Monthly Archives: November 2010

The Hundred Mile An Hour Goat

Two friends are out hunting, and as they are walking along they come upon a huge hole in the ground.  As they approach it they are amazed by the size of it.

The first hunter says “Wow, that’s some hole; I can’t even see the bottom. I wonder how deep it is.”  The second hunter says” I don’t know, let’s throw something down and listen and see how long it takes to hit bottom.”
The first hunter looks around and spies an old automobile transmission lying in the grass.  He tells the other hunter “Hey, there’s this old automobile transmission here. Give me a hand and we’ll throw it in and see”.

So they pick it up, carry it over and count “One, two, three!” and
throw it into the hole.

They are standing there listening and looking over the edge when they hear a rustling in the brush behind them. As they turn around they see a goat come crashing through the brush, run up to the hole and with no hesitation jump in head first!

They are totally shocked and surprised to say the least! While standing at the edge of the hole looking at each other and then looking into the hole trying to figure out what just happened, an old farmer walks up.

“Say there”, says the farmer, “you fellers didn’t happen to see my goat
around here anywhere, did you?”
 
The first hunter says ” Funny you should ask, but we were just standing here a minute ago and a goat came running out of the bushes doin’ about a hunnert miles an hour and jumped headfirst into this hole here!”
 
The old farmer said “Why that’s impossible…… I had him chained to a
 transmission!”

The moral of the story…don’t chain your 2011 Fixed Operations Gross Profit to anything that can be tossed into a deep hole. If your 2010 ended up like a goat chained to a transmission, now is the time to make a plan for 2011.

This is the time to measure what you accomplished or did not accomplish in 2010, what you want to improve in 2011 and plan how you are going to do it.

Goal setting is critical for achieving Success.

Here are the 10 most important areas to measure in Fixed Operations and their standards to help you set defined Goals for 2011. 

  • Labor Gross Profit Margins (75% is the correct number)
  • Parts Gross Profit Margins (45% is the correct number)
  • Parts to Labor Ratio (80% is the correct number)
  • Multipoint Inspection Completion Rate (100% is the correct number)
  • Additional Service Requests (30-40% of CP ROs is the correct number)
  • ASR Closing Ratio (30-50% is the correct number)
  • RO Count to Sold Units (6-1 Ratio is the correct number)
  • Effective Labor Rate (90% of Door Rate is the correct number)
  • Gross Profit Increase Year over Year (10% or more is the correct number)
  • RO Count Increase (Yearly 10% or more is the correct number)

These are the bare minimum numbers for planning next years Goals. By planning now you are keeping yourself from “chaining your goat” to something that can be tossed at the first sign of trouble or adversity, which we all know happens when things are not going smoothly.

Goal Setting with everyone involved will prevent the possibility of 2011 being tossed into a deep hole before it even gets started.

Send an email to lbuchholz@dealerprotraining.com put “Send me the 20” in the subject line and I’ll send you a free report on “How to Increase Your RO Count”

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3 Ways Service Advisors Can Speed Up Service Sales

One of the most frustrating things that Service Advisors have to deal with is the unavailability of the Customer after they have left the Dealership.

In 100% of the cases there is a series of steps the Advisor can do during the writeup and repair process to increase the chances that they will be able to contact the Customer once the vehicle has been inspected or the repairs have been completed.

Step Number One.

Get a “Pre-Approval” amount. This is amazingly easier than what you would think it would be. Why? Because the Customer wants to have the vehicle repaired the same day as much as the Advisor does.

And the easiest way to do that is for the Customer to authorize an “up to” amount. This amount is typically a figure based on what the average RO dollar amount is for your Dealership.

And it is just as simple as asking the Customer. It might sound like this.

“Mr. Jones, I have here on the Repair Order to do an oil change, check the brakes for a grinding noise and diagnose the check engine light. If I can repair all of these items for less than $250.00 dollars, do you want me to go ahead and take care of it?”

This does not mean spend the $250.00. What it means is if the repairs can be handled for $250.00 or less than the Customer is authorizing you to complete those repairs and to call him (or her) if the repairs exceed $250.00 dollars.

Step Number 2

Have the Technician do a complete and thorough Inspection and report back to the Advisor before any other repairs are completed. This will ensure that the Advisor has a complete report to share with the Customer and advise them on any needed repairs before the vehicle comes off the rack.

Step Number 3

Verify the Customers Information.

Now you would think that this would be a “no brainer.”

And every day in a Dealership a Customer is being written up right now and the Advisor is not asking the Customer “Is the information listed here correct?” while pointing to the address and telephone number on the RO.

Or asking “What is the best way to reach you today?” and “Is there another number or email that I can use if I don’t have any success reaching you on the primary number?”

If you are a Service Advisor and you want to increase Service Sales, why would you not ask for a telephone number and email address? It makes no sense not to ask. Service Advisors are in the Communication Business and the first rule is “Know How To Contact Your Customer!”

These 3 Simple Steps will Speed Up your ability to contact your Customer and make more Service Sales.

