From lost productivity to strained customer relationships, the hidden costs of employee turnover are real — and only getting worse.
But employee turnover is just one part of a larger issue. Dealerships today are grappling with broader workforce challenges — from an aging labor pool and evolving skill demands to technician shortages and competition for talent. In this environment, every advantage matters — and a smarter health plan can help you stand out.
How High Turnover Impacts Dealership Performance
The true cost of turnover isn’t always obvious — but it adds up fast. Consider these ways it can hurt your dealership’s bottom line:
- Recruitment and Training Costs
Every time a dealership loses a salesperson, service advisor, or technician, it must spend valuable time and resources to find and train a replacement. According to the NADA Dealership Workforce Study, turnover rates in some dealership roles exceed 40%. This means a lot of wasted time, money and productivity. - Team Stability and Performance
High employee turnover disrupts team dynamics and slows down operations. When dealerships struggle to retain experienced employees, team dynamics suffer, service consistency declines, and remaining staff are left to pick up the slack. This can lead to burnout and even more turnover. - Disruption to Customer Experience
Auto dealers thrive on relationships. When employees leave, the relationships and trust they’ve built with customers often walk out the door too. This can lead to lost sales, lower customer satisfaction scores and reduced repeat business.
How a Smarter Health Plan Reduces Employee Turnover
In a competitive talent market, your health plan can do more than offer coverage — it can be a strategic tool to attract and retain employees, reduce staff turnover and support long-term growth.
One way to unlock that potential is through reference-based pricing (RBP) — a smarter approach to healthcare reimbursement that replaces inflated, inconsistent provider charges with fair pricing based on real data. By reducing wasteful spending, RBP gives employers greater visibility into costs and frees up dollars that can be reinvested into their employees.
With the right RBP solution, auto dealers can:
- Lower health plan costs without cutting benefits.
- Gain visibility into healthcare costs to make smarter, more informed decisions.
- Support employee retention by offering affordable, high-quality coverage.
- Reinvest savings into better employee benefits, training programs or recruitment efforts.
Case Study: How Gunn Automotive Group
Gunn Automotive Group faced the same turnover pressures as many dealerships. In 2012, they partnered with Imagine360 to implement RBP — a decision that delivered $61 million in savings over 12 years.
Instead of pocketing those savings, Gunn reinvested in its workforce by offering life insurance and short-term disability at no cost to employees, while keeping premiums flat and deductibles low. Employees noticed — and responded with gratitude.
As Brandye McDermett, Gunn’s Director of HR, says:
“Imagine360 does more than process claims — they’ve become a lifeline for our employees.”
That level of support, combined with reinvested savings, helps Gunn create a benefits package that strengthens loyalty — a critical factor in reducing turnover in a competitive industry. Read the full Gunn Automotive Group case study.
Struggling with High Turnover? Make Your Health Plan Work Harder
In today’s talent market, affordable, high-quality coverage isn’t just a perk — it’s a powerful recruitment and retention tool. When employees feel supported, they’re more likely to stay, contribute and grow with your dealership — and that stability drives stronger sales, better customer service, and long-term business growth.
Bottom Line: Your health plan isn’t just a benefit — it’s a competitive advantage. With Imagine360, you can cut costs, improve retention, and redirect savings into initiatives that strengthen your business. Ready to rethink your strategy? Let’s connect.
Frequently Asked Questions (FAQs)
Why are health insurance costs rising for auto dealerships?
Costs are rising due to higher provider prices, increased healthcare utilization, and expensive new treatments. Auto dealerships, like other midsized businesses, often lack the negotiating power to offset these increases.
What factors are driving up employer healthcare costs?
Key drivers include hospital rate hikes, increased demand for services (especially behavioral health), and the introduction of high-cost medications and therapies.
How do rising health insurance costs affect employee retention?
When employers pass rising costs to employees through higher deductibles or copays, it can hurt employee morale and retention — especially in industries like auto retail, where employee turnover is already high.
What is a self-funded health plan and how does it work for auto dealers?
A allows employers to pay for employee healthcare claims directly rather than paying fixed premiums to an insurance carrier. This gives dealerships more flexibility and control over plan design and costs.
What is reference-based pricing (RBP) and how does it help control costs?
Imagine360’s RBP model sets fair reimbursement rates based on Medicare rates and actual costs of care, rather than the inflated amount that most providers charge. This gives employers greater visibility into costs and helps reduce wasteful spending.
How much can auto dealerships save by switching to RBP?
Many dealerships save millions on health insurance with Imagine360. Explore real results and case studies on our Auto Dealer solutions page.
