Tacklng Turnover


I wish I had 10 bucks for every dealer who's complained about staff turnover and then, almost in the same breath, admitted to having a compensation package less attractive than that offered by the local burger joint. Or for every dealer who's claimed to have issues but does nothing to correct them.

Sorry, I have no sympathy for that logic. But I do have some ideas on how to reduce turnover (and management stress) while increasing profits. This comes from teaching parts and service people for the past 25 years. Here are the top 10 reasons they said they left a dealership, along with what you can do to avoid a similar situation:

1) Work was boring. Vary job duties to keep staff invigorated with new challenges. Transfer employees to another department if needed.

2) Store wouldn't implement new ideas. Ask staff for ideas to improve profits and customer service. Your best employees will deliver action plans ready to implement.

3) Employee felt unappreciated. Interact with every employee, every day. Criticize in private and praise in public. Adjust pay for performance, not for time in grade or as a one-raise-fits-all strategy.

4) Owner's family member was unbearable to work with. Decide if the store is going to be run like a business or a family. If you choose the latter, expect less profits and greater turnover and stress.

5) Employee paid the same as (or more than) customers. Offer employee discounts. When employees ride accessorized bikes of your brands, it tells customers the store believes in what it sells. Offer at least 20 percent off retail to inspire purchases. If it were me, I'd sell to staff at dealer cost. That might even reduce internal pilferage.

6) Store didn't offer tool insurance, health insurance or a retirement plan. Even some type of insurance and retirement plan is better than none. Consider sharing the premiums with interested employees. I know techs who quit the business altogether when their dealership was robbed and they couldn't replace their tools. Admittedly, the younger, single employees may not be excited about health insurance and retirement, but the married-with-children employees will be. And married employees are better candidates for long-term employment.

7) Too many work hours and not enough personal time. Flex work schedules whenever possible (seasonally, for example). Alternate weekend duties so all employees can enjoy family/personal time. Consider subsidizing a manager's cell phone so he or she can leave the store but still be on call to handle a crisis.

8) No (or limited) training. I have seen dozens of students rejuvenated by getting away for a few days and learning new skills. Every employee should attend external training once per year.

9) Could earn more elsewhere. Create a pay-for-performance compensation plan that extends to 10 years of employment. It should take into account the skills accrued and the value of that position. The most effective pay plans combine a salary or hourly wage with an incentive.

10) Jealousy — the boss made all the money. When I was at MMI several managers and I were invited to my boss's house for a dinner with Harley-Davidson dignitaries. The dinner backfired because everyone learned the boss was very wealthy. Afterward, employees wanted a raise, and the Factory guys started resisting our requests for motorcycle donations. My boss had the right to spend his earnings on a nice home, but he should have held the dinner at a local restaurant.

This article should spark discussions among staff, management and owners. Communication is key to keeping turnover low and profits high.

Dave Koshollek teaches sales and service classes for dealership personnel. His career includes stints as a service manager, Dynojet VP and director of technical training at MMI. E-mail him at editors@dealernews.com.