Published in Automotive News Dec. 1, 2014
In March, DARCARS Automotive Group founder John Darvish, now 78, handed over control of the company. Son John Darvish, 42, who started working at DARCARS at age 6 in the parts department, became CEO. His brother, Jamie, 39, became COO.
DARCARS has bought limited rooftops over the past 10 years, but Darvish intends to double the company's size -- whether through acquisitions or revenue or both -- in the next five years. DARCARS has 22 dealerships, two in Florida and the rest in Maryland and Virginia. The company posted revenue of $1.13 billion in 2013 and ranks No. 31 on Automotive News' list of the top 125 dealership groups based in the U.S., with retail sales of 20,577 new vehicles in 2013.
John Darvish discussed his plans for DARCARS with Staff Reporter Jamie LaReau.
Q: You became CEO in March. Your brother is COO. How has the transition gone?
A: It's been pretty smooth and pretty effective. We're still learning a lot, we're still studying a lot and gathering what's working well, what's not working at all.
How long did you plan the succession?
We worked on succession planning solidly for five years prior to the announcement.
How do you and your brother divide the responsibilities?
I guess it's easy -- I'm the oldest and I'm the CEO. We get along very well. Some days we talk 10 to 15 times. We're in the process now of creating a corporate office space where I can at least have a home base for our leadership team, although they'll be most of the time in the stores. It'll make communication and planning a lot more efficient.
How were you groomed to take over?
I was vice president of the whole group prior so I had a very good knowledge of everything that was already on the table.
Jamie and I together visited every single location that we have. Some of those locations, we spent the entire day there. We went through every inch of every facility -- storage rooms, locker rooms, obviously the showrooms and service areas and everything. We made time to go into each department and talk to the employees very candidly about what it would take to make DARCARS the best place to work. Anything that comes to their mind, we want to know.
Those tours took us a little over a month to complete and we came up with a list of over literally 499 items that needed to be addressed. We have taken almost every single one of those, assigned people on my leadership team to be the task force on those items and see to it they are addressed.
How does your leadership style differ from your father's?
We're similar in many ways. One of the biggest differences is he is very autocratic. I believe with a company our size, especially in today's marketplace, if we want to win and be the best, we have to have excellent people -- which we've always had, great people -- but empower those people to build.
An easy example is the question I posed to every single employee: What would it take to make DARCARS the best place to work? If I can get all employees to answer that question, that'll give us a good head start.
The next questions are: Does the company you work for enhance the quality of your life regardless of paycheck? What can we do as a company to make your life better? This is what I've tasked our leadership team to make job one.
One of our assistant service managers emailed me about the vacation pay policy. I looked at it and I had a conversation directly with that assistant service manager. We ended up changing the policy, with his help, to what would make it extremely competitive rather than run-of-the-mill. It'll cost us some cash, obviously, but the way I see it, over the long run we will be able to attract and retain better people.
What is the extra benefit?
It's how the compensation is calculated. It would probably end up tripling vacation pay for full-time employees.
What other changes have you made?
One thing we were very weak in is our digital marketing. We completely revamped it. We have basically an all-new team. We've hired a really great person to head up those efforts.
Our traditional marketing team had no communication with our digital marketing team prior to the transition. We revamped that. We now have one marketing team. Under that digital presence comes not just the marketing, but the social media and another division under that team is all of our equipment, such as telephones and computers. It streamlines it and makes it easier for our employees to have all the tools that they need.
And that gives you more efficiency in those operations?
It creates efficiencies, but on our leadership team, we want one person for every facet of our operations. One person I can go to if we have a problem in one of the shops. Or not even a problem; we just want to talk about, say, technician compensation.
So that one person takes ownership of an area and gets the job done?
Absolutely. Our plans are to grow across the country and possibly beyond, and as we do that I'm going to need to have a team set up that understands how to handle everything that falls under their area of responsibility.
You have 22 dealerships. What are your plans for expansion?
We are fast at work looking at some acquisitions. Jamie and I committed to our employees that our goal is to double the size of the company, in terms of revenue, over the next five years.
Are you interested in expanding overseas?
We would be interested in going overseas. However, I would not go overseas until I have everything here dialed in and the leadership team is fully functional.
What about in the U.S.? You're mostly in the East now. Is there any other region you want to expand to?
We're completely open. We're not looking specifically marketwise; we're looking at where there's a deal.
Which areas of the company offer the most growth opportunities?
We are looking at both sales and service very intensely every day. Some of those things I can't discuss, but they will really revolutionize, in our opinion, and change the game for how most dealers will do business. What we said at our conference table was "forget about how impossible it might sound, forget about how unrealistic or how the numbers might not work. Don't worry about that. Just come up with the ideas."
They came up with some really strong stuff. It was a little challenging to see how we're going to tackle it, but we've come up with some ways on how it will work and we're fast at work.
DARCARS has been progressive in many areas, including hiring female service writers. How do you plan to continue to attract and retain women, minorities and college grads?
We have to change the game. We cannot operate as a car company the way it was operated five years ago. We need to understand what people want and find a way to give it to them.
As I tell my leadership team, all of our meetings and conversations are all about how to better service the customer. I asked everyone: "Please tell me the last time you were in a DARCARS meeting that was talking about how to better serve the employee." Everyone just looked at me. This is what our meetings need to be about.
If we find a better way to serve our employees, our employees will take better care of the customers. That goes hand in hand with attracting Gen Y and attracting the female.
You used technology to improve your finance and insurance profits. How else will you use technology?
One thing we're looking at with technology is, again: How can we better serve our employees? We're going to use technology to make their lives easier.
Beyond that, we're looking at ways to make technology genuinely streamline a process. We're looking at ways that will really, really save the customers' time. If it saves them time and even one ounce of hassle, what can we do?