Fixed Operations a new year, a new role

[tcollins]

The One:

I agree with everything except one point.

The customer, as Tyler points out, has come to the dealership concerned that you are expensive and is already suspicious of our industry. Not one customer ever comes because its a good time. They come because they have to.

In reference to point 4, if I was your customer, I would be annoyed that you hadn't addressed my concern in the first conversation and wasted my time. I'm OK with the fact you presold me and prepared me based on you expertise and experience. But, I only brought this in because the concern I was having I couldn't live with anymore and I wanted it fixed correctly. In effect, you played right into what I was fearing when you didn't call me about what my concern was. Now not only am I more apprehensive, I'm a little angry as well because you have wasted my time. Yes, I want to know what else is wrong with my car and why I need to fix it, but only after I am comfortable that I have gotten what I asked for and that you are trustworthy.

The biggest mistake our industry makes is assuming the customer is naive. Thanks to the internet and its blogs and face pages, the customer is better enlightened than any generation before and when we try our circus acts they tell others in mass.

Treat the customer like a human instead of a commodity or a number, provide excellent service, preach value and benefits, be truly benevolent, and make it easy to do business, on the customers terms, and you and I will prosper.

[KLINK]

The first thing my service writers and service manager say is,
what this guy said:
I would be annoyed that you hadn't addressed my concern in the first conversation and wasted my time. I'm OK with the fact you presold me and prepared me based on you expertise and experience. But, I only brought this in because the concern I was having I couldn't live with anymore and I wanted it fixed correctly. In effect, you played right into what I was fearing when you didn't call me about what my concern was.

Could you please help me with this objection?

[TheOne]

Sorry about the delay getting back to your objections.

The customers do ask the question. What about the concern I brought it in for? I find it nice to be able to predict what the customer is going to ask so I can be prepared with the answer. It must be honest, and logical. It is "The technician is working on that right now. As we spoke this morning if he can solve the problem for $200.00 or less I will call you when it is ready, if it is going to be anymore than that I will call you right away. We do the inspection first so that you and I have a clear picture of the condition of your vehicle before ANY of your money is spent. I promise if you authorize this additional work now we will not do any of it until we have completed repairs for your original concern. This allows us to get your vehicle back to you more quickly, and with the work done in a priority that best suits you and your situation.

[TheOne]

A second note in reference to above.

The comment concerning price and the customers not wanting to be there:

Customers spend money in many locations that they dont want to. Do you look forward to sending out your monthly electric bill? Is the grocery store a place you go to just for fun? Do you hang out in doctor waiting rooms for the company? How about an emergency room, ever picked up a date there? If your looking to turn your service department into Disneyland, good luck. Mills Ford is right down the street from them, and they haven't done it! Try taking the FEAR out of the equation. Make the uncertainty of expense and inconvenience disappear. Provide a PROCESS that your customer can learn to EXPECT. Have your process provide usefull timely information delivered in an orderly systemic fashion. KLINK I have had hundreds of service managers say exactly what yours did, and yes even a couple of customers too. The vast majority of customers however are THANKFULL for the process....

Price.
Price.
Price.
Price is a CURRENT problem. Price is largely a problem because many of us in the industry have rationalized the disparity between ourselves and the aftermarket by belittling the afterrmarket instead of searching for a viable means to compete. Yeah in the past I too have done this. The evolution of my thinking began like most, that there was enough work for all of us so I didn't feel threatened. Next I worked to force the independents to compete on our field instead of attacking their strengths. The last several years I have been working to maintain our level of quality expertise/warranty/competence while learning to compete with them on their strengths, convenience and price. These are important issues and I have addressed how I have learned to profitably handle them elsewhere on this board.

[tcollins]

I think the biggest problem that we have in this industry is putting ourselves in our customers shoes. We shouldn't be building processes that our customer can "learn" to expect. We should be building processes that the customer expects and/or demands. There is a big difference. The aftermarket exists for many reasons but price is probably one of the last ones on the list. As an industry we failed to provide what the customer wanted.

Sales "tactics" that do anything less than build trust with that customer (and loyalty) are worthless. We need to be able to do business in a way that dispells all the myths about dealership and that includes our sales process as well as our prices and give that customer a reason to return.

