Are We Flushing Our Customer's Away????

[robc]

Great points made by all - I will comment specifically on GM's position (this is a long rant warning):

1. GM says no to flushes the same time they are settling large class actions on Dexi-cool. Related or not, some issues kind of go hand in hand.

2. GM wants everyone on simplified maintenance -- dealers go on it -- price the service 1 at $79.95. Then GM issues a coupon for an LOF/rotate (the heart of a service 1) at $39.95 - effectively taking $40 out of the gross.

2a. And the upsell they want is the $10 you'll make on a battery.

3. GM seriously should have other issues more important on their table than running retail. GM has never even really proven that honest selling of flushes that 99% of dealers does not actually enhance retention. (I don't know if it does or not - I just know in our ultra-sensitive world that if no one ever complains about your selling practices you aren't doing it right.)

4. They really need to do a hard RO survey of looking at what makes up the work in a Toyota or Honda shop. Besides LOFs, etc it is timing belts, filters, etc. That is where most imports can make money. GM cut their dealers legs out from under them with simplified maintenance, it hasn't helped them sell one more vehicle, it has maybe led to shady practices by a few, and here we are. Face it - GM really doesn't know what they are talking about with retail - good people, just clueless. I am sure they would be upset at the grosses that perfume counter at Macy's makes and that Macy's allows these outside vendors to set up displays, etc. GM will next rally against the evil of "do you want fries with that?" Dont you know that fries arent good for your customers and can lead to long-term health issues? What kind of heartless bastard tries to sell fries?

5. GM's biggest problem with getting involved in service merchandising is THEY CAN'T DO IT RIGHT!!! Send the $39.95 coupon to the guys I haven't seen in a year - not the guy I serviced last week for $79.95. These types of pieces barely move your car count because they are basically marketing to customers we already have. Stop cannibalizing our own customer-base, it is all we have.

6. That's right sir ... the dealer's name is on the side of building. GM is just a product they sell. They sell other products as well. I remember when GM used to also say 22" rims where the death of us all - there is a long, long list of GM being wrong about fixed ops. Things are never a problem once GM figures out how the can make money on them (exhibit one GM Fuel System Treatment PLUS).

7. I would LOVE to see a similar letter to the dealer about GAP, etch, etc. But they know the dealer knows the front-end and would kick GM in the teeth. They do this in the back because it reinforces a suspicion that even some dealers might hold about fixed ops.

8. Finally (one because I have to get back to work), if you follow GMs advice on everything about fixed ops I can guarantee you wont have to worry about customer retention because your dealership will be closed. Maybe that is what GM is after anyway.

[This message has been edited by robc (edited 03-04-2009).]

[scotstrong]

Rob:

You have also pretty much described GM's RIM program on the parts side. Why oh why do dealers let a company that has proven repeatedly by their track record that they cannot manage warehouse inventories tell them how to manage the inventory in their own parts departments. GM had some of the worst fill rates in the industry BEFORE there finances went in the tank.

Dealers should INSIST on divorcing themselves from these worthless programs as part of any "restructuring".

[sermgreby]

Rob:

AMEN!

[mbaker]

Very well put Rob!!!!

[FJFIXEDOPS]

THINK NOW 2009,
We recently recieved an open letter from our manufacturer that decries the use of "Supplemental Services" as being expensive, unnecessary, environmentally irresposible and may cause damage to the vehicle.
They suggest that as an alternative, we should sell alignment checks, wheel balancing, computer system health checks and air filters (all low-gross services that their maintenance schedule does not address).

