Life for dealers in 2009 was tough, but it may have been even tougher for brokers.
Stephen Bentley, CEO of Automotive Avenues in Lakewood, Colo., used the downturn as an opportunity to advance his brokerage business, most of which is connected through credit unions.
Automotive Avenues' new- and used-vehicle sales fell last year, from a peak of 4,600 to about 2,350, and the company took some hits. Head count was reduced by about 10 percent, and Bentley eliminated some employee benefits in exchange for not cutting further.
"You had to look at priorities," Bentley said. "Some benefits are nice and make us a better place to work, but we just could not retain all those benefits."
For example, he cut the company's 401(k) matching contribution and long-term disability insurance.
Bentley also made a major change in how Automotive Avenues interacted with franchised dealers and its credit union customers, which include 700,000 members belonging to Bellco, Elevations and the Credit Union of Denver.
Previously, Automotive Avenues had linked with as many as 60 new-car dealers -- basically anyone who wanted to do business with the company. But that created inventory-tracking problems.
Bentley decided to pare his connections -- to just one dealership per brand -- and list the inventories of 6,000 new cars in real time on his site. That made for quicker customer interactions but also more precise communications with his fewer dealer partners.
Lead generations have increased to 950 a month from 700, Bentley says.
"Around 95 percent of customers are going to the Internet first. The sales process is changing," Bentley said. "Our site itself will become relevant ... and become a more efficient way to display inventory for our customer bases."
Automotive Avenues also is aggregating its used-car inventory through consignment deals. As a result, used-car listings on the company's Web site have jumped from 200 to 2,000 vehicles.
Said Bentley: "We are becoming the central information source for these relationships."