Part 3 of 14: The Employee-Customer-Profit Connection
In this article, you’ll learn:
- Why CSI measurement often replaces true customer listening
- How employee disengagement shows up directly in customer interactions
- What happens when dealerships measure employee experience with the same rigor as CSI
Ask any dealer principal about their numbers and they'll rattle them off: gross profit per unit, service throughput, hours per RO, closing ratios, inventory turn. These metrics get reviewed daily, sometimes hourly. Compensation is tied to them. Careers rise and fall on them.
Ask those same dealers about their employee engagement levels by department. Ask them what percentage of their service advisors would recommend their dealership as a place to work. Ask them which positions have the highest turnover and why people in those roles are leaving.
Many can't answer with any precision. They might have a gut sense. They might know it's "not great." But the rigor they bring to financial metrics disappears when the subject is their own people.
This is the measurement gap at the heart of automotive retail—and it's more revealing than most people realize.
Here's something that doesn't get said often enough: most dealerships aren't actually good at listening to customers either.
What they're good at is tracking OEM satisfaction scores. That's different.
OEM programs tie customer satisfaction metrics to real money—bonuses that can exceed $200,000 quarterly, vehicle allocation priority, eligibility for co-op marketing programs.¹ The stakes are high enough that salespeople beg for perfect survey scores because their pay—and sometimes their jobs—depend on it. Industry sources note that a single bad survey can take 15 perfect surveys to offset.
So dealers pay close attention to those scores. But paying attention isn't the same as listening.
The goal often becomes influencing the score rather than learning from the feedback. Survey timing gets optimized. Customers get coached on how to respond. One industry analyst put it bluntly: dealers "work harder on the index than they do on the customer satisfaction."¹ The score becomes the objective, and the actual insight gets lost.
If customer listening is inconsistent, employee listening is often nonexistent.
There's no OEM program requiring it. No incentive tied to it. No external pressure demanding measurement. So it doesn't happen.
The 2025 NADA Dealership Workforce Study shows the consequences.² Overall turnover averages 42%—but that average masks wide variation. Non-luxury dealerships run at 45% while luxury stores see 30%. Regional differences are even starker: turnover ranges from 33% in the Northeast to 48% in the Mountain-Plains states.
Sales consultant turnover tells the most dramatic story. The national average of 66% already sounds alarming. But non-luxury dealerships hit 73%—and in the Southwest, that number climbs to 86%. Service advisors average 43% turnover nationally, with three-year retention at just 46%. That means fewer than half your service advisors will still be there in three years.
These aren't numbers from dealerships that don't care about their people. Many genuinely do. They just don't have systems to understand what their people actually experience—and whether the things they're doing to improve retention are working.
Research published in the Journal of Organizational Behavior studied 95 independently-owned car dealerships over six years and found that department culture consistently predicted higher subsequent levels of customer satisfaction ratings and vehicle sales.³ The connection is documented. It's just not acted upon.
Think about what actually creates a positive customer experience in a dealership.
It's the service advisor who remembers a customer's name and the quirk with their vehicle. It's the salesperson who asks follow-up questions that show they were actually listening. It's the technician who spots a potential problem before it becomes a breakdown.
These interactions require something that no process manual can provide—genuine engagement. An employee who feels valued, who believes in the organization, who sees a future for themselves there, brings a different energy to every customer conversation.
An employee who's mentally checked out, who's updating their resume between customers, who's counting down to their next opportunity? They'll follow the script. They might hit the checkboxes. But customers feel the difference.
You can't script your way to genuine customer connection. You can't checklist your way to trust. Yet that's exactly what we expect when we treat employees as interchangeable parts in a customer experience machine.
Bozard Ford in St. Augustine, Florida operates in a town of about 15,000 people. They sell roughly 947 units per month.⁴
Those numbers don't compute unless you understand what's happening inside the dealership.
