JCT sees web as new place to fight for customers

The group boosted turnover to £623m in the year ending December 2011, an increase of 1.3 per cent on the previous year.

But pre-tax profits fell 30 per cent to £8.5m, which the group blamed on difficult trading conditions.

John Tordoff, chief executive, told the Yorkshire Post: “Margin erosion and increasing costs have been our big battle in 2011. It’s the same this year.”

His grandfather Edward founded the business in Bradford in 1946. It operates 42 dealerships across Yorkshire, Derbyshire, Lincolnshire and the North East and employs 1,350 people.

The group invested heavily in marketing and returned to television screens a year ago with its first TV advertising campaign in a decade.

In a sign of the times, the advert was designed to drive traffic to the group’s website, which has seen a 40 per cent jump in visitor numbers.

Car buyers used to visit an average of seven dealerships before buying a car; now they do the majority of their research online and visit just one or two dealerships, said Mr Tordoff.

“The internet is the battleground now,” he said, adding that the move online is also forcing down margins.

The group got off to a good start in the first quarter of this year, with new car sales up 19 per cent against the same period last year, said Mr Tordoff.

He was cautiously optimistic that the summer months with the London Olympics, the European football championships and the Queen’s Jubilee would bring further improvement.

“I would like to think it is going to create some patriotism and get everybody feeling glad to be British and wanting to be successful.

“Whether that happens remains to be seen.”

Last year began strongly for the group but slowed after Easter and the Royal Wedding and did not fully recover, said Mr Tordoff.

JCT600 sold around 8,500 new and 13,000 used cars last year. It sold around 6,300 fleet cars, but is reducing its exposure to this “cut-throat” area of the market.

Last year saw “significant” devaluation of used stock and the group chose to “aggressively” write down goodwill on past acquisitions, said Mr Tordoff.

To help protect margins, JCT600 has invested in staff training.

Mr Tordoff said: “We are doing more and more training around the customer experience and customer journey.

“It’s about treating the customers how they deserve to be treated – with care and attention.

“If you can put customers through a proper sales process and treat them as human beings and do the job right, you stand a much better chance of retaining margin.”

The third-generation business has a large amount of repeat customers, which also helps protect margins.

It is investing in solar panel technology for power generation across parts of its estate and has spent £2m on property in York to develop a new Audi showroom.

The group has also invested in a new computer system for the entire network of dealerships.

Regarding the all-important issue of consumer confidence, Mr Tordoff said: “The attitude of the consumer is they are happy to do business but on the basis they are getting good value for money.”

He claimed that the North of England is less prone to peaks and troughs than the South East.

At the luxury end of the market, Mr Tordoff said sales are holding up well. JCT600 unveiled its new-look Ferrari showroom in Leeds last week following an £800,000 refurbishment. The group sold five used Ferraris on Friday alone.

Mr Tordoff said this reflects the resilience of the North.

@bernardginns