Franchised dealers look set to loose over £85 million in business before 2013.
The latest report from Castrol Professional suggests that over the next two years franchised dealers will loose almost four percent of their current business. That lost business equates to £85.6 million.
Castrol says the primary reason for the shift in market share is a combination of weak new car sales and an increasing awareness of bargains in the independent sector.
Another factor, says Castrol, is that the number of cars on the road less than five years old will continue to decline. Therefore the profits franchises can make on these newer cars will also decrease.
The trend is nothing new to the aftermarket, and the independent sector has been gaining market share from franchised dealers for months.
Castrol’s Nigel Head said: “With franchised dealership aftersales revenue from cars under five years old set to shrink, customer retention will become even more important.”
Head commented that franchises need to work harder on their aftersales service to keep customers coming back.
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