Quantcast
Jump to content









Loaners Cars for Customers


Recommended Posts

I have been considering adding a few loaner cars to my business. We do have a shuttle service for our customers, but there are many times that customers need the use of a car when their car is in for repairs or major services. We also have an discount agreement with the local Enterprise Rental Agency. I would like to hear from other shops, the pros and cons and opionions of loaner cars.

 

Joe,

One thing you need to do is talk with your insurance agent. I asked mine about it and he told me if I charged a "rental" fee my insurance would be astronomical, but that was not what I wanted to do, as I don't think that is what you want to do either. I am a one man shop as you may know and I have one company owned loaner and one personally owned truck that is my back-up loaner. I find it to be a great incentive. Granted most customers who enjoy the use of it are regulars, but it sure frees me up from being under the gun to get their car fixed if I fall behind. Right now the car is out so I can have the customer's car to try and catch an intermittent no start that has plagued the car for a few months now.

 

With you size operation and the fact that you can afford (I am not insinuating you have lots of money, just you have personnel to do it) to shuttle customers around, I had to stop everything and leave, you may not need loaner cars. Only you can judge the demand within your customer base. I find that the rental car idea puts off a lot of people because the last customer I had use a rental told me it went from $60.00 a day to a final cost of $100 a day with insurance and taxes. I believe the loaner car is a great idea. I have days in a row when the car sits in the lot unused and I have other days when the car is returned and loaned out again within an hour. And I got a $1200.00 job because I had it available, the customer could not be without a car because of work so either he would have done only part of the repairs or put them off completely if he had to be without a car or get a rental.

I firmly believe that my company's loaner car is a valuable marketing asset. And I am on the lookout for another.

 

With that said there are a few things to consider about what you pick for a loaner car:


  •  
  • Who will you let use it? Over 25 only, over 21, or 18? My insurance covers anyone over 18 with a valid driver license. This has come in handy a couple times.
  • Where will you let it be used? Mine is only local, within 25 miles of the shop
  • Who will pay for the gas? I find if the customer takes it to work and back or only a few hours they do not want to fill the gas and as long as the needle is on “F” they don’t, so by the third loan the tank needs an extra couple gallons and the last customer is upset because they had to pay for extra gas. You will have to accept the expense of fuel used to some extent.
  • Be careful how nice a car you have. Of course you want a nice vehicle because it is a reflection of your business. Mine is a 2002 Mercury Sable GS. It’s very clean. I have had customers comment that they didn’t want to bring it back and pick up their car because they like mine better. Then I had one lady complain about numerous things, I think she’d complain if she was hung with a new rope.
  • How are you going to police the condition of the vehicle? It was recommended to me, but I’m a one man shop so it doesn’t apply, to either drive the car home myself or have a service writer drive it home periodically to make sure everything is OK. Don’t rely on a short test drive or inspection to find everything. You certainly don’t want to let your car go out with a customer if it isn’t in primo shape.
     

 

That's all I can think of for now but I check back too. I can fax or email you my loaner agreement if you wish, it is in Excel 2007 format.

Link to comment
Share on other sites

  • 1 year later...
  • 1 year later...

Transport to or set the customer with the rental car agent of choice. Let the customer pay for the car rental and you discount the amount you settle on off the repair invoice price. cool.gif

 

This is really the best way to do it. We offer a shuttle service within 3mi of the shop. For 98% of all customers this is enough. The other 1% use Uber, a smartphone-based taxi service that is HUGE in urban areas. The other 1% use rental car, which they pay for themselves.

 

The only time that we provide a vehicle for the customer is when a repair goes south, and it is our fault. In those rare cases, we offer to pay their Uber fares all over for the night (typically only $20) or get them a rental car for the night.

 

I highly recommend downloading the Uber app and taking a look at it. You can get a customer a LONG ways for $5 on this thing ...

  • Like 1
Link to comment
Share on other sites

 

This is really the best way to do it. We offer a shuttle service within 3mi of the shop. For 98% of all customers this is enough. The other 1% use Uber, a smartphone-based taxi service that is HUGE in urban areas. The other 1% use rental car, which they pay for themselves.

 

The only time that we provide a vehicle for the customer is when a repair goes south, and it is our fault. In those rare cases, we offer to pay their Uber fares all over for the night (typically only $20) or get them a rental car for the night.

 

I highly recommend downloading the Uber app and taking a look at it. You can get a customer a LONG ways for $5 on this thing ...

So I downloaded the app and just for kicks and giggles I put in a standard location that I could see needing a ride to. It was super seamless to use the app and get it set up but to my dismay it wanted to charge me almost $30 for one way. At that rate I could pay for the rental for one of my customers for a whole day without even a shop rate on the rental. Am I doing something wrong or where are these $5 fares??
Link to comment
Share on other sites

We used to have a fleet of 4 loaner cars but it was very time consuming keeping car clean and in good working order. We felt our company would be better served to let the rental cars companies handle all that expense and up keep. We have a very reasonable rate with several rental agencies and the peace of mine to the owner of the repair shop, knowing the car is clean, newer, full of gas and in good working order is worth it.

Link to comment
Share on other sites

I think that is the direction we are leaning too. What advantages and disadvantages have you found with the different companies? For instance hertz I know will bring the vehicle and return the vehicle to your shop where enterprise will just pick the customer up.

 

Also would like some ideas of how to deal with the pricing. Its only about $30 a day for the rentals but would like to figure something out so we don't have to eat that cost. And something smoother than just charging the customer...

