Business Interview: Robert Forrester, CEO of Vertu Motors

Tom Keighley speaks to the boss of fast growing automotive retailer Vertu

Robert Forrester, CEO of Vertu Motors
Robert Forrester, CEO of Vertu Motors

As a student Robert Forrester’s tutor told him he was too competitive for the career he wanted in academia. That tutor was probably right, as he now presides over one of the fastest growing automotive retailers in the country.

What’s more intriguing – the Oxford geography graduate isn’t all that bothered about cars. He says so matter-of-factly. There is little acknowledgement of how absurd this sounds from the man responsible for making some £12.8m profit out of them in the first half of the year.

The 45 year-old developed his business acumen in the property industry, having started his career as a chartered accountant in the early 90s. But it took a life-threatening jolt to alter his course, and move him into the automotive retailing trade.

Robert explained: “I was around 29 at the time, and I’d just started going out with this girl from Newcastle, who was a Doctor. One night I felt quite unwell and she diagnosed me as dying of meningococcal septicaemia. She rushed me to hospital and in fact I was dying – the diagnosis was right.

“I was off work for about eight weeks. Just to keep myself sharp I was flicking through the Financial Times while in bed and spotted this job advert for Reg Vardy financial director in Sunderland. I thought myself, that would fit me.”

He landed the job, and moved to the North East. By the way, Robert married the life saving girlfriend, and the pair now have three children.

His aptitude soon propelled him through the Reg Vardy business and less than five years later he found himself as managing director. In 2005 the company hit the headlines as it was sold for £500m to rivals Pendragon.

Finding himself out of a job – and on 12 months gardening leave – Robert used the time to ponder an opportunity in the region. Soon he was in London seeking investors to fuel a “cash shell” – essentially a listed business with cash in the bank. He floated the firm and collected £26m with which to buy dealerships. Vertu Motors was born.

“I always think that one of the great advantages of the North East is its proximity to London. You can be on the train early in the morning, into the financial capital of the world by 9am, and then back on the train again two weeks later with 26 million quid. Newcastle’s also got great lawyers, accountants and city expertise. We actually put this together on the back of North East professionals.”

It was only a matter of months after floating that Vertu acquired large national dealer Bristol Street Motors for £40m. The deal took Vertu from zero to 32 dealerships, three used-car hypermarkets and 500 staff overnight.

With Bristol Street Motors in the Vertu stable, Robert set about repeating the move across other dealership groups

Fast forward seven years and Robert is sat with The Journal in one of his latest acquisitions, a former Honda dealership at the Silverlink Retail Park in North Tyneside. The sparkling glass doors of the boardroom give punters a peek inside. A huge photo mural showing one of Nissan’s Infiniti cars adorns the wall. It’s one of the luxury range which will be sold from the sleek new dealership.

The £500,000 refurbishment at this property is small-fry for Vertu, who are constantly expanding their national footprint.

Robert explained: “My property background actually comes into play a lot with this business. We have over 100 sites, and a good portion of my time is spent dealing with the stuff. On one level the job is not too dissimilar to the job I had working for the property company. We’re always looking to find sites, acquire them and develop them.”

With a smile, he added: “Property is very easy compared to cars. There’s not actually that much to do. You have to know what you’re doing of course, but in terms of hours, it’s not actually that much hard work.

“Of course now we have over 4,000 people in the company, which brings with it complexities. It’s also a low margin business, so you have to work very hard. We’re not short of work to do. This game is a constant balance between volume and margin. You can be a busy fool and sell a lot of cars but not actually make any money.”

When he’s not negotiating leases or overseeing the refurbishment of dealerships, Robert is talking to the manufacturers. He constantly traverses the country to be at the table with the likes of Volkswagen, Seat and Jaguar Land Rover, among others.

Diary management is tight but Robert’s self-professed “robotic nature” keeps him in exactly the right place at the right time.

An all bells and whistles IT system - the “motherboard” of Vertu - is constantly open on Robert’s laptop. It gives him detailed, minute-by-minute, sales information from each of the Group’s dealerships and how much money is being made.

The time in between all this leaves little room for investor relations, but that doesn’t phase Robert.

He explained: “That side of things isn’t the be all and end all. Ultimately the shareholders want me working on the business and creating value for them. When the business is going right, they’re happy. It’s no good for me to be spending all my time in the city.”

The first Monday of every month is always occupied by a get-together of new managers in Darlington. It’s when Robert talks company culture – an intriguing area given the automotive retail sector’s historically bad reputation.

His weapon? Robert points to the list of company values on the boardroom wall. The list – comprising the likely tenets of honesty, integrity and respect – is the centrepiece of all staff training.

Robert explained: “You need to be very clear about what you want. There shouldn’t be anyone in this business who doesn’t know what they’re doing. Most people know what they’re meant to do, but its the execution which is crucial to success.”

He’s a fan of American self-help authors and speakers. He notes Steven Covey’s ‘7 Habits of Highly Effective People’ and Dale Carnegie’s ‘How to Win Friends and Influence People’ among his bookshelf choices.

“If a customer walks into one of our dealerships and gets on with the sales executive, she’s more likely to buy a car from us. The “five unteachables” are crucial to that: good character, positive attitude, positive energy, drive and talent. To be missing one of those things is a bit of a disaster. We try to choose people on this basis, sometimes we don’t get it right, but more often than not we do get it right,” Robert added.

With a background in accountancy and Vertu’s meteoric success to date, you might be forgiven for thinking Robert is a strict numbers man. Not the case, he said.

“In my twenties I was a numbers man par excellence. I was the numbers man. But nowadays I concentrate on the other things too. If I get the people and processes right, the numbers take care of themselves,” Robert explained.

Not long before The Journal arrived for the interview, Robert had faced a big test of his people skills. A phone call had told him four Vertu technicians had been involved in a horrific road accident the previous night.

He said: “We’ve got families to take care of first and foremost. Then we’ve got customers and colleagues to take care. It’s really important that we respond to something as serious as that in the right way. These are the challenges that sometimes face a business.”

Business challenges are surely nothing to a company with such momentum behind it. For a start, new car sales have risen for 32 consecutive months.

Robert said: “The market is back, people are buying and cars are very affordable. The European car market is a shadow of its former self, but the UK consumer and the UK economy are by far the most powerful in Europe. The “change cycle” for car-buyers in the UK is completely different to Europe. I was looking at one of our Seat dealerships recently where people have been changing their cars once every 1-2 years. In Europe that rate would be more like once every five years.”

Luckily for Robert it’s an appetite that shows no sign of slowing down.

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