| Fast and Convenient Oil Changes Yield Long-Term Customer Retention and Profits! |
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| Written by Steve LaPenta |
| Wednesday, 14 October 2009 13:45 |
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The shift in the economic climate along with fewer vehicle sales and non-franchised dealerships has created an immediate need to explore and uncover opportunities for additional revenue streams. Automobile dealerships that have historically relied on new car sales profits will now require a revised business model and roadmap to take aim at boosting additional gross profits from the service and parts departments in order to pay the monthly bills.
In order to accomplish this task, there are at least four essential elements that must be in place to drive a successful, efficient, and profitable service department:
1. The service department must be viewed (in the customers’ eyes) as a fast and convenient place to have their oil change and other highly visible maintenance items performed.
2. The service department requires a constant flow of vehicles in and out of the shop that require maintenance and repairs, enabling each department to sell available labor hours and parts.
3. A comprehensive vehicle inspection process must be performed on each vehicle that enters the service department.
4. Effective retail selling and pricing strategies must be in place.
I cannot emphasize enough that themost important maintenance item in our industry is the oil change service!
According to a most recent 2008 Fast Lube Operators Survey:
· Fast lube operators take an average of 14 minutes to change a customer’s oil.
· On average, 73% of fast lube business is from repeat customers.
Is your service department currently designed to meet or exceed the competitions level of service? Is your dealership oil change referral rating this good?
Here are some common customer remarks that I have heard, when I take the time to ask them about their oil changes experience with their selling dealership;
“I was told my oil change would take 45 minutes or one hour to complete”
“Thanks for recommending these services, but I don’t have enough time today”
“I need to make an appointment just for an oil change!
“When I arrived at the dealership it took 5-10 minutes for someone to help me”
“You guys did my last three oil changes and now you tell me that I need to spend $1200 dollars for additional repairs and maintenance”
“Why didn’t you inform of my vehicle needs the last time I was here for an oil change?”
“I called the service department and was told that it would be one to two days before I could schedule an oil change”
Fast and convenient oil change visit for the customer will create future visits while increasing visit penetration and/or frequency. Each oil change visit will keep building the customers trust and confidence within the dealership.
Some dealerships have attempted to address this by implementing a quick lube consisting of one tech per bay. This type of quick lube structure has limited success and only effective when customer arrival times are staggered every 30 minutes.
The moment oil change “waiters” start to stack up in the service drive, customer wait times become extended and the quick lube technician enters a crisis mode and is only worried about completing only the oil change. Therefore, any required maintenance and repairs are overlooked that otherwise could have been up sold and routed over to the main shop technicians as to increase shop hours sold.
Before I get ahead of myself and start to discuss profit-building solutions, the first step is to identify if there is an opportunity to improve your oil change service at your dealership.
I recommend to the dealership management team is to go on a fact-finding mission and start asking each customer this very important question after they finish the cashiering transaction.
"Based on your oil change experience today, on a scale of 0-10, how likely are you to recommend us to a colleague or friend?"
I recommend using a “Net Promoter Score” Survey to ask your customer to rate their visit.
The “Net promoter Score” method is easy to use:
1. Ask your customers a single question: "Based on your oil change experience today, on a scale of 0-10, how likely are you to recommend us to a colleague or friend?"
2. Count the number of 0-6 answers. These are your detractors.
3. Count the number of 7-8 answers. These are your passives.
4. Count the number of 9-10 answers. These are your promoters.
5. Calculate the percentage of promoters and detractors.
6. Subtract your detractors from your promoters to get your “Net Promoter Score.”
This information is powerful and useful when it comes from asking people if they will recommend your service department as a fast and convenience place to do business. In other words, how likely is the customer to bet some of her own reputation in order to promote you and your dealership?
Please send me over an email if you need a copy of the Net Promoter Score.
Steve LaPenta is president of Dealer Automated Systems, an industry expert with providing and implementing retail service and parts business growth solutions for automobile dealerships and independent franchise. He can be reached at 561-714-5071 or email
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