Busy time for sewells MSXI’s business turnaround consultant
Guill Marais, a Senior Business Consultant at Sewells-MSXI, is having a busy time as the ongoing economic downturn takes its toll on many retail motor companies. Marais’s speciality at Sewells-MSXI is turning around businesses that are either in trouble or headed that way. Sewells-MSXI, in turn, is a major global consulting and outsourcing firm which specialises in the retail motor industry.
He says that the health of the South African motor industry tends to go in cycles of approximately eight years. This is what he has found over the years both as an active participant in the retail business and latterly as a Sewells consultant specialising in helping companies facing challenging financial times.
Marais said that 2016 was, hopefully, the end of the cycle that began with the global economic meltdown in 2008/9. The previous low point had been 1999/2000. However, he warns that the upturn will be slow and it will need dedication from management and the full cooperation of staff members to ensure profitability in ongoing, tough trading conditions.
The experienced Sewells-MSXI consultant says he has found that one of the major reasons for these cyclical downturns is that management tends to forget that they are in the “people game”, not just the “motor game.”
“When times and the economy improve then the focus tends to move away from people – be they staff or customers – and shifts to pure business,” explained Marais. “Only when the dealers hit hard times again do they realise they have tended to neglect the people aspects of their business and have to quickly put programmes in place for team-building at the dealership and relationship building with customers as countermeasures to the downturn.”
Marais is a strong supporter of multi-franchising for small volume dealers and believes this trend will continue to grow in South Africa, where he says many OEMs make demands that push up operating costs of a dealership substantially and impact on sustainability. He says that multi-franchising need not just be limited to other automotive brands, but could also include joint ventures with common interest stores such as those selling outdoor equipment, top end bicycles, and the like.
Marais, who joined Sewells-MSXI in 2014, has come the full gambit in the retail motor trade, having started as an apprentice technician with Lindsay Sakers Volkswagen and rising to master technician, which gave him an excellent technical background.
The next 14 years were spent at the Sandown Motor Group going through all the divisions, from used cars to being Dealer Principal at Sandown Motors in Randburg.
Marais had a spell at Barloworld before joining the Super Group as Franchise Director and Dealer Principal for the Honda and Volvo brands. He said this latter assignment, which lasted seven years, provided an excellent overall grounding because it taught him that you can’t preach (as the franchise director) if you can’t deliver (as a dealer principal).
Marais has a special interest in the financial aspects of the motor trade and the benefits to be gleaned from accurate budgeting and goal-setting. Knowing how motivated he is, it is no surprise that he is self-taught in terms of these vital aspects of a business.
His comprehensive background in the motor trade and enthusiasm for his job have prepared him particularly well for his current career as he has wide experience and can talk in a language dealers understand.
Marais sees his role as looking after a struggling dealership through what he calls the “operation and intensive care” phases before handing it over to colleagues at Sewells-MSXI who monitor the dealership’s health on an ongoing basis and give advice where and when necessary.
Marais is also heavily involved in the various Performance Group’s which are an important part of Sewells-MSXI’s offering to the retail motor trade. At present, he is involved with 12 such groups and says each has its own identity which adds to the experiential feedback he can provide in the future.
He says he finds that a lack of proper leadership is usually the cause of motor dealerships getting into financial deep water.
When he is called in to assist he arrives in his Mercedes-Benz Vito, which is his mobile office. He then spends 2-3 days analysing not only the business, but also the environment in which it operates and its potential.
During his time at the Super Group Marais developed a formula to evaluate a motor business in terms of its economic potential.
“What is critical is to find the dealership’s magical ‘X’ which is its sales potential, staffing requirement and the financial support systems required. We develop a virtual dealership right down to income statement and balance sheet. Once we have found that ‘X’ we can start with remedial treatment such as restructuring and target-setting.
Marais says he can develop strategies for dealer health quickly as he concentrates on this aspect 100% of the time whereas a dealer principal can only use about 10% of his time developing strategies. The rest of the time is hands-on managing of the business and staff.
“I am proud to say that none of the dealerships I have assisted over the years to get back on their feet have had to close down. On each occasion, they have moved out of intensive care and are performing well with the ongoing assistance of Sewells- MSXI consultants and facilitators,” concluded Guill Marais, who enjoys long distance rides on a motorcycle as a form of relaxation that is totally different from his very demanding day job.