By Marilou C. Vroman, CPA, CFE
A dealer and his loyal CPA and family attorney typically form a bond over the years in a relationship that has potential to last for decades provided that level service and value for the price paid both remain high. I believe that this relationship is important and should be respected by other CPA, consulting and advisory firms. However, a dealer may have specific needs that require the skills of a specialist. Is it OK to explore and engage the use of more than one firm to address a dealer’s highly specialized operational needs?
Accountants and attorneys, like doctors, often specialize in a practice area. While every doctor knows that exercise and proper nutrition will lead to a healthier body and every CPA knows how to properly keep the financial records, and most attorneys know contract law, not every doctor knows how to perform heart surgery, nor does every accountant or attorney know what’s best for a car dealer. Some dealers have shared with me that they have long standing solid relationships with their incumbent professional firms. “We’ve had the same accountant for 15 years and don’t plan to make any changes”. As we do with maintaining our own health, we gain comfort from visiting the same doctor who has come to know us over the years. He is familiar with the back pains and the recurring headaches and will write a prescription to cure what ails us in a heartbeat. But what if our health concern is more complex? Most people would like to count on a primary care physician for all medical needs, but often, the primary care physician will refer us to a specialist. Why? Because we can expect a better result from a practitioner with whose expertise and focus is in addressing our specific health needs. The same applies to accountants and advisors in the automotive retail space.
For example, in a dealership buy/sell, a dealer may defer to using their personal family attorney based on years of having a trusting and successful relationship; however the attorney may not be well versed in dealer law, or understand the intricacies of valuing dealership assets, representations and warranties, and may misinterpret the impact of key language and provisions in an APA which could be very costly to the dealer once at the closing table. In this case, it makes more sense to seek a specialized dealership attorney with the experience of many dealership closings in their arsenal. Not only will dealer have access to unique expertise, with experience comes efficiency. Efficiency often equates to a less billable hours and ultimately greater savings on the final bill for services rendered.
Over the years we have worked alongside many other professional firms in differing capacities with great success. There is an increased level of comfort and assurance for the dealer knowing that there are multiple sets of educated eyes looking at the operation from varying perspectives. In searching for industry experts, we believe it’s important to seek a firm that employs individuals who can bring the unique knowledge and skill set that can only be gained by spending years working in and around dealers and their dealerships.
The bottom line is there is strength in numbers when it comes to a dealership’s financial and operational well-being. One professional may take the role of the primary care physician and the other the cardiologist. Both have the dealer’s long-term health in mind.