Ted Morse, Ed Morse Automotive Group
Interview by Michael Roscoe
Ed and Ted Morse run one of the country's top 20 megadealer groups. Even with AutoNation headquartered right next door in Ft. Lauderdale, The Ed Morse Automotive Group remains a private, family-owned business. I recently had the opportunity to spend some time with Ted Morse, President/COO, at their corporate headquarters.
Ted, how did you get in the automobile business?
When I think back, I think I was born in the automobile business. Actually, my father started with a rental company in Miami. It was called Morse Auto Rentals, which he merged with National Car Rental. Eventually, National Car Rental bought the franchise, but my father stayed in operations from Palm Beach south.
While I was in high school, I used to work weekends and summers shuttling cars back and forth from the rental offices to the hotels. Later, I worked at the office downtown and rented cars to people coming off cruise ships. Then, in 1961, my father purchased a majority share of a Ford dealership in North Miami Beach. It was Cecil-Holland Ford, but it became Morse-Holland Ford. My father eventually bought Mr. Holland out and it was then Ed Morse Ford. That was our first dealership.
I finished high school and went to junior college. I would go to classes in the morning and then go back to the dealership, checking in new cars off the truck, getting new cars ready and the like. After two years of junior college, I went to my father and I said, "I know you want me to go to college, you can afford to send me to any college I could get into, but it's a waste of money. I don't want to go." He said, "Well, if you don't go to college, you're going to work everyday, the rest of your life" and I said, "I'd rather do that." So, that was the end of my formal education. I worked some of the different functions at the store and eventually went onto the sales floor, selling cars. We got an open point Chevrolet franchise here in Broward County and we built a dealership which we opened in 1968.
I went to the new Chevrolet store, wrote service for two years, worked in the sales department, worked back in the service department, basically, worked every single department in the dealership, other than parts. I performed those duties as Sales Manager, Assistant General Manager, etc., up until 1979 when I became the dealer at the Chevrolet store. Then we started building all the other stores. My father and I moved out of the actual day-to-day operation of the dealerships, probably in 1991 or 1992, when we established a corporate office.
What was it that led your father to buy that first store?
The gentleman who had owned our first store had become ill and he wanted somebody to come in and be his partner. My father came in as a 51% partner.
Ted, what is your management philosophy for your dealerships?
We try to let the general managers be autonomous, to a point. There are policies and procedures that we have, there are rules by which they need to operate. However, a Toyota dealership, which we own, cannot be run the same as a Cadillac dealership. There has to be the right person in the right job. That is the biggest thing we have found. A general manager in a Toyota store, doing a great job, may fall on his face at a Cadillac store and vice versa. A Toyota business is much faster-paced, higher volume, especially down here with Southeast Toyota, because they are so aggressive. Our GMs make all the personnel decisions at their dealership. Now there may be an instance where somebody has been with the company 20 years and a new general manager comes in, he's there for six months and he says, "I don't like this guy." Well, somebody who has given you 20 years ...
You would move him somewhere else?
Yes. We would either move him somewhere else or we would try to resolve whatever conflict there was there. But I think, there's really never that much of a personality conflict between two people that cannot be talked about; a little give and take on both sides makes a lot of things work. We do a lot of our training with our salespeople and managers using a sports theme. We use the Miami Dolphins a lot, as an example. Dan Marino didn't need to go to spring practice or mini-camp-everybody knew he could throw the ball, there was never a question about that. But he had to come in and get back to the basics, get his mind focused right. We try to instill the same attitude in our people in the training. If a store isn't doing well, we take a look at what they are doing. We've got to get back to the basics. The basics have changed so much over the years, especially where you now have the Internet and what you used to do years ago, you just can't do today. It won't work. You know, you give a salesman a list and tell them to go make 20 phone calls. Well, that's about as useful as running up against a wall. It just doesn't work. We like to have our salespeople take the deal from beginning to the end. We have a formalized training program for our salespeople, either new hires, refresher courses, accelerated courses, all kinds of training. We have two trainers and that is all they do.
