customer experience
Removing Effort and Friction: Part 2
Dealers need to remove effort and friction for their customers. It should not be difficult for customers to work with us digitally or in the...
Put Employees First, Watch Profits Follow
Learn how employee-first dealerships achieve twice the recommendation rates, reduce turnover, and boost profits through better customer experiences.
Cathy Palochko
Aug 25, 2025
Jim Rohn, the legendary business philosopher and mentor to Tony Robbins, once said, "You can have everything in life you want, if you will just help other people get what they want." As the automotive retail industry faces its worst talent crisis in decades , I keep coming back to this quote. Data reveals a direct line from how dealers treat people to CSAT and profitability. Most dealers chase monthly numbers first, worry about employee satisfaction later. But stores dominating markets have flipped this approach. They understand that in relationship-driven business, happy employees don't just impact customer satisfaction—they ARE it.
The Generational Tsunami Hitting Dealerships
Walk into any dealership today and you're witnessing a dramatic workforce transformation. Gen Z and Millennials now make up roughly two-thirds of the typical dealership workforce , bringing completely different expectations than the Baby Boomers who built this industry.*
The numbers tell a story that should keep every dealer awake at night. Gen Z turnover has spiked significantly—roughly double the rate of other generations.* We're not just losing entry-level positions either. The technician shortage everyone's talking about? We actually made progress hiring Gen Z techs recently, but here's the problem: we're great at recruiting young talent, terrible at keeping them.
Three factors are driving this exodus: poorly defined career paths, lack of coaching and mentorship, and work-life balance issues. Sound familiar? These aren't "entitled millennial" demands—they're basic human needs that previous generations simply accepted wouldn't be met in automotive retail.
The Numbers Don't Lie
Industry research shows that employees with strong growth and career opportunities are twice as likely to recommend their workplace. Meanwhile, employees who are detractors are more than likely to be actively looking for another job. In a market where good people have options, you can't afford employees actively seeking other opportunities.
Yet some dealer groups are proving it's possible to break this cycle. Industry leaders in employee experience are achieving recommendation rates in the 80-90% range, compared to industry averages in the 40-50% range.* Their secret isn't complicated—they're giving younger employees what they want: clear career paths, genuine mentorship, and flexibility.
The Training Desert
Here's a sobering reality: three-quarters of dealerships are failing at career development. That's not hyperbole—it's based on industry research.*
Only about a quarter of dealerships have defined career paths. Let that sink in. Nearly three out of four dealerships expect employees to figure out their future on their own, then wonder why ambitious people leave for industries that invest in their growth.*
The mentoring situation? Equally concerning. Less than half of dealerships offer any mentoring programs.* We're asking young employees to learn complex technical skills, master customer service, and navigate commission structures with minimal structured support.
Even basic orientation varies dramatically. While most dealers have some form of formal program, the depth and quality range from comprehensive multi-week experiences to brief one-day introductions.
Compare this to dealers winning the talent war. They understand that helping employees get what they want—the direction, development, and support that younger workers crave—directly translates to getting what the dealership wants: skilled, motivated people who stay and deliver exceptional customer experiences.
The leading dealer groups have created comprehensive training universities with hundreds, even thousands of courses, formal mentorship programs, and what employees describe as "hire to retire" philosophies. Rather than treating OEM training as just a box to check for incentive payments, they position it as valuable career development that benefits both employee growth and customer service quality.
They've established clear technician advancement tracks from entry-level positions through master technician roles, covering all certification costs and providing tuition reimbursement. Some even partner with technical institutes to create apprenticeship programs with guaranteed employment.
Progressive dealers are also innovating compensation structures. While pure commission models contribute to devastating turnover rates across all departments, some dealer groups have created hybrid models offering base salaries plus performance bonuses.* This provides income stability while maintaining motivation, addressing one of the biggest barriers to attracting quality people to automotive retail.
These aren't just gimmicks—they're substantial investments in their people's futures.
