Change is pain, and nowhere is that more easily articulated than through a construction project. The process by which dealers must navigate their OEM, third-party compliance reviewers and local municipalities just to get their vision for their facility made a reality can be a headache. If you’re considering an update or a new facility — or if your OEM has finally said it’s time — hopefully this very brief guide can at least give you a starting point and highlight some dealer benefits.
This might be biased but first and foremost is your general contractor (GC). These are the only people working directly for you. They help you represent your interests to the OEM, execute your vision and are with you every step of the way to the finish line. References matter here, as this isn’t a standard commercial construction project. An inexperienced GC may inefficiently organize space for a cohesively operated dealership, or unintentionally miss OEM compliance requirements.
After selecting the GC to help you through this project, the process starts by obtaining your OEM-specific image package. If you are doing a remodel, this involves presenting a set of what are called “as-built” plans, which reflect your current facility as it exists today. If you are doing a new ground-up building, some basic floor plans and a site plan will jump start the process.
Next will be the negotiations. The OEM representatives and third-party reviewers will be on one side, with you and your general contractor at the other. Everyone should be working to find the building look and process that upholds OEM standards for a compliant facility as well as the goals you have for operating your business.
This process can be difficult — especially during your first time — as your OEM’s national goals could potentially not line up with your local market. This is where it is key that your team understands the OEM approval process. With the benefit of more automotive construction experience, negotiations can be streamlined to deal with the national perspective of industry standards and OEM compliance allowances. Compliant items could include items such as floor tile, lighting and paint colors all the way to exterior look and entry elements.
Once the building plan is settled, you or your GC will get with architects to detail the actual building plans based off your agreed upon compliant project layout. With full plans in hand then construction is set to begin!
While this is an extremely abbreviated version of what to expect, on average we see that dealers who undertake a remodel utilizing this process planning see 12 to 14 percent increase in revenue while their facility is under construction. For new facilities, on average, we see a sustained increase of 12 percent annual recurring revenue because everyone loves to check out the new building!
Good luck, and have fun — it’s well worth it.
For more information about what to look for when planning a construction project, feel free to contact me at the address above.
Chip Walker