Ted, there has been a lot of consolidation in the industry within the last couple of years and a lot of it has emanated from right here in Ft. Lauderdale, yet The Ed Morse Automotive Group remains a family company.
Correct.
You must have been approached by the consolidators...
We have been approached by just about all of them. First one to approach us was AutoNation. We sat down and we talked, but the deal never got too far along. We had some dealership brands they didn't want, so...
You didn't want to sell pieces...
Right. We were going to sell the whole company or nothing, we decided, and it was a very quick decision, too. We didn't have that many meetings with them. We asked ourselves, do we want to sell out and still run the dealerships and answer to somebody else? We decided we didn't want to do that. Both my son and daughter work here. My son is training right now. He's worked in the training unit at our Sawgrass Chevrolet store. My daughter works here in the Internet Department, handling our Internet sales. My sister runs our Human Resources Department. She has two sons. One is at a dealership in F&I, one is at a dealership as a Sales Manager. We have family coming into the business that didn't want to leave their fate up to somebody else. We decided to stay private and considering where things are today. It kind of looks like we made the right decision.
Good move ...
Yes.
Or good non-move.
Right.
Sometimes the best move is the one you don't make.
It didn't fit what we wanted to accomplish.
What about growth plans, Ted? At one point, you were 29 dealerships. You're at 20 now. Are you just going to continue to focus on the ones you have or are you open to ...
We're still in the market looking to expand. The dealerships we sold, honestly, were either something that General Motors wanted to work out with us or they weren't performing the way we thought they should and weren't worth the investment.
We're not concentrating our efforts on downsizing. We have been in the business over 40 years and I plan on being in the business for a long time. We're relocating two of our dealerships right now-two Honda dealerships, one in Palm Beach and one here in Ft. Lauderdale. We are just breaking ground on the one in Palm Beach and we should start construction probably, by January for the other one. So, if we were downsizing, I wouldn't be moving the dealerships and spending all that money because the buildings those dealerships are in now are not so old. We are going to have to sell those after we move out and then we're going to expand our operation out in Sawgrass. We have Chevrolet/Olds out there now and we're going to add Cadillac.
You mentioned your daughter is in the Internet Department... what are you doing in regards to the Internet at Ed Morse Automotive Group?
We have Internet people, designated Internet people, at every dealership. We have two people here. At corporate, one is my daughter and the other lady who works with her, keeps track of analyzing the sources we use and getting the leads from the companies. Eventually, like anything else, we'd like to try to do it all from our own Web site, not having to pay AutoByTel, etc. or the other companies. It's not growing as fast as we would like. I don't believe anyone buys a car totally over the Internet, but they shop tremendously.
They gather information.
Right, they get information. So, it's not only another way to sell cars, it's another way to advertise, too. That's my feeling on it.
So each store has got an Internet salesperson...
Could be two, depending on the number of hits they are getting.
And where are they actually set up?
They are in offices right off of the showroom.
Each store has it's own Web site?
Yes, we have a master Web site, too that consumers could go to, edmorse.com.
And they can select any of your dealerships that they are interested in and that would link them to the dealership's home page?
Right.
What do you see in the future for your company and for the car business?
I think there will always, always be a love affair with the automobile, and the car business, I think, will stay strong. Hopefully, the manufacturers will recognize what it takes to get back to doing what they do best, building the car, letting the dealer sell it. I love this business. We're going to be in it. We've been successful in the past and we'll continue to be successful by treating the customer right and treating our employees right.
There's always going to be problems, but if you have a happy dealer you'll have a happy customer. Back in the old days, a District Manager comes in and says, "I've got 200 of X Model I've got to get rid of. Can you help me? Can you take 30 or 40 and all the other dealers take and, you know, get me out?" A happy dealer will take the cars, but if you're squeezing them and squeezing them and squeezing them, they're not happy. A happy, successful dealer leads to happy employees which leads to happy car buyers. It's not rocket science.
