Case #9: Sullivan Ford Auto World
Taguinod, Joivy S.
Tayao, Ruth C.
Case Study #9: Sullivan Ford Auto World
Sullivan Ford Auto World is owned and founded by Walter Sullivan. Unfortunately, he died and his eldest daughter, Carol Sullivan-Diaz, a health care manager took over the business. She found out that their family business is in financial trouble based on current financial performance and market outlook.
The Customer Satisfaction (CSAT) results from car buyers show that the company has problems with its service quality.
The company’s financial situation had been deteriorating for the past 18 months and running at a loss for the past 6 months
Average sales of 1,100 cars per year
Revenues: $26.6M (car sales from last year’s $30.5M) and $2.8M (service and parts sales from last year’s $3.6M)
Low car sales margin (5.5% of sales revenue and 25% for service)
Recent 12 months’ financial show that gross sales figures were 4.6% and 24% and it is insufficient to cover the dealership’s fixed expenses
Margins had been squeezed b promotions and other marketing efforts
Due to rising fuel prices, industry and in-house forecasts for future sales were discouraging
Trend is shifting towards vehicle service transactions
The 30-day Purchasers CSAT Results:
Auto world achieved better than average ratings on most dimensions
Almost 90% of respondents said that Auto World informed them of what to do if they needed service
Less than 33% of respondents said that they have been introduced to someone in the service department (a sales protocol)
The Nine-Month Purchasers CSAT Survey Results:
Overall level of satisfaction with Auto World Service Department was consistently low, placing it in the bottom 25% of all Ford dealerships
More than 50% of the respondents said they would rather use another Ford dealer for future service
Worst Ratings: promptness of writing up orders, convenience of service...