That combination of lower sales and thinner margins is definitely a recipe for bankruptcy. My first word of advice: stop. Stick to the basics, do what you know how to do, keep the customers informed on the condition of their automobiles, link the features and the benefits of the services and show them how to avoid their pain (poor fuel economy and car payments) and invest in maintenance.
The biggest key to becoming a successful service writer is consistency. The shops and the service advisors that have remained consistent are hitting record weeks, months and quarters. I see it all over the country. They are focused on building and maintaining relationships and building confidence and trust with their customers. They are using one of the biggest benefits to schedule maintenance and maintenance services to their advantage — increased or maintained fuel economy.
They are recommending services that increase fuel economy and teaching customers how keeping cars in proper running order will allow the car to last longer and get the 300,000 miles that they are built for. The ones who haven't done this have allowed this to smack them right in the face, using it as an excuse, and they may not survive. Only the strong will survive, and I have plenty of clients who are taking advantage of shops going out of business, getting customers and talented employees to add to their team.
My second word of advice: leadership. Pay attention to morale and your crew. It is easy for service writers and technicians to fall into that "negative trap." Again, they hear the customers complaining about the economy and their woes, but your people feel it, too. They have to buy gas and food, and they watch the news as well. It starts with the customers, then gets to the writers and then trickles to the technicians. Then all you have is a shop full of bad attitude.
Where does it end? With you, being the leader of the shop. First, get your head around the whole thing and what you are going to do to combat the high price of fuel and customers tightening up on their wallets. Then get your service writers the sales, information tools and training they may need to help get customers to see the value in buying maintenance and to continue to be there for them to keep them pumped up. Role-play with them, practice with them in specific training meetings. Never use or allow the word economy as an excuse. And make sure that they have a carrot to chase in the form of rewards for performance. Seagull management and weak leaders will not survive; your customers and your talented crew may eventually end up on someone else's team.
If you can't fix the low morale and bad attitude, you will go backward.
So how is a poorly maintained automobile inefficient? Any malfunction in one or more components in the fuel, ignition or emissions systems, especially in extreme temperatures, has a huge penalty in fuel efficiency. The penalty for just one misfiring spark plug is two to three miles per gallon. Any increased rolling resistance, whether it is underinflated tires, poor alignment, worn shocks and struts or any brake component causing the slightest drag, leads to as much as two miles per gallon.
Inadequate cooling system or thermostats lead to two miles per gallon. Any slipping or hesitant shifting from the transmission leads to one to two miles per gallon. Dirty oil and sludge buildup can lead to one mile per gallon. Dirty air filters, fuel injectors and induction system, and even restricted fuel filters lead to one to two miles per gallon.
What most overlook and not even think about — gas caps and an improperly functioning EVAP system — allow fuel to evaporate and have huge penalties in fuel efficiency. I read an article that said more than 147 million gallons of gas is wasted through loose or bad gas caps alone.
All of these combined into one vehicle can greatly exceed any increase in gas prices. Do the math. Even assuming that the fuel, ignition and emissions system and all CECS components are functioning properly, let's take one mile for improper tire inflation, one for dirty oil, one for a dirty fuel and induction system and two miles for a dirty air filter. That is a total of five miles per gallon. On a car that typically gets 30 miles per gallon, that is 17 percent loss of fuel economy. If that same five miles was in a car that gets 20 miles per gallon, that is a 25 percent loss of fuel economy. You can just imagine how bad that could be with some of the above items as well as a CECS system failure.
Do not forget to explain the features of the service, what it does and the benefits to customers for purchasing, and follow that up with the summary benefits to their buying personality. From the leadership side of things, you need to manage your managers, set the expectations and give performance-based feedback.
The math for the customer
We have talked about the six major factors that lead to poor fuel economy and lowering fuel efficiency. I used examples of 17 percent to 25 percent, and 20 and 30 miles per gallon. These numbers will vary for every single customer who comes in the door. Let's say the car needs an alignment and tire balance, oil change and fuel injection and induction service. Using the above numbers, that would be as much as four miles per gallon lost. Four miles per gallon in a car that gets 20 miles per gallon is a 20 percent loss.
At $4 a gallon times 20 gallons per week, it equals $80. That $80 times a 20 percent decrease in fuel economy equals $16. That $16 per week times 52 equals $832 in fuel savings annually.
If the customer spends $832 a year in routine maintenance, spending the money today to save in the long run is a good investment. As fuel prices get higher, they receive a much greater return on their money. Ask them to decide if they want to save the money today and keep burning it or invest in the maintenance and save over the long haul. By using this approach, you have a bigger chance of getting them to see the value in investing.
Chris "Chubby"Frederick is CEO and president of the Automotive Training Institute. He is thankful for assistance from George Zeeks, Brian Canning and Bryan Stasch in preparing this monthly column. Contact Chubby at [email protected].
