What would you think is the number one issue used car managers complain about?
Ok, you got that right, the Service Department.
Let’s be more specific. Do you think they complain the most about the pricing they receive or the time it takes to get a car done?
I’d say in many ways the market has become “equalized.” What I mean by that is a large percentage of dealers are now using a pricing tool to manage their inventory. They know that if they price the cars “right” that the customers show up.
Not too many years ago only a small number of dealers used a “pricing tool”, thus they had the advantage. There is still an advantage to using it, especially if you do it right, but to continue to dominate your market there are some other elements you have to get an edge on.
I’m fascinated when I’m talking to dealers and managers about their challenges that in most cases whatever the issues they are struggling with are “fixable.” Someone, usually the dealer, just needs to want to “fix it.”
I doubt that there can be any disagreement that “speed” is critical in today’s market. We all understand we cannot let a car sit and that getting it on line and online as fast as possible is extremely important.
The why don’t we just go ahead and fix the speed issue in the service department? Is it because we’ve always done it that way and we don’t want to rock the boat?
Let me say this as nicely as I can. In today’s Internet-oriented, fast-paced world, if you don’t rock the boat, the boat will soon sink. You cannot and will not survive this business if you don’t speed your processes up.
Used Car flow in a typical Dealership:
2 days sitting before getting ticket written.
1 day before it goes into shop.
2 days in the shop.
2 days in and out of clean up.
2 days before the photos are taken and posted online.
You may be better or worse than this, but on average it takes most dealerships 7 to 10 days to get a car ready and out into the market. The reality is 99% of the dealerships don’t really know how long it takes. It’s a guess at best.
The number one excuse that we get from the shop is that they are too backed up and customers come first. I understand that. I really do. When you’ve got retail customers screaming at you, then of course it’s easy to set your best customer, the used car department, to the side. Doesn’t make it right, but I get it.
What other options do you have if the shop is truly backed up and you have 10 used cars you need to get done for a big sale this weekend? Let’s pretend it’s Wednesday and there is no way the shop is going to get it done.
Maybe that’s when dealer needs to step up and make some big boy/big girl decisions. Here are two options:
1. Pay the technicians extra, lots of extra, to stay late and finish them up. The dealer has to make this happen because the service manager won’t do it. The reason they won’t do it is the training we have given them over the years. We’ve taught them to manage “the numbers.” They have been well schooled in controlling their cost of sale/labor. They have been taught they need to retain in excess of 70% of the sales number, so if they paid people extra to get your cars ready it would kill their numbers and they would be “bad managers.”
I’m just wondering whether the technicians would be willing to stay if you paid them double time. How about $100 bonus per car that they get out of the shop completed that night? Do those numbers scare you? So let’s do some math. If you had 10 cars to get out that cost you an extra $1000. What does it cost you if those same 10 cars don’t get on line this weekend? Hmmm…
2. Let’s say that’s a real bad idea. Why would you not sublet those cars out to a jobber? Oh, that’s right, I forgot. We want to keep all the revenue in house that we can and it’s against our policy to send cars out. One of the reasons a dealer gets to be the dealer is he makes the policy and he gets to break the policy. (or she, please….)
Of course we don’t want to lose the revenue and it’s not a good thing when you don’t have total control of the quality of the work, but sometimes you have to make an executive decision if you’re going to keep things moving. For me it’s far more important to get those 10 cars ready for sale this weekend than it is to sit on antiquated “company policy.”
Hey “Super Hero,” I didn’t say you allow just anyone to make these decisions. It’s the dealer or maybe the General Manager, but sometimes you have to do what you have to do to make things happen.
See, I started this article out saying that in most cases whatever the problem is in your store is fixable. You just have to want to “fix it.” Getting inventory on line fast is a very fixable issue. Speed is critical.
Realize that most dealers won’t “fix it.” They will find hundreds of reasons why they can’t or won’t “do it.” So, to get “the edge” all you have to do is be the exception to the rule. Making speed a priority will get you the edge.
Using vAuto software gives you an edge when you’re pricing your inventory. Your “decisions” give you an edge when it comes to getting your inventory ready for sale. That’s all I’m gonna say. Tommy