“We make our decisions based on the most productive employees in the company, those who have been with us for a long time, who are unwavering to the company, and who are part of the Chapelhouse family.
That’s Phil Clay describing the culture of Chapelhouse, a £112 million racing organisation founded in the North West that sells Suzuki, Kia and MG, and there will be more in the future. Chapelhouse named Clay as its new chief executive in January 2023, when Nick Coen stepped down from his role. role. Clay, with 24 years of experience in the automotive industry, joined Chapelhouse in 2015 as the group’s director of aftersales, was promoted to director of aftermarket a few years later and became the group’s chief operating officer in 2019. In the year prior to his appointment as CEO, Clay had been advised by the outgoing CEO and the president.
Due to the pandemic, Chapelhouse has been instrumental in accelerating the rollout of virtual so that consumers can continue to do business with movement restrictions and closed showrooms. In fact, the company has revamped most of its formulas. It had a new website, leading address, and a new phone formula with its Keyloop DMS.
“Nick Coen, our president, has been a great mentor and continues to be so. He’s on the other end of the line if I ever need anything. But in terms of day-to-day operations, Nick hasn’t been with the company since 2020. So, in terms of adjustments, I was already making a lot of adjustments in the company,” Clay said.
“We have radically replaced our business. We’ve implemented all of those new systems. And we did it in collaboration with the team. So I incorporated them by adding them to the decision-making process.
Work Practices
Clay has also replaced the work practices of sales managers. Whereas before, they had one out of every 3 weekends off, this was replaced each week to balance life and work. Sickness benefits have also been replaced. Clay and his team were looking for the most productive practices to become the employer of choice.
“Many companies, not just in the auto industry, have a tendency to make decisions based on the worst players in the industry because they’ve been stuck in the past. They were burned. We make our decisions based on the most productive players in the industry. industry, in other people who have been with us for a long time and who are unwavering with the company and who are part of the Chapelhouse family.
“We’re still at that 25% to stay in the average. We take a look at the package, we look at how we pay the commission. We have to keep moving forward and that’s what was done,” he said.
Chapelhouse has expanded in recent years. It now represents Kia Suzuki and MG in its network of franchised outlets in the North West and has approved aftermarket franchises with Fiat, Vauxhall, Citroen and Peugeot. In 2022, it also opened the doors to a new Suzuki dealership in Blackpool.
First Quarter Performance
I ask Clay how business is going in the first quarter with the same tuition change. He said the market had recovered after a difficult fourth quarter. Customers were still concerned about the cost of living crisis and peak interest rates, but the market had responded to those demanding situations with strong sales incentives.
“Our Lopass partners presented us with strong offers, which actually helped in the first quarter. We’ve actually bounced back and I think even with a slow start to the quarter, I think we deserve to be able to spend “Coming back and generally looking at the quarter, I think we’re moving on to having a smart outcome. The projects they’ve put forward are really helpful,” he said.
The company has been imaginative in rewarding its employees. Chapelhouse has bought an apartment in Mallorca for its employees that it uses 30 weeks a year.
“We bought an apartment with the sole aim of finishing the families whose painters paint for us for a week. This can be used as a “well done. ” This can be an incentive. This can be praise for reaching a goal. I use to do it in other ways, but at the end of the day, it’s a thank you on my part to this person. It’s just a matter of thinking outside the box.
Clay remembers the president of Chapelhouse asking him, when he was COO, what he wanted the company to be, what he wanted it to be.
“I said, ‘I need to be an employer of choice. I need to attract the most productive people. That’s my mission. So we have first responders with intellectual aptitude. We have 10 sites in the organization and the site has an intellectual aptitude first. Help on the spot.
Community Work
The organization maintains strong network links with conscientiously targeted charitable aids. He wrote to his visitor database and asked them to nominate charities that deserved it. For Clay, it’s vital that consumers choose charities. According to Clay, the reaction was overwhelming and eventually subsided. to 8 charities, each of which will receive £5,000.
“I just had the excitement of touring those charities over the last few weeks, making the payment and seeing what the charities are doing and how we can help them. “It can be financial, it can be with staff work days at charities, it can be with sports and marketing,” Clay said.
The company has also implemented Medicash fitness plans for its employees, which are valuable at all times, but even more so in the event of a cost-of-living crisis. Weekends and diets have also been reviewed.
“Work-life balance is a priority for me and it’s vital that we provide our groups with the right balance. It was imperative that we implement this new operating design in the company. Our groups now work alternate weekends, which replaces one out of every three weekends off. This provides all of our sales teams with a five-and-a-half-day workweek on average. We’ve received very intelligent feedback from staff,” he said.
“We looked at vacation pay and said we were looking to give everyone 25 days as standard and when they’ve spent a certain amount of time here, we want it to be 26 or 27 days. What we’re looking to do is be in the most sensible quartile, to go back to being the employer of choice, I guess,” he said.
Back to Sales
Chapelhouse is a successful company that consistently ranks among the most sensible Motor Trader dealers in terms of return on sales. In 2023, it made a pre-tax profit of £3. 3 million with a return on sales of 2. 9%. The previous year, it is a pre-tax profit of £5 million and a RoS of 5. 2% and in 2021 it generated a PTP of £3. 3 million and a RoS of 4. 4%. How does Chapelhouse manage to achieve 5%?
“We run it like a family business. When I arrived, we had five sites and now we have 10. Some other people might say it’s micromanagement and it’s not healthy, but we’re still looking at the labelable elements within the company.
