Vince Sheehy, president and CEO of Sheehy Auto Stores, isn’t a big fan of long-term planning. Instead, Sheehy, who oversees 24 stores with annual sales of more than $1 billion, tries to anticipate trends rather than “wasting” his time looking five years into the future.
“I think even forecasting three years out is a waste of time,” he says. “The world keeps changing at a faster and faster pace. By anticipating trends we look at what we’re seeing now and then see what we can do to make that trend pay off for us.”
An example of this is when he saw a rise in people looking at used cars on the internet. “Our used car business was mediocre at best and we put a real focus on our used car business with pricing and availability of the cars. At the time we ranked 50th in the area in used car sales; now we’re the 22nd largest used car dealership of the private dealership groups.”
Building Blocks for Growth
Sheehy, instead, believes having “building blocks in place is more important so that we can take whatever we predict will be a growth area and run with it. It keeps us on our toes but we’re able to go in a couple of different directions at the same time. We’ve been pretty nimble at identifying trends and making changes. We also did that with our service department and turned it into a strong revenue generating business.”
Sheehy’s ability to identify trends and go with his instincts has served the Fairfax, VA.-based dealership well.
Today, Sheehy is the 37th largest dealer group in the nation with 35,000 new and used vehicle sold per year. They have 24 stores located from Baltimore, MD to Richmond, VA. They are the largest retailer of Fords and Nissan in the region and have the largest selection of new Fords. Other franchises include Honda, Lincoln, Subaru, Lexus, INFINITI, Toyota, Volkswagen, Hyundai, Nissan, and Harley-Davidson.
Brand Marketing
Although he grew up in the business, Sheehy didn’t have his eyes set on a dealership career. His grandfather, Vince, opened a couple of dealerships in the Fairfax, VA. area after World War II and sold them to his general manager in the late 1960s.
Meanwhile, Sheehy’s father, also named Vince, started his own dealership in 1966. “It was a Ford dealership and I would occasionally work there in the summer but I graduated from college in 1980 and ended up selling insurance with Prudential and moonlighted with Sheehy Ford.”
After that, he went to the University of Pennsylvania and earned an MBA and started on his stated career of being a brand manager for a Fortune 500 company. “I handled Gold Medal Flour and Yoplait yogurt and I loved it. I still have pictures of the products in my office. I was doing quite well and enjoyed working for General Mills. But I realized I had the desire to run my own small business in my blood. Maybe my father subconsciously imbued me with the desire to go back to the car business.”
He made the leap back to his father’s dealership and started out as a salesperson. At the time, Sheehy’s had about seven or eight stores and he remembers being a part of a group meeting to decide whether to go public. It may be the birth of his hostility toward long-term planning.
“We decided not to go public and then next day the stock market crashed. It was Black Monday in 1987; that made a lasting impression on me,” he says. “I had a pretty good sense of how to navigate the new landscape.”
After eight months he moved up to sales manager and then a year later went to Ford in Springfield,VA. He learned a few lessons. “My strategy was to have a say in the direction of the company and I understood the boundaries of what I could say and how to approach and talk about new ideas. I definitely looked at it from a marketing perspective.”
Part of that learning experience came from his father who was determined to “constantly take the MBAisms out of me. He was more of a plain speaking man and we just spoke a different language even when we were saying the same things.”
In July 1998 he became president and his father became chairman. “My father was very gracious and validated me by staying out of my way and making it so that I could make it on my own. Of course, he was there when I needed him. But he let me make my own decisions – and mistakes.”
Marketing By Spotting Trends
With one notable exception, Sheehy says predicting trends has served him well. He started the Sheehy Markdown to ensure that no customer ever pays too much for a vehicle at any of their stores.
“We did Markdown pricing 15 years ago,” he says. “Everyone else was marking up, we were marking down. Now everyone is doing it. It breathed more life into the overall car buying experience and it made every car something more than just a price. We wanted to show we cared about long-term relationships based on trust and integrity and not have customers come to us primarily for just price of a car.”
The dealership, he says, was always looking at ways to entice customers into the showrooms. In the 1970s they launched the 3-Day Money Back Guarantee, a first-ever in the market. Sheehy is also the home of the Price Match Guarantee where they will match a competitor’s price.