Their turnover runs around 2%. Not 42%. Two percent. COO, Ed Roberts, attributes the results to culture - specifically, what he calls "attitude and effort chasing a vision."⁴
Roberts emphasizes that while many dealerships focus on the purchase moment, Bozard pours energy into the ownership journey, making every post-sale touchpoint matter. The dealership has built an internal training platform called Bozard University to support consistent onboarding, skills development, and cultural alignment. Over the past decade, they've grown the service department from 7 technicians to over 90, not by recruiting talent away from competitors, but by developing it internally.⁴
"If we provide our staff with the right career path, they'll chase the career path rather than the next position," Roberts told CBT News.⁴
This isn't about being soft. It's about being smart. When your employees stay for years and build deep customer relationships, you're operating with an advantage that no marketing spend can replicate.
Dealers measure what they're paid to measure.
OEMs have powerful reasons to track customer satisfaction at the dealership level. It affects brand perception, influences warranty costs, impacts sales. They've built elaborate survey programs, tied significant money to results, and created systems that ensure dealers pay attention.
No comparable incentive exists for employee experience. OEMs don't track whether their dealers have 13% turnover or 66% turnover. There's no bonus for maintaining high employee recommendation rates. Vehicle allocation doesn't change based on workforce stability.
This creates a predictable outcome: dealers optimize for what's measured and incentivized. They implement processes to capture every satisfaction point because tens of thousands of dollars ride on it. Meanwhile, employee experience remains in the realm of "nice to have" rather than business-critical measurement.
The dealers who've broken this pattern are choosing to measure something the industry hasn't required them to measure—which makes their results all the more notable.
Most dealers who read this will nod along. "Of course happy employees create happy customers." The insight isn't revolutionary.
But how many can actually prove it in their own operation? How many can show the correlation between engagement scores and customer satisfaction in their specific dealership? How many have the data to identify which departments are struggling and why?
What if you could see the connection between employee experience and customer experience in your own data—not as a theory, but as a measurable relationship you could track and improve?
That's not a hypothetical. That's what measurement makes possible.
Want to understand what's really driving turnover at your dealership? ESi-Q helps dealers and OEMs measure employee engagement, analyze retention patterns, and build a workforce that stays. As the research partner behind the NADA Dealership Workforce Study, we bring nearly three decades of automotive workforce data to help you see the connection between employee experience and business outcomes.
About The Author
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.
What is the connection between employee experience and customer satisfaction in dealerships?
Research shows a direct link. A six-year study of 95 car dealerships found that department culture consistently predicted higher customer satisfaction ratings and vehicle sales. Engaged employees build relationships, remember customer preferences, and go beyond scripts to solve problems—creating experiences that drive loyalty and repeat business.
Why do dealerships have high employee turnover?
The 2025 NADA Dealership Workforce Study reports 42% overall turnover in automotive retail, with sales consultant turnover reaching 66% nationally and as high as 86% in some regions. Contributing factors include commission-heavy compensation that creates income instability, demanding schedules, limited career pathways, and a historical "sink-or-swim" training culture.
Do dealerships measure employee satisfaction?
Most do not measure it systematically. While dealerships track financial metrics and OEM satisfaction scores in real time, employee experience typically gets annual surveys at best—and often nothing formal at all. The dealers with exceptional retention rates tend to be those who measure engagement with the same rigor they apply to other business metrics.
What is a good employee turnover rate for a car dealership?
The industry average is 42%, but top-performing dealerships achieve dramatically better results. Bozard Ford reported 2% turnover in 2022. Luxury dealerships average 30% compared to 45% for non-luxury stores. The gap proves that high turnover isn't inevitable—it reflects choices about how to treat and invest in people.
Footnotes:
¹TradePending, "A Complete Guide to CSI in Automotive for Car Dealers"; Edmunds, "Why Car Salespeople Beg for Top Customer Survey Scores"
²2025 NADA Dealership Workforce Study
³Journal of Organizational Behavior, study of 95 car dealerships over six years
⁴CBT News, "Elevate the ownership experience through servant leadership and training – Ed Roberts | Bozard Ford" (2025); "Defying industry challenges with innovative solutions – Ed Roberts | Bozard Ford Lincoln" (2024)