Building a diverse staff requires a dealer push

Jason Olesnavage's auto career got off the ground quickly, like one of his field goals for the University of Michigan football squad.

Olesnavage, whose family has indigenous roots in New York's Cayuga tribe, was drawn to the industry when, in 2010, a professor alerted him of an informal training program for potential general managers at Victory Automotive Group, which has stores in Alabama, California, Florida, Indiana, Michigan, North Carolina, Ohio, Tennessee and Texas.

Olesnavage was a kicker for the Wolverines, appearing in 12 games as a fifth-year senior. The economics major was unsure of what career options he wanted to pursue, so he began researching the car business once his professor mentioned the opportunity. He said he liked what he discovered because he felt auto retailing was a career in which hard workers could move up the ladder.

And he did just that. In three years, Olesnavage went from bright-eyed rookie in the service lane of a North Carolina Chevrolet store in 2010 to general manager at a Honda dealership in California.

All Olesnavage needed was a nudge from a professor to consider the car business -- a field in which hiring workers from various cultures will be key in the years to come as car buyers become increasingly diverse. According to IHS Markit, 28 percent of 2016 model year vehicle registrations in the U.S. were by ethnic consumers, defined as Hispanics, Native Americans, African-Americans and Asian/Pacific Islanders. That percentage is forecast to keep growing.

A diversity of employees, one expert says, also leads to a diversity of ideas -- not just colors. More and better ideas can help dealerships thrive.

"As in general for minorities, and just the general population, [auto retailing] is not seen as a career path as much and not pushed, which I think is the first problem. There are not avenues to explore it [and] get mentored in the business," Olesnavage, 30, told Automotive News. "If you don't have the support from a mentor or an owner or a direct manager, the road is a lot harder to travel."

But many young minorities and women aren't aware of opportunities in auto retail and never take a serious look at the business. Champions of diversity within the industry say this has to change if dealerships ever expect their employees to reflect the communities they serve.

This won't be a passive exercise, either. Some minority dealer associations say dealers will have to do some legwork to find more diverse recruits by going into their communities and talking to potential hires where they congregate: churches, beauty salons, barbershops, high schools and colleges.

Stores also will have to be more precise when writing job descriptions for career sites by clearly telling applicants what the car industry has to offer them.

Terms such as "rock star" and "sales ninja" or phrases such as "only closers need apply" tend to appeal to a narrow demographic and won't help stores bring in women or minorities, said Adam Robinson, CEO of Hireology, a Chicago consulting firm that helps dealerships recruit and hire, in part by broadening their candidate pools.

Dealers, he said, have to think about the perks they have that would be enticing to the groups they want to bring in.

For example, Robinson said women are vastly underrepresented in auto retailing, accounting for about 10 to 15 percent of the sales force despite being decision-makers in 70 percent of car purchases. But dealers could snag more female applicants if they mention that they offer salary-based pay plans instead of commission-based plans.

"The goal of any dealership should be to have a work force that mirrors the demographic makeup in the community they're serving. If your community is 30 percent Hispanic, 30 percent Caucasian, 30 percent African-American, ideally, your dealership employee base is split along those lines as well," Robinson said.

"Armed with those as benchmarks, the next thing that dealers need to do is make sure their employment brand is going to attract a diverse candidate," he added. "So much of that is linked to the copy, the word choice and images presented in the career site."

Damon Lester, president of the National Association of Minority Automobile Dealers, said diversity within stores is critical because consumers tend to gravitate to those who look like them or speak the same language. Lester said the directive for increasing diversity has to come from store leadership, however, and should trickle into every facet of the operation -- from salespeople and accounting to management.

Lester considers the incorporation of a multicultural hiring strategy as a business imperative that will ensure that stores won't lose market share as demographics shift. Consumers who come into dealerships and see their cultures represented, he said, likely will spread the word about who they worked with and become "marketers" for those individuals.

To enlighten young people about the industry, NAMAD visits historically black colleges and universities to plant seeds in students about growth opportunities in auto retail. He said students at Clark Atlanta University were "blown away" about the possibilities in the car business during an event last fall. Another program is on tap for March at Bowie State University in Maryland. 

When some think of the automotive sector, Lester said, being a salesperson is often the first thing that comes to mind. Lester said students don't realize they can make a great living being a service technician, for example, and that they don't have to be salespeople for their entire careers. 

Lester said auto retail doesn't have an infrastructure to make people aware of the industry, so NAMAD has been doing its part by pulling together manufacturers, dealers and suppliers to talk to students about the industry's entrepreneurial spirit. 

"I think our industry has to paint the picture of the opportunities that are available for growth. You can't just be a salesman forever," Lester said. When prospects forge a career path at a dealership and set goals, stores should show them "the number of years that it will take for you to be that. We have to do a better job of painting the picture of progression and advancement in our industry."

For established dealership managers who want to become owners, there are programs available that will provide funding. A.V. Fleming, executive director of the Ford Minority Dealers Association, said minority dealers have been taking advantage of the Ford Capital Loan Investment Program that was introduced in 2012.

While the loan program isn't limited to minorities, it's been a useful tool for them.

It requires dealers to put up 20 percent of the cost of the stores. There is a first loan through Ford Motor Credit Co., secured by the dealership's assets, and a second, unsecured loan. The secured loan is to be paid off first; the second loan then is refinanced and converted into a secured loan.

"This is a good program for access to capital," Fleming told Automotive News.

General Motors, Toyota and BMW have similar programs, but not all brands do, and the commitment behind such programs varies widely.

Now that Olesnavage has paid his dues, he's looking to become a dealer principal.

He's researching the programs offered that can aid minority dealers in establishing footprints as owners. He said the capital constraints make it difficult for anyone to own a store, especially minorities who don't know "as many folks that have done it before you and can help you along the way."

He has researched a variety of automakers' programs and requirements, including those of Ford, GM, Fiat Chrysler, Nissan and Toyota. He isn't picky on which brand he'll start with.

Right now, he's finding it hard to get in front of the right people and dig out information on the programs that are offered to minority dealers. He spoke with a dealer body representative for one manufacturer but said he came away unsure whether the company would be a true partner.

While Olesnavage's quest continues, he said dealerships should pursue high school internship programs to increase awareness among minority students.

"I think more than anything, the opportunity isn't shown to them. If you don't know the car business, you're not going to have that chance to get your foot in the door," he said.

"Think outside the box and try to find the right people who have the skill set and are willing to work hard in these minority groups, and then nurture them. The sky's the limit on what that opportunity can bring to the dealership."