There’s is no question that customer repair hours and R.O.’s are on the decline. I have the pleasure of working with more than 250 dealers, and I’m alarmed at how many service departments are going backward in customer pay service hours and gross.
If we saw a massive downturn like this in new vehicle sales, every dealership would be clamoring for a solution. I think the increase of warranty and internal hours have lulled us into a false sense of security. But even though those hours are up, hemorrhaging customer pay is a losing long-term strategy.
We have the tools to get more customer pay hours, so let’s use them.
I’m continually amazed at the effectiveness of the automotive industry’s sales processes; yet we rarely, if ever, apply the same approaches in our service department. We need to change that because the best way to solve the customer repair hour problem is through improved service sales.
To do this, though, we need to overcome culture. When service team members encounter issues with a sale, most of us just let the sale go … we commonly send service business home without any attempt to save the deal. And then we rely on a coupon or other incentive to get customers back into the shop.
Bring more sales to service
We would never allow a new vehicle buyer to just walk way! So why do we let service work go? After all, what do you think happened? Did the client wait for the discount coupon? Or do you think they called up one of your competitors and had the work done elsewhere?
Let’s get back to the basics and begin holding training meetings with the number one sales people in our stores: our service advisors. They talk to more customers in a day than some sales people do in a month, and they generate more gross profit in a month than most sales people do in two or three months! A sales model makes perfect sense, yet we spend too little time motivating and training the most productive sales person in our dealership.
Here are two easy meeting agendas you can use to start bringing a sales approach to your fixed operations staff. I also recommend training to support this culture change; the NCM Institute has a great one-day training course that teaches your service advisors how to sell.
10-Minute Service and Parts Meeting
Meet with techs and advisors every day for ten minutes at 7:15 a.m. Here are some discussion points:
- Customer Satisfaction Index (CSI) numbers: 1-month and 3-month
- Fixed Right First Time (FRFT) stats
- Number of hours written by each advisor and tech against their goal(s)
- Pace for the month
- Review work schedule for the day
- Problems (i.e. problem child issues)
- Multi-Point Inspection (M.P.I.) walk around
Bring back service sales
What happened to the time in our industry when a customer could simply call our store for service work on their vehicle and be told to bring it in today with no appointment?
Think about it, how do you feel when you are told it’s an hour wait to get a table at your favorite restaurant? If you’re like me—and like most people—you probably just go somewhere else for dinner because of the wait! The same thing happens in our service department.
It’s time to realign our fixed ops approach to be more sales focused. Let’s take control of our service lanes and have a very profitable year!
See how Mark Shackelford and his NCM colleagues can help your dealership improve performance with 20 Groups, in-dealership consulting, and customized training options. And don’t forget about NCMi training for service managers and service advisors!