Motor Trader The award-winning and longest running UK magazine for car retailing professionals. Your first stop for News, Jobs and Reports for the motor industry.
Following a strong year in 2021, Chorley Group has been racking up the acquisitions, with the latest coming in the form of Vantage Citroen in Blackpool. Back in March it also acquired two Citroen dealerships from the BCC Cars group for an undisclosed sum.
Both moves form a part of the group’s strategic growth plans across the North West. Capitalising on the record-breaking performances in 2021, the business has plans for more acquisitions in the coming months, which it said demonstrated its commitment to reinvesting in the business and into local communities.
The acquisition of Vantage takes the group to five new business locations in the space of 18 months. On the back of this, we spoke to Adam Turner, managing director of Chorley Group on how it approaches acquisition, its future plans and his views on market trends.
On the acquisition front, Turner said that Chorley Group is open to further growth, looking for businesses that it feels it can help grow and evolve. He said “We will continue to look for opportunities to grow, largely with the brands that we already represent. We’re looking at opportunities with those brands across the North West and Manchester.
“We are not focused on just Citroen, we’re very open. It is a relatively new brand for us and we have a great relationship with the team. We are looking to grow with them but we’re also looking to grow with the other brands we represent.
“Growth by acquisition is part of our plans, and we are looking to buy businesses that we think we can expand. We like to buy businesses that we can improve and that slot into our group structure. We have very high market share in our areas, with our current brands, so we want to continue to strengthen this through acquisition.”
And when acquiring and moving into a new business, how does Chorley Group navigate the process? For Turner, respect for the acquired business is key.
He said: “I think the key thing is to have respect for what has come before in the business and trying to build on those strong foundations. We have never wanted to be the kind of business that comes in and rips the heart and soul out of the acquisition, especially when it has previously been run by fantastic operators such as Vantage. It’s a case of looking at what they do and looking at their people and at how we can help improve sales by adding our own techniques. It’s not a broken business, so our first task is to make sure we don’t break it.”
At Citroen Blackpool, this process is just beginning. Turner added: “We are very much in an observing stage and the early stages of optimisation, just looking at the business, seeing what opportunities there might be, but being respectful of the team and the processes in place because we may be able to learn from them as well. So, there’s no specific training to be done with staff, but we do try to have Chorley Group people in the dealership just to make sure the culture is what we like to maintain across the rest of the business.”
When it comes to a Group culture, Turner said that Chorley keeps it simple and just aims to look after all those associated with the business. He added: “We do have some key pillars, but we don’t get hung up on straplines. We have one goal within our business, which is to look after people, whether that be stakeholders, customers, or staff. We want to do the right thing. We may never be the most profitable group in the world because of that, but it is the way we like to run our business.”
Making an adjustment
With 2021 being a bumper year for many dealerships off the back of a disrupted 2020, 2022 is a more normalised year. He said: “In the grand scheme of things performance is strong when compared to more normalised years like 2018 and 2019. It was always going to be challenging to come off the back of a good 2021. I think realistically we all knew those times couldn’t last, so were expecting a decline.
“Used cars have taken a bit of a dip since April, so it has been a more challenging, but we are working our way through, and we have refocused our used car proposition.
Our new car situation is going well because we have some strong order banks. The challenge is adapting to the changes to our business model as before we could supply vehicles within weeks, now we’re looking at anywhere between two and 12 months. So, it’s been a massive change in the way we market our messaging to customers. We’re a very aggressive business when it comes to marketing because we like to get out there and bring traffic in. But the job has changed over the past 12 months with extended lead times, and it’s been a bit of a learning curve for sure and we have more to learn. I don’t know if it will go back to the way it was.
“I think one of the most obvious trends this year is the decline in used car volumes and a slight decline in PPU. I think the reduction in PPU has ultimately come from the fact that we’ve got vehicles that have been appraised and valued several months ago to come in against new cars, and now we don’t quite know where they stand. Managing customers on that journey is also challenging, and there is a consistent theme of having to manage customer experience more than the actual sales process. We have moved away from being a sales business. We are a customer experience business now.”
And has the behaviour of those customers changed with the cost-of-living crisis? Turner said he hasn’t seen any major changes.
He said: “We have not really seen an impact from the cost-of-living crisis yet, but there has probably been an impact on the traditional spikes in the industry, so March was not as aggressive as it once was. We’re noticing a lot of premium brands being part exchanged against our brand programmes, so your typical premium BMW, Audi, Mercedes being exchanged for, for example, an MG. You could attribute that to a cost-of-living crisis, but I think it’s more likely that MG has good value products.
“I think we’re in for a challenging six months, but I think that it will be fine providing we are efficient in absolutely every area possible. That doesn’t mean a cost cut, just making sure that the money that you spend is being maximised. But, the good businesses will come through. The cream always rises.”