to spiff or not to spiff?

[IMNUTZ]

How many shops allow outside companies to spiff for there products? We had done away with the large $10 spiffs and had gone with .50 to 1.00 spiffs for the flushs ect... The boys from JB just came in and had a meeting with the owners and told them how much we are losing a month by not selling there stuff. So here come the $10 spiffs back. Is it just me? I dont think there should be that big of a spiff. If I put a $10 spiff on batteries everyone would need one.

[Richard]

I just put an end to the air filter spiff the Service Manager had that I didn't know about, until I had a $120 charge that I didn't know anything about last month....
Boils down to this in my mind, why spiff someone for doing there job? I can see spiffing a salesperson for selling accessories, but air filters, flushs, ect...thats all part of the job, and they are selling labor on those jobs...I shouldn't have to supplement them when they are making more money on the job than I will.
Letting an outside company spiff your techs/advisors leads to overselling. I've run into 'loyal' customers in town who I hadn't seen in a while, told them we had missed them , ect, was there a reason....each one told me that they couldn't come in to get anything done without some EXTRA thing being pitched, and they just got tired of it....

[This message has been edited by Richard (edited 03-16-2005).]

[DEALERGUY]

Imnutz, Richard is right you shouldn't have to spiff to sell items. I find it that it does over sell those items.

Now for business purposes, We do spiff. Why? Well my techs will not look at tires, batteries air filter etc except with out a spiff. I use Lottery tickets. One lottery ticket for an upsell. Battery tires get 3 lottery tickets.

Now as for JB type of outside spiffs. THe first thing is The flushs will make you $$$$. Techs and writers tend to sell the flushs some times when not needed. If you can control that it might be wurth it. I had a problem with JB personally. But won't get into that now.

Right now, I give NO cash spiffs out. ONLY lottery tickets. I charge it to the gross of parts and service. JB and other companys take away your gross of the parts department by adding the cost and driving the price up.

But with out spiffs, items don't sell. Even knowing I hate to do it, the bottom line dictates that. Its a business decision.

[This message has been edited by DEALERGUY (edited 03-16-2005).]

[robc]

The simple answer from me, in this very specific case is no - don't spiff for these. The possibility of abuse out-weighs the potential positives.

In a larger since, any pay plan - and therefore any spiff - is designed to focus behavior and action. A spiff is an extension of the pay plan. So as noted why are we paying them extra to do their job? Well what does/should their job pay and how does it relate to the overall pay plan for bonuses and incentives. Spiffs are part of pay, otherwise wed all be hourly employees. In a similar vein about focused pay, a salesperson is sitting in his desk and he sees two people on his follow-up sheet, low-gross Larry and high-gross Howard who do you think hell concentrate more time on. His job is to sell both, but he will really go after the money. Pay the advisors on labor sales and that is what they will chase while LOF Louie stands there waiting for someone to write them up.

The spiff sets the priority, so the question is why do we want to emphasize this service over all others? What makes this so special or needed? I answer that question first then decide on a spiff, encouragement, contest or other.

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** Rob, Editor Dealersedge/WD&S **
Help is only a message post away!
robc@dealersedge.com

[fburrows]

I used to give small spiffs on things like wiper blades or air filter elements because there is no money in it for techs and you lose customers over not replacing them occasionally. I also dont like the idea of outside people paying spiffs, especially big ones. By approving this you are endorsing the service.

It is very true that the dealership that tries to sell 5 flushes to every customer with 15,000 miles will make more money short term than one that doesnt do it. That doesnt make it right. It also does not mean that in two years the profit will be still be there. I am afraid that judgment day has not arrived for the aggressive flush group but it will someday. I also realize that the temptation is huge because of increased quality and extended service intervals. I think I would ask my dealer if he or she would rather have quick profits now or be able to sleep easier at night.

I think you are better off taking the high road. Your mileage may vary!


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Frank Burrows ABS
fburrows@absdata.com

[Mike Vogel]

I'm in total agreement with the others - no spiffs. If you feel you must do spiffs handle it in house, don't let your vendors be in control.
In a previous job we had spiffs on flushes to the asm's and techs. The program went great but when we decided to end it we saw a drop of over 30% in flushes. My assumption was some of the flushes were sold for the spiff and not because the vehicle needed it.
I will never again offer spiffs. The techs and asm's get paid for these in flag hours and sales commissions so why have to add to that, it encourages gouging !

