Increase Service Profits with Traffic & Training

Ask some of your existing service customers why they don’t have their maintenance work done at your store and they will most likely tell you it is because they think you charge too much, take too long and that you are inconvenient. This is their perception – and whether it is true or not, perception is reality. They will also probably tell you, “It’s just an oil change, and I can get that done anywhere.” That’s what they really think!

But the good news, I guess, is that they will also tell you that they believe you have better technicians, better parts and better warranties than their local mechanic and that if something on their car breaks - they will strongly consider your dealership as a place to have it fixed. The problem is - cars just don’t break as often as they used to.

Both warranty and customer pay repair work has been declining for years due to improved quality and better technology. Think about it; when was the last time you sold and installed a muffler, or struts, shocks? It’s been a while, right? Well wait, it gets worse. Maintenance work is also declining.  I can remember when you had to do tune ups about every 12,000 miles and change your coolant each season or at least every other season. I can also remember 30,000 mile transmission services, but those days are gone.

And that’s not all- now, even oil and filter change intervals are being stretched out further and further due to synthetic oils and oil life monitor systems. The result is less traffic in your service drive for warranty, customer pay and even maintenance.

Here’s the deal. If you intend to build your service business (or even survive), you have to increase service traffic and customer retention. Start with a powerful, low priced, oil change offer to get more customers in your store. ‘Wow’ them with the price and ‘Wow’ them again with quick, courteous service.

Dealers are constantly telling me that they did a market survey and found that their oil change price is competitive with their market. Here’s a little fact boys and girls: being competitive is not enough. If customers perceive an oil change as just an oil change - which they can get done anywhere…they have no extra incentive to have it done at your store. You are the same as everyone else, except that they think you are inconvenient and will take too long (and very often, they are right.) You have to change the way you think if you expect to change the way they think – and start with a ‘Wow’ price and ‘Wow’ service.

If the going rate for an oil change in your area is $19.95 to 24.95, then why not get aggressive and price yours at $17.95 and knock their socks off! You make very little if anything at $20-24, so why not “Wow” your customers and drive some serious traffic in your store for a few bucks less. Remember, traffic in your service drive gives your service sales people and techs an opportunity to up sell – and you might even get a car deal out of it, too. Think of it like this - How much profit do you make on the customers that go someplace else for service? Think of the oil change as an opportunity creator!

Make sure you are competitive on other maintenance items, have a good service menu in place and push your team to up-sell. Become the home of the $17.95 Oil Change and advertise it as a burst on your existing vehicle sales ads as well as on your service reminders. Don’t be the best kept secret in town!  

But dropping the oil change is just the start. Make sure you are competitive on other maintenance items, have a good service menu in place and push your team to up sell.

Remember, I said you actually have to change your service department into a service ‘sales’ department. So with that said, I have to ask - when was the last time you had a good old fashioned sales meeting with your service advisors? Most stores probably have a vehicle sales meeting at least once each week, with some holding them every single day. They do this because they are important, they get the sales team pumped up and excited, and the result is that they sell more cars.

Now think about this - most vehicle sales people sell 8-15 cars per month, hold a 20-25% closing ratio and see 50-75 ups each month. Compare these numbers to your service sales people. They come in contact with that many people in just 2 or 3 days, usually writing up about 400-500 customers each month. Wow!

Your service department is a gold mine of opportunity, why don’t you go back there have a pumped up, rock and roll, hand out some money, get’em psyched up and excited service ‘sales’ meeting? Bring good information to the table like how to identify and overcome objections, how to answer the phone to get more people in and how to assume the sale. And don’t stop there.

Put up a tracking board to track individual and departmental performance. Track customer pay effective labor rate, hours and dollars per RO, number of menus sold and missed opportunities. Have them post their numbers daily and watch the improvement that takes place almost automatically. You do this in your vehicle sales department and it works, so why not do it in your service ‘sales’ department.

Remember, your service advisors are selling service and you are up front selling cars – and selling is selling - it is all the same. Your service staff needs your guidance and expertise on how to sell and you know how to do it. They need to know that you have sales expectations, that they need to produce and that you require them to sell. You can do this! More service gross drops to the net bottom line than from any other department so change the way you think - get involved and convert your service department into a service ‘sales’ machine today.