I work in a store where service manager is very worried on being "competetive" Posted labor is 86.95/hr and works on a matrix from there. The more the customer spends the higher the rate(seems backwards to me) I've seen it as high as 115/hr for engine replacement with shop supplies at 17% of RO with a max of 48.00. However on the parts side, wants us to match the prices for brakes batteries etc of the locals (Firestone/Goodyear/NTB) etc.
While being a GM store parts give service 50% of cod profit(only carline that does this) This practice of being "competetive seems a bit one-sided. Any opinions?
Being Competetive/Parts & Labor
-
NetProfits
Being Competetive/Parts & Labor
Howard,
Price depends on various factors. Price is sometimes determined by how competitive the industry is in your area. However, price is also based on convenience, reputation, the urgency of the need for the buyer or seller, how great or inferior the product or service is and the state of the economy. Consumer demand is also a significant factor. In order to effectively command the best possible price for your products and services, you first have to build value. First, you have to build the value of your organization. Having done this, you then have to build value more specifically by knowing your customer's objection and the goal he or she is trying to accomplish. Survey your employees and ask them to come up with a list of all the things that your company does for your customers that are above and beyond what your competition provides. In many company cases, you won't find the phrase " courtesy expressed by all employees " on the list. Courtesy doesn't cost your company one cent, but customers value courteous treatment immensely. They place a very high value on courteous treatment. Don't believe for a minute that a customer would prefer discounted prices over long term trusting relationships, fair dealing and courteous treatment. Conversely, today's customer wants to trust in the best service and if you can provide it, you can also price it. Having said all of the above, if your labor is matrixed, then so should your parts be matrixed for those so-called competitive items. If you are going to enter the " competitive arena ", and ask parts to cooperate, then the labor should also be competitive. I don't know many independents, quick lubes or mass merchandisers charging 86 + dollars an hour for labor. Finally, anytime a win-lose situation is created in your company, the loser will be sure to cause failure in some way, shape or form. Focus on the win-win for your company and your customers. Achieving that may make any price discussions irrelevant.
Price depends on various factors. Price is sometimes determined by how competitive the industry is in your area. However, price is also based on convenience, reputation, the urgency of the need for the buyer or seller, how great or inferior the product or service is and the state of the economy. Consumer demand is also a significant factor. In order to effectively command the best possible price for your products and services, you first have to build value. First, you have to build the value of your organization. Having done this, you then have to build value more specifically by knowing your customer's objection and the goal he or she is trying to accomplish. Survey your employees and ask them to come up with a list of all the things that your company does for your customers that are above and beyond what your competition provides. In many company cases, you won't find the phrase " courtesy expressed by all employees " on the list. Courtesy doesn't cost your company one cent, but customers value courteous treatment immensely. They place a very high value on courteous treatment. Don't believe for a minute that a customer would prefer discounted prices over long term trusting relationships, fair dealing and courteous treatment. Conversely, today's customer wants to trust in the best service and if you can provide it, you can also price it. Having said all of the above, if your labor is matrixed, then so should your parts be matrixed for those so-called competitive items. If you are going to enter the " competitive arena ", and ask parts to cooperate, then the labor should also be competitive. I don't know many independents, quick lubes or mass merchandisers charging 86 + dollars an hour for labor. Finally, anytime a win-lose situation is created in your company, the loser will be sure to cause failure in some way, shape or form. Focus on the win-win for your company and your customers. Achieving that may make any price discussions irrelevant.
-
tjsmith
Being Competetive/Parts & Labor
From what I seen in the past, when we lowered our prices on brakes,batteries,oil changes etc.... we always did ALOT MORE WORK for the SAME amount of money. You always get people who only want the special and you never see them again, but you might get an upsale every now & then. I guess there are Pros And Cons to everything.
But I think people come to a dealer expecting to pay more than a Firestone, I think they expect better service and better quality of parts. And to get that quality you have to pay more for it.
If you want to get treated like a Cadillac come to a dealership. If you want to be a Yugo go to Goodyear.
But I think people come to a dealer expecting to pay more than a Firestone, I think they expect better service and better quality of parts. And to get that quality you have to pay more for it.
If you want to get treated like a Cadillac come to a dealership. If you want to be a Yugo go to Goodyear.