Training is a Process and not an Event. Do you need help with the Process of Increasing Gross Profit? Send an email to lbuchholz@dealerprotraining.com or call 888-553-0100. Lets make your 2011 the best ever in Gross Profit.

10 Reasons Multipoint Inspections are Important

In our world there is a constant search for “better.”

Better personnel, better systems, better procesess, better sales…you get the idea.

Is there “better” out there in Fixed Operations?

Sure. In recent years software and computers have made getting every conceivable report possible and as easy as a press of the button.

 Software applications like ASR Capture from Reverse Risk is a prime example. Here is an application that does nearly everything that old school managers did by hand 20 years ago. It tracks and compiles every Multi-point Inspection and tells the Service Manager at a glance what is happening in Service Drive.

There have been strides made in vehicle repair. In the  Dealership today we repair more vehicles with software than we do with metal. It’s the evolution of the computer chip combined with software engineering that made that possible.

What about the Dealership? Has there not been a serious industry wide upgrade to facilities over the past 20 years? The Customer has been the beneficiary of new waiting rooms and amenities like wifi and espresso coffee makers.

Better and better.

You know what has remained the same?

The Multi-point Inspection.

Do you know why?

Because it still remains the Number One Tool a Service Department has to ensure Excellent Service to the Customer. (Besides the well trained Service Advisor)

The reason it has remained a mainstay in Fixed Operations is because it works.

It works for the Customer. They get a safe and reliable vehicle. They get consistent service. They get a report on the condition of everything from the windshield washer fluid to the air in the tires.

It works for the Fixed Operations. They get an opportunity to sell repair work while providing a safe and reliable vehicle. It helps them provide a consistent product called Excellent Service!

It works for the Dealership. It reduces the liability factor. It increases the amount of Customer contacts. It increases the amount of opportunity to demonstrate to the Customer that the Dealership is the right place to not only Service the vehicle it is the right place to buy the next vehicle.

Some in this industry have said that “Multi-points are dead” and “old school won’t work in the new school attitude we have nowadays.”

Really? Customers don’t want safe and reliable vehicles? Service Advisors don’t want opportunities to sell needed services so Customers can maintain their vehicle? Dealerships don’t need revenue…or Customers?

I would like to see a Service Manager explain to 75 year old Granny that there is no need for a complete and thorough Mult-point Inspection…in a  waiting room…full of Customers.  

Hey Mr./Ms. Service Manager! Looking for a way to stress the Dealer Principal?

Just go into their office and announce that you will singlehandedly increase their exposure to Liability and Risk by not completing a thorough Inspection on every vehicle that comes into the Service Drive. Think they will embrace that idea?

So here are the Top 10 Reasons Why Multi-point Inspections are Important.

1. The word “Liability” has not been removed from the dictionary. Every time a vehicle comes in to the Service Department there is a risk of Liability. A properly completed Multi-point Inspection reduces that Liability.

2. The word “Responsibility” has not been removed from the dictionary. Dealerships not only have a responsibility to the Customer, they also have a responsibility to the manufacturer. This responsibility is to provide the Customer with a safe and reliable vehicle.

3 thru 7…They have not made a Lifetime-No Replacement Necessary Brake Pad, Tire, Wiper Blade, Serpentine or Drive Belt or Air and Fuel Filter. (Here is a little tip…they’re not going to anytime soon).

8. They have not made a vehicle capable of fixing its own oil leak, replacing a cv boot, removing a rock from a caliper or rotating its own tires.

9. They have not made a vehicle capable of completing its own Safety Inspection. There is no doubt that the Vehicle Management Systems we have today can check a lot of things. Airplanes have one of the most sophisticated management and monitoring systems on the planet. Ever notice the pilot walking around the outside of the plane and taking a look?

10. Oil has not been re-invented. It has been reformulated to be sure, but it wears out. And because everybody drives differently, it wears out at different intervals.

Bonus Reason!

People have not stopped finding ways to drive with little or no regard to how the manufacturer thinks they should drive! (Ever removed a bush, bike, furry animal, piece of concrete, chunk of wood, dead furry animal, lost watch, family heirloom or some other flotsam from the front seat, rear seat, grill, undercarriage, windshield, gas tank, engine compartment or wheel well?)

Better sometimes is left well enough alone.

Got Training? Call 888-553-0100 and find out how Service Advisor Training will dramatically improve 2011 in your Dealerships Fixed Operations. Or send an email to lbuchholz@dealerprotraining.com.

The 100% Rule

Dealership

Dealership (Photo credit: Dan McKechnie)

100% of doing exactly the same thing next year as what you did this year will yield you 100% of the same results.

100% of Personnel employed in your Dealership will perform exactly the same next year as they have this year.

100% of the Processes you used this year to get the results you now have will give you exactly 100% of the same results next year.

100% of the of the Profit you make this year will be exactly the same as next year and exactly the same as last year when using the same Personnel and the same Processes combined with the same Expectations.

100% of Making a Change comes from the Desire to Do Things Different.

What do you want the Next Year to look like?