Good communication and teamwork between sales and after-sales are also essential. When Clay joined the company in the aftermarket sector, car sales were at the forefront of concerns, and the aftermarket was a poor cousin.
“I think a clever example of that is when I joined the aftermarket, it was an afterthought,” he said.
Clay has implemented core controls, with more processes and therefore greater consistency, while rewarding for impressive results.
“If the effects come, as long as you praise other people properly, they will continue and keep striving to get to the next rung or level. We praise other people very, very well,” he said.
“So, I guess I manage 10 sites the same way someone else might manage a giant site. It’s one way to run an organization of this size, but it works for us. It works because everyone has a voice and everyone feels like they’re contributing.
Confronting Chery
Any racer organization is only as smart as the product it sells, and in the case of Chapelhouse, it’s MG, Kia, and Suzuki. MG sales are skyrocketing, Kia is Motor Trader’s Automaker of the Year for its strong sales, stock offering, and racer relationships, and Suzuki is a popular logo among racers.
“We have three incredible partners to work with, without a doubt, Kia helps us continue to go strong; They sold more than 100,000 games last year for the second time. And I’m sure they’ll continue to grow with their order bank and they’re creating amazing products, it’s a very forward-thinking company.
“It turns out that MG came out of nowhere. I joined my spouses 3 1/2 years ago. Now we also have 4 MG and Suzuki locations, we just have a smart relationship with our spouses’ brands. Suzuki has been through a difficult time, however, they are wonderful people to be close to.
Is Clay making plans to move to the franchise?Chinese brands are attracting attention. Who’s in the picture?The short answer is Chery with its brands Omoda and Jaecoo.
“I talked to several new Chinese logos that were popping up and it was vital for me to have a logo that was compatible with our business. The logo that caught my eye was Chery. The maximum of the Chinese logos that are popping up are all-electric, and at the moment, I don’t think the infrastructure is where it deserves to be. Chery first offers ICE and hybrid vehicles, in addition to a full-battery electric vehicle. So yes, I agreed to do it in two places. ” These are smart, quality, well-priced products that I think will be a huge hit in the UK,” said Clay.
Used Vehicle Performance
On the used car front, Clay, like all brokerage company bosses, has had to deal with a drop in the price of used cars in 2023, wiping stocks off its books to lessen the impact on the bottom line. He makes a gross profit of £1,400 for used cars.
“At the time we had an inventory of used cars valued at around £8 million. We react very, very temporarily to market events. I guess part of our good luck is reading the headwinds, reacting and making sure you’re covered, and that’s what we’ve done.
“So yes, we were affected in the same way as everyone else. However, we saw it coming, we reacted as temporarily as we could. So they gave us the quarter in the most productive way possible. January was another quiet month, however, the quarter started and now my orders are back to what they were, if not a little higher than the same time last year,” he said. I ask Clay if all 3 brands are in terms of push marketing. Have things returned to general before the pandemic?
“Kia’s order bank is incredible. So I think they opened the calendar year with over 40,000 pre-orders. Therefore, it is still an attractive market for that brand. But as far as Suzuki and MG are concerned, we now have a boost again. “market,” he said.
Auto Financing
Auto finance is now in the headlines, with the Financial Conduct Authority leading the rule in old auto finance commission cases. What does Clay say about the review and where and how has the review impacted Chapelhouse’s business so far?
“To date, we have received 113 inquiries from consumers that would possibly be similar to the Discretionary Commission (DCA) settlements. The vast majority of them are consumers who simply ask for data about the identity of their lender. We are also seeing a volume in expansión. de requests by lenders for copies of old sales documents in connection with court cases they have won directly.
“As a company, we sell 6,000 cars a year, so as a percentage of sales over the period studied, that’s less than 1% of customers, so the impact to date hasn’t been too onerous for the compliance team. To manage. . . We have a fully documented and well-controlled grievance handling procedure in place at Chapelhouse and I am confident that those court cases and inquiries are dealt with in accordance with the applicable DISP rules, as are all other court cases filed across the company. ,” he said.
The FCA is reviewing GAP and has suspended the sale of GAP pending its resolution on the matter.
“We view GAP as a value-added product to bridge the difference between the insurance payout for a general loss claim and the payout required to ensure our consumers can upgrade their valuable asset. It offers a point of convenience that our consumers consider to be us.
“That said, as a company, we don’t market GAP en masse and a lot of our GAP sales are to consumers who have had the product before and tell us they need it back. Several of our consumers have asked the product to pause. And while we’ve indicated that we can’t talk about it at this time because of the pause, they’ve indicated their preference to talk about it again once the pause is lifted.
“Without a doubt, the loss of this product is impacting the bottom line, and as such, we are looking for other value-added products to fill that gap,” he said.
Clay at an agency
It’s time to move on. I tell Clay that he sells 3 brands that don’t go the firm route. Feeling lucky?
“I’m lucky with that, absolutely. I’m sure you’ve talked to Dale Wyatt at Suzuki, you know he puts a lot of emphasis on the fact that the company is broken from his point of view. ” Our brands value appointments with their broker partners and present you to the company. So yes, I am in a very, very privileged position.
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We wish all of our consumers and connections a successful moving day#NewRegDay
Blue Motor Finance Limited (Blue), a UK-based and FCA-regulated financing provider, is proud to be. . .
Use Keytracker’s Smart Locker formula to safely automate delivery and pickup lockers. . .
Diamondbrite, famous for its paint and fabric coating systems, has expanded its diversity with Array.
We’re excited to share the launch of our new partnership with streaming service, Kwikcast, Array.