Mitchell said minority candidates, in some cases, should consider partnering with another more experienced dealer — whether a minority or not — to get their first taste of ownership.
The pandemic could encourage some dealers to sell, Mitchell said, creating more chances to buy in the near future. Mitchell said some dealers may think there’s no end in sight for the health crisis.
Candidates looking to buy a dealership in this environment may need to have “a bit more capital and/or collateral to make the banks more comfortable” than they would otherwise, Mitchell said. Banks will recognize that sales are rebounding but also take into account the added risk dealers now face.
“Banks are looking at all those things, so that’s something that candidates may run into,” Mitchell told Automotive News. “But I think [it] is still a good market for buy-sells.”
Then there’s the cultural aspect. Suddenly being one of the few Black residents in town, for instance, can be a jarring shift for some. A.V. Fleming, executive director of the Ford Motor Minority Dealers Association, said profit potential isn’t the only factor to consider.
If the candidate is a person of faith, Fleming mused, can they find a place of worship that supports their spiritual needs? He also mentioned the importance of barbershops, which serve as pillars of social discourse and camaraderie in many Black communities. The loss of those connections can’t be overlooked, he said.
The adjustment of having a minority-owned business in a town with little diversity isn’t confined to the dealer. While some dealership staffers wouldn’t have a problem embracing someone with different cultural experiences, Fleming said, that may not be the case with everyone.
“They may even work with somebody that looked like me, but they never reported to somebody that looks like me. That’s a big difference,” Fleming said. Treating others right may not always get them to accept minorities because “the world is more complicated than that.”