Category Archives: Service Advisor Training

3 Key Components of Outstanding Service Departments

When examining the best service departments across the country, you often find that they all share common best practices that create additional service sales and gross profits for their dealerships.

These best practices combined with daily monitoring, observation and coaching results in professional sales organizations that can sustain a dealer during times of slow sales or downturns in the economy.

One of the most overlooked skill sets in dealers that struggle with decreasing repair order count is service phone sales skills. While you would be hard pressed to find people who do not have the ability to be courteous and project a good image on the phone, it is easy to find personnel who have not been trained to sell service appointments.

One phone survey company* found that service advisors do not offer appointments or attempt to sell an appointment on 57% of the calls they field even though the opportunity sell an appointment presented itself.

If this is happening in your dealership and your service team fields an average of 100 information calls a day, it means there are 57 missed opportunities, every single day. A properly trained Advisor can be expected to convert 30% of those calls (or more) into service appointments.

So the question is, what would your service drive look like with an additional 17 service appointments every day?

Once you’ve trained and coached on phone sales skills you can then begin to train on Advisor communications skills. This is another area that the most successful dealerships continually monitor and coach their employees to near perfection.

Communications skills are not only important to Customer Satisfaction Index scores, they are critical in Customer retention. Advisors that have weak listening skills and a complete lack of follow through on promises, become the source of nearly every Customer complaint registered at your dealership.5waystoincrease

One Advisor will interact with an average of 10-15 Customers per day. Based on that number, one untrained Advisor can impact 44 Customers a month in such a way as they could possibly decide not to come back.

If your store sells 150 cars a month, and your retention is in the mid-range of 40-50%, you can expect a net gain of 31 new car Customers a month from your 150 sales in the front end.

Does it make sense not to train your Advisor in communications skills when so much is dependent on him/her being a professional in every sense of the word? Of course not.

Lastly, those dealers that are doing it right have a complete marketing plan in place. They make a decision to budget funds for service marketing based on repair order count while taking into consideration recalls, campaigns and industry trends.

Recently there has been a flood of recalls that have not left any manufacturer on the sidelines. Many dealerships took advantage of those recalls by highlighting their ability to service their Customers while attracting new business through strategic traditional marketing as well as social marketing.

And they have “hit it out of the park.”

Not only did they service their own Customers, they were able to attract new business with the goal of converting then to regular service Customers. Take an average dealer writing 45 repair orders a day, factor in about a 30% warranty repair order write-up rate, adjust for “just recall” warranty repairs of about 30-40% from that warranty rate, and your team has the chance to make 3 or 4 recall Customers into regular service Customers every day.

So the question is, did you want to allocate funds for marketing, train for opportunities and coach for results…or did you just want to keep doing what you’ve always done and keep getting what you’ve always got?

Make a commitment to your service team and follow through with sales training, communication skills training and a marketing budget in line with your stated Goals and watch your Profits soar!

by Leonard Buchholz
*PhonePops

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Why small increases are important to your Dealership profits

Just what does a 10% increase (in any KPI you choose) really mean to your dealership?

Why small changes make big things happen.

Why small changes make big things happen.

 

Have you heard the old saying “Yard by yard it’s hard, but inch by inch is a cinch”?

If I were to go to any of your dealerships and walk into the GM’s office and say “Would you be interested in a 50% increase in Gross Profits?” what do you think he or she would say to me?

They would jump out of their chairs and yell out “Of course…how do I get it!”

And therein lies the problem with increasing performance or increasing profits 50% at a time. It is really hard to achieve that big of a jump all at once. It’s not that people are not capable or willing, it’s just that getting all of the components of a dealership focused and firing on all cylinders at the same time is a difficult proposition at best, and trying to get a 50% increase in any measurable KPI just becomes impossible.

Truthfully, whenever you have heard someone (DP, GM, New Manager, etc…especially the New Manager) say something like “I’m expecting big things this year and our goal is to increase (fill in the blank) by 50%”, would you say the “Dirty Diaper Alarm” trips in your head and you disregard everything that was said and develop a less than favorable opinion of said “Authority Figure” (or whomever was speaking)? Yep, me too.

But if I go into any dealership and ask any service advisor “Hey there Mr. /Ms. Advisor, do you think you could sell an extra $10-20 dollars on every repair order?” what do you think the answer is nearly 100% of the time?

