Is your team ‘selling’ service?
- $213 billion in parts and service sales are being lost to independents.
- 33% of dealerships capture service work - the rest goes down the street.
We all agree business in the front end over the last few years has been impressive with new car sales reaching over 17 million units. Dealers just like you have been successful driving sales by implementing various marketing and CRM solutions to capture and follow up with leads. But what about the back end?
According to NADA estimates, fixed operations is a $310 billion business. That dollar amount is only set to rise, since 80% of vehicles on the road are out of warranty and the average age of a vehicle is 11.5 years. However, with the frequency of service visits decreasing due to manufacturers extending new vehicle maintenance intervals, there is an increased focus on keeping current customers coming back.
Where are consumers spending that $310 billion – your dealership or the shop down the street?
Today, according to NADA, only about a third of that business is captured by dealers. Why? When I ask about their biggest priority, the usual response is “to sell more cars.” However, the biggest focus should be to sell service. I’m willing to bet, even on slow days in service, you have more gross profit opportunity than your best day in sales.
Think about it. That 69% (or two-thirds) the other guys down the street are getting is almost $213 billion in parts and service sales.
So ask yourself these questions:
- Why is the same CRM concept used in sales not used in service?
- How does your dealership track recommended services declined by the customer?
- How are those services followed up on?
- How many technician recommendations never make it to the advisor? I see this all the time—technicians see problems and under-trained or over-worked advisors don’t have the time or the skill set to sell additional services to the customer. They could be afraid of upsetting the customer or worried about getting other work done.
- Have you implemented a consistent service process?
If a dealership hasn’t implemented a consistent service CRM process, technicians and advisors are prone to leaving. Technicians want advisors to upsell their recommendations and advisors want the technology to do their job effectively. Worst of all, customers will leave to find a shop they trust.
If you haven’t already, consider a process shift with a CRM tool for service. Ensure inspections are completed 100% of the time on vehicles that come through your service department. With the adoption of this new process, advisors can track upsell opportunities and follow up on them every time.
Change in the retail sales environment is fast and formidable. The margins dealerships see in new car sales are slim and continue to shrink. Transparency…
Do you know the Dirty Dozen? Back in the summer of ‘67, when muscle cars roamed the streets and 8–track tapes were the hot way…
In part one of the mousetrap series, you learned why using a computer mouse can slow down the parts department. Now it’s time to learn a few…