Montreal-based Leader Auto Resources (LAR) and U.S. private equity firm Resilience Capital Partners announced a partnership on March 30 to expand LAR’s dealership sourcing and service business in the U.S.
LAR’s existing U.S. business will be rebranded as DealerShop. Canadian auto dealer reached out to Al MacPhee of Ford-Dartmouth in Nova Scotia and Chairman of LAR, to get a better idea of what this partnership means for Canadian dealers.
“The LAR group is 2,000 dealers, and it did well from 1980 until now. But if we are going to get more buying power and get better deals from major suppliers, we have to grow larger — and growing larger is going south of the border in this case,” said MacPhee. “DealerShop nearly doubles our buying power and the discounts we are able to get are much greater.”
According to MacPhee, DealerShop reached a deal with LAR in Canada and will be running south of the border, taking over activities in Albany and the Boston area of New England.
“LAR is a co-op and broke into the U.S. some time ago. But we are Canadian dealers who own LAR, and to invest very significantly across the U.S. for something that is really a co-op wouldn’t be prudent for us,” said MacPhee. “So this company (DealerShop) that is centred in the Detroit area — with significant backing we are hoping to reach 17,000 dealers.”
MacPhee said the partnership was good for dealerships and the collision centres it serves. “This deal will result in a stronger company that is even better equipped to help customers save money, operate more profitably, focus on their core businesses and enable them to serve their customers in better ways,” he said, adding that “We will benefit in Canada.”
MacPhee also said they are hoping to increase the collision business considerably as a result of the new (rebranded) DealerShop. Furthermore, he said every dealer member will receive the exact same pricing on anything in their dealership.
“Obviously we are buying from ourselves, which is a very smart way to do it. So when I need a component, I don’t need to shop the entire market, because LAR has done it for me. And obviously south of the border, they can see the same need,” said MacPhee.
DealerShop will handle and expand all of the company’s U.S. operations, and serve as a subscription-based distribution hub that will supply dealerships with the things they need to operate their business. This includes everything from administrative supplies and services, to warehouse and direct-purchase products and capital equipment, according to LAR.
DealerShop will be led by Mary Petrovich as the Chairman, and Bill Gryzenia as President and CEO.
“With more than 17,000 dealerships nation-wide, we believe there is an incredible opportunity to help dealers and collision centres minimize administrative tasks, optimize time devoted to other core functions and realize true cost savings in almost every area of their franchise,” said Petrovich.
DealerShop plans to utilize LAR’s business model and create stronger distribution channels, as well as negotiate rates locally.
