The Garnier Ford Dealership (A)

Published 01 Jan 1999
Reference 4801
Topic Operations
Industry Automotive
Region Europe
Summary

Case A describes how Antoine Vitry, a Ford dealer who is highly successful in a small market, is offered the opportunity to buy a floundering business whose territory is bordering his own: the Garnier dealership, which serves the 16,000-new-car-a-year BigCity market. The catch is that Vitry must make up his mind very quickly ( within a few days without any time to carry out a detailed analysis. Despite the appalling state of the Garnier dealership, Vitry is under pressure to buy it from Ford, whose strategy is to regroup several dealerships under joint management and ownership in order to allow significant economies of scale.

Teaching objectives

The Garnier case illustrates the following concepts: The specificity of a service industry, with the distinction between back office and front office The specificity of car distribution, its evolution: consolidation of dealer networks to achieve economies of scale, e-commerce, car superstores, consolidators Turning round a failing business and preparing a business plan The valuation of an acquisition How to develop a process of continuous improvement (lean management methods and lean thinking in the back office, improvement of value perceived by customers in the front office)

Keywords
  • RD1099
  • AR1999