Link to comment
Share on other sites

I think that is the direction we are leaning too. What advantages and disadvantages have you found with the different companies? For instance hertz I know will bring the vehicle and return the vehicle to your shop where enterprise will just pick the customer up.

 

Also would like some ideas of how to deal with the pricing. Its only about $30 a day for the rentals but would like to figure something out so we don't have to eat that cost. And something smoother than just charging the customer...

 

When I was in the Diesel engine business, we shipped many blocks, cranks, rods, heads, engine kits, and engines by motor freight. I employed a salesman to call on my customers....trucking, construction, refuse companies, etc. Mike, my salesman, told me that the customer would blow a fuse if we charged freight or shipped collect. So we shipped everything "Pre-Paid," and just added the freight cost to some of the line items for the job. That way we got paid for the shipping and everyone was happy. Most of the time we do the same thing to cover car rental expenses. One day at $30 is pretty easy. Change the labor from 2.0 to 2.3 on just one R & R and that will cover it. Another tip....instead of just saying " I will get you a rental car" I say "I will provide a Complimentary car from Enterprise!" That way they know up front they don't have to pay for it. Psychology being what it is, even if they have a $1488 work order, they do not want to pay for a rental car, too. So we make it easy for them.

 

I had a lady in this morning for an oil service and rotation on her 2001 Accord. The CEL was on. When scanned it showed a P0420 Cat code. I gave her the price and she wanted it done today. When I told her I could do it next week, because I couldn't work it in today, I could see the anxiety on her face. She was wondering how to get it done since she has a fifty minute commute. I then told her That she could come in at 5:30 Monday and I would provide the "Complimentary Rental Car," and that I could do the Cat and O2 sensors Tuesday and she could pick up her car that day. She was really happy about that, and asked me if we could do the timing belt/water pump job that we suggested a few weeks ago. Could we work it in? So I told her we could do it all along with a transmission service and power steering service. She was so happy to get a positive response that she told me she loved me (Valentine's day, right?) and thanked me for taking care of her. Obviously it will be a good ticket and she is prolonging the life of the car.

 

It took me a while to learn how to set things up like this one, but the more you try it and do it, the better you get at it!! And the more tickets you will write and the more customers you will satisfy!!

Link to comment
Share on other sites

We recently have added a total of 5 loaner vehicles in the last 4 months and will be adding another one this week, for a total of 6. Being in a rural community where some customer live up to 15 miles from the shop, we are getting great results and a lot of happy customers.

All customers must be a min of 25 years old. I also have a contract the customer must sign and show they have insurance on the vehicle we are working on. I spent countless hours researching what the verb age of the contract says so it is a legal binding contract ( not bad for a guy who barely graduated from High School, I got my law degree out of a beer can, :lol: ). The contract is the key because the one I came up with releases the shop of ALL liability and also makes the customer liable for any damage.

We clean and check all fluids weekly and document everything on a spread sheet. We fix cars for a living, so maintenance really is not a problem.

I took a good sized hit on my shop insurance policy because while the underwriter liked the contract, they still have to cover the rear ends.

The added income ,not to mention very happy customers, offsets the insurance costs 3 fold.

Smoking in the loaner vehicles was an issue for a while but that stopped once we put a sign in each of them stating there would be $150 cleaning fee for smoking in the vehicle. We also added a smoking clause to the contract.

We have had some alcohol being consumed in the loaner vehicles ( maybe some guy looking for his law degree in a beer can ? :D ) The contract also covers this.

All vehicles are 10 years or older, so if one was to be totaled ( which the customer would have to pay ALL costs ) its not a big loss

for the business.

Studies show the number 1 reason a customer brings their vehicle to your particular shop is convenience, not price, and also not reputation ( which is still number 1 with our crew).

It was a risk at first and the program is still going thru its initial testing period, but it is really starting to pan out. Feel free to send me a message for more info, I would be glad to help. :) Just like this GREAT website has helped me.

Thanks, Mike.

Link to comment
Share on other sites

We recently have added a total of 5 loaner vehicles in the last 4 months and will be adding another one this week, for a total of 6. Being in a rural community where some customer live up to 15 miles from the shop, we are getting great results and a lot of happy customers.

All customers must be a min of 25 years old. I also have a contract the customer must sign and show they have insurance on the vehicle we are working on. I spent countless hours researching what the verb age of the contract says so it is a legal binding contract ( not bad for a guy who barely graduated from High School, I got my law degree out of a beer can, ). The contract is the key because the one I came up with releases the shop of ALL liability and also makes the customer liable for any damage.

We clean and check all fluids weekly and document everything on a spread sheet. We fix cars for a living, so maintenance really is not a problem.

I took a good sized hit on my shop insurance policy because while the underwriter liked the contract, they still have to cover the rear ends.

The added income ,not to mention very happy customers, offsets the insurance costs 3 fold.

Smoking in the loaner vehicles was an issue for a while but that stopped once we put a sign in each of them stating there would be $150 cleaning fee for smoking in the vehicle. We also added a smoking clause to the contract.

We have had some alcohol being consumed in the loaner vehicles ( maybe some guy looking for his law degree in a beer can ? :D ) The contract also covers this.

All vehicles are 10 years or older, so if one was to be totaled ( which the customer would have to pay ALL costs ) its not a big loss

for the business.

Studies show the number 1 reason a customer brings their vehicle to your particular shop is convenience, not price, and also not reputation ( which is still number 1 with our crew).

It was a risk at first and the program is still going thru its initial testing period, but it is really starting to pan out. Feel free to send me a message for more info, I would be glad to help. :) Just like this GREAT website has helped me.

Thanks, Mike.

If you were to add all your fees up