At its core, automotive retail is a business built on relationships. Every transaction, whether a vehicle sale, repair order, or trade, relies on trust built between a customer and a sales or service advisor.

As dealerships continue to invest in their teams and customer experience, employee retention represents an important opportunity to strengthen those relationships even further. According to HR4’s State of Automotive Workforce report, nearly 60% of employees leave a dealership within a year, with the highest turnover in the sales department, costing dealerships on average $500,000 on turnover-related costs each year. That does not include the operational tax that constant turnover has on customer satisfaction and lifetime profitability.

High-performing companies across adjacent industries hire from the exact same talent pool of hourly and entry-level workers. Some have found key strategies that lead to longer tenures, improved customer experiences, and better business outcomes.

Here are three strategies from leading customer-focused organizations that dealerships can apply to build on their existing efforts and further strengthen employee development, retention, and customer experience:

Onboarding matters as much as character & chemistry

Chick-fil-A operates with a mostly young workforce, hiring from the same talent pool as its quick-service competitors like McDonald’s, Wendy’s, and more. Yet, Chick-fil-A achieves industry-leading customer satisfaction and employee retention rates at a fraction of those competitors.

Chick-fil-A demonstrates how strong hiring can be reinforced by an equally strong onboarding and development experience. Chick-fil-A produces a much higher-caliber employee from the same pool of workers because of its substantial training and development. While Chick-fil-A prioritizes character and chemistry during recruitment, it ties the employee experience directly to the customer experience. By training and investing in employees, Chick-fil-A ensures they deliver a higher-caliber customer experience.

The same principle can be especially powerful in automotive retail, where employees play such a vital role in building lasting customer relationships. A new hire’s training and onboarding lay the foundation for the rest of their tenure with the dealership, whether long or short. Dealerships can build on their existing onboarding efforts with a structured approach that walks sales and service staff through every aspect of their new role.

With a 30-60-90-day ramp, employees have time to absorb information, see it in practice, and receive feedback before they’re pressured with performance metrics. According to the Brandon Hall Group HCM Outlook 2024 study, structured onboarding is proven to make employees 82% more likely to stay and 69% more likely to remain with a store for three years or longer.

Development & empowerment make people stay

Luxury hospitality leader The Ritz-Carlton treats training not as a one-time onboarding event, but as a daily discipline. Every team across every property gathers daily for a brief, five-minute lineup when employees reinforce service standards, review core values, analyze real customer scenarios, and practice problem-solving skills.

Dealerships can strengthen the impact of the training and coaching they already provide by reinforcing learning consistently over time. Hermann Ebbinghaus’s foundational research on the Forgetting Curve — which shows that the vast majority of unreinforced learning is lost within 30 days — dates back to the late 1800s, but modern studies like this one consistently validate that reinforcing content through bite-sized micro learning substantially increases retention. Flipping the script to continuous microlearning delivers a higher training return on investment, all without losing half a day of productivity.

The Ritz-Carlton also encourages employees to resolve guest issues on the spot and deliver memorable experiences, such as not just replacing a guest’s prized toy, but capturing its “journey” back home — a simple gesture that has been mimicked by the likes of Southwest Airlines and others.

Many successful dealerships already understand the value of empowering employees to create memorable customer experiences. The Ritz-Carlton example demonstrates how making that empowerment part of the culture can strengthen that approach even further. When a customer comes in with a unique challenge or a rough week, encourage your employees to deliver an experience that is beyond the status quo.

Build long-term careers, not short-term stepping stones

Bulk goods retail giant Costco built an industry-leading retention strategy centered on developing and promoting talent from within. The vast majority of Costco warehouse managers started in hourly, frontline positions. Through formal career development programs, structured support, and a deliberate practice of promoting internally, entry-level employees see their current role as the first step of a long-term career, rather than a steppingstone to the next job. As a result, Costco maintains an exceptionally low annual turnover rate of about 8% compared to 60% for other retailers, according to the Economist.

Dealerships, too, can establish clear, visible career pathways for employees. Today’s dealerships support careers from digital marketing and social media to people management and accounting. There’s almost certainly something for every interest, and when a dealership builds a culture of internal coaching and fills roles from within, entry-level team members see a tangible future at the store they can get excited about. Promoting from within also preserves institutional knowledge, accelerates leadership ramp times, and transforms short-term jobs into long-term careers. It’s a win-win for the dealership and the employee.

Back at Chick-fil-A, managers are encouraged to learn about and support their direct reports’ goals, even if those goals aren’t long-term at Chick-fil-A. Dealership leaders can continue building on this mindset by understanding what drives individual team members and connecting those interests to opportunities within the dealership.

Personal passions may translate directly into core dealership needs. For example, if a sales advisor spends weekends DJing weddings, a sharp manager will connect the dots: reading a crowd, managing event flow, and providing high-touch customer service are the same skills that win on the showroom floor. When employees feel you are genuinely invested in their personal growth, the dealership reaps the benefits in performance and loyalty.

The long-term return on frontline talent

Dealerships are always looking to protect margins. Sometimes protecting margins simply means controlling costs, but it can also mean controlling risk and investing in areas that can benefit your business long term, such as the people who interact with your customers every day. Dealerships that keep investing in strong onboarding, continuous coaching, and clear growth pathways can strengthen retention, develop future leaders, and build high-performing teams. In return, they’ll build loyal, high-performing teams that drive exceptional customer experience.

Matthias Stoever is co-founder & CEO of RockED