Sullivan Ford Case

BA 235 Services Marketing
Group 7: Case Solution ~ Sullivan Ford Auto World
Feb. 2012

21

Case Background
Walter Sullivan the founder of Sullivan Ford Auto World died and his eldest daughter Carol Sullivan-Diaz, a health care manager by profession took over the business and found out that the family business is in financial trouble based on current financial performance and market outlook. In addition, CSAT results from car buyers show that the company has problems with their service quality.
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Sullivan Ford Auto World Facts:
Average sales of 1,100 cars per year
Posted Revenues:
$26.6 M – car sales (from last year’s $30.5 M)
$ 2.8 M – service & parts sales (from last year’s $ 3.6 M)
Margins on car sales are low (5.5% of sales revenue & 25% for service). Auto World’s financial situation had been deteriorating for the past 18 months and running at a loss for the past 6 months.
Past 12 months’ financials show that gross sales figures are not enough to cover fixed expenses
Margins had been squeezed by promotions and other marketing efforts. Market:
Due to rising fuel prices, industry and in-house forecasts for future sales were discouraging.
Trend is shifting towards vehicle service transactions.
30-day Purchasers CSAT Survey Results
Auto world achieved better than average ratings
90% of customers said that Auto world informed them of what to do if they needed service
Less than 33% of respondents said that they have been introduced to someone in the service department (which is a sales protocol)
90-day Purchasers CSAT Survey Results
Overall satisfaction with Auto World Service Department was consistently low placing it in the bottom 25% of all Ford dealers
More than 50% of respondents said they would rather use another Ford dealer for future service

BA 235 Services Marketing
Group 7: Case Solution ~ Sullivan Ford Auto World
Feb. 2012
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21

Major Concerns:
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