NEW YORK — Consumers favor car dealerships that adhere to compliance regulations, according to a survey conducted by Total Dealer Compliance (TDC). In its survey, the compliance-auditing firm found that 68% of consumers are more likely to purchase a vehicle from a dealership that adheres to all federal regulations.
Dealers share the sentiment, with more than 80% of dealers polled saying that compliance training and implementation will improve their reputation in the community. However, the survey also found that only 37% of dealerships actually offer comprehensive compliance training to their employees and 65% of dealers have not had a comprehensive audit in the last 12 months.
“In an industry known historically for its resistance to change, the demand for car dealers to become more transparent and fully compliant with federal regulations is fueling a transformation,” said Max Zanan, president of TDC. “Our report — the first of its kind — turns a spotlight on the hot topic of compliance and the necessity of having strict policies and procedures in place that are being adhered to by all employees to ensure consumer confidence and loyalty.”
More than 73% of consumers are more comfortable dealing with dealership staff that has completed compliance training and has certificates of completion on display, the survey found. And, nearly 80% of consumers will send referrals to dealerships that make compliance a priority, according to the survey.
As for dealers, the survey found that nearly 65% of them feel they are under scrutiny by proactive regulators. Still, less than 25% employ a compliance officer.
“We calculated that noncompliance costs car dealers an average of $792,000 per year in lost profit, which further highlights the need for a strong compliance training program that will proactively mitigate risks while helping dealerships to build a positive reputation,” Zanan said. “Car dealers are increasingly recognizing that federal regulators are looking to make headlines by imposing steep fines and penalties on those who overlook this critical part of doing business. We are delighted to offer a solution that will help dealerships avoid unnecessary headaches and expenses.”
Originally posted on F&I and Showroom