Today’s car business has many challenges such as customer satisfaction, retention, and overall profitability. One thing I find interesting is, many of the challenges that car dealerships face are self-imposed. Today let’s look at some of the challenges and areas of opportunities for growth between the sales and service departments.
The used car department manager many times will not make repairs on recommended items. They believe by not doing the repairs it will improve their gross profit margin, and bonuses on vehicles sold. The other factor that I’ve heard is, if the vehicle has to go to auction they will lose the investment on the vehicles at the block.
What happens many times is, when the vehicle is sold we make a commitment to make theneeded repairs that the customer is complaining about and wants included in the deal. This is so disruptive to the Service Department, because standard practice is to walk back and demand that service be performed on this vehicle today because it’s a sold unit. Imagine the disruption to the service department after they have made commitments to customers that brought their vehicles in for service, and now they are faced with the dilemma to meet the demands of the sales department or the commitments to their customers.
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