Visionary dealer: Winning in a saturated market with 9 dealerships!

Welcome to another episode of the Car Dealership Guy Podcast.

In this edition, Patrick Coleman, President of Jim Coleman Automotive, joins to discuss the current retail auto landscape and share tactics for navigating constrained used vehicle inventory. Patrick joined the family business right out of college, working his way up from sales and into management. Some of his first years spent as company President were during the COVID-19 pandemic, giving him a crash course in leadership. Now, he’s focused on making sure his dealership group continues to grow while staying true to its values.

You can stream the full episode now on YouTube, Spotify, or Apple.

1. Joining the business.

Patrick Coleman is a third-generation car dealer. While he wasn’t entirely sure whether he would join the car industry, a short conversation with his college career advisor made him realize that joining the family business was a no-brainer. Jim Coleman Automotive has grown to include seven rooftops and nine franchises in Maryland. Patrick started out in sales and worked his up through the ranks, eventually taking over from his father as the company’s president.

2. Differentiating in a crowded market.

The Maryland car market is quite crowded, filled with dealerships that have been in operation for decades. While the name and faces have changed in recent years to a considerable number of buy-sells in the region, it can be challenging to differentiate oneself in such a saturated sector. Patrick notes that as his group’s competitors have gotten bigger and expanded into new areas, he has taken the opportunity to emphasize his brand’s focus on family and customer service, optimizing for the local market as much as possible.

3. Optimizing a dealership group.

Standardization has played a key role in the dealership group’s success. When Patrick became the company president, he explains that several rooftops in the organization had, up to that point, been treated as separate entities, running according to their own procedures. A major focus of his leadership in the time since has been to streamline operations across all storefronts, so that every location offers the same high-quality experience using the most effective guidelines. This has improved efficiency and branding across the state of Maryland.

4. Recent expansions.

While optimization has been a focal point for Patrick, the company hasn’t avoided the occasional expansion, adding several new franchises over the last four years. One of these additions is a Nissan storefront, which was merged into a dual-point location alongside Infiniti. Nissan has been struggling in recent years due to a sharp decline in profit. However, Patrick notes that Maryland is a fantastic market, and the dual-franchise style of the new storefront has been “helpful to have during otherwise challenging times.”

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5. Opening new stores.

The experience of adding new rooftops has been educational for Patrick and his team, informing them not only of how the acquisition process works but also of how setting up a new location can be both challenging and rewarding. Through this, Patrick has learned how to instill the company culture in a brand-new environment and identify the best members of the team to carry out the brand’s vision.

6. Core values for success.

Keeping a business “family-oriented” is easier said than done, requiring the right values. The most important value for Jim Coleman Automotive is integrity, followed by transparency. Both are essential for earning customers’ trust and ensuring the dealership remains a part of the community. Another core element is good communication, which Patrick explains governs relationships not just with consumers but also between dealership staff.

7. Used vehicle pain points.

A major differentiator between Jim Coleman Automotive and other competitors is preowned vehicle acquisition, which, for many dealers, has become a critical pain point due to the scarcity of inventory. Patrick’s investment in Lasso, a startup created to address this difficulty, has been a massive help in driving his company’s used car acquisition strategy forward. Lasso uses an auction-based system that allows car owners to post their vehicles online and accept bids from dealers. Jim Coleman Automotive has purchased more than $5 million worth of inventory through the startup since joining the platform. The company has also created a team whose sole responsibility is to source used inventory. Patrick notes that having dedicated acquisition staff has made a tremendous difference in the company’s preowned business, as leveraging employees with other responsibilities, including sales reps and managers, proved ineffective.

8. Looking ahead.

Patrick feels optimistic about the months ahead. It has taken several years for industry inventory levels to correct after the COVID-19 pandemic; now that supply has finally started to catch up to demand, dealers can begin to follow through on their growth plans. While performance varies between franchises, he recalls that the turn rate (the percentage of vehicles that sell in one month) at his group’s Toyota store has reached 86%, underlining the substantial growth of the local market. “There’s been a lot of demand and we’re doing our best to fulfill it,” he comments.

9. Market dynamics.

Toyota remains at the head of the market and is likely to stay there, thanks to its excellent product mix and reputation for quality. Patrick is especially excited about the future of the Jaguar Land Rover brand, whose inventory has finally started to rebound from the recent pandemic. Electric vehicles also show a lot of promise in Maryland and Washington D.C. Patrick notes that Tesla recently surpassed Honda in new vehicle registrations in his area. Jim Coleman Automotive has already implemented the facility upgrades needed to support EV sales.

10. Managing relationships in a family business.

The car business is constantly changing, which can be difficult to navigate in family-owned dealerships with multiple generations in charge of leadership. However, Patrick notes that his father has given him plenty of freedom to innovate and guide the company. At the same time, he has made sure to leverage his parent’s knowledge of running the dealership, especially when it comes to high-level strategy and major investments like mergers and acquisitions.

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