When Work-Life Actually Balances
Dealership research reveals that work-life balance positively impacts workplace recommendations by more than half.* This isn't about working less—it's about working sustainably.
Progressive dealers are already adapting. Roughly one-third now offer non-traditional scheduling, with four 10-hour shifts becoming the most popular option.* This gives employees three consecutive days off while maintaining coverage and productivity.
The weekend burden is finally easing too. We're seeing noticeable declines in mandatory weekend work, especially for sales consultants and service advisors. Some dealers are implementing flex time where employees can take extended breaks during slower periods to exercise, handle personal matters, or be home when their kids get out of school.*
Through industry research and conversations with dealership employees across all levels, it's clear these changes aren't just employee perks. They're retention strategies that directly impact the bottom line. When people aren't burned out and resentful, they bring completely different energy to customer interactions.
The most successful dealers are getting creative with scheduling solutions. Some guarantee technicians at least one Saturday off monthly, with two Saturdays off every other month. Others offer mobile technician positions for those who prefer field work. A few have implemented comprehensive wellness programs including on-site fitness centers, wellness coaches, and even company-wide stretch breaks.*
One dealership group's approach particularly caught my attention: they provide up to two weeks of PTO starting on day one, maintain full health insurance during any furloughs, and have leaders that know every employee by name. Those aren't just business practices—that's demonstrating genuine care for people as individuals.
The difference between engaged and disengaged employees is immediately apparent to customers. Consider the service advisor who's been passed over for promotions, works mandatory Saturdays, and has no visibility into potential career progression. Their customer interactions are mechanical—technically correct but lacking genuine engagement. They're protecting their energy because they've lost faith in the organization's investment in their future.
Contrast this with employees who have clear advancement opportunities, schedule flexibility for family commitments, and confidence in their professional trajectory. These employees naturally take ownership of customer problems, going beyond minimum requirements because they're emotionally invested in both their role and the dealership's success.
Digital Natives Want a Voice
Gen Z employees expect to have a voice in how things work. Industry research shows that feeling encouraged to offer suggestions significantly increases workplace recommendation rates.* Yet many dealerships still operate with rigid hierarchies where feedback flows one direction.
Dealers winning with younger employees have learned to tap into their digital native skills. Instead of fighting their comfort with technology, they're leveraging it. These employees often have insights on social media engagement, online review management, and digital customer communication that can significantly impact sales and service effectiveness.
But here's the key: you have to ask for their input and actually implement good ideas. Feeling heard matters more than most dealers realize.
Some of the most innovative dealers are also tapping into underutilized talent pools. I've seen veteran integration programs that include specialized training partnerships, mentorship networks, and career pathing designed specifically for military backgrounds. These programs aren't just good corporate citizenship—they're smart talent strategy, accessing a workforce with built-in discipline and strong work ethic.
Why the Corner Office Can't Stay in the Corner
Research consistently show s that strong connections between employees and senior leadership significantly increase workplace recommendation rates.* This isn't about being friends with employees—it's about visibility, communication, and showing that leadership cares about individual success.
The most successful dealers have leaders who regularly walk the departments, not only know employee names, but names of family members and career aspirations, and celebrate individual achievements publicly. They understand that in a relationship-driven business, the relationship between leadership and employees directly impacts every customer interaction.
I've seen this done at the highest level—a dealer principal who sends daily video messages to all locations, executives who refer to staff as "partners" rather than just workers, and leaders who back up their words with substantial financial investment in employee safety and security. These aren't just feel-good gestures; they create cultures where people genuinely want to represent the brand well.
When employees feel disconnected from leadership, they become transactional in their customer approach. When they feel valued and supported, they naturally become brand ambassadors.
From Good Intentions to Real Results
Creating this employee-first culture requires more than good intentions. It means measuring what matters, starting with systematic employee feedback. The most successful dealers regularly survey their workforce, track recommendation scores, and—most importantly—act on the feedback they receive.
