Car dealerships here in the U.S. face a real problem with customer perception of their ethics as the latest survey from Total Dealer Compliance suggests.

2016 Total Dealer Compliance Survey

You can say what you will about the sample size, but the fact is that the findings from the latest survey from Total Dealer Compliance (TDC), a car dealership compliance-auditing firm, regarding dealership ethics should be a wake-up call for U.S. car dealers.

TDC's latest online survey, conducted in July among 200 U.S. adults age 18 and over, finds that nearly 65% of consumers said that "they believe that U.S. car dealerships' business practices are not ethical."

unethical car dealerships

Code of Ethics

What can dealers do about this? According to TDC, dealers can take at least one simple step that could help them gain a customer's trust.

"A code of ethics is designed to reinforce a dealers' personal commitment to quality service and high ethical standards," said Max Zanan, President of TDC. "Our survey confirmed that the trust between the consumer and car dealer is well and truly broken. Ensuring a code of ethics is on display will be the first step in rebuilding the consumer's trust, where compliance is of top priority."

TDC Survey Findings

Here are some of the survey's findings:

  • Nearly 65% of consumers believe that U.S. car dealerships' business practices are not ethical
  • Over 50% of consumers are more likely to shop at a dealership if their code of ethics were clearly displayed
  • 40% of consumers said that it would not make a difference if a dealership's code of ethics was clearly displayed upon purchasing

So even if dealers do display their code of ethics, it appears that there's still a long way to go before they earn the trust of many customers as TDC notes that "the survey highlighted one common theme which is overall consumer fatigue towards car dealerships' sales processes."

"Car dealers have a lot of work to do when it comes to changing the public's perception. While ethics and compliance go hand in hand, car dealers should execute regular audits, provide online courses to employees and conduct their business ethically," said Zanan. "TDC's survey further highlights the need for a strong compliance training program that will proactively mitigate risks while helping dealerships to build a positive reputation."

While it may seem a bit self-serving coming from a firm that specializes in car dealer compliance, the results of the survey point to the fact that after spending thousands of dollars to attract customers into their showrooms, car dealers still must overcome the perception that their business practices lack transparency and, as a result, are viewed by the buying public as unethical.

About Total Dealer Compliance

Total Dealer Compliance is an auditing firm that provides a comprehensive solution to ensure car dealers are fully compliant with Federal regulations within Sales, BDC, F&I, Fixed Ops, HR and IT departments. For more information, please visit www.totaldealercompliance.com or call 1-888-243-5204.

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