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Maximizing Profitability in Your Dealership’s Service Drive

Sponsored by Naked Lime

There is plenty of maintenance and repair work your customers need done, and that means your service drive is full and your techs are busy. But for most, standing still isn’t an option, so what can you do to continue to grow?

You’ve done everything you can to decrease one line ROs.  You’ve seemingly maxed out the hours per RO you can get.  Your tech efficiency is through the roof.  What other levers are there?  

One to look at closely is your effective labor rate.  There may be an opportunity to bring it up by focusing on filling your shop with highly skilled repair work that warrants a higher rate.  Yes, it’s good to bring in maintenance work and try to upsell, but what about filling your shop with high-value customers from the start?  Here are some strategies to do just that.

Capture Demand

Consumers don’t casually shop for repair work—they look for services when something breaks or their check engine light comes on. They already need repairs when they start shopping, so you need to be there as an option.  

Additionally, claiming the most profitable business means not only showing up when customers are looking, but standing out from the competition as the place to go. Relevant search ads and a strong business profile on Google and through Apple Maps are the way to do this. 

Consider:

·       88% of consumers who search for a local business on their mobile device will call or visit that business within a day[i] 

·       75% of people say paid ads make it easier for them to find what they need[ii]

Making your dealership the obvious choice to customers when their dashboard lights up starts with your online presence, and having a balance of paid service ads across multiple platforms and a healthy organic ranking is going to maximize your reach to customers across all buying stages.

Be the Destination

Emergency vehicle repairs are not in the budget for most consumers, so when they’re needed, customers want to feel confident in their choice to come to you. They want their service work done right and they want it done quickly, and odds are they’re looking online to see if you can give them that kind of experience. 

Your online presence is the first thing potential customers are going to see about your service drive and the kind of business you run. You need to show them that you’re an expert destination. 

You can demonstrate your expertise by posting maintenance tips on social media, instructional videos on YouTube, or through informational pages on your website. Additionally, it is essential that your online reputation on customer review sites reflects the credibility, accuracy, and quality of the services you provide. 

Studies show that only 48% of online users would consider using a business with an average rating of under four stars, and this number drops to a mere 19% who would consider a business with less than three[iii]. With numbers like these, it’s important to recognize how closely linked your digital reputation is with your ability to acquire new business. 

Big repairs are the most profitable work you can find in your service drive, and your reputation can do a lot to show customers that you can be trusted with even the most extensive of projects. A great start to building a solid reputation is to have resources in place to monitor what is being said about your service drive online. Good or bad, make sure to respond to customers, showing them that their time and feedback is valued, and work to adapt as customer needs dictate. 

Be Proactive 

Its far more efficient to bring customers with declined services back in to your drive than it is to work from scratch—after all, these are vehicles that your service techs have already assessed and customers that your advisors have already worked with. 

Customers have a variety of reasons for declining a service, and budget, urgency, and impact all play a role. That said, declining a service doesn’t mean the customer never intends to complete the work—the key is to make sure that when they’re ready, they come back to you instead of taking their business to a franchise or independent auto shop. 

Consistently and automatically follow up with customers to bring them back in. Follow-ups are a chance for you to put your name back on the customer’s radar, and a personalized message is a great way to show that you’re the right place for their business.  You know the work needs completed, and so does the customer. Ask for the business again to bring in that extra bit of profit without the additional work of taking on a brand new customer.

In Today’s World You Have Three Options for Growth:

·       Expand your facility and hire more techs.

·       Increase efficiency so you can work with more customers each day.

·       Prioritize getting the most profitable work into your shop.

The first option is likely restricted by cost (and physical space), while the second is an ongoing process most dealerships have been working on for years. That means now is the time to focus on bringing the most profitable work into your service department right from the start. 

[i] Social Media Today

[ii] Clutch

[iii] Status Labs

Sponsored by Naked Lime

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