“Of course I can.”

That is the power of a 10% increase.

So let’s look at John Q. Advisor and some of his numbers. At the average of 1.5 HPRO at $85.00 an hour, every repair order John writes is averaging about $229.00 a ticket. A 10% increase is only $22.90 and if John writes 220 repair orders a month, that equates to a $5 Grand a Month increase in Service Sales.

What does John get? At the end of a year, he gets an additional $60 grand in Commission-able Sales and if he is on an average pay plan, he just made another $5000.00 or so dollars for the year or $400.00 bucks a month.

Now go ask your Advisors, “Hey there Mr. /Ms. Advisor, want to make $400.00 more a month?” and what do you think their answer will be? (If they say something smarty pants or “No” or “Who do I have to kill?” just tell them you are going to write a letter to their spouse or significant other stating they turned down a $400.00 dollar a month raise)

Most organizations focus on trying to increase too much when they should focus on just making small but effective changes that yield results over time.

One more thing. Don’t forget the power of compounding.

Back to back increases of 10% in John Q’s example is big. How big? In the second year of a 10% increase, John’s average sales per repair order become $277.00 per copy or $48.00 more than year one, which equates to a $126,720.00 yearly increase in service sales…not too bad a result for a 10% increase.

Get focused on making small incremental changes that add up to big improvements! Help your team see the value and vision of a 10% increase in their service sales process and watch those profits (not to mention team morale) soar!

By Leonard Buchholz

Where does Profit Improvement start? At the Service Managers Desk, of course!

In every Dealership there is a desk. And behind that desk sits someone who has the responsibility to increase Profits.

In Fixed Ops, this person is called the Service Manager.

Typically  (when I go into a store that is not profitable), I find the person sitting behind that desk working on everything not related to increasing Profits while believing that they are working on everything related to increasing Profits.

I call it the “Theory of Un-relativity” and it goes like this.

P=ATD+PIxNC. Profits equal the Amount of Time Dedicated plus Process Implementation times the Number of Completions.

Simply, the Manager must dedicate as much time as needed every day to making sure processes are being followed and that they are being done with every Customer.

In stores that are not profitable, the Manager spends more time on things that have nothing to do with Profits and everything to do with nothing…including Managing the department…or as I stated before the “Theory of Un-relativity.” The things they are doing have no Relativity to making more Profits for the Dealership.

UP=ATW+UTxNC. UnProfitable equals the Amount of Time Wasted plus Unnecessary Tasks times the Number of Completions.

Let give you an example. I am standing in the Service Drive with a Service Manager when he is approached by the Sales Manager and informed that the tethered marketing balloon outside which normally is in position first thing in the morning is not up yet and “Could you take care of that as soon as possible.”  Unnecessary Task.

Another. SM is working in his office when he is informed that the lights on the front lot “are not lit up and can you do something about it?” Unnecessary Task.

One time, as the owner of my store had just handed me another daily task not related to Profit growth, I decided to write down all of the daily tasks that had been thrown my way over the past year just so I could get a handle on it. The list was 40 plus items and guess what…not one of them had anything to do with making more money.

Were some of them important? Yes. Necessary…no doubt about it. But at the end of the day when the Dealer Principal has “The Fin” in his or her hands and wants to know why “Fixed Ops is off by 15% and what are you going to do about it?” and you have the “But Boss, I’m so busy doing all of these other things!” excuse sputtering out of your mouth…now doesn’t that paint a pretty picture Mr./Ms. Service Manager?

By the way, when I handed the Dealer my list and asked him to specify which of those tasks were Top Priority and which were not, he actually apologized. He had no idea how many things he had “delegated” to me until I pointed it out to him.

Here are a few things you can do to get back on track making more Profits.Profit

1st, make a list of the things you are doing every day. Now separate that list into “Tasks That Make Money” and “Everything That Does Not Make Money.” Give Top Priority to Monitoring, Coaching, Training, Managing and Nothing, Zero, None, Nada Priority to Everything Else. Within a few days someone will come to you and say something like “The lot lights are out again” and then you can show them your list that makes the Dealership money and they will find someone else to ask about the lights.

2nd, share this list with your Dealer Principal or General Manager. Why? Because they forgot they told you to do half of those things and don’t remember the reason why they told you to do the other half.

