Tuesday, October 18, 2011

McDonalds

(originally aired August 18, 2011)

From a Saab Dealership point of view...

If McDonald's corporate stopped making burgers but kept invoicing (charging) independent McDonald's franchisee's for cardboard burger boxes, paper cups, napkins, advertising fees, and facility upgrades, I suspect McDonald franchisees would rally together, hire an attorney and sue the parent company for breach of their franchise agreement.

If the CEO of McDonald's stated McDonald's indeed had a fully funded business plan (three times) when in fact they didn't, I suspect McDonald franchisees would rally together, hire an attorney and sue the parent company for breach of fiduciary responsibility and reliance.

In essence that's life of a Saab dealer today, however in this story Saab dealers do nothing.

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A major problem with Muller's Saab is the organization itself. Muller's "leadership team" followed bad habits learned from larger car companies. Mile high dealer objectives, monthly dealer invoicing, poor communications and departmental walls reflect the culture / habits of GM, designed with a focus of selling millions of cars.. not 3,000 Saabs. Examples:

GM styled product offerings - Lets look at Saab's new product offerings. The new 9-5 and 9-4X, designed by former GM employees, reflects a mindset of carlines selling in the the tens of thousands - rather than one hundred. Both the new 9-5 and 9-4 offer a ridiculous high matrix of trim and option packages typically found in Chevy and Buick showrooms.

GM type push for special tools and launch parts - Once again following the mind set of GM, the new Saab organization delivered to its sleepy dealers tens of thousands of dollars in 9-5 and 9-4X spare parts and special tools (how about a $12,000 engine support stand for the 9-5!).

GM Type facility standards - Following GM's "you should be thankful your still a dealer feeling," Saab requested its dealers volunteer thousands of dollars in facility updates ("ice block" building designs) at the same time Saab is not producing cars?

This nonsense doesn't happen by accident, it happens because no one asked the hard question:

What are we doing? and Why?

At minimum, Saab Corporate should have treated their dealers at a graduate level - reducing the financial burdens of keeping Saab dealerships open during these turbulent times. Deferring or suspending all dealer invoicing for items as i.e., Saab cups, plates and paper napkins would have been a great start.

Franchise Agreements and state laws are in force to protect dealership rights. Now facing closure, Saab dealers are left holding large inventories of new cars, parts and special tools.

But no one speaks.

Not Saab's dealer council. Not NADA. Not AIADA. Saab dealers are united... their passiveness during difficult times was truly amazing.

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