Interview – Sean Kelly Vines Group MD
The view from Vines MD Sean Kelly: “September has been nuts”
Sean Kelly is Group Managing Director of Vines, the privately-owned BMW and Mini group based in the south-east. In both his current role and having previously worked OEM-side with BMW as a regional manager, he has lived and breathed premium car sales.
Here he outlines his views on the current sales trends in the volatile 2020 market, as well as giving his insights into some of the challenges that retailers face at present.
How was September for you?
“At one point we were looking at being 30% up year-on-year, which is crackers. That momentum couldn’t possibly last to the end of the month, but even then we were looking around 20% up, which is incredibly positive. From our perspective the market remains buoyant: there are sales coming in, aftersales is going like a train – I’m cautiously optimistic for the year-end.”
Why only cautiously?
“Because there is no crystal ball at the moment, and we have already had to take some hard decisions around restructuring that I want to respect. But we are looking to be in the right shape for the market, albeit with everyone having to work a bit harder – and smarter, making more use of the technology we have – to absolutely maximise what we can get out of it. Today, I look out across the dealership and we are busy, and that’s all I can ask.”
How is the pipeline of orders looking?
“Strong – possibly as good as we’ve ever seen, and that’s a result of a lot of hard work to try and manage the flow of supply and demand. The enquiry rate remains high – if not at the super-peak we saw earlier in the year – and is high enough for us to run a sustainable business at least until the year-end.
“Add in the fact that there are still concerns around using public transport, and it’s clear that cars have a major role to play, whether they are new or used. Sure, we aren’t playing at the bottom end of the market, but the flip side is that PCPs have made BMWs and Minis more affordable for many. We have cars for most budgets.”
Are you seeing evidence of people using money they saved in lockdown to treat themselves?
“Certainly. Some people did save through not going on holiday or living as freely as normal, and they are rewarding themselves for getting this far through it. Others are predicting that they won’t be travelling abroad as much in future, so are investing in something they can enjoy around the UK more. Finally, I think there’s been an acceleration of people wanting to buy premium brands – the trend has been there for a decade or more, but I believe it has accelerated again.”
Does the mass-market appeal of premium brands jeopardise their exclusivity?
“I don’t think so, no. Because the product ranges are so large these days there’s a lot of differentiation across the brand – you and your neighbour might both own BMWs, but it’s unlikely they’ll be the same model, let alone the same trim.”
Are big, fancy dealerships a part of that?
“They are important to creating a brand, yes. You can’t just make a product and expect it to sell, even if it is great. You have to create a feeling around that product, and that is where our dealership experience comes in.
“The comparison I’d use is Rolex watches. They make a lot of them now, but they are still hugely desirable thanks to the brand strength. Another one might be an upmarket hotel – say the Savoy. If you go there you expect a better experience than in a Premier Inn.
“The fact is that there are still a lot of people out there who dream of one day owning a BMW or a Mini. Our job is to ensure that they feel special when they walk in to decide on whether to act on that wish, and our showroom experience helps with that.”
Do your customers always recognise that?
“No, to be frank, they don’t, and it is a huge irritation to me. We are only as strong as our weakest link and, while I love the teams we have, we can always do better. At the moment we are recruiting in some areas, and our desire is to find more people with a customer service background, rather than car sales one, because I believe that will pay off; I can teach the car knowledge, but it’s harder to retrain someone’s attitude.
“The main thing for me is that the managers all have time to train their teams. It’s easy to get embroiled in day-to-day tasks and to skip over developing people, but I believe that training is vital, and not just in the formal classroom sense – managers can achieve a lot every day. Likewise, I’m very conscious of not just cutting teams to the bone to improve the bottom line – they need breathing room to be able to improve.”
“At the end of the day we are a relatively small group, and I don’t have the buying power or the cheque book that some of my rivals have. I need better people to compete.”
Is addressing gender balance part of the same challenge?
“Yes. More by accident than design we do have a strong female representation in the senior team here, but there’s no question we need to do more to broaden the mix in all areas. I understand why we have a shortfall; garages are seen as unexciting and uninviting places to be in. But the reality is that our retail sites and workshops are incredibly sophisticated and we need to do more to sell that image.
“Our goal has to be to represent our customer base. We’ve taken some strides towards that, it’s why we don’t dress in suits and ties anymore, for instance, but absolutely there is so much more that we need to do.”
Are online sales also part of that changing landscape?
“We’ve had a couple of people buy outright online, but it is very, very rare. Where we are seeing growth is in people researching online, or reserving used car stock online and then coming in to view it.
“Most customers still desire to interact with a human being, but the point at which they wish to do that is changing. Especially at the moment, anyone who walks in a showroom wants to be there, and if they walk out without buying I’m a firm believer it is going to be because of something we’ve done wrong.
“They will also walk in knowing more about a particular model than our salespeople could hope to, so we have to acknowledge and sometimes even help steer them towards more suitable choices, about which we might know more. But the key here is that we are experts at dealing with people – and the vast majority of buyers still want to lean on that expertise.”
How are rising used car prices shifting the dynamic for salespeople?
“The key is to look at it from the perspective of the customer. It’s absolutely true that used car prices are rising – that’s the simple logic of supply and demand. There’s the double impact of increased demand as people try to avoid public transport, and reduced demand, because of the pause in collecting lease cars during lockdown.
“But the flip side to that is that someone who might have been looking at a nearly-new buy is now seeing that the car they want isn’t much more money on a manufacturer-backed PCP. We can offer the customer the choice, and it is part of our job to ensure that they get the very best deal for their money. Often, that might be by buying a new rather than used car.”
What’s your outlook for the near future?
“As I say, it’s positive at the moment, and we’re using that to build up a pipeline for the months ahead. Yes, there are stock limitations, but we can either use that to push nearly-new or used stock, or to encourage a customer to factory order a car, creating a car to their own specification which is worth a little bit more of a wait.
“I’m sure there will be tougher times ahead, but I’m an optimist. I don’t worry about anything, because I’d rather focus on what I can do. I’m a firm believer that the most exciting thing to happen every day is what’s coming next, and there’s no greater motivator than that.”