Two years after retiring as an owner of a successful dealership in Ontario, David McQuilkin is back in the business with a growth strategy that includes turning around struggling rooftops and making senior managers equity stakeholders.
And he’s not going to let the upheaval caused by the COVID-19 pandemic shake his resolve.
“Have I regretted the decision [because of the coronavirus]? Absolutely not. Not a chance. Financially, we’ll get through this.”
McQuilkin, 58, decided to return to automotive retail after realizing retirement was not for him.
“The truth is, I was bored stiff being retired,” he told Automotive News Canada. “What I really learned is I missed the customers, and you don’t really know how much you miss that atmosphere and the game and the hustle until it’s gone.
“A couple of winters in Florida golfing and walking the dog every two hours, I’m thinking, ‘Is this my trajectory for the next 20 years?’”
McQuilkin seeks to replicate the success he and his former partner, Ron Loveys, enjoyed over the 22 years they ran Whiteoak FordLincoln in Mississauga until they sold it to the Go Auto Group in December 2017. For eight consecutive years, the pair steered Ford of Canada’s largest volume dealership, which also ranked in the top 10 in North America in overall volume sales.
“We had a highly functioning dealership at Whiteoak,” McQuilkin said. “To re-create that and ideally make it even better, that would be a nice accomplishment to do it not once but twice or maybe three times. It sounds corny, but I believe in the product.”
DOING DEAL AS DUO
While McQuilkin kept his hand in auto retail as a dealership consultant, last November he purchased Gallinger Ford-Lincoln in Milton, 55 kilometres west of Toronto. He also recruited John Bettio, who worked with him at Whiteoak, to join him as minority partner and manager of fixed operations.
Bettio, a 30-plus-year veteran, was working at Oak-Land Ford-Lincoln in Oakville as fixed-ops manager when McQuilkin called.
“It doesn’t come every day, for sure,” Bettio said. “It’s something you always aspire to and work for. You treat the dealership like it’s yours anyway, so to have that opportunity is pretty awesome.
“But the line we have at this dealership [for employees] is: ‘You don’t work for me. You work with me. We work together.”
In late February, McQuilkin became a partner with Brian Legatt, CEO of the Leggat Group, in the acquisition of Houston Ford in Stouffville, about 90 kilometres northeast of the Milton dealership.
DEFYING THE TREND
McQuilkin is a bit of an anomaly in a retail sector undergoing consolidation. A 2019 study conducted by DesRosiers Automotive Consultants found that there were 126 dealership groups — defined as owning five or more stores — that together controlled 54 per cent of the vehicle sales in Canada. Additionally, there were more than 100 dealer groups, which typically own between two and four rooftops.
“That’s concentration of power, and it’s hard to identify a dealer in the last four or five years that did not sell to a group of some sort,” said analyst Dennis DesRosiers. “It’s a case of survival; you either do it or don’t exist.
“One of the strategies is to acquire some stores to put yourself into a better position to sell to a bigger group.”
But McQuilkin challenges that notion.
“I’d rather have one store or two stores than 20 stores right now. I could see that being a very, very major concern, that level of overhead and trying to control it. We’re smaller and we can be nimble.”
McQuilkin said he looks for opportunities to turn around underperforming stores in suburban markets, which he believes aren’t as vulnerable as larger, urban markets to disruptive technologies such as online shopping and to electric and self-driving vehicles.
“My vision is the further out of a city centre [people] are, the more reliance [they’ll] have on your individual vehicle. You need mobility, you need access, you need your own transportation.”
With Ford exiting the sedan market, it’s more of a rural brand, McQuilkin said.
“You might have a great population density [in urban centres], but people living in condos aren’t buying F-150s. ...To me, the opportunities are now in the suburbs and rural markets.”
‘I THINK THE MARKET IS THERE’
On his third day at Gallinger Ford in November, McQuilkin held a staff meeting outlining the goals: improving customer service and profitability and doubling newand used-car sales in the first year.
“I think the market is there,” McQuilkin said. “We’ve spent a lot more money on advertising.”
Building blocks for success include empowering staff, creating a safe work environment and upholding values such as work-life balance and community involvement.
“They teach you in school that 80 per cent of your job is not monetary,” McQuilkin said. “It’s self-fulfillment and self-actualization. At a certain age, I think that’s exactly true. It’s not necessarily true when you are in your 20s, trying to pay the mortgage.
“It’s not about the money now. It’s truly about creating something and being increasingly proud of something.”