3 Brothers, 7 Dealerships

The Riverside Auto Group in Michigan's rugged Upper Peninsula and the Dagenais family has carved a niche for itself in rural America. Riverside partners with the Dodge, Jeep, Chevrolet, GMC, Cadillac, Honda, Nissan, Toyota and Chrysler nameplates, a group started over 40 years ago when Robert Dagenais became a partner in a small Chrysler store in Escanaba. Their seven dealerships in four cities bear

The Riverside Auto Group in Michigan's rugged Upper Peninsula and the Dagenais family has carved a niche for itself in rural America.

Riverside partners with the Dodge, Jeep, Chevrolet, GMC, Cadillac, Honda, Nissan, Toyota and Chrysler nameplates, a group started over 40 years ago when Robert “Bob” Dagenais became a partner in a small Chrysler store in Escanaba.

Their seven dealerships in four cities bear names such as Marquette Riverside Auto Mall, Riverside Chevrolet and Iron Mountain Riverside Auto & Truck Sales and represent rural markets in Michigan's U.P.

Bob recently passed away, but his three sons Matt, 42, Paul, 40, and Tim, 39, are carrying on the family's legacy through a unique partnership and a hands-on approach at their stores.

“We've been in car business a long time, and dad started our first store in 1968,” Matt says. “Right now, we're in a downturn in the market, but I've been here long enough in the car business and been through several of these already to know that when it goes down it always comes back up.”

Dealers across the U.S. have faced uncertainty in the vehicle market due to credit conditions and fuel prices, and auto makers General Motors Corp. and Chrysler LLC have talked about mergers and cutting brands.

But, in the “U.P.,” the Dagenais family keeps doing what they've grown accustom to doing for years — selling cars, trucks and SUVs.

“No matter what (the auto makers) do up on top, we'll still be here in Escanaba, Iron Mountain, Marquette and Marinette and we'll be selling something,” Matt says. “I'm pretty sure people aren't going to go back to horse and buggy, and if they do we'll start selling our share of those.”

Matt says Riverside Auto Group is focused on what they can control “right here in Escanaba, and in our local markets. We are going to be here selling something.”

He says they face challenges because the market is wide and its population widespread, but they have a major presence in each of the communities where they operate. They try to establish long-term relationships with customers.

“We don't want to sell them one car, we want to sell them 10 to 15 cars,” Matt says. “We do a tremendous amount of repeat business, and we have a great staff. There are several 20-year employees. We also have a lot of 10-year employees.”

In all, Riverside Auto Group employs 185 at the dealership level. The group's oldest employee is a technician, Joe Bellmore, who started in 1971 and continues to work at the original Chrysler store in Escanaba.

Although the general population has shifted somewhat away from pickup trucks and SUVs, Riverside still sells a lot of them in northern Michigan. The group's used-to-new-car sales ratio is 2 to 1.

“It's not a new function for us, we've always done well with used cars and program cars on an annual basis,” Matt says.

Marketing tactics that work for them include a combination of direct mail and a lot of phone calls. Riverside does less traditional TV, radio and print advertising than other markets. Instead, they use a customer-relationship management system and direct marketing.

“We also use our CRM tool pretty heavy to build the relationships and sell the next car and get the next service — we want to be there for the customer when they need us,” Matt says.

As far as tightening credit, the group broke from financing with Chrysler Financial and Ford Motor Credit a while ago.

“We use an independent bank that we have a long-term relationship with,” Matt says. “Consumer credit shifted, but there's still money out there to loan. Credit unions and local banks are a whole lot more active.”

The Dagenais family says they are not big on actual titles. The three brothers specialize in different areas of the dealership.

“Tim pretty much focuses on HR and sales functions, Paul focuses on used cars and real estate stuff and I focus on parts and service operations,” Matt says. “We have a very unique relationship with three siblings all active in the business … we all work hard and play hard.”

Matt says that since they are each so hands-on in the departments, it changes the relationships with their employees from a standpoint of respect and knowledge.

“We have worked in nearly every department, and not just for a week like many dealers' sons have.” says Matt. “We were there until we learned it.”

It was fun growing up in the car business, he says. “We joke that every family supper was a sales meeting at home. As we grew up as kids, the car business was bred into us from day one.”

They credit their father with laying the foundation for success.

“Dad's been very instrumental in all of us,” says Tim. “We worked with him every day and spent a ton of time together. He pretty much helped us avoid being complacent.”

They each credit their mother, Jeanine, for teaching them qualities in business that help them continue to lead the organization today.

The patriarch had been semi-retired from the car business since the fourth store was bought. His father's legacy continues, Matt says. “Our father instilled some basic values in us, like the harder you work, the luckier you become.”

Riverside's Recipe for Success

  1. The group has been able to cut marketing expenses by doing less TV, radio and newspaper. Instead, Riverside relies on direct marketing and customer-relationship management and focusing on bringing customers back for the next service appointment.
  2. It's all about repeat business, says Matt Dagenais. “We want to sell them 10 to 15 cars,” he says.
  3. Riverside sells a lot of used cars, and does well with program vehicles.
  4. Riverside has shunned the captive finance firms, a philosophy that serves the group well now, considering the credit crisis. Local banks and credit unions have filled the gap.
  5. The Dagenais brothers grew up in the dealership and are hands on in each department. It's helped with employee relationships and keeping turnover low.
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