Using Data to Identify and Mitigate Dealer Risk

Dealer risk is a major concern for automotive OEMs. If a dealer defaults on its financial obligations, it can have a significant impact on the OEM's bottom line. As a result, OEMs need to have a robust system in place to identify and mitigate dealer risk.

How to identify dealer risk

There are a number of factors that can contribute to dealer risk, including financial performance, operational efficiency, and customer satisfaction. OEMs can use data from a variety of sources to identify dealer risk, such as:

• Financial data: 

OEMs can review dealer financial statements to identify dealers with high debt levels, low profitability, or negative cash flow.

• Sales data: 

OEMs can review dealer sales data to identify dealers who are struggling to meet their sales goals or who are losing market share.

• Customer satisfaction data: 

OEMs can review customer satisfaction data to identify dealers with high customer churn rates or low customer satisfaction scores.

How to mitigate dealer risk

Once OEMs have identified dealers at risk, they can take steps to mitigate that risk. Some common mitigation strategies include:

1. Providing financial support: OEMs can provide financial support to dealers who are struggling financially. This support can come in the form of loans, grants, or equity investments.
2. Providing operational support: OEMs can provide operational support to dealers who are struggling to operate efficiently. This support can include training, consulting, or software solutions.
3. Monitoring dealer performance: OEMs can closely monitor the performance of dealers at risk. This monitoring can help OEMs to identify problems early and take steps to address them before they become serious.

How pOrbis can help

pOrbis' Business Management Services tool can help OEMs to identify and mitigate dealer risk in a number of ways. First, it can collect data from a variety of sources, including dealer financial statements, sales data, and customer satisfaction data. Second, it can use AI and ML to analyze this data to identify dealers at risk. Third, it can provide OEMs with real-time insights into their dealer network risk.

Features of pOrbis' Business Management Services tool

pOrbis' Business Management Services tool offers a number of features that can help OEMs to identify and mitigate dealer risk, including:

1. Dealer risk dashboard: The dealer risk dashboard provides OEMs with a real-time overview of their dealer network risk. This dashboard includes key metrics such as financial risk, operational risk, and customer satisfaction risk.
2. Dealer risk reports: pOrbis' Business Management Services tool can generate a variety of dealer risk reports, including financial risk reports, operational risk reports, and customer satisfaction risk reports. These reports can help OEMs to identify trends and patterns in dealer risk.
3. Dealer benchmarking: pOrbis' Business Management Services tool allows OEMs to benchmark their dealers against other dealers in their region or industry. This can help OEMs to identify areas where their dealers are more or less risky.
4. Dealer alerts: pOrbis' Business Management Services tool can generate alerts for OEMs when dealers are at risk. This can help OEMs to intervene early and address problems before they become serious.

Conclusion

Dealer risk is a major concern for automotive OEMs. pOrbis' Business Management Services tool can help OEMs to identify and mitigate dealer risk in a number of ways, including by providing them with a real-time overview of their dealer network risk, generating dealer risk reports, benchmarking dealers, and generating dealer alerts.

By using pOrbis' Business Management Services tool, OEMs can reduce their risk of dealer defaults and improve their bottom line.Contact pOrbis Now.