3rd, learn to say No. Point out that working with your Advisor on Phone Sales Skills is way more important than stocking toilet paper in the bathroom or talking to the coffee vendor about the price of the new machine.  Stick to what makes money and makes sense.

Lastly, you and I work in the real world. If the DP drops the keys off and asks to get his demo washed and gassed, don’t show them your list. Get the demo cleaned up and gassed. Remember the 20 foot rule. Walk outside the building 20 feet and look up 20 feet and see whose name is up there.

by Leonard Buchholz

Where does Service Sales failure start? In the Service Drive of course!

In every dealership that I visit that is struggling with increasing Sales per Repair Order, performing a walkaround  is the area that the Advisors do not do well, if at all.

Recently, I was observing a service drive when a customer pulled up in a car and the advisor looked up from the desk and and said “Oh, look…she is just sitting there.” And for the next 3-5 minutes, the advisor sat at her workstation and waited…until the customer got out of the car and made her way into the service reception area. The advisor did not get up and go outside to greet the customer, make them feel welcome or offer any assistance. Is there any wonder why this store is struggling with increasing service sales and declining RO count?

We have all been customers in dealerships, repair centers, restaurants, cleaners, hotels… you name it…and there is nothing like a customer service person who gets it…from the initial greeting all the way through the final payment. And like many of you…I spend more money when I am taken care of.

Treat me like a number…give me grunts in response to questions…don’t use common courtesy…be in a hurry to get rid of me…don’t explain the process and expect me to guess what is happening next…and make me feel like an interruption to your day…is there any wonder why some Advisors (and Dealerships) struggle? I wouldn’t spend any money there and neither would you.

A walkaround is the very first tool in every Advisors toolbox to start building the relationship and introducing the customer to the maintenance and repair process. Without it, the customer might as well be at the DMV or the TSA line at the airport or the checkout line in the supermarket. It’s all the same until the person delivering the service decides to do the right thing.

And that is the fundamental difference between the checkout line and the service drive… one caring professional human.

by Leonard Buchholz

The Service Advisor’s “6 Steps to Happy Bank Deposits”

Here is a simple way to make more every month.
It’s called the “6 Steps to Happy Bank Deposits” and it goes like this.

1st, write down what you make per month right now.

Your position in life is determined by what you believe.

Your position in life is determined by what you believe.


2nd, write down what you want to make per month. (Be Realistic) This is a crucial first step because if you don’t make a personal commitment to make a change in how you think about your income then you can’t make the income you desire. 
3rd, determine your Sales per Transaction. If you write an average of 180 Customer Pay Repair Orders per month and you average $45,000.00 dollars a month in Customer Pay Sales, each Repair Order you write is worth $250.00.
4th, decide what amount of increase you would like on each Repair Order. Write it down and be Realistic. Post it where you can see it everyday. Think of it as building a staircase. You can’t jump to the top of the staircase…you have to take each step one at a time. Make a commitment to yourself to increase by a specific dollar amount…say $25.00 on each Repair Order. 
5th, increase your Sales per Transaction by using the Tools (Menu, Multi-point Inspection, Maintenance Recommendations) and Techniques (Feature/Benefit Sales Presentation, Professional Sales Skills) to Communicate Effectively to the Customer the Information they need to Maintain their Vehicle in a Safe and Reliable operating condition.
6th, Deposit New Income from following these steps.

Set Goals, Be Successful!

By Leonard Buchholz

200K in 200 Days

In the past 4 years there have been quite a few Dealers who successfully increased their Fixed Ops Gross Profit by $200K, $300K (one Dealer had a $900,000 dollar increase) by changing how they conducted their daily Service Operations.

They made fundamental changes in Processes and then Coached their personnel to increased Performance.

If they can do it, so can you.

 

Here is a link to “200K in 200 Days” a resource that describes how Successful Dealers did it!

Get it, Read it, Do it!

By Leonard Buchholz

Are your Advisors “Helpful” or “Professional”?

Helpful…or Professional…which of these sound better?

If you are like a lot of Dealers and General Managers hiring “helpful” people always seems to be the right call. The belief is that you can develop someone into becoming a Professional. While I don’t disagree with this practice, what I find all across the country is the opposite of helpful or Professional.

