Once upon a time, the days of car dealers were deteriorating. However, from the latest data, it seems that there has been signs of warming. According to the semi-annual reports of the major listed car dealership groups, performance has generally enjoyed relatively high growth. Guanghui Automobile's revenue for the first half of the year has increased by 30.78% year-on-year, and its net profit has increased by 57.7% year-on-year. Zhongsheng's revenue for the first half of the year has increased by 20.7% year-on-year. %, Net profit increased 53% year-on-year...

The overall sluggish auto market, why the dealer group's performance can be warmer? According to industry analysts, this is mainly due to the refinement of dealers, the development of intermediate businesses, and the optimization of network layout.

Then, in the context of the domestic new car market reaching the top of the globe for seven years in a row, and the car ownership of more than 200 million vehicles, the recent warming of dealers is returning to light, or is it winter to spring?

Dealers are beginning to transform

Under the dual pressures of the macroeconomic environment and the auto market, dealer groups have embarked on the transition road since 2016, and have generally increased their investment in used cars, finance, and quality products. In terms of new car sales, it has optimized its own sales network to adapt to the trend of consumption upgrades.

Since the beginning of this year, CGA continues its development strategy of mergers and acquisitions integration, and has regained its super-luxury, luxury and mid- to high-end brand outlets, strengthened its comprehensive services, and strengthened its profitability. While optimizing the new car business, services such as after-sales services, used cars, and financial leasing have grown rapidly.

Profits from the transformation have resulted in a huge increase in profits. Despite the sustained growth in revenue from passenger vehicles, revenues from value-added services such as finance, insurance, and quality products have all increased significantly, and sales of new energy vehicles and parallel imports have exceeded last year. In order to adapt to the new situation, Huge Group also accelerated the deployment of the travel market, launched a compact car, and increased efforts to integrate company resources and revitalize assets.

In the eyes of the industry, the domestic automobile market has entered the buyer's market, and new car sales have entered the era of meager profits. Therefore, it is more and more important for dealers to benefit from management, which has become one of the important means to improve profitability. At the same time, the integration effect of the large distributor group is more prominent and the industry concentration continues to increase.

Market competition is still grim

The data shows that in the first seven months of this year, the growth rate of automobile production and sales was only 4.7% and 4.1% year-on-year, of which the growth rate of production and sales of passenger cars was only 3% and 2%. It is widely expected in the industry that the increase in automobile production and sales in 2017 will be only about 5%. Although the auto market maintains a “micro-increase” momentum, and the promotion of the national auto industry policy has also spawned a variety of new business models and new operating models, but the market competition is still severe, and the difficulty of dealers to further increase sales is increasing.

From the perspective of consumers, the data released by the China Association of Automobile Marketing Managers shows that the consumer level index for August was 44.63 points, which was lower than the 5.37 points for the Ronghe Line, which means that consumers’ purchasing power is still not optimistic.

Fortunately, the August inventory warning index for dealers fell to 47.1%, and the confidence index of auto makers was 52.67 points, which means that manufacturers are still optimistic about the market's future trend.

Yan Jinsong, general manager of the company’s operating support center, pointed out that in the current market environment, car dealership groups with 4S stores as the main body must maintain their confidence and can focus on three main areas in the future: strengthening internal operating capacity, enhancing development, and focusing on brands. And the layout of regional structure; continuously promote the development and innovation of external business, find profitable channels for differentiated derivative business; combine customer operation with customer assets management in Internet+ mode, and open up full value chain management channels such as customer selection, car purchase, and after-sales service.

The relevant person in charge of the Beiqi Penglong Group also pointed out that the distributor group must achieve overall planning in terms of manpower, finance, operation and management, etc. Only in this way can significant improvements in business management be achieved and profitability can be quickly improved.

Open innovation is the way to break

No matter what kind of transformation, the purpose is to adapt to changes and create greater value. The dealers obviously want to get rid of the heavy reliance on new car sales as soon as possible, but in terms of actual conditions, sales revenue will continue to be the top revenue of dealers for a long time to come, and the sales of cars is also a high-profit aftermarket business. Foundation.

Faced with shortages of clues, low conversion rates, and customer churn that are common pain points in the industry, it is a consensus to strengthen online presence. From the results of practice, staying in a car vertical platform is more cost-effective than a self-built platform. According to data from a Buick dealer, after using the car home to sell the treasure product, due to the rich and accurate data, it can provide better insights into consumer demand and improve communication efficiency, leading to a 30% increase in clue invitation to store rate.

In addition, the upgrading of the car-watching experience brought about by technological innovation also benefits dealers. A Chery 4S shop stated that “The 4S shop panorama showroom of the Auto House can increase customer stickiness and increase clues. Through the AR red envelope campaign, the amount of clues obtained in a week is 3 times more than the weekday.”

No one business model can last forever. No one competitiveness can be eternal. The relevant person in charge of the Beiqi Penglong Group pointed out that in the long run, the important indicators of the refined management of dealer groups are mainly related to the continuous improvement of service quality and the group effect. It is more important than ever to actively participate in various marketing and promotional activities, especially online marketing activities. “In the first half of 2017, the strong online advertising channels and a large number of high-quality sales leads of the Auto House have provided a good boost to the performance growth of Beiqi Penglong Group.”