It means tailoring experiences to meet individual needs rather than applying one-size-fits-all solutions. Progressive dealerships are investing in transparent communication channels and leveraging technology to create personalized development paths for employees.
Most critically, it means investing in leadership development so managers can effectively coach their teams. The best dealers recognize that supervisors are the bridge between company culture and employee experience—and they train them accordingly.
When Employee-First Pays Off
The dealers who have embraced this employee-first approach aren't just creating feel-good workplaces—they're generating measurable business results that prove the ROI of investing in people.
While the industry struggles with nearly 50% annual turnover rates*, the leading employee experience dealers have turnover rates in the low teens at their best locations. Their employee satisfaction ratings consistently score above 4.0 out of 5.0, compared to industry averages around 3.4. Some are achieving employee recommendation rates above 85%, while their competitors struggle to break 50%.*
Most telling: employee confidence in company direction—what researchers call "positive business outlook"—runs above 80% at the best dealers, compared to competitor ranges of 45-70%.* When your workforce believes in where you're headed, they're naturally more invested in helping you get there.
These aren't just HR metrics, they translate directly to business performance. Dealers dominating "Best Places to Work" rankings year after year are also the ones consistently outperforming on customer satisfaction and profitability measures. Some have claimed 9 of the top 10 spots in national workplace rankings—unprecedented dominance that reflects systematic excellence, not luck.* They've proven that when you help employees get what they want, you get what you want: sustainable competitive advantage in an industry where talent is becoming the ultimate differentiator.
When service advisors feel valued and see growth opportunities, they deliver better experiences. Customers trust them more, buy additional services, and return for future needs.
When technicians have clear advancement paths beyond leaving the industry, they stay longer, develop expertise, and reduce comeback rates.
When salespeople aren't worried about job security and see genuine career progression, they focus on building value and relationships rather than just closing deals. The result is more profitable sales where customers feel confident in their decisions.
This principle—helping others get what they want so you can get what you want—isn't just philosophical wisdom. It's a proven business strategy with measurable ROI in automotive retail.
The Choice Every Dealer Faces
Your techs are watching job boards. Your sales team is fielding calls from other stores. Your service advisors are looking at job opportunities outside automotive.
That's the reality. And the data presents every dealer with a choice: continue chasing profits directly while leaving employees to figure out their career paths on their own, providing little coaching or feedback, and treating people as replaceable rather than investable—or build environments where people actually want to work.
The question isn't whether this approach is effective, it's whether you'll implement it while you still have time to get ahead of competitors who haven't figured it out yet.
The choice is yours, but the window is closing. In a market where good people have options and customers have endless choices, putting employees first isn't just good leadership—it's the only sustainable path to the profits every dealer ultimately wants.
Ready to transform your dealership?
Quantum5 has helped hundreds of dealerships transform their workplace culture and improve employee satisfaction without sacrificing profitability. We know how to build the systems, processes, and leadership approaches that make people want to stay, grow, and perform at their best. Contact us today and start building the dealership where top talent chooses to work.
*The research cited throughout this article comes from Quantum5's research division, ESi-Q, which has been studying automotive employee feedback for decades. ESi-Q has conducted over 25,000 surveys and, in partnership with NADA, collected nearly three-quarters of a million payroll records from retail employees across leading private and public dealership groups, making them the industry's leading researcher of automotive employee data.
Frequently Asked Questions (FAQ's):
What is the average employee turnover rate at car dealerships?
The automotive dealership industry struggles with nearly 50% annual turnover rates—one of the highest across all industries. However, leading dealerships focused on employee experience have achieved turnover rates in the low teens at their best locations. This dramatic difference translates directly to the bottom line through reduced recruiting and training costs, improved institutional knowledge, and better customer experiences.
How much does employee turnover cost a car dealership?
