Dealers Tackle Head Count Struggles

The latest CDK Friction Points Study brought to light a staffing issue. Of the 1,281 dealers surveyed, 34% said they hired more people in 2024, but considering the high level of turnover, it’s likely they did so to backfill positions. Here, we dive into the data around head count and turnover, and detail some of the things dealers are doing to retain talent.

Dealerships Are Selling More Without Increasing Head Count, Risking Burnout

While head count is essentially unchanged across the dealership from two years ago, sales were up by some 2 million units in 2024 from 2022. At first glance, this might seem like a positive: More is getting done by the same number of people, which indicates an increase in productivity. But given the high turnover rate dealerships are facing, it would appear that employees aren’t content with this new pace.

As a whole, dealerships lost an average of 3.3 salespeople in the course of the year. Given the average head count for the Sales department is 8.2 people, that represents a considerable 40% rate of turnover. This isn’t necessarily unexpected: In our recent Dealership Workplace Study, about a third of the employees surveyed said they were considering leaving their current place of work within six months.

It’s easy to conclude that employee burnout is at least partially to blame. According to the Friction Points Study, Sales staffers are spending more time at the dealership than last year, to the detriment of work/life balance. That’s a big issue for employees. Of the 100 former employees we surveyed in our Dealership Workplace Study, 47% listed long work hours as a reason for leaving their posts. In addition, a whopping 83% of then-current dealership staffers said that work/life balance is important to job satisfaction.

Poor benefits are another top concern, with 48% of former employees saying it factored into their decision to quit. And yet, per the Friction Points Study, only 10% of dealerships reported improving their benefits this year — down from 15% in 2023 and 19% in 2022. Of course, it could be that some dealers enhanced their offerings in previous years and, therefore, didn’t see a need to adjust benefits now, but if that were the case, we’d anticipate less turnover than this.

When Salespeople Leave, All Departments Feel It

When a trained staffer quits, the rest of the team generally needs to pick up the slack to keep things running as usual. That could mean increased stress and longer hours for your remaining staffers and the beginnings of widespread burnout.

If the dealership backfills the position, as it seems several did in 2024, you now have a new person on staff who needs training and regular guidance, likely from the Sales Manager. But according to our study, 40% of Sales Managers said they lacked time to effectively coach the Sales team.

If this new hire doesn’t receive sufficient training, they’re bound to make mistakes as they get their feet wet. Those mistakes then take time to fix and may involve other departments. For instance, if a new salesperson fumbles the paperwork for a sale, the F&I team will likely have to take time to correct the error and train the salesperson. Depending on the patience of your team, this could have a lasting effect on the dealership’s culture and the new hire’s contentment at the store.

It could affect your dealership’s reputation as well. As one car shopper divulged about their experience with a new Sales rep: This person “did not explain all the procedures needed to purchase the vehicle,” which not only caught the shopper off-guard but lengthened the transaction time by hours.

Some Dealers Are Listening to Their Teams and Looking for Ways to Help

The obvious solution to the above problem is to avoid it altogether by retaining talent. While that’s easier said than done, identifying and addressing staffers’ pain points are good starting points. For instance, compared with 2023’s survey, more staffers have reported frustration with finding duplicate leads in their CRM, waiting for the Desk Manager, and dealing with inaccurate information on the dealer’s site.

Some of the dealers we surveyed spoke about their efforts to enhance employee support. At least a few made changes to their training programs and structured processes, for instance. This could be as simple as setting clear goals and responsibilities for each member of the staff to ensure everyone feels supported and no one receives too much work.

Another dealer upped employee perks, gave people birthdays off, more apparel and pay raises. They also implemented monthly company lunches.

Sales Teams Still Deliver

Despite the churn, most customers give salespeople very high marks. In CDK’s ongoing monthly Ease of Purchase survey, salespeople have improved in every area we measure over the past two years whether it’s making efficient use of a customer’s time to demonstrating product expertise. No matter the number of separations, focusing on the Sales team’s success seems to be making a difference.