UPDATED: 1/17/14 8:40 am ET - correction
EDITOR'S NOTE: This story has been corrected to correctly identify the provider of business development center services used at Henry Brown Buick-GMC in Gilbert, Ariz. It is Traver Technologies of Houston, a business unit of ADP Dealer Services.
In the mid-1990s, Henry Brown expanded his Mesa, Ariz., Chevrolet store from a modest outpost on the outskirts of Phoenix into one of the nation's highest-volume Chevy dealerships. It sold more than 8,000 new Chevrolets for four straight years through 1997.
The next year, Brown sold the operation to Republic Industries, AutoNation's forebear, and retired, settling into a 340-acre quarter horse farm in Oklahoma. But the third-generation dealer soon got antsy. In 2004, he returned to Mesa to buy a Buick-Pontiac-GMC dealership. Brown moved the store, now called Brown Buick-GMC, in 2008 to nearby Gilbert, where he is transforming it into another volume monster. New-vehicle sales in 2013 jumped to around 1,800 from about 600 when Brown took over.
Brown, 69, credits much of his success to his business development center, an office in the dealership in charge of following up on phone and Internet leads, as well as contacting customers for everything from birthday wishes to lease-expiration reminders.
Although business development centers have been around for years, Brown says most dealers don't use them, partly because contracting with a third-party vendor to help operate one can cost $5,000 to $10,000 a month.
But Brown is a business development center believer. At Brown Buick-GMC, the center occupies a prominent office.
Brown is chairman of Buick-GMC's National Dealer Council, and General Motors touts his business development center as an example of how such an operation can drum up sales and keep consistent contact with customers.
Salespeople "want to rely on floor traffic, but that's diminishing" because most shoppers research vehicles on the Internet before visiting the showroom, Brown says. "So it's become vitally important to learn how to contact your customers through your BDC."
GM's 'big push'
David Kain, president of Kain Automotive, a consultancy that trains dealership staffs in digital marketing, says business development centers are most common at dealership groups, which can spread the costs across multiple stores. He estimates that as many as half of the dealership groups in the United States have business development or call centers, while roughly 20 percent of single-point dealerships operate them.
GM wants more of its dealers to get on board. Starting this month, GM is requiring all dealers in its Standards for Excellence incentive program to have some of their employees go through business development center training.
GM is "making a big push for BDCs," Alicia Boler-Davis, GM's customer experience chief, told Automotive News last month. She said most of GM's 4,300 dealerships don't operate the centers and "don't understand the need" to keep sales leads from falling through the cracks.
Brown's dealership contracts with Traver Technologies of Houston for the software to run the center. Traver Technologies also provides face-to-face training and on-site consultation.
Business development centers have their detractors, who say that the centers breed laziness among sales staffers. While center employees work on Internet and phone leads, these critics say, salespeople on the floor simply wait for customers to walk through the door.
Brown believes he has the antidote to that problem: He merged his traditional floor staff with his business development center.
Now, each of his 38 salespeople is required to spend one hour per shift in the call center, working off a list of 30 prospects and customers gleaned from Brown's customer relationship management system and a list of leads from GM.
Brown says the structure helps forge better ties with customers by having the same person who set the appointment greet them upon arrival, which wouldn't happen if the call center and sales staff were split.
"Everyone in the dealership has to buy into the BDC and get involved," he says. "Otherwise, all of your salespeople end up standing around bitching about how tough things are or how Ford has a better rebate than us."
Getting that buy-in from salespeople, he warns, can be difficult, but the process exposed how many leads had been ignored before the system was implemented.
Predictor of sales
At Brown Buick-GMC, the business development center has a prominent location in view of the showroom to reinforce that it's the "heartbeat of the dealership," Brown says. It has eight workstations for sales staffers and is overseen by a manager.
Calls are recorded. The best and worst interactions are played back during sales meetings for training purposes, Brown says. Within 10 minutes of when an appointment gets scheduled, the desk manager is required to call that customer to confirm as an added element of formality.
"The whole point of the BDC is to make an appointment and get the customer in to take a test drive," Brown says.
Brown Buick-GMC's most closely tracked metric is the number of scheduled customer appointments for test drives and trade-in estimates. Brown gets a text message each night that shows how many appointments are set for the next day and for the coming weekend.
"We can practically predict what our sales are going to be based on those schedules," Brown says.
On a typical Saturday, the dealership has around 30 scheduled appointments, Brown says. About three-quarters of those will show; half of them end up buying eventually, he estimates.
"People don't just drive to a dealership on a Saturday to see what's going on," Brown says. "You've got to go out and get them."