While this blog doesn't provide specific dollar amounts, the impact of reducing turnover from industry-average rates (nearly 50%) to best-in-class performance (low teens) is substantial and measurable. The costs extend beyond direct recruiting and training expenses. Inexperienced staff deliver lower customer satisfaction scores, reduced service absorption, and weaker sales performance. Conversely, the dealerships achieving the lowest turnover rates are the same ones consistently outperforming on both customer satisfaction and profitability measures—proving that retention investments pay off across every business metric that matters.
What is employee engagement in the automotive industry?
Employee engagement measures how emotionally invested workers are in their role and dealership success—and in automotive retail, it directly impacts every customer interaction. Research shows employees with strong growth opportunities are twice as likely to recommend their workplace, while detractors are actively job hunting.
Won't focusing on employee satisfaction hurt my bottom line in the short term?
Actually, the opposite is true. Dealers implementing employee-first strategies typically see improvements within 6-12 months. Lower turnover alone saves tens of thousands in recruiting and training costs per position. Meanwhile, engaged employees deliver better customer experiences that drive higher CSI scores, increased service absorption, and stronger closing rates.
How can I attract and retain Millennial and Gen Z workers at dealerships?
Millennials and Gen Z now represent roughly two-thirds of the typical dealership workforce. To attract and retain them, address what drives their turnover: only a quarter of dealerships have defined career paths, less than half offer mentoring programs, and work-life balance remains inadequate at many stores. Successful strategies include advertising clear advancement paths in recruiting, assigning structured mentorship early, and offering flexible scheduling.
How long does it take to see measurable improvements in employee satisfaction and retention?
Most dealerships implementing systematic changes see early indicators within 60-90 days and substantial movement within 6-12 months. However, transforming culture is ongoing work, not a one-time fix. The dealers achieving 80-90% employee recommendation rates have been consistently investing in their people for years. The good news: every improvement compounds—better retention means institutional knowledge grows, which improves training capacity, which attracts stronger candidates. Start now, measure progress quarterly, and plan for continuous improvement.
What is the ROI of investing in dealership employee training and development?
The ROI is measurable and substantial. Employees with strong growth and career opportunities are twice as likely to recommend their workplace—and recommendation rates directly correlate with retention and customer satisfaction. Dealerships that have created comprehensive training programs with formal mentorship are achieving employee satisfaction scores above 4.0 out of 5.0 versus industry averages around 3.4, recommendation rates above 85% versus competitors struggling to break 50%, and turnover rates in the low teens versus nearly 50% industry average.
We've tried employee surveys before and nothing changed. How is this different?
The critical difference is what happens after the survey. Most dealerships collect feedback but fail to act on it, which actually makes things worse—employees lose trust when they share concerns that go unaddressed. The winning approach involves three steps: measure consistently (not just once), communicate what you learned and what you're changing, then track progress over time. When employees see their feedback driving real improvements, engagement and trust increase dramatically. Our research division, ESi-Q, helps dealerships not just collect data, but translate it into actionable strategies with accountability built in.
Where can I learn more about the research cited in this article?
All research cited comes from ESi-Q, Quantum5's research division and the industry's leading authority on automotive employee data. ESi-Q has conducted over 25,000 employee surveys and, in partnership with NADA, analyzed nearly three-quarters of a million payroll records from retail employees across leading dealership groups. To access benchmarking data, schedule an employee survey, or learn how your dealership compares to industry leaders, contact Quantum5 today. Understanding where you stand is the first step toward building a workplace where top talent chooses to stay.
About the Author
Cathy Palochko
Cathy Palochko has spent her career in learning and development almost exclusively in automotive, including senior leadership roles in training and development for multi-franchise dealer groups and extensive experience on the agency side supporting OEMs.
Today, she serves as COO of Quantum5, which provides the first Performance Intelligence Ecosystem™ redefining how organizations develop their people. Their unified platform combines learning, feedback, recognition, and performance data through sophisticated AI and human expertise to deliver personalized development experiences that unlock potential and drive authentic growth.
