If you don’t, your competition will
Six months after the fact, at the height of summer, the Winter Olympics are now a distant memory. But they can still remind us of a lesson worth learning.
Did you watch the Olympics? Probably, and you probably remember the Canadian slogan, “Own The Podium.” It was hard to believe that some people were critical of this mantra. What were our athletes supposed to do: work hard, train for four years and then stand on the sidelines?
That’s all well and good, but what does this have to do with running a service department? Well, how about adopting a variation of that slogan, “Own the Customer” – take the customer out of the market place and make him/her your own.
Truth that hurts
Do you remember the Mr. Lube commercials from the Olympics? We laughed every time they came on. The best one, given my warped sense of humour, had to be one with the woman and two children waiting for an oil change. She falls asleep and when she wakes up, the kids are missing. It turns out they are in the showroom with a salesman who is trying to sell them a car. Parody, remember, is only funny when it has some truth to it, and there is a message here.
We were recently trying to convince a general manager to change the way he did business in the service department and offer some quick maintenance services with no appointment necessary. His response was that NADA training told him 70 percent of all work should be done by appointment. We pointed out that the department was running out of work by midday, so why make customers jump through the hoop? Still, he wouldn’t change his mind and ignored the fact that there were several independents close by that offered drive-in, no- appointment-necessary service for their customers’ convenience.
Who are we serving?
It is hard to believe how many of our OEM service departments still don’t have efficient quick-service bays and how many try to force customers to make an appointment on their own terms.
At a recent dealer seminar, we asked how many attendees open their service department on Saturdays and several hands went up. Our second question was, how many open with a full shift on Saturday for the whole day? No hands went up.
The bigger question is, are we in business to serve the customer or to serve ourselves? Why is it that after struggling in a shrinking market for over a year, we are still letting the independents eat our lunch?
If we truly want the customers’ business, why do we expect them to leave their vehicles when they need them the most? Having a fancy building and nice signage out front is great, but it will not keep the customer ours. It takes convenience, friendly staff and a culture change to do that.
It’s sad to say but we were telling a dealer recently about the opportunity to increase quick service business and the response was, “We are not in that type of business.” No kidding; we knew that just by looking at the dealership’s labour sales.
Fast equals opportunity
From our limited statistics, it appears that Ford stores with ‘Fast Lane’ service attract higher-mileage vehicles than other dealerships, which should tell us something. The downside is, some dealerships struggle with the fast-service business and others have closed them down.
General Motors was really onto something with its fast oil-change promotion: “Twenty minutes or the next one is free.” Unfortunately the dealership mindset and culture didn’t change to accommodate the concept, so it ultimately failed.
If the guy down the road can do it, then why can’t we? Do they have better facilities? No! Do they spend more money on training than we do? No! Are they smarter than us? Probably not; just more customer-driven.
It’s not just an oil change
Could it be that we fail to realize that when we lose an oil change to the competition, we risk losing all the other maintenance business that goes with it?
Example: a customer drives in at 4 PM and asks for an oil change and tire rotation. The service advisor looks at the clock and decides it’s too late. The customer drives down the road, gets the service done at a place that is still open and wants the business, likes the friendly service and never comes back to your dealership. Now that is the real potential cost from not taking care of a customer!
We recently asked a service manager to start coaching the staff and to never walk a service customer. He asked, “What if the customer wants a brake job and it is 4:30 PM?” Our answer: “Find a way.” Hell, there is more gross profit in a brake job than in selling some new vehicles!
Sometimes, we just have to look at basic bottom-line facts. If, by being more flexible and responsive to your customers’ needs, it generates just two more customers per day, look at the impact:
Two customers per day x 241 working days a year = 482 additional customers.
482 customers x 1.8 hours per work order = 867.6 hours x an effective door rate of $90.00 = $78,084 more customer paid dollars per year.
If the parts-to-labour ratio averages 80 percent, that’s an additional $62,467 dollars in parts, totaling an $140,551 increase in parts and labour sales in one year.
Frankly, we don’t know any dealerships that couldn’t pick up two more customers per day by becoming more customer-focused. So what’s holding you back?
