5 Dealership Hiring Practices That Are Bad for Business

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In your auto dealership, hiring the right people should always be a top priority

You’ve spent a ton of money on advertising, getting the best inventory, and upgrading your dealership’s interior design. These are all things you thought would bring your business to the next level — so why does it feel like you’re just bleeding money and not getting any positive results?

You may find the answer if you take the time to look at your dealership hiring practices.

High turnover can affect your dealership hiring process

There’s just inherently a lot of turnover in dealerships; the 2015 National Automobile Dealers Association (NADA) Dealership Workforce Study placed car dealership employee turnover at 39 percent. The most troubling statistic, though, points to the fact that car sales consultants have a 72 percent turnover rate. That means that every year, the average dealership loses 72 percent of its sales team. How can you make money if you’re constantly trying to replace your staff?

There are certain things you’re up against that are industry-wide and hard to compete with. For example, many salespeople are entry level and after a while, feel like they simply can’t make enough money. They may give up on sales altogether, or their eye may wander over to luxury dealerships where the earning opportunities are usually greater. It takes a committed, driven, passionate individual to be successful in an auto dealership, and as you’ve likely witnessed, a lot of people aren’t up to the challenge.

Constant turnover isn’t just annoying, though. It’s expensive. The Society for Human Resource Management says that total costs associated with a bad hire can be up to 200% of that person’s annual salary. With that figure in mind, imagine how much money you may have lost over the past few years due to employee turnover.

It’s time for you to take control of your dealership hiring process. If you make the effort to organize what needs to happen and commit to it, you’ll finally start hiring top employees that don’t just stick around — they make you money.

Dealership hiring practices you need to avoid at all costs

Dealerships with high turnover rates usually engage in bad hiring practices. Here are some of the most common hiring practices that are never a good idea.

01-5 Dealership Hiring Practices That Are Bad for Business-011. Hiring a relative or friend with a bad track record

In general, referrals from existing employees can be great. New hires that come in as referrals tend to stick around longer than the average Joe who responds to an ad, but they need to be the right referrals. If you are in a tight spot and you have a friend or relative that you know is looking for a job, think for a second before you go any further. Is this person reliable? Do they have a good track record at past jobs? Does their personality leave a lot to be desired? It’s wonderful to help people you care about, but not at the cost of your business.

2. Making an offer on the spot

You had a few employees leave over the course of a month or so and you’re desperate — but do not, under any circumstances, offer someone a job in the very first interview. It makes you look desperate, raises red flags, and increases the likelihood that you’re hiring the wrong person. You need to develop a comprehensive hiring process that includes multiple interviews, reference checks, and possibly a project of some sort or a day in the dealership.

02-5 Dealership Hiring Practices That Are Bad for Business-013. Not doing a background or reference check

You may feel like background and reference checks are a waste of time, but they’re not. A survey from CareerBuilder found that 56 percent of hiring managers have caught job candidates lying in their resumes; a quarter of those hiring managers have even encountered people who list companies they’ve never actually worked for. Background checks are also important for keeping your staff and customers safe, in the event a candidate has done less-than-respectable things in the past.

4. Believing that interviews are one-sided

News flash: You’re not just interviewing someone for a job — they’re interviewing you, too. You can put them through the wringer and make them feel like they have to impress you, but at the end of the day, you need to put your best foot forward too. Be polite and punctual, make sure your dealership is clean, and work hard to ensure they feel comfortable. You want the candidates to want to work for you…and even if you don’t hire them, they should walk away with a favorable impression of your dealership (they may just come back to buy a car from you).

03-5 Dealership Hiring Practices That Are Bad for Business-015. Writing short, vague job descriptions

If you want the best candidates possible to apply at your dealership, put some extra effort into the job descriptions you post. If you are 100 percent clear about the type of person you need on your team, they’re going to find you. If you post a short, vague blurb about the position, don’t be surprised if you get a lot of resumes from unqualified applicants.

If you shift your priorities and focus on attracting solid hires, you’ll save time, money, and eliminate a lot of stress from your daily life. Make the commitment to develop a consistent dealership hiring process and ensure it is implemented across the company — you’ll be glad you did.

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Ty W.
Ty W.

Ty was born and raised in the automotive world. He's an enthusiastic expert who writes exquisite content about cars, automotive sales, and dealership best practices. When not writing for AutoRaptor, you'll find Ty on the golf course.