Implementing a process and holding your service personnel accountable to follow the process is a common practice at most dealerships across North America. The challenge is to keep the process from being so “transaction” driven that you miss revenue opportunities along the way.
For example, dealerships that have a quick lube rack might have a process like this: get ‘em in, write ‘em up, entertain ‘em with free Wi-Fi and get ‘em out the door. The process includes factory-trained techs, OEM parts, articulate service advisors…and all this in less than an hour. Process followed. Transaction completed.
However, there is more to the automotive service business than simply executing a flawless transaction process. The best way to illustrate this point is to tell you a true story:
I bought a pre-owned, late-model import crossover for my daughter so she’d have reliable transportation as she headed off to college. I took it to an import dealership when it was time for the first service. (By the way, this was not the same dealership where I purchased the vehicle. Why? The original dealership never asked for my service business. They were focused on the used car sales transaction. Period. But that’s a story for another article.)
I arrived at the service drive at 10:20 a.m. and was greeted by a service advisor who met me at the car at 10:22 a.m. I asked for an oil change and he gave me a “write up sheet” to sign. It was not a busy day, in fact there was only one other car on their spacious drive.
He didn’t do a walk-around, didn’t give me a menu, didn’t raise the hood, didn’t discuss a free maintenance inspection, didn’t introduce himself, didn’t ask for my name and didn’t point me to the customer lounge.
Since I hadn’t been shown where to wait, I decided to just sit in the first chair I saw, which was in the corner of the service drive.
At 10:30 a.m., the advisor approached me and suggested I’d be more comfortable in the customer waiting area, and he escorted me there. He still didn’t introduce himself, ask my name or thank me for being there.
The customer lounge was very modern, clean and bright, complete with a flat screen TV and a children’s play area. They had a state-of-the-art coffee station, but the pot was almost empty. There were no cups and the condiment area needed to be replenished. I was really impressed with the men’s room, the granite and tile were first class, but there was no soap.
The advisor approached me again at 11:25 a.m. stating the car was ready and asked if I wanted a free car wash. It was one of those snow-turned-to-slush-on-the-road days, so I said no thanks… but I was impressed with the gesture.
He walked me about 25 feet over to the cashier’s window where he went over the multi-point inspection form. The technician had recommended a mileage service bundle, an air filter and a throttle plate cleaning…but the advisor did not ask me to have the services performed while I was there, nor did he offer to set a future service appointment. I knew the vehicle was due for a tire rotation, but neither the tech nor the advisor recommended it.
The cashier had me sign the invoice, ran my credit card and gave me the keys. The car was parked right by the service door and I drove off the lot at 11:35 a.m.
Here’s how I rated the dealership:
Oil change transaction: B-
Additional revenue opportunities: F
They lost 1.7 hours of labor and $200 revenue for one simple reason: the service advisor didn’t ask for the sale! Incredible! This dealership sees about 40 cars per day, so when you project the missed opportunities over a year, it looks like this:
$200 x 40 cars per day x 21 days a month x 12 months = $2,016,000.
To be fair, let’s say only 50% of the people who are asked will actually say yes, so that’s $1,008,000 in lost revenue for the dealership…just because they won’t ask for the sale!
Let me come back to the central issue: the advisor was focused on an oil change transaction, get the job done right in about an hour. Mission accomplished. What he missed…well, I think I’ve made my point.
By the way, one of the best ways to alienate your techs is by requiring them to thoroughly inspect vehicles and then your advisors never selling (or even offering) any of the services they recommend.
To recap, this dealership has spent millions of dollars to create a beautiful, inviting facility for its customers. They go the extra mile by washing each car that comes in for service. Yet, a top notch facility and first class amenities will not generate increased revenue, although both are vitally important. The only way to increase revenue is to sell service by asking the customer to buy!
So here’s a question for you to ponder: do you suppose my experience has ever been repeated at your dealership? If so, the way to turn it around is training.
Action point: Each month I conduct a 45-minute webinar on selling maintenance services. If you want your service advisors and management team enrolled in the webinar series, just send me an e-mail at email@example.com.
I look forward to seeing you and your staff online each month in 2012.