Land tax, the hidden holding cost

AutoExec Summary:
The article discusses the hidden costs of owning dealership properties, focusing on land tax as a significant expense. It also highlights the importance of analysing the return on invested capital (ROIC) for dealerships. By subtracting land tax, rates, and other outgoings from the gross per transaction after rent, dealers can better understand the impact on profitability. Due diligence is crucial before making decisions such as CI upgrades or taking on new brands. The article emphasises the need to assess property acquisitions and holding costs to ensure profitability.

Brands mentioned: Eagers Automotive, Peter Warren Automotive Holdings, Autosports Group Limited.