[This message has been edited by Mike Vogel (edited 03-17-2005).]

[dave87101]

What I am hearing here is the typical service manager whining about his sales people being paid a commision to sell. You are SALES managers and it is YOUR job to CONTROL your SALES people to sell what is proper in your dept. If one or more of your salespersons is selling too much, that is exactly the problem you want. You dont want the problem of not enough sales. I would much rather have the problem of too much business to manage than not enough. The main reason outside vendors have to do this spiffing is because of the average SERVICE (not Service Sales) manager not managing his/hers sales dept. The selling of Flush services is not the same as writing an LOF. 98 out of 100 service customers have no idea what any of the flush services are and the sales person must take a considerable amount of time (compared to just writing an order) to properly explain the benefit and value of these new-to-the-market services. Why would a Sales Person spend the extra time unless there is value to them too. They are in this business just like you are, to make a living for themselves and there families. If we want them to take extra time to make the more dificult sale, we have to make it worthwhile, otherwise we get order writers that just look to write the most ROs in order to make their living. There is no doubt to anyone that is technically knowledgable that a Cooling System Flush is a much higher quality service than a radiator drain&fill, but this has to be explained to the average service customer and this takes TIME. I would bet that those that are anti-spiff are also the ones that complain that they cant find good sales people for their service drive. LETS GET REAL!!!

[robc]

Let's get real ... ok.

(1) You sound like someone with something to sell

(2) Flushes are not "new to the market" - I've been hearing this debate for at least a decade.

(3) Some of these services are designed to do one thing first in my opinion - separate a customer from their money. Any real benefit just seems like a nice side point. Are flushes (and I am just talking about transmission and coolant) a good every 30k or so, sure. But unless you have a truck pulling a large load, they are mostly overkill. Doubt me - look at the literature that the flush companies use to get use to buy the equipment ... somewhere after talking about how much money they make us will be a little aside like it might actually benefit your customer.

(4) Service managers didn't just fall off a truck - they know what holds real value and if they don't believe enough in the product then I'd trust that belief.

(5) Outside companies do not dictate how I would run my business See point 4 - either I believe in it enough to direct my advisors or I don't.

(6) Selling too much is great today - it sucks when the customer never comes back. That sounds like something a really weak consultant would say just to show improvement in the short term, and never looking at how it will tank the dealer 9-12 months from now.

(7) I absolutely said the same thing about the high/low gross level of difficulty issue with spiffs ... read the posts again - others said as well. The question was would you let an outside company spiff not the total destruction of all sales incentives.

(8) What if I just pay the advisor $125k a year ... will he sell then? Motivation is internal and if all you have is spiff chasers your performance is going to struggle. Again, reread my post - pay is pay and how you get there is totally up to the dealership. If I had an advisor that wouldn't do something I asked him too because there wasn't a spiff, I'd kick him to the curb.

(9) Ummm .. in the immortal words of Pete Townsend "who are you" - sign your name if your going to bash those whom I would guess are your potential customers.

Sorry about the rant. I just get disgusted when I hear this level of contempt out of someone who probably purports to support dealer efforts. Can you imagine telling one of your customers in the drive how stupid they are?

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** Rob, Editor Dealersedge/WD&S **
Help is only a message post away!
robc@dealersedge.com

[This message has been edited by robc (edited 03-18-2005).]

[IMNUTZ]

DAVE87101, I guessed when I read your post that you were either getting spiffs or selling them, I see that your selling them. Sorry for questioning your profession. Please forgive me. This group to comes in call themselves consultants also, it must be their latest sells tactic.

I welcome any help from real consultants as long as there not seling their products.

[kcatdeejay]

robc, I will allude back to GM bulletin #04-06-01-029 re: Unnecessary Crankcase and Subsystem Flushing that I briefly touched on in an earlier post. What's going to happen when the general public gets wind of such info (and they will). In addition, I see such practises 'flushing' potential future business down the drain along with any credibility they may have had. This is all our 'consultant' ever talks about-flush, flush, flush. Flushing him out of the loop would be a great improvement.