At a time when vehicle sales are less than robust, dealers with vision are looking beyond just their core operations to optimize opportunities in the wider area of fixed operations. Some elements, like the quick lube facility add directly to the bottom line. Others generate a payback by contributing to CSI as well as creating a better workplace for dealership staff.
The ultimate in expanded fixed operations may well be a Toyota dealership in Chesapeake, Virginia, where the dealer has built a full-service kitchen/café, a hair salon, a shoe shine station, a small theatre and a manicure station.
There’s nothing quite so elaborate in Canada, yet, although Denis Leclerc’s Albi Mazda dealership outside Montreal contains a franchised croissantery, dairy bar, and hairdressing salon and CADA Laureate winner, Brian Jessel’s Vancouver BMW store has a restaurant as well as other amenities to keep customers coming back. And there is currently a Mercedes-Benz store under construction in Burlington, ON that is scheduled to include a spa and a simulated golf driving range.
Mixed results for quick lube
The quick lube lane has become a familiar sight at franchised dealerships, but not surprisingly, dealers have different opinions on its value. It’s generally agreed, however, that it’s a good way to get current customers back into the dealership and to entice non-customers to come by as well.
When dealer Kent Ledingham (Ledingham GM) renovated his Steinbach, MB dealership, he included a quick lube and a drive-through. “We’re the only dealership in Steinbach with a quick lube,” says Ledingham, “and there’s no competition from any of the standalone franchises either.” Ledingham says customers like the convenience and he’s seeing a few non-customers every day as well. “Obviously we hope they’ll come back for other services, once they’ve met us. We hope to draw them away from independent garages. So far I’ve got nothing but positives.”
However, Marilyn Sheftel’s experience demonstrates why the addition of a quick lube doesn’t always work. A couple years ago she installed one at her Calgary dealership, Silver Hill Acura, but in the existing facility they weren’t able to provide dedicated access. “Our customers couldn’t get in and out easily and had to go through our parts and service area. We tried it for two years, but gave it up,” she says. Having learned from that experience, she now plans to add a quick lube and a full car wash as part of a new service centre on the site of their used car lot.
The quick lube concept simply doesn’t fit with the corporate philosophy at Rallye Hyundai in Moncton. GM Steve Chapman explains that they don’t even use language like ‘oil change’. Instead they promote the idea of ‘maintenance services’. “We try to encourage our customers to think beyond a single service,” says Chapman. “Customers may think they just want a quick lube job, but often they have questions about other things.”
Chapman schedules a couple of technicians on Type 1 and 2 services, but it’s company policy to develop all their technicians beyond the basics. “We don’t want them stuck doing oil changes for too long.”
While they didn’t put in a quick lube when they built in 2004, they did include a couple of interesting features. In the service department customers sit down with a service advisor, across a desk or counter. Chapman says it puts customers more at ease, especially if they’re upset about something. And the service advisor isn’t on his or her feet all day. “It’s not a unique idea,” Chapman acknowledges, “but it’s not widespread either, and it certainly enhances customer satisfaction.”
Better working conditions were behind his decision to put in-house wall phones in every service bay. Now technicians can order the parts they need by phone, instead of waiting in line. And they can call the service advisor if they have a question, without leaving the service bay. It’s made the technicians more efficient and been a big timesaver.
Cafés and play areas are popular
Several Canadian dealerships have added in-house cafés and kids play areas in their new or renovated facilities. (Not everyone agrees that kids play areas are a good thing, including the publisher of this magazine! “McDealerships, CAD June 2006.) Others say the enclosed play areas let parents keep their kids safe and amused while they focus on the task at hand. It’s a big hit at Rallye Hyundai where the small, glassed-in, two-story play area is highly visible from the road. “Customers tell us their kids nag them to stop and come in,” said Chapman, “because they see the play area when they’re driving by.”
Adding an in-house coffee shop is great for customers, but it’s equally appreciated by employees. Keystone Ford in Winnipeg did things a little differently when they renovated in 2006, including a no-grill version of Sal’s, a popular local restaurant chain, right in the store. Keith Cochrane, manager of fixed operations, said the main reason for including it was customer convenience, but as it operates in the black most months, it’s also a good little profit centre.
Back in Steinbach, Ledingham explains, he inherited The Waffle Shop from the previous owner. But when he was planning for recent renovations, he chose to make it a focal point for customers and employees. The café seats 25 and is operated by two dealership staff members. The menu is basic, with lots of home-made items and, of course, waffles. “Customers really like it,” he said, “and it’s especially popular with staff because the dealership isn’t close to any restaurants.” Prices are slightly below market and Ledingham does not expect to make money from the operation.
On a smaller scale, Rallye Hyundai doesn’t have an in-house restaurant, but maintains an array of vending machines that are well used by staff and customers alike. Says Chapman, “We keep the prices low, but we do make a percentage on sales, so they produce a small revenue line.”
Especially for women – but men like it too
Count on a woman dealer to consider her female customers when dreaming up ways to attract more people to the dealership. Grimsby Chrysler’s Barbara Beaudoin, in Grimsby, ON gets special recognition for opening the first in-dealership spa in North America. Called the Crossfire Spa, it’s a full service operation on the main floor of the dealership, close to the service centre and customer lounge.
“We were building a new facility,” says Beaudoin, “and I had a lot of ideas for bringing people in. One was a Chrome Shop, a department dedicated to toys for boys. Originally I located the spa upstairs. But when we opened in April 2005, the spa was so successful that we cancelled the Chrome Shop, expanded the spa and moved it down to the main floor.”
Two full time aestheticians see approximately 50 clients every week, and Beaudoin says she frequently gets bumped herself because they’re so busy. She has been pleased and surprised to find that 25 percent of the spa’s customers are men. She speculates that men who might not be entirely comfortable going into a traditional spa seem to be happy to patronize one within their dealership.
There’s separate access from outside, and about 40 percent of the clients are not current customers of the dealership. As Beaudoin puts it, “my original goal of finding ways to entice more people into the dealership seems to be working splendidly. “
Other opportunities
There are other opportunities in fixed operations still being developed.
At Keystone Ford, Keith Cochrane says his next fixed-op move will likely be in accessories. “We already do a good job with accessories here. So we may hire an accessories manager to dress up the vehicles on the lot so customers see the possibilities right from the start. We already have a great display of accessories in the parts department so we wouldn’t require any more physical space. I see that as the biggest opportunity we have to build business in Fixed Operations.”
Savvy dealers all across the county continue to look beyond vehicle sales and the business office for opportunities that will benefit the bottom line as well as produce happier customers and staff.