Because we train all across the country, we have exposure to every make and model of vehicle in every kind of Dealership, whether it is a locally owned single point, multi-line point or large Dealer Group.

And when we train invariably, we get to the point in the training that we ask the Advisor “How do you see yourself as an Advisor” or we might ask “What is your role in working with the Customer?”

And 9 times out of 10 the answer comes wrapped up with a bow in a package labeled “I want to be helpful” or “I want to help the Customer and give the best possible Customer service.” This answer is of course not only the expected answer but the accepted answer. And it has absolutely nothing to do with helping the Customer.

In fact, I submit to you that being “helpful” is exactly what we don’t need in a Dealership.

The reason I say that is because in every single case where I have an Advisor who is trying to be “helpful” to his or her Customers, they have become the exact opposite. They have become “un-helpful” and in most cases a liability.

Let me explain.

Helpful Advisors share 3 common characteristics.

  1. They make decisions for their Customers without asking the Customer what they (the Customer) would like to do.
  2. They make judgments about their Customers based on past experiences and fail to honor the word “Advisor” which is part of their job title.
  3. They are poor Salespeople with poor communication skills and non-existent processes.

Helpful Advisors make decisions for their Customers like not telling them everything that is wrong with their vehicles, instead just telling them what they think the Customer wants to hear.

They do not offer additional services during the write-up process and never present a menu. They have become in effect the same as the person whom we call an “order taker” at your local dry cleaners or fast food restaurant.

Professional Advisors make no decisions for their Customers at all. They Advise them on everything the vehicle needs, recommend additional services they know will be beneficial for the Customer and present a menu at the time of write up. They take the time to explain everything to the Customer so the Customer can decide what they would like to have done on their vehicle.

Helpful Advisors make judgments about their Customers based on the past.

If Mrs. Jones came in 2 years ago and Doubtful Dan tried to make an Additional Service Recommendation and was shot down by Mrs. Jones with the “I can’t afford it today”, Doubtful Dan now assumes that Mrs. Jones can never afford any additional repairs and stops telling her that there are additional services needed in order to maintain a safe and reliable vehicle.

The next time Mrs. Jones comes in for an oil change, Doubtful Dan is surprised to learn she has new brakes and tires.

Doubtful Dan then asks Mrs. Jones “Where did you have the repairs completed?” and Mrs. Jones replies “Right down the street at Bob’s Big Boy Service Center. After the last visit here my grandson stopped by to visit me and said ‘Grandma, you should have your tires checked’ and of course I asked Timmy (my grandson) ‘Why?’ and he said ‘One of your tires has some wear on the edge Grandma.’”

She continues “Well, I just happened to have some free time later that day and popped in at Bob’s and they said ‘Sure we can take a look at it’ and next thing I know they told me that the tires were needing replacement and I said ‘Are you sure, because I just had it in a ABC Motors and they didn’t say anything’ and they showed me the worn tires and wouldn’t you know it, when they took off the tires, the brakes were worn down too.”

In the car business this is known as “Someone just ate your lunch.”

Professional Advisors do not make judgments. They Advise. They take all the recommendations from the repair order, prioritize them from most important to least important and then tell the Customer everything they need to know about maintaining their vehicle. They let the Customer decide.

Lastly, Helpful Advisors are invariably poor Salespeople who do not keep up on their skills and they do not use any Sales Processes because they want to “be natural and not robotic.”

Let me ask you this and you tell me if it sounds crazy.

When was the last time the General Manager stood up in the Sales meeting and said “From this day forward, Salespeople do not need to log their ups. You do not need to touch the desk and you do not need to complete a walkaround and test drive with the Customer. You can do what you feel is natural.”

Crazy….or what?

And every day in the Service Drive we have Helpful Advisors who do the exact same thing. They don’t follow a process, they don’t communicate the benefits of maintaining the vehicle to their Customer and they don’t develop their skill sets.

Professional Advisors use tools like processes, like menus, like Listening Skills, etc. to help them make the Customers service experience the best it can be. They want the Customer to make informed decisions based on the recommendations and vehicle maintenance needs.

So, look around your Service Department. Ask yourself “Are my Service Advisors helpful or Professional?” and decide for yourself which of these is the better choice for your Dealership.

Written by Leonard Buchholz