His one big mistake was an expansion move into North Carolina with the purchase of a Nissan dealership. The store was “way out of our normal footprint” and presented logistical challenges. “It was right after the big recession and out of our market area. It was a bad decision and it took us away from our core principles.”
Possible Acquisitions
Today, Sheehy isn’t opposed to a possible acquisition, but he will most likely stick to the MidAtlantic region. Last year he purchased two Toyota dealerships in Fredericksburg and Stafford County, Va., from the Rosner Auto Group.
Sheehy says there are potential acquisitions in the market but “there are also a lot of buyers out there and while we are in acquisition mode, it has to be a smart acquisition that fills a hole in the company. The market is highly valued now and we have to be careful of our picks.”
While looking for a target, Sheehy considers geography and brand. He likes working in a “tight” territory.
“It allows us a great system of getting supply to the customer and flexibility,” he says. “We’re a brand name and our name means something. That’s what we advertise. It makes our job easier. Customers know that we have highly qualified and high quality people working here who will provide an outstanding customer experience every time.”
He says he runs the company, which celebrated its 50th anniversary last year, with an entrepreneurial flair with an eye on marketing. “We have a centralized business but our general managers are empowered to do things,” he says. “When we had six stores we acted like we had 20 and we started doing things like centralizing accounting and branding. But we started acting like we had 20 stores back then and 20 years later we do. Now, we acting like we have 30.”
The Digital Challenge
Sheehy says he has several challenges, most notably trying to “figure out the digital world and digital pricing. Everything is priced on the internet and you can underprice.” He says that about 70 precent of his sales starts on the internet. “There several third tier sites that people go to, including ours. They start to explore and then that leads to phone calls or emails. You have to achieve that digital front of quick access and value. And, you have to integrate the digital playground with traditional advertising.”
He has a large television budget, which he feels drives business to the website and then the showrooms. Increasingly money is also being directed to digital advertising. “We know our market well and, because we have several stores, we can spend our dollars effectively, whether it’s radio, tv, digital or promotions.
The dealership is in its 20th year of the Sheehy 8000 Sales Event, a community-wide effort where the goal is to sell 8,000 vehicles during a 50-day period. Every dealerships gets involved, and since it’s a benefit for the American Heart Association, there are such things as healthy cooking demonstrations, blood pressure screenings and CPR training.
“It’s a way for us to give back and it helps define us as a company. Is it a good PR move? Certainly. But it’s the right thing to do, it’s a great cause and if it helps attract people into the business, fine. But it’s more than just selling cars.”
It’s a Good Life
He also spends his time developing his team — from a first-year technician to a seasoned sales manager — and providing them with a career path. They recruit heavily, including college and military job fairs.
“I tell them that life in the car business can be a good life with real opportunities,” he says. “And, that includes having the chance to make your own way. Our people can run their own department like a business, and depending on how hard and long you work you can help determine your pay scale and have a great career path. We do a lot of training, provide tuition assistance. We remind people how important the auto industry is to the economy and they can be a part of it. It’s a big challenge.”
Other challenges facing the industry are the questions of ride sharing, automated cars and all sorts of new technology coming in the near future — or now.
“We simply can’t have a failure of the imagination,” he says.
Product Wins
Sheehy is active with the Virginia Automobile Dealers Association, which has been one of the most vocal and political entities opposing Tesla. Sheehy’s viewpoint is balanced. “That fight — the direct selling model — I spend very little time on. I do believe in having everyone playing under the same rules. That’s my bigger concern. And, they’ve come up with a pretty good automobile and product wins in the end.”
He also notes that “There is no reason why a company that is 10 years old should have developed a fully competitive electric car ahead of car manufacturers that are 50 years old.”
Sheehy says business is good and sees a strong consumer preference for the small SUV. His top four sellers are the Ford F-150, the Nissan Rogue, Honda’s CR-V and Toyota’s Rav4. Subaru is also gaining in popularity, he notes. “I believe in the brands in terms of long-term marketing and in our brand. There are cycles, of course, but we are always looking for whatever works and stay relevant.”
Going back to his belief in trends and being nimble, he says that disruption “whether its from Tesla or the marketplace or from the consumers, means more opportunities.”
Adding, “We’re just trying to see our way around the corner and keep growing.”
