I want to start with the problems with this because I have experienced most of them and they are roadblocks to the success of this type of marketing. If you are serious about changing the way you have been doing things and change the results you've been getting, you need to grab hold of this type of marketing with gusto and commitment. Especially in today's soft market, this type of marketing can make a powerful difference in the dealerships profitability and stability.
Here are the problems as I perceive them:
- Many dealerships think that they can charge the highest labor rate because they have the manufacturers prowess behind them and they think that "factory-trained" mechanics are worth the extra over the non-dealer competition. Wrong. Having been a journeyman auto mechanic myself, I feel qualified to speak on this subject. The only thing a dealer has over the non-dealer competition is they can do warranty work paid by the manufacturer because they are a franchised dealer. All of their non-warranty work is just like that done at every non-dealer auto service facility. I don't have a serious problem paying all the money as long as I get all the service. My experience at dealerships is the opposite. The reality to me is that it costs more and I get less. Those are the two biggest negatives. This issue must be addressed squarely and honestly and quickly. Get your head out of the clouds and focus on customer service at a fair and reasonable cost.
- Many dealerships think the best way to have more profitability in the service department is to raise the labor rate. I've seen this so many times over the years. I'm all for paying attention to where you are in the marketplace relative to each other, but the best way to profitability is providing more and better service more efficiently and effectively and constantly massaging that concept. More and better service. Better productivity. More clients who are not warranty customers. These things need to be the focus and watch it change for you.
- Many dealerships think they have the best mechanics because the best mechanics want to work for dealerships. Wrong. I've met some very good mechanics at dealerships, but I have met more at non-dealership facilities. Really good mechanics find the real problem and fix it so it doesn't need to come back. When I was in auto shop in high school, my teacher used to call those poor mechanics "Joe Magee Mechanics." They were just parts changers with an expensive and large chest of tools. I have seen the comebacks, so I know this is a problem. Seek the best and you will be rewarded for it. It is more important now than ever to be a great diagnostician to be a great auto mechanic.
- If you want to see how good a dealership service department can be, take away 100% of their warranty work and see how profitable they can be. This should be one of the reports that a really good dealer, general manager and service manager should get. They should be able to look at how much was generated by warranty work and how much non-warranty and how that relates to the profitability of the department. The other thing that needs a good deal of scrutiny is comebacks. I know no one likes them, but what are you doing about it? To an owner, there is little worse than having to bring it back again to have the thing fixed that should have been fixed the first time.
- Many dealerships think they should not work on other make vehicles. Wrong. That will limit your income right off the bat. Think of one of your dealership customers who bought that new Chevrolet from you, but they have three vehicles in their family and only one of them is that Chevrolet. They also have a Nissan and a Ford. If you say to them to bring their Chevrolet to the service department, but don't bring the Nissan or the Ford, you are operating a service business that will continue to have a hard time being profitable unless there is sufficient warranty work which is totally dependent on how many new cars and trucks are sold. Find mechanics that have more experience. Train more. Watch out how many ways you say no.
- Service follow up is just as important as sales follow up, yet it doesn't get done. If I ever got a call about my service, it was maybe one or two. That's in 40 years of driving! Think about it. You had a problem, you brought it in and they called you the next day or a couple of days later and asked if everything was okay. Wow. What a concept! How would you feel about that call? I would be impressed and pleased.
These are just a few of the biggest problems and their solutions for dealers. If you really look at your operation from every angle that you can with one good two-part question asked over and over: Why should people bring their vehicles to us for service and how will they respond to our service experience? Understanding the problems fully is part of the solution to them.
Now that these problems are being solved, we can effectively market the service department. Every communication with every prospect and customer must talk about service proudly and encourage people to come there for their regular service needs on all the vehicles they own. There should be a good supply of service and parts coupons to pass out to people. Create some marketing magic by getting the entire dealership involved in promoting the best service department on the planet!
Dealers just don't seem to realize how important the service and parts departments are to the dealerships success as a whole. I say this confidently: The better the service and parts business, the better the dealership overall. If sales can really, seriously promote the service department, that is a huge advantage. Most sales departments have an adversarial relationship with their service department. Much of that comes from the points above. I could give you a list of specific examples, but I think the point is made.
I'm not buying a new car right now, but I am getting my oil changed on time and I just had to have an expensive repair done on one of our vehicles. This is a common experience. Get them coming to you instead of the non-dealer facilities. Be the best and show it in your performance.
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