The balancing act: A holistic approach to improving retention at auto dealerships

“The only way to do great work is to love what you do.”

- Steve Jobs

Mr. Jobs’ famous words above may not be true in every case, as certainly many dedicated professionals deliver top-quality work despite being unenthusiastic about their careers. Still, the sentiment rings true, as we’ve all known people unhappy at work and they not only often do the minimum expected, but they are usually also thinking about an exit plan.

Unfortunately, statistics indicate auto dealerships have more than their share of discontented workers. The employee retention challenge for dealerships is nothing new. Turnover rates have far exceeded most other business sectors for many years. As of late 2024, annual dealership turnover was approximately 46% overall and an astounding 80% for sales consultants.¹

A common reason given for this is that auto retail is highly competitive — and can be highly stressful — with sales professionals feeling the most pressure. However, that explanation doesn’t help address the problem. What can help is determining where your dealership stands in terms of some universally valued job qualities:

• Good pay and benefits
• A healthy workplace culture
• Growth opportunities
• Pride in the work
• Work/life balance

Think of employee satisfaction like preparing a great meal. It’s not so much about individual ingredients, but how they work together. Even when employees are well compensated and receive great benefits, they may look for other opportunities if the work environment feels stressful or unwelcoming. Conversely, a positive atmosphere isn’t enough to keep someone with an employer if they are struggling financially or don’t see promising prospects ahead.

Fortunately, your dealership can become an employer of choice by finding a balance between the competitiveness inherent to the industry and the security and satisfaction that all workers desire.

Compensation: Go beyond the basics with profit participation

Competitive base pay and benefits are important, especially in an industry where commissions and bonuses can be impacted by things beyond individual performance: economic downturns, global trade conflicts, supply chain issues and more. If regular, significant pay hikes are not workable within your operational budget, wealth generated through profit participation programs can be used to enhance bonuses or implement new rewards for key employees.

Culture: Good attitudes flow from the top down

Despite the famous “Glengarry Glen Ross” speech (“First prize is a Cadillac El Dorado. Second prize is a set of steak knives. Third prize is you’re fired.”), fear and stress are not good motivators for long-term success and certainly not good tools for retention. Relevant leadership and management training, and consultations with outside human resource and employee well-being specialists can reveal how to better connect with your people. Like all skills, encouragement and empathy need guidance and practice. Make sure the examples your leaders set are constructive and positive.

Career growth: Don’t block ambition

One of the challenging aspects of retention is that the aspirations of valued employees may be overlooked in the busy day-to-day aspects of running a business. There can also be a concern that promoting someone may mean losing the productivity they brought to the role they are leaving behind. Just like a successful sports team, it’s important to develop a talent pipeline within your dealership. Team members ready to take the next step up often have the skills to be great mentors and trainers. On the negative side, if people feel their careers are at a standstill, they may look elsewhere. Encourage ambition and it can inspire a positive, infectious drive throughout your workforce.

Job performance: Confidence is the key

“Imposter syndrome” at work is a feeling that you are constantly hiding professional inadequacy. While dealership-specific data on the phenomenon is limited, it is widespread across different industries. One study reported that 71% of North Americans feel like an imposter on the job.² A different study showed the exact same percentage of American CEOs experience similar feelings³, suggesting a confidence crisis at all professional levels. It’s hard to take pride in your job without feeling you know how to do it well. That takes us back to training — specifically thorough, role-specific training.

Many training programs are too broad, and businesses also tend to emphasize learning on the job. While no training can cover every real-world business scenario, the more prepared employees are, the better they can adapt to unexpected developments.

Supportive job training is important, but the need for encouragement and guidance doesn’t end when training is completed. That’s where a strong mentorship program can fill the void. If you think mentorship doesn’t generate concrete results, think again. Research from 2024 showed that median profits for Fortune 500 companies with mentoring programs were twice as high as those without them.⁴ Here at Zurich, our F.A.S.T. (Field Accelerated Success Track) mentorship program has been helping Direct Markets team members since 2012.

Life is messy…in and out of the office

While the importance of a good work/life balance has become more widely accepted, that acceptance means nothing without taking steps to help your employees achieve it.

Work/life balance isn’t just about ensuring workers have enough vacation days to spend quality time with loved ones, limiting excessively long workdays, or providing flex time to reduce the stress of navigating medical appointments, childcare and other personal matters. It’s also about a wide spectrum of mental health support. A benefits package that makes in-person or remote professional therapy affordable and accessible is fantastic, but if that’s out of reach, there are other ways to help your people manage life’s inevitable challenges:

• Offer short blocks of personal time beyond scheduled lunch breaks.
• Provide qualified financial advisor services. Reducing money-related stress is a mental health issue as well as a budgetary one.
• Simply asking employees about problems at home, as well as on the job, and allowing time to discuss those problems can be liberating for many. Of course, you need to confirm the employee wants to discuss those issues and respect their privacy and conversational boundaries if they don’t.

There’s no magic wand to wave to improve job satisfaction for every employee, but a combination of clear communication, strong incentives and a focus on employee well-being can foster a positive workforce and keep top talent with your business longer.

This article originally appeared in "Dealer Principal" magazine.

1. Netchex. “Car Dealership Employee Turnover: The Complete Guide to Understanding, Measuring, and Reducing Turnover.” 2 November 2024.

2. Kickresume. “Is Imposter Syndrome Holding You Back? 71% of Americans Struggle With Self-Doubt, Europe Close Behind.” 1 May 2025.

3. Korn Ferry. “71% of U.S. CEOs Experience Imposter Syndrome, New Korn Ferry Research Finds.” 6 June 2024.

4. Cook, Sam. “40+ Definitive Mentorship Statistics and Research for 2024.” MentorcliQ. 2 February 2024.