WOODCLIFF LAKE, N.J. - BMW dealers have opened eight 'satellite' dealerships.
Three more are under consideration. That puts BMW of North America Inc. near the head of a pack of established brands that are adopting the 'market area approach,' in which a dealer owns a second location in the same market area as his or her primary dealership. The practice was pioneered by newer U.S. marques like Saturn and Land Rover.
Several such initiatives come under the general heading of BMW's 'Retail 2000' plan, which was introduced to dealers late last year. BMW lifted its prohibition against dealers holding more than one franchise in any market area. about two years ago.
Vic Doolan, president of the U.S. subsidiary, admitted that many of his programs are being tried elsewhere, but he thinks BMW deserves credit for moving on all fronts at once. 'It's the totality of the effort that's important. I don't think any of the elements are that different from what other manufacturers are doing,' he said in a recent interview.
At BMW, other programs include:
nCross-training the sales staff in parts and service and finance and insurance, so that the same person waits on the same customer, no matter what the customer wants. Dealers are encouraged to offer compensation plans that place more emphasis on salary and group performance and less on unit volume and commissions based on a percentage of gross profit.
Reducing the wait for 'built-to-order' cars. The South Carolina plant that builds the Z3 has helped, but cars from Germany arrive faster, too.
From start to finish, it takes no more than 30 days to get a car from Germany with specific options, compared to more than 50 days two years ago, said Reinhard Fischer, vehicle process manager. It takes no more than 10 days for U.S. customers to get a car from the U.S. plant, he said.
Parallel with that effort, BMW is trying harder to stay in touch with lease customers and invite them to custom-order a car before their leases expire. Doolan said he believes 60 percent of the company's sales could some day come from that source.
Ed Sweeney, sales manager at one of the five pilot Retail 2000 stores, said the off-lease program has helped sell cars and has saved the dealership money that would have been spent on inventory. He works at Chris Motors Corp. in Decatur, Ga., an exclusive BMW store. 'Everybody wins,' Sweeney said.' The customers get what they want, and there are no floorplan charges. Does it happen? Yes. Does it happen all the time? No, but I believe highly in the program.
'We are truly a one-stop shop,' Sweeney continued. 'We'll get customers what they want - even if it's not a BMW. If somebody wants a Porsche, we'll acquire it from another dealer. ... (The other dealer) doesn't mind, as long as we pay him the profit he wants.'
Besides BMW, other brands experimenting with the market area approach and/or service-only facilities include Volvo, Saab, Jaguar, Mercedes, Nissan (see story on Page 3), Honda, Mazda, Lexus and Infiniti.
Staff Reporter Mark Rechtin in Los Angeles contributed to this report.