Industry Expertise
Automotive Services

We provide dealerships with careful assessments of market areas to ensure that territory assignments that offer a true sales and service advantage. This is done to ensure that dealership performance is appropriately measured. Market areas that are too large result in inflated sales performance targets, facility size requirements, planning volumes, and other metrics that dealerships are asked to meet. Our team carefully considers all market conditions to identify or verify the appropriateness of assigned territories.

Sales Performance

We help dealerships maximize their potential within assigned trade areas, and evaluate sales performance relative to factory-prescribed measures, such as the RSI or MSR. We consider sales penetration, sales-distance relationships, competitor locations, incentive offerings, and product allocation to properly measure market potential while identifying opportunities for additional sales.

Location. Location. Location. It still matters. We assist in identifying the best location within a market for expansions and relocations. We determine geographic areas of advantage based on customer proximity, road networks, travel times, and buying patterns. Our Geographic Information System (GIS), combined with data on traffic, demographics, and customer addresses, allows us to pinpoint optimal locations for individual retail locations, or several locations covering a broad geographic area. These independent determinations ensure accurate measures of opportunity in the market.

Incentive Programs

Automotive manufacturers use numerous incentive programs that are focused on increasing their sales and exerting control over dealerships’ operations. These incentive programs are now responsible for keeping most dealerships profitable. We help dealerships determine the reasonableness of program requirements, and decide whether to participate in certain programs during certain time periods.

Manufacturers use specific, complex processes to allocate new vehicles to their dealers. These typically rely on a “turn and earn” principle: as dealers sell cars or “turn” their inventory, they receive (earn) more vehicles to sell.

These programs are often confusing and can be unreasonable, but there are numerous state laws requiring manufacturers to allocate vehicles through a fair and equitable process. We help dealerships large and small to determine if the allocation process applied to their dealership is reasonable, or if they may be entitled to additional inventory.

Many factors can result in dealerships losing sales, including business interruptions or dealership network changes. We quantify past or potential lost sales for dealerships so that they can be armed with reasonable estimates to better make the difficult decisions they face during these times.

We specialize in estimating damages and lost profits resulting from business interruption, breach of contract, illegal competitive practices, and other such causes. Our methods include analysis of financial and operational records, industry and competitive analysis, discounted cash flow models, and sophisticated techniques such as real options or simulation modeling.

Valuation

Determining a dealership’s value requires financial, market, and product expertise, all of which our team offers. Our valuations consider prior performance, expected market trends, brand performance, product appeal, and competitor positions. We have assisted a number of dealer-principals in buy/sell matters, and in determining values for estate, gift tax, succession planning, and other such purposes. Our market and financial analyses provide an unbiased view of the deal. What sets our work apart is a careful focus on market conditions and trends.

Our experts have provided expert testimony and reports for business entities across the country in matters involving terminations, add point contests, damages and lost profits, business valuations, market area disputes, breach of contract, and land use and zoning disputes.

AEG has worked with original equipment manufacturers and their associations on policy issues that affect the manufacturing and the sales side of the industry, including CAFÉ, environmental justice, taxes, and other factors. Please see our Public Policy page for more information.

Anderson Economic Group offers the industry’s most thorough, comprehensive knowledge of the electric vehicle market from every angle. Whether you’re concerned about good public policy, strategic planning, implications for the energy grid, consumer sentiment, or economic impacts, AEG has the insight necessary to take your EV-related projects to the next level.

Our strategic valuation methods recognize critical elements of investment opportunities that traditional models, like discounted cash flow, fail to consider. This provides our clients with significantly better results that account for real options, such as the option to shut-down a line, repurpose a facility, or switch suppliers. We model your ability to adjust to new conditions, and the costs and benefits of doing so. As a result, our strategies are shaped not only by data, but also by your options and likely actions.

We welcome every opportunity to work with the dealership community, including presenting on a variety of topics at “20 Group” meetings, association events, and other such venues. Topics include the state of the economy, industry and regulatory trends, dealership market assessment tips, what dealers can do to maximize business value, and what to consider during the buy/sell process.