If you don't believe me look at what has happened to new car sales for the companies still using "tactics" that are 30 years old and there are plenty out there. You have more customers looking in the windows when the dealership is closed than when its open. We could easily be in the same position except they don't sell new cars in the aftermarket. What they do sell is value and convenience. Until we address these issues we will always be the alternative.

[TheOne]

Oh come on! Revisit the purpose of occupying the chair you do! It is solely for the purpose of making money. Understanding the perspective of the customer is necessary for the purpose of developing a product or service that customers wish to purchase in sufficient volume, and at a price that maximizes the return on investment for the dealership.

To call a process that promotes sales in any realm including fixed operations a "tactic" with a negative connotation is generalizing at its finest. One of the more simple things in our business is to shoot down systems and processes. It is far more difficult to set out to make them work, and make them work in a manner that attracts rather than repels customers. Even more difficult yet is to develop said systems and fight conventional wisdom that all but predicts the quantity of dollars that the customers have to spend, and their wish to do so.

I started this thread for the purpose of pointing out that fixed operations now MUST produce enough gross profit to overcome ALL direct departmental expenses, and the lions share of fixed expenses. To FAIL is to do nothing more than taking your Dealer Principles strongest chance to survive this economic mess away from him or her, forcing them to pray for a "hail Mary" performance from the sales department yet again.

News flash prior to the recession 77% of all fixed operations in the United States using NADA guide for fixed expense allocation LOST MONEY. I have no doubt that this percentage is currently shrinking, but most likely because dealers are going out of business. Those that don't ge the real focus, "fixed MUST make MONEY" will be next.

There are three real choices.

1. Fade away

2. Make a real profit with your current customer base.

3. make a profit by attracting a new customer base.

My personal opinion is that many will fade away. Those of us that manage to stick around will implement solid systems (tactics) that allow us to provide consistency to the service selling process so that we can maximize the return on our current customer base providing an overall profit. Then we will continue to turn our focus towards increasing our customer base with new systems and processes (tactics) that allow us to compete with the aftermarket and reclaim our maintenance and light repair business.

Got a better system? Seems like this is as good a place as any to share it!

[tcollins]

I agree almost entirely with your eloquent albeit loquacious response. We just differ on the process or tactic you suggest. Anything that could be percieved as being allusive or misdirected by the customer will surely turn him off. I'm not saying it won't work on some, PT Barnum said it best, I'm just suggesting you will never know until the customer votes against your system with his dollars. So you suggest this is a good place for process and here is mine:
1. Full walk around inspection when the customer arrives. The main purpose is to build rapport, not to sell. You have certainly seen the studies on spending just 30 seconds more with a customer?
2. Ask about the primary concern and Yes, presell if possible. This very quickly determines the customers intentions and establishes a basis to go forward.
3. Present a blank inspection sheet to the customer after write up. Establish a value for it and present an analogous reference to the doctors office. "This is like taking the vitals of you vehicle" and ask if he could have that available when we call to discuss our findings. Ask for an appropriate time to contact the customer.
4. Call the customer (on time) and present the prime item, the amount and the time the vehicle will be completed.
5. Ask if its a good time to address any concerns on the inspection sheet as you had suggested you would previously and ask for the sale. Address any objections.
6. Active delivery back to the customer on time.
Look at this process carefully and it is designed to allow the customer to remain in control at all times. When he is on your turf, he is the least comfortable and the least likely to spend; that's basic psych 101. Remove those barriers and the customer will not only spend today, he will return tomorrow. This is just a pragmatic approach to servicing the customer. Does it leave something on the table? Yup. Does it give me the best chance to retain that customer? Absolutely.
Fixed ops will undoubtedly carry the dealerships of the future. Fixed absorbtion averages are approaching 90+% and the best are well over 100%. Many dealerships are fading and quite frankly many deserve to because they have resisted the changes that have become so evident.

[Gasser]

Tcollins.....
To me your process seems very 70's/basic...
You need to step up your game and give careful thought on what you read on this thread.

Just 2cents

[gmcgrew]

The process being used needs to be tailored to your clientel. I am in a rural area with many farmers and ranchers. I know that I would not take my vehicle back to anyone that tried to upsell work before at least checking my original concern and I believe many of my customers are the same. I would go with the fact that an inspection is a must and that there must be a process to ask for the additional work.

[tcollins]

Gasser

I guess that was the point I was trying to make. It doesn't have to be complicated to be effective.