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Agency vs Dealer Franchise Model

Jan 10, 2024 · 4m 2s
Agency vs Dealer Franchise Model
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Decoding the automotive Industry: Unravelling the agency vs franchise model. The automotive industry is undergoing a major shift in how vehicles are sold to customers. Traditionally, automakers have relied on...

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Decoding the automotive Industry: Unravelling the agency vs franchise model. The automotive industry is undergoing a major shift in how vehicles are sold to customers. Traditionally, automakers have relied on independent dealerships to sell their cars using the franchise model. However, some automakers are now adopting the agency model as an alternative. In this episode, we explain the key differences between the franchise and agency models and what this means for the future of car sales. The franchise model is what most car buyers are familiar with. Under this model, automakers grant independent dealerships the right to sell their vehicles in a defined territory. Dealerships buy inventory from the automaker and market, sell, and service the vehicles locally. The agency model is different in that automakers own and operate retail locations themselves. These company-owned stores are branded specifically to the automaker. Under this model, the automaker has more control over inventory, pricing, customer experience, and its brand image. The agency model represents a major shift for the auto industry. Automakers like Tesla have found success using company-owned stores versus franchised dealerships. As consumer preferences change, more automakers are considering the agency route to improve customer experience and better compete in an evolving marketplace. On this episode, we are excited to speak with Clive Prevost, an automotive executive with extensive international experience rolling out the agency model. Clive shares valuable insights on the best practices for implementing agency stores and their impact on automakers, dealers, and car buyers. For any automaker, dealer group, or industry stakeholder, this is an important conversation on the franchise versus agency models. We break down the implications of this retail shift and what it means for the future of automotive sales.
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Author John
Organization megan
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