They have no provision in their maintenance schedule for extreme climate conditions, other than if you drive predominantly on dusty roads, and then only to change the air filter more often.
At the same time, they are offering fuel injection flush tools and chemical additives for most operating systems. Why is that?
I used to think that only some religious sects were total hipocrites!
I agree with most of you that have posted to this topic. The vast majority of us are always trying to do the right thing for our customer, and are attempting to balance the need for increased gross profits to help cover the bills, with the manufacturer's elimination of many of the most profitable services on the vehicles.
To the manufacturer's I say... stay out of our business. It is not those of us that are always trying to do the right thing that are costing us business, it is inferior product, ineffective marketing campaigns sponsored by the manufacturer and reduced service intervals that cost all of us money.
If you don't think that reduced intervals are an issue not only at the retail but also the wholesale level, just look at the number of "gelled" engines and cooling systems that we have seen over the past decade and that the manufacturer has had to participate in correcting! In addition, if you think that the marketing campaigns are effective, just look at the Toyota MAG Malier program....send out the same message with the same incentive to every single customer in the Market Area, whether they were in a week ago or never have been in to a Toyota store. Real effective!
Just my 5 cents worth.

[techuser]

Sometimes it is the smallest details that make all the difference. What is displayed when a GM vehicle needs an oil change? "Change Oil Now". That's good. What is displayed when a Yota needs an oil change? "Maintenance Required". Hum, what's the difference. Change oil now means 30 minutes and about $30. The customer has already planed their day and budget on it. Maintenance required means I need to go to the service department and see what is needed. The door is open to a good adviser to do their thing. Am I the only one that has noticed this? Just different wording on the display (that cost nothing more) can make all the difference.

[TheOne]

All good comments!

I would also point out that those living in glass houses (GM,Ford, Chrysler)shouldn't throw stones. Over the years I have been hired to fix many, many, many corporate owned stores for Motors Holding (GM), Dealer Development (Ford), and MID (Chrysler). The very first steps with every one of these stores is to implement a service selling process including agressive flush sales. Each of these stores comes with a corporate handler who apporves each process change. Long story short their overriding desire to make these stores move from the red to the black have in every case that I have been involved in motivated them to embrace whole heartedly aftermarket flush programs. I even worked a crew around the clock pumping nitrogen into 1200 new vehicles with corporate approval!

The manufacturers opinion on the things we do changes constantly based on their self interest at the moment. Does this make them bad people? I don't think so. Just opinionated, short-sighted, uneducated, and very often dead wrong.

Lack of integrity from the manufacturers as a group with some very significant exception allows them to plan for legitamate warranty claims going unpaid due to procedural or clerical failures instead of partnering to pay what they owe. It also lets them sleep at night as they threaten dealers seeking to exercise their rights under state law to raise their warranty labor rates and parts markups.

In closing we are extremely unlikely to change them or their practices, what we can do is disregard their letters and comments when they intrude on our business.

[harleygrl]

I had a vehicle in my shop a few weeks back with a intermittant hard start issue. After several calls to TAC and more than 1 visit, GM sent out an engineer. He indicated that carbon built up on the valves may be absorbing fuel causing the issue. We removed the fuel rail and looked at it with a boroscope. Sure enough, there was lots of carbon build up. The engineer recommended running GM top engine cleaner through. We did; carbon still there. GM engineer stated he could not recommend doing a BG Fuel/Air service, however he was going to leave the store to go road test another vehicle then come back. (wink, wink) We did a BG fuel air/induction service. Looked with a boroscope, carbon all but gone, customer fixed, vehicle fixed, saved GM from a potential buy back. When the engineer came back and we told him about doing the BG service, he told us that he uses the BG products in his personal vehicles, he just cannot "officially" recommend it; and that he knew the BG service would work.

Second story. I had a customer come in asking about pricing out a power steering rack for his Bonneville. He has approx. 70k miles on the vehicle. I asked him out of curiosity how ofter the power steering fluid was changed. He looked at me ans said NO ONE had ever told him that should/could be done. So I priced him out a $1400.00 repair. Manufactures have 2 things to sell. Cars and parts. I would rather have asked that customer for $130.00 for a power steering flush vs. $1400.00 for the rack.

[This message has been edited by harleygrl (edited 03-10-2009).]

[This message has been edited by harleygrl (edited 03-10-2009).]