Tag Archives: Consulting

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

The Right Way and The Wrong Way

During the analysis and evaluation we conduct prior to starting a training program the question of ethics and standard business practices we train on usually requires some explanation. In other words, Dealer Principals and General Managers want to hear from us that we conduct our training programs ethically and professionally.

If I were to stand in a room full of Dealer Principals and ask “Who in here believes that the best way to take care of a customer is to sell extra or un-needed services?” I would venture to say that not one hand would be raised.

This misconception is a holdover from an original misrepresentation/misconception of our industry from the early beginnings. It is far past the time that we begin the process of changing the perception that people who work in the car business are only interested in taking as much money as they can using unethical business practices that prey on the public at large.

In 99% of the situations I have personally investigated where something went awry and the customer felt that they were “wronged”, I have found that almost every one of these situations was an error (and not a conscious decision) and 100% of the time it was resolved in the customers favor with little cost to the dealership.

In every dealership and within our industry we have a small percentage of people that just don’t get it, no matter what the culture, training and daily business practices that you reinforce at your dealership and it is those people we must remove permanently from our industry.

Customers are nothing more than the person standing in the mirror every morning, they are you. From Dr.Tony Alessandra “Treat other people as they want to be treated.”

All this means is dig into what the customer wants, separate those wants into needs and then identify the must haves from the needs. Communicate those must haves to the customer in a way they can understand you and do that ethically and with passion.

By Leonard Buchholz

businessethics

 

Financial Statement Success Steps

Increase Gross Profit, Increase Net Profit, Control Expenses, Increase Sales.

Chances are you have been living those four financial principles since you became the owner or GM. And if you are a service manager reading this, you have been the willing champion of the preceding 4 financial cornerstones to dealership success.

Can I ask you a question?Looking for answers?

How does it make you feel when you read the statement, and it is painfully obvious to you what needs to be done, yet there does not seem to be anybody on your team following those 4 financial principles?

A little frustrated?

Let me ask you another question. Do you know the 3 steps you can take right now to get your team focused on your goals and get you dealership on firm financial ground? Would you like to take a few minutes and learn how you can get started on your dealership’s financial success?

Ok, here we go.

1st, observe your teams performance and take notes on what they do well and what you would like for them to change. It’s quite simple really. In regards to your Fixed Ops Team, there are 3 areas to observe.

The service drive, the back parts counter and the cashier booth or customer pickup area (for those dealers whose service advisors are cashiering).

Making these observations requires no more than an hour a day for several days in a row. Best times for the service drive is morning 8-10, back parts counter anytime and the cashier booth from 4-6 pm. You will learn a lot about your dealership in a short period of time.

This is a critical step in making the necessary changes. Be prepared to discuss with your service manager/director the specific observations you made. Make sure your write down the things they did well and start with those first.

2nd, make a plan to correct the actions that do not meet the performance standards. If you don’t have performance standards, now would be a good time to establish them.

Get the manager involved by meeting with him or her and defining the standards they are to be accountable for. The number one barrier to success in any organization is the inability of leadership and management personnel to correctly identify performance goals. And if they don’t understand them, you can bet that Andy Advisor does not understand them.

This plan includes your expectations, mid-level and ending goals and should be focused on 3 separate timelines as follows; immediate (within the next 2-3 weeks), 90 days and 180 days. Describe exactly what actions you expect to be taken along with the expected outcomes.

3rd, train on the processes and coach on the performance. It is critical for every customer contact person to have a process for everything from answering the phone to making a service sale. Without a process to follow a team will disintegrate to the highest level of self-knowledge available to each individual team member and then begin to perform their duties at a level they determine to be acceptable rather than the level expected.

At this point they become un-coachable because you cannot correct or change the behavior of an individual who is performing their duties as best they know how in the absence of process and performance standards. Every single action in every successful organization since the dawn of man has been process driven. And when people are coached on their performance in the execution of processes they become successful.

Dealership financial success begins by taking action. These 3 action steps will get you started on making your dealership the financial success you expect.

By Leonard Buchholz

“Things” do not a good Service Experience make…

Service is an “elbow to elbow” people business. As I (we) have traveled and observed so many Dealership Service Operations, there is still one overriding factor that every Customer Service Organization must understand and adhere to. This is people business.

Customer services

Customer services (Photo credit: gordon2208)

You can have perks, loyalty programs, free coffee, wifi, marble covered floors and chandeliers…and none of that makes a difference if you fail to take care of your most valuable asset…the Customer.

To be clear, I am not saying that Customers do not want perks. We all do. CRM companies sprang to life and have done very well since the industry recognized the need to stay in touch and recapture Lost Souls and Lost Sales.

Loyalty and Rewards programs have filled the gap between “have a seat and a cup of coffee” to “for every visit you’ll get_____ and _______.” Customers get it.

The reason we have seen a defection of Customers (even though there are Factory Sponsored Free Maintenance Programs) is the People they do Business with coupled with the Professionalism in How they Deliver said Service.

You can’t train Friendliness or Caring.

Here is the proof. When was the last time you went somewhere…say a local dry cleaners or a restaurant…and were treated poorly…maybe you weren’t greeted properly…or the clerk or waiter didn’t smile, answered all of your questions with grunts, one word answers and frowns…all the while staring at the computer screen or order pad…and then said to you “Come back and see us again. We have a rewards program…here is a brochure.”
That brochure hit the round file the second you had a chance to do so and for good reason. There is no way (EVER) you would go back there.
Things do not a good Service Experience make!
People do make the Service Experience!

By Leonard Buchholz

“The Cheapest Oil Change In Town”

In every market and at every dealer there is the perception in Fixed Operations that cheap oil changes will add profit.

While it is true that cheap oil changes will bring Customers to your door, it is up to you to do something with them when they arrive.

Here are 3 Ways you can maximize the 1st Time or Long Time Customers  oil change visit.

  • Be “Over The Top” with your Customer Service. Be clean and neat, be accommodating, be prompt, be courteous and be Thankful. Think of the Customer as someone who is test driving your Dealership to see if they like the ride. Give them the best ride possible.
  • Do a Complete and Thorough Inspection of the vehicle. Instead of a “27 Point” how about a “Driveability Check” or a “Winter Safety Check” or a “Brake, Light and Fluid Check” in addition to your usual 27 Point Inspection. The object is to give the Customer something that they were not expecting when they came in for “just an oil change.”
  • Give them a Reason to Complete Service Work with You. Hey, you advertise, you plan for, you spend money and you lose money on the oil change and then…you don’t give your Customer a compelling reason to have service work completed at your Dealership? What are you thinking?

Making money in Fixed Operations is difficult when you don’t plan for the 1st time Oil Change Customer and your regular Oil Change Customer. It is impossible if you do not maximize the Customers visit.