Finally operational profit!

In October 2023, it finally happened: operational profit at the Ligier Store Doesburg! In the months that followed, November and December, black figures were also recorded, and for January, the results were likewise positive. My thought is that if we can make a profit for one month, we can also do it for two months. And if we can achieve that for a quarter, we can do it for two quarters, and then always….

It took a long time!

It took quite a while to achieve this result…. In June 2022, we started as Ligier Store Doesburg – Experience Center in Doesburg, focusing on selling new city cars from Ligier and Microcar. It took quite a while, I believe six weeks, until we had the first order on paper, while the costs kept accumulating every month. I underestimated this startup phase. I assumed that starting the business would immediately pick up sales. How different reality turned out to be.

I underestimated this startup phase. I assumed that starting the business would immediately pick up sales. How different reality turned out to be.

Challenge

The challenge was that we started in an area without a database, without customers, without used cars, without a workshop, and without history. The average costs, with a focus on marketing, amounted to €27,000 per month. Indeed, a hefty sum.
The months following continued with high costs, especially investments in marketing. We invested a lot of money in gaining visibility. And in terms of revenue versus costs: you can sell ten new microcars per month, but that won’t break even if your costs are €27,000 per month….

Buying a business property means 100% commitment if it wasn’t there already!
At the end of 2022, I was able to buy the entire business property, consisting of four business units, from the landlord. On the one hand, a good business investment, on the other hand, a commitment to continue with the Ligier Store! The purchase was closed within fifteen minutes, and I immediately had the thought of expanding by at least two units, thus doubling the size, to create more absorption capacity in the profit and loss statement. Actually, it’s odd to add more costs, but I’m happy to explain the reasons.
The unit next to ours, identical to the Ligier Store, is a showroom-like space that can serve as a car showroom. Not necessarily suitable for microcars, more for cars.

Business Management

Back to business management. It turned out to be difficult to keep buying used microcars in the right quantities…. That’s why we focus mainly on new microcars and Citycars. When one of our tenants agreed to move to the back unit, we were able to set up the vacated space as a car showroom. That showroom was named Experience Store Doesburg, and it was painted orange. Not because it necessarily had to be, but the newly purchased VW Crafter tow truck was orange. You better have matching colors, right?

Lynk en Co

In the showroom, we specialized in selling used Lynk and Co’s that came back from leasing. The advantage of selling ‘regular’ cars is that you only need a showroom, you put the ads online on the portals, and you’re operational.
With Ligier, we have to build the ‘brand’ and find a customer base, the youth, who haven’t considered the city car yet. Selling used cars is much easier in comparison! The website, a copy of the Ligier Store, was put online, with the approach that online first is and offline second! In other words, the showroom is the studio for the website, and the website/online is primary!

The costs absolutely increased but actually decreased!

The costs increased from an average of €27,000 to €34,000 per month. This increase was due to extra manpower (50%), more rent, and more money in the portals. The price per business unit, on the other hand, went from €27,000 to €17,000.
The marketing also improved, both on the Ligier and Experience sides of the store. This was partly due to the use of Walcu CRM. With good insight, we didn’t have to invest as much in marketing, while still selling more. Data in Walcu CRM told us to stop with Channel X and invest more money in Channel Y.

Data in Walcu CRM told us to stop with Channel X and invest more money in Channel Y.

A few months later, the third unit became available because we also made a good financial proposal to that tenant. With the freed-up space, we could finally set up a service/after-sales department as a Ligier dealer. So service for microcars with a good technician who also enjoys microcars!

Used workshop setup

Thanks to Bert de Kroon, I was able to buy a complete used workshop setup for a nice amount, including two lifts. And with partners like Bram Teun Koskamp and Vishal Durgaram, we could also arrange the last things such as toolboxes, small materials, and oils.
The costs per month increased