When you affiliate yourself with a trusted brand like Dodge, opening a car dealership can be extremely rewarding. Dodge is a part of Stellantis (formerly FCA), the world’s eighth largest automotive manufacturer.
They have a loyal consumer base that purchases popular models such as the Charger, Challenger, Durango, and Ram trucks. But how to open a Dodge dealership? Starting your own Dodge dealership in Etobicoke can be a great way to capitalize on a trusted brand.
However, opening a Dodge dealership requires a considerable investment of your time, money, and energy.
In this blog post, we will break down the steps to opening a Dodge dealership.
Article Summary
How To Open a Dodge Dealership?
When considering opening a Dodge dealership, you must do your homework and create a business plan.
1. Market Research
It is important to understand the local automotive market to succeed. Learn about the competition in your area, potential customer demographics, and the Dodge vehicle demand through things such as:
- Customer Base: Is there sufficient demand for Dodge vehicles?
- Competition: Are there other Dodge dealerships or competing brands nearby?
- Location: Is the area growing? Are there opportunities to attract new customers?
2. Business Plan
Your business plan is your guide and will see you through it. You will share it with investors or Dodge itself as part of your application process, ensure it’s solid. It must include the following:
- Executive Summary: Overview of the dealership and your objectives.
- Market Analysis: Insights into local competition, target customers, and market demand.
- Marketing Strategy: How you will attract and retain customers.
- Operational Plan: Daily dealership operations, including staffing and vehicle inventory.
- Financial Plan: Startup costs, funding sources, sales forecasts, and projected profitability.
Secure Financing
Starting a new Dodge dealership is a large investment. Usually, the total capital is at least six digits. Financing is crucial before opening a Dodge dealership. Look at some of the financial responsibilities:
1. Startup Costs
Some of the key startup costs to consider include:
- Franchise Fees: Dodge may charge initial franchise fees to become an authorized dealer.
- Real Estate: A large lot and building are required for inventory, sales offices, service bays, and customer areas.
- Construction or Materials: To meet a brand standard for construction or renovation.
- Inventory Costs: it can be costly for dealerships to stock the range of vehicles they need.
- Operating Costs: Salaries, utilities, marketing, and other ongoing costs.
2. Sources of Funding
Considering the high expenses, the potential dealership owners resort to multiple sources of funding, including:
- Bank Loans: Many financial institutions offer business loans for franchises.
- Investors: You may bring partners or investors to share the financial burden.
- Personal Investment: You must usually invest significant money in your funds to satisfy capital requirements.
Apply for a Dodge Dealership Franchise
Now that you have a business plan and financing, you can apply for a Dodge dealership franchise. Stellantis, owner of Dodge, has requirements for approving new dealership franchises.
1. Franchise Application
Fill out a formal franchise application with Stellantis or Dodge’s corporate department, setting forth the following information:
- Your Background: This would be your greatest asset, followed by any relevant experience, preferably in the automobile industry.
- Financial Status: Dodge will want to see you demonstrate your financial ability to pay startup and overhead costs.
- Business Plan: Your business plan will be carefully evaluated to assess its feasibility.
- Location: Dodge will consider whether your proposed location aligns with their network expansion plans.
2. Approval Process
This approval process can take weeks to months. Dodge will judge your application, valuing your assets and the cash you can bring to the dealership, the market opportunity in the area, and your strategic fit with the broader dealership network.
You can expect to be interviewed and potentially visited on-site by corporate representatives.
Find the Right Location
In Dodge’s case, whether your dealership is a success or a failure depends on where you place it.
Dodge might have strict guidelines for dealership locations based on proximity to other franchises, traffic visibility, or demographic distribution. Here are some thoughts on how to pick a site.
- Visibility: You want a dense pedestrian traffic location near a major highway and/or populated area.
- Accessibility: Ensure easy access for customers, including ample parking and easy entry points.
- Zoning: Ensure the property is zoned for commercial use, specifically for automotive dealerships.
- Future Growth: Is this area growing, and does this growth have the potential to continue? When you open in a growing market, your dealership becomes part of a thriving community for many years.
Build or Renovate Your Dealership Facility
After locating a site, you must then design a facility or renovate an existing one to meet Stellantis’s branding requirements.
1. Sales Showroom
For many customers, your showroom will be their first contact with Dodge cars. It needs to be modern, hygienic, and well presented. Think about these design features:
- Spacious areas to display new models.
- Comfortable waiting areas for customers.
- A professional and welcoming atmosphere.
2. Service Center
An essential revenue center is your service department. You need to have the most advanced service bays and equipment built to handle scheduled maintenance and repairs, emissions, and safety standard inspections. A well designed service center needs to support high customer demand.
3. Compliance with Dodge’s Brand Standards
Despite the autonomy of Dodge dealerships, following brand standards is crucial. This involves the signage outside your dealerships, the showroom design, sales floors, and service areas.
Work closely with the design department of the holding company, in this case, Stellantis, to ensure that you follow protocol.
Hire and Train Your Staff
A dealership with strong teams will lead to success. You will need to hire people with different skills, including:
- Sales Staff: ‘Your sales staff will sell new and used Dodges and provide quality customer service.’
- Service Technicians: Skilled, certified technicians are essential to running your service department smoothly.
- Finance and Administration Staff: This staff will handle customer financing, dealership accounting, and administration.
Stellantis has training programs for dealership personnel designed to ensure our brand standards are consistently executed. Take advantage of our training resources to help ensure your team is prepared.
Market and Launch Your Dealership
Once building construction is complete and employees have been hired and furnished with inventory, you can begin marketing the dealership to the public.
To ensure a successful launch of your dealership, you need to develop a marketing plan to reach potential customers.
1. Grand Opening Event
Throw a flamboyant grand opening event to generate interest and attract customers to your dealership.
Consider promoting a giveaway, offering discounts and buy one get one deals during the launch to sweeten the pot and close deals.
2. Ongoing Marketing
To grow your customer base, market through a combination of digital marketing channels and traditional marketing strategies like:
Digital Marketing: Increase your web presence: establish and regularly update your website, use social media, and advertise online.
Local Advertising: Use print, radio, and TV ads to target local audiences.
Customer Retention: Provide discounts on oil changes, brake system service, and other services, as well as loyalty programs and discounts on future purchases to keep customers coming back.
FAQs on How To Open a Dodge Dealership
How Much Does It Cost To Open a Dodge Dealership?
Opening a dealership for the US automaker Dodge typically costs several million dollars. The most significant expenses include franchise fees, location, building or renovation of the facility, initial inventory of vehicles, and operating costs. The exact figure depends on the location, site size, and market conditions.
Do I Need Prior Automotive Industry Experience To Open a Dodge Dealership?
Although this is not required by law. A few newer dealerships in suburban areas have been won from existing franchise groups by non automotive applicants. Everyone who has ever bought or sold cars appreciates the value of people who can share that background with the staff. Dodge (Stellantis) often favors dealer franchise applicants with prior automotive experience over the rest. Experience in dealership management, business operations, and/or sales can also improve your chances of approval.
How Long Does the Dealership Approval Process Take?
It can then take months to get approval. Once you submit an application, along with your financial documents and a business plan, and have interviews or meetings with people from Dodge, you’ve got to hope the market wants what you want nearby. Dodge can revoke the approval if the market conditions change or you haven’t gotten the building underway.
What Kind of Support Does Dodge Provide To New Dealership Owners?
Dodge (Stellantis), for example, offers new dealership owners assistance with training sales and service staff, helping with facility design according to brand standards, and providing ongoing strategic marketing and operational guidance that helps ensure the business thrives.
Final Thoughts
When you decide to open a Dodge dealership, opening a business can be an exciting and daunting path.
First, you have to come up with an ample budget, then plan and spend enough of your time researching the auto industry. With proper orientation and knowledge, the business can be a rewarding one.
You have a dealership business by following these steps, doing proper research, and partnering with Mopar Dodge.
