All employees, no matter their title, should be aware of security risks, and the role they play in mitigating them. Creating – and most importantly, enforcing – cyber security policies within a company can help strengthen your dealership’s cyber defense from the ground up.
While it may seem arbitrary, strong passwords can make an enormous difference. A strong password should contain a combination of letters, numbers, uppercase, lowercase and special characters. These passwords should never be shared or displayed, as attacks can happen in minutes and are often hard to detect.
To prevent future headaches, keeping all antivirus and anti-malware software up to date is a worthwhile investment. Other necessary precautions include securing wireless devices and encrypting mobile devices, backing up and encrypting data, ensuring proper segregations and rotation of duties, and performing background checks on employees.
Hiring an external vendor for an information technology (IT) security assessment can be a good option, as it allows an expert in the field to make sure your dealership is truly prepared.
Future-proofing also often entails thinking about who will run the dealership 10, 20 and 30 years from now. Crafting a strategy for business transitions early ensures a smooth and stable transition down the road.
Prior planning is essential when it comes to the future of your business. Almost 50 percent of business transitions occur due to unfortunate events like death, disability, divorce, disagreement or distress. Meanwhile, only 67 percent of the time are these unfortunate events covered by contingency plans.
A recent survey by the Exit Planning Institute revealed that 88 percent of business owners are not prepared to address transition planning. Even more surprising, 76 percent of business owners are not aware of their options, or what is involved in the transition planning process.
With only 13 percent of organizations having a written and communicated transition plan, a simple step forward is to begin recording and communicating your thoughts and intentions for your dealership. Key pieces of any transition plan include: parameters; a review of your buy-sell agreement; operating agreements; resources to fund a transition; an employee/leadership pipeline and retention policies; assignable contracts; and customer commitments.
When creating a transition plan, it is imperative to also have a strategy for continuous growth of your business. To develop this strategy there should be a variety of tasks discussed amongst leadership. Ideas include: offering new services; tapping into new markets and territories; breaking into existing markets; developing new sales and delivery channels; and planning for successful mergers and acquisitions.
Having a plan of where you want to see your dealership go is extremely helpful in any planning process. With the automotive world continuously increasing in complexity, and rules and regulations changing every day, it’s increasingly difficult for dealerships to keep up with demands. To ensure that you are in compliance while also keenly focused on the task at hand, hiring outside professionals can help.
Instead of having an employee at your company perform a certain task once in a while, the efficiency and proficiency of an outside expert who performs the task day-in and day-out can be a great relief. Outsourcing jobs such as accounting or other financial work help many dealerships stay on track, and keeps owners and management focused on their core goals. It’s yet another way to future-proof your business, scale your workforce as needed, and let your skilled workforce focus on their areas of expertise.
It is impossible to predict the future, but being keenly aware of where you’re headed, having processes in place to protect yourself and outsourcing as needed will help prepare your business as best as possible for what is to come.
About the Author
Jim Goerlich is a Principal at Rehmann and leads Rehmann’s Automobile Dealership Services Group. He has been practicing since 1985, providing his experience in accounting, taxation and business planning and consulting to his clients. EMAIL: email@example.com.
Author: Jim Goerlich
Jim Goerlich is a Principal at Rehmann and leads Rehmann’s Automobile Dealership Services Group. He has been practicing since 1985, providing his experience in accounting, taxation and business planning and consulting to his clients.