strategic plans, develop a strong bench of talented department
managers, complete acquisitions and integrations of new
dealerships, and continually drive operational improvements.
Dealerships that are strong in execution have a robust
operating system that makes daily performance and continuous
improvement the norm and not an exception. Those with strong
execution also maintain high levels of financial working capital,
building a strong foundational platform for the future. Strength
in this area tends to make dealerships more profitable and
require less outside capital to operate. This has a very positive
impact on valuation.
Leadership
Leaders are responsible for connecting the financial, growth, and
execution functions into a cohesive, high-functioning team. But
leadership teams are not static. They evolve over time as people
join and leave. Strong dealerships actively manage and plan for
the ebb and flow of the leadership team.
Many in the Baby Boom generation are reaching an age where
they are planning for the next phase of their lives. Since most
dealerships are owned by Boomers, there are many dealers that
are currently contemplating their succession or transition.
One of the riskiest periods for a dealership occurs during
leadership or ownership transitions. With the right planning and
approach, this can also be a period of revitalization and new
ideas. It takes time to prepare for a transition that maximizes
value for the current owners and ensures sustainability for the
new owners. The best dealers start the succession planning
process many years ahead of a