On the eve of his retirement from running one of Australia’s biggest family-owned and operated dealerships, Michael Tynan still has strong views on the state of the Australian retail auto industry and its future.
When did you start your business and what was your first franchise?
1966 – Mazda.
What’s the biggest achievement of your career?
Witnessing my family join the business and seeing them develop, and now achieve the professional standards to allow for an effective succession plan.
And the biggest disappointment?
I commenced in the motor industry with one totally unknown brand – Mazda. Promoting and building the Mazda brand in our local PMA for 34 years was our absolute commitment.
In the 90s, the Importer–Distributor falsely claimed that we failed to build facilities to their demands and advised the non-renewal of our franchise agreement. We totally disputed this cynical claim.
Five years of legal activities followed and were only finalised on the day of the final court hearing. Mazda management offered a financial settlement including all legal costs. The final offer was accepted by the company.
Alas, 34 years of total dedication and the company’s commitment to building the brand was compromised by a proven illogical and poorly applied decision.
Did you enjoy being in local government?
I served 18 years as a Sutherland Shire Councillor and Mayor and leader of the Liberal Councillor. Local Government offered me the opportunity to serve my community at the grass roots level, while also providing the challenge of reforming the then, Local Government system.
It was also an education in all aspects of community life and as a Local Government representative, I had the opportunity to help protect the interests of residents.
Humbly, I took this responsibility most seriously, studied Council meeting papers with intensity and always tried to find a positive way forward.
How will you spend your time in retirement?
I would believe retirement indicates stepping down from active and daily decision-making at a company level. But not retiring from an active lifestyle.
A Chinese concept as well as my Board position at the NRMA, Calvary Hospital and other community projects will keep me busy.
Hence, retirement can be a very misleading term. Does any active person really retire?
Do you have a succession plan in place?
The company succession plan has developed and matured over the past decade and I am totally confident that it is in professional management hands.
In a recent interview you said that you hope to improve the image of Dealers when research has found once again that car sales people – especially used car salespeople have the second lowest professional ranking…
The Parramatta Road–white shoe brigade ceased many years ago. Today, both new and used sales management and staff are highly professional, well disciplined, committed to customer service and acknowledge that return business is the key to their financial benefit and satisfaction in the work place.
It is difficult to diagnose why the media and public perception is so harsh on the motor industry sales force.
Possibly, many clients visit a dealership with pre-conceived opinions of salespeople and some react in the negative accordingly. It’s a constant challenge for the team.
All manufacturers employ independent and specialist companies as buyers to continually evaluate sales conduct. In our sales environment, it is rare for any salesperson to be evaluated and achieve a score lower than 90 per cent.
While salespeople are expected to be cheerful, helpful and experienced, regretfully on many occasions the buyer’s attitude and behaviour is most testing.
I believe the motor vehicle industry is poorly judged by both media and the general public. Personally, I am proud to be a part of the industry.
How do your salespeople overcome this negative public perception?
Regardless of the occasional difficult buyer, if the salesperson can rise above the negatives, by being courteous and professional, there is little else that anyone can do.
Our policy dictates that we offer a quality product and we need to present our offering in a professional and respectful manner. Our mantra is ‘A company built on integrity.’
In our case, most of the sales team are local, and are encouraged to be involved in the local community.
Why did you decide on a career in the auto industry?
For 12 years, I was a jeweller and watchmaker operating my own business in Kogarah NSW. I studied gemmology, and became a specialist in precious stones.
For over a decade, I was also involved in rallying.
I was approached by a company trading as Westco Motors in Sydney, who were the NSW-QLD Importer-Distributor for Mazda. I was asked to take their new product, a Mazda 1500 Luce, into a rally and report on its overall performance. It was a glowing report. Later, I was offered the franchise for Sutherland Shire and while no longer a Mazda Dealer, the company has grown to represent 15 brands in the Shire, Wollongong and Nowra.
…49 years later, we still enjoy the challenge.
If you hadn’t chosen a career in the auto industry, what would you have done?
Possibly stayed in the jewellery business and expanded into other areas.
Do you think there will ever come a time when you’ll say we’ve got too many franchises?
In the early days, with the organisation reliant on one brand, logically, it was inconsistent from a business perspective. We represented an unknown Japanese brand and much time and effort was devoted to building the brand’s qualities within the local community.
Our company and staff were totally reliant on the factory and Importer-Distributor producing an attractive, quality product at a competitive price. When they got it wrong, we went into a slump.
We battled 57.5 per cent duty and sales tax imposed on imported vehicles by the Fraser Government as well as the established strength of the Australian products.
Our current business model has dedicated staff for each brand and they compete against each other, but under our control.
There is no doubt, that we need a brand and model mix. If one brand is down, another is up, which allows consistency, planning strategies and budgets to be aligned and functional. It also provides the staff with confidence that they have a career with the company. So to answer the question – possibly no!
Who or what inspires you?
Thankfully, I am a positive person. I love a challenge and I am willing to accept a calculated risk by doing the homework and research. The motor industry is consistent with hard work and that is where I am blessed with an “Irish” background.
I am inspired and driven by the acceptance of responsibility to my family and staff, and the numerous companies and individuals that have granted us their trust. I also seek much guidance and peace from the bloke upstairs. He hasn’t let me down yet.
What have you learned about yourself over the course of your career?
I continually get frustrated by situations and outcomes which I have no control over.
What are you looking forward to?
Humbly, I have led a blessed and charmed life with a wonderful family. I’ve had many incredible experiences and am associated with many great people. I am looking forward to more of the same. I would indeed be grateful for a few more healthy years of living as I still have the challenge of a few more projects to conclude.
2013 was a pretty good year for new car sales in Australia, is there anything in the Q1 figures that give you any concern?
Like many Dealers, I voice concern as to where the industry is taking us and I am convinced that the dealership business model we practiced for decades is broken and unsustainable in the long term.
Profitability through volume is very suspect for Dealers.
Sadly, with many Manufacturers-Distributors driving Dealer volume to obtain market share, ever diminishing margins, reliance on factory bonuses, transference of costs to dealerships, unrealistic targets and constant competitive attacks on all areas of the business, the current model doesn’t appear sustainable.
Large and small Dealers are struggling to identify a new and rewarding model that justifies the capital and risk factors expected by other business enterprises.
The ‘Dealer Only’ AADA has been reborn and revitalised at a telling time in the industry.