DealersEdge Professional Forums

Anyone out there using any kind of LOF PROGRAM where you sell 1/2/3 years of LOF's at a reduced price so that LOF's may run the customer as low as $10.00 Chrysler has service contract convenience plans 1yr or 15,000 miles for 80.00. Interested in those selling them or your own inhouse program in the service drive not sales dept. Are you spiffing writers or anything else? Any concerns to watch for?

Not absolutely related to your question but my local dealer uses that program but the way they handle it is that sales pays for a contract on every new vehicle. The LOF reimbursement rate is low, so they market it as a $7.95 LOF. Essentially the service department submits for the LOF fee (I think it is like $19.95) and also collects the $7.95 from the customer. They seem to like this set-up and the customer is still getting a terrific deal.

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** Rob, Editor Dealersedge/WD&S **
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robc@dealersedge.com

At a store I was at we set up an Oil Change for Life program for 159.95. We charge the customer and we sold it everywhere (F.I.,Sales,Bodyshop,Service,Parts,Cashier) it worked. We added a 10.00 spiff after the first month and it took off. We didnt included diesels but I cant see why you couldnt. The LTOC was good for that vehicle only and for as long as they owned the vehicle. We set up an account to pay for the LTOC that is where we put the 149.95. No looking back once you start, its like Social Security you have to keep on funding it.

We sell "Lifetime Lube" packages, too.

Sure, the customers return...but it is totally up to the service advisors to make the program suceed. Ours are finding a bit more resistance than expected when trying to upsell other work.

However, a lifetime lube package together with a service contract is a winner.

Cheers
DD

My dealer group is currently in the process of trying to do away with our liftime oil change program. The 1st couple of years it worked fine covering costs and pocketing a little extra. This year our 5th year on the program has turned into a loss that will never be able to get out of. Membership has grown so much that each of our 2 store our at about a $75,000 deficit ytd. If you want to build traffic and have writers who can sell this is a great short term $ producer. If your advisors cannot sell, forget about this totally. We are currently looking into a rewards program to replace our Oil change Club with that is much cheaper and offers more to the customer.

I like the "reward" programs where the customer gets the 4th or 5th LOF free. Some include the 1st as complimentary and then kick into the frequent shopper type. Brings them back in for the CP and gets them in the habit of doing business with you. It works for Kroger, and they are certainly not the cheapest grocery in town!

Linda

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Linda Graham Hansen
Auto Dealer Focus
www.autodealerfocus.com