A little over a year ago, Richard Dyer was at the top of his game. His 19-year-old Volvo dealership in Chamblee, Ga., was the No. 1 retailer of new Volvos in the country. Profits were good. Customers were happy. Turnover was minimal.
But Dyer, a second-generation Volvo dealer, sought a challenge.
How could he run his own store and have access to more capital to expand? The answer arrived when Sonic Automotive came calling.
'We sold to Sonic in November of 1997, and one of the main reasons was economics,' says Dyer, who started his dealership at 27.
'It was a way to liquidate the assets of the dealership and take some additional profits into personal income,' he says. 'Plus, I'd still be able to run the dealership.'
Dyer & Dyer was one of the first acquisitions made by Sonic after its initial public offering in 1997. After 12 months, the company owned 73 dealerships and 15 collision repair centers.
With plenty of resources, Sonic has provided capital to help Dyer fulfill his dream of having multiple locations. In May, Sonic will open a $4 million Volvo dealership in Gwinnett County, Ga., one of the fastest growing U.S. counties.
In 2000, Sonic will open a third Dyer & Dyer Volvo store in Buford, Ga., 10 miles north of the Gwinnett dealership. Sonic also is setting up an Oldsmobile store in Chamblee in Dyer's former used-car showroom.
Not only did Dyer receive the proceeds from the sale of his dealership, but Sonic appointed Dyer its vice president of Volvo franchise development. All Sonic's Volvo dealerships, including the Atlanta-area stores, report to Dyer. In addition, Dyer is responsible for contacting other Volvo dealers who may want to sell and contacting the importer about open points.
'I have a three-year contract, so we'll have to see what happens at the end of the next two years,' says Dyer.
To Scott Smith, Sonic president and CEO, it's a win-win deal: Sonic gets Dyer's expertise and contacts, and Dyer gets capital to expand and a percentage of profit from each store he manages.
'It's a performance-based compensation program; we give him a low salary, then a percentage of net earnings of the stores he runs,' says Smith, who is the son of Sonic chairman and founder Bruton Smith.
'He has a three-year contract and he'll come up for 'free agency' in two years. I expect Richard to stay with us as long as he is enjoying what he is doing.'
Dyer recently helped Sonic purchase BMW-Volvo of Chattanooga in Chattanooga, Tenn., and Tampa Volvo in Tampa, Fla. He has been calling Volvo dealers around the country and telling them his story. Some are interested; others are not.
Dyer says little has changed at Dyer & Dyer since Sonic purchased it. Most employees and managers stayed. Some managers have been promoted to new posts.
'We've run it the way we've always run it ... and that's the way Sonic wants it,' says Dyer.