NADA's factory image programs study divided the programs, and the factory rationale for demanding dealership investment, into three categories, which it called "layers." Each layer affects factory-dealer relations differently.
The 2011 study, conducted by Glenn Mercer, was based on surveys and in-depth interviews with dealers, automakers, attorneys, accountants, buy-sell brokers, dealership appraisers, architects, designers, lenders, economists and equipment vendors, plus experts in store improvement and image programs in other franchised industries, such as restaurants and hotels.
Here are the basic types of factory image programs, according to the study.
1. Expansion: "Expansion generated the least argument and OEM/dealer tension among our interviewees, partly because it is the only layer where hard numbers are often available," the study said.
Having said that, the study called on automakers to improve in two ways: first, to provide more realistic forecasts of space requirements, forecasts that don't shift over time; second, to update formulas used to figure out required capacity.
For instance, to take into account that extended service hours can create additional service-bay capacity.
2. Modernization: "The Modernization layer of facility programs generates more controversy because while the costs are clear, the benefits are at worst minimal and at best un-quantified," the study said.
The study said automakers need to make a better business case for modernization and asked them to avoid designs that increase costs "with no corresponding increase in customer value."
3. Standardization: "The Standardization layer creates the most contention because its benefits are very unclear," the study said. Dealers were particularly incensed that automakers insisted that their dealerships look the same when strong brands in other industries, notably McDonald's, allowed their stores to take on different building designs to suit their regional and local characters.
The study said the factories must "revisit -- and explain -- their motivations for asking for this degree of "cookie cutter' design across their dealerships."