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4 Best Practices To Reduce Employee Turnover At Car Dealerships

[fa icon="calendar"] July 20, 2020

3 minute read

4 Best Practices To Reduce Car Dealership Employee Turnover

Car dealerships have an employee retention problem. The employee turnover rate currently stands at 67%*, a number that has risen steadily for a decade. This trend presents a costly problem for dealerships, who lose millions of dollars when employees take their customers with them to the next dealership.

This employee turnover problem that car dealerships are suffering from is not going away anytime soon:

  • According to Automotive News the average sales associate stays at a dealership for just a little over two years
  • 45% of dealerships have an average employee retention rate of three or more years. However, that number fell to about 33% when looking exclusively at employees who work in sales positions.

Employee turnover not only causes monetary losses for dealerships, but it is also costly in terms of reduced sales opportunities. When continuity is broken in the sales department, new employees have to start building relationships with customers from scratch. 

A typical dealership loses an average of $500,000 each year due to employee turnover according to Automotive News. Considering this fact, it is not surprising that the most profitable car dealerships also have the lowest turnover rate.

Short of seeing into the future... 

average sales associate stays at a dealership for just a little over two years

how can you reduce employee turnover at your car dealership?

1. Keep All Customer Information In A Central Place

Customer data loss occurs when employees keep customer information in their personal phones or on their personal laptops. When an employee leaves, that information goes with them and potentially to a competitor.

Take power back by storing all customer information and exchanges in one central place: the dealership's own cloud. When your car dealership uses technology in the cloud, you will always have the information, regardless of how many employees leave.

Plus, you can monitor the interactions employees have with customers and with each other to make sure these conversations are not detrimental to your dealership.

2. Cut Former Employees Off 

When you have a central place in which to store information and customer exchanges, you can cut employees off from your customer base when they leave. This tactic prevents your competitors from getting ahold of this valuable customer information.

3. Engage Employees To Prevent Them From Leaving

Too many car dealerships use antiquated practices, leaving employees unengaged and disconnected. Instead, utilize technology to take care of repetitive tasks so that employees can focus on the core responsibilities of their job. This frees up their time and energy to focus on the tasks that will generate revenue for your dealership and keep customers coming back for more.

4. Group Chat

It is far too easy for dealership employees who work in different departments to feel disconnected from each other. Traditional modes of communication leave internal and external communications open to costly errors. 

Monitoring and managing communication is another challenge that car dealerships face. There are so many employees, keeping track of their conversations is difficult, to say the least. Internal communication breakdowns can cause cracks that lead to craters - both when servicing customers and when operating the business. 

Create a connection between employees in the same department, different departments or throughout the entire dealership with a group chat solution. The names of the employees who are online are displayed so that you always know who is available to chat. Chat rooms can be customized in several different ways to perfectly suit your evolving communication needs. 

By using the group chat, you eliminate the need for external messengers and personal phone lines. This allows you to retain control over communications and access conversations at any time since all chats are stored in the platform. If there is an issue with an employee, management can review their interactions to get the full picture.

When you store customer information in a central place instead of on employees’ personal devices, you protect your dealership against losing the information and against employees taking it with them to competitors. 

Giving employees ownership of more interesting tasks and reducing the number of repetitive tasks required of them will improve employee engagement and retention rate. 


Would you like to learn more about solutions that reduce employee turnover, & see how other car dealerships are implementing communications software successfully?

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Topics: car dealerships, group chat, Employee Turnover, Group Chat feature


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