The level of employee turnover in car dealerships is on the rise. The highest number of job hoppers comes from the sales department; causing the biggest disruption in day to day operation.
A few years ago NADA Chief Executive Steve Shakaly gave two reasons for high sales consultant turnover. First of all, you get entry-level workers who decide to try sales but then realise they aren’t made for it. Second of all, he explained that automotive retailing is going through significant industry changes, which puts pressure on sales staff earnings. His rationale is true to this day, however there are other factors playing a role in this movement.
The three factors that every employee will consider before job hopping are salary, career development and workplace culture. However, in some instances job hopping can be traced right back to poor hiring practices. Recruiting new members of staff without an effective selection process in place is very much like buying a car without taking it out for a test drive.
The Vicious Cycle of Employee Turnover
Employee turnover can very quickly escalate and turn itself into a vicious cycle. Once this ugly trend kicks off, the workload piles up on steadfast employees. Stress levels start to build and the quality of work falters, customer service suffers and before you know it more employees start looking for other jobs. Car dealers are left with low productivity levels, shattered culture and years of rebuilding their public image.
The ripple effect of risks that car dealerships have to mitigate against employee turnover is a serious business drawback. You can tell a great deal about a car dealership that keeps on losing its employees. Just a whiff of unhealthy working culture can repel any customers and potential investors.
The trick lies in Recruitment
You cannot yield profits without making an investment. The trick is to have an effective hiring process, and select candidates that are eager to work towards their rewards and incentives through hard work and engage in the businesses goal and objectives.
Creating that win-win scenario between dealers and their staff is going to lower the employee turnover rate and in exchange help them improve their business’s performance and reputation. The cost of staff retention will always outweigh the cost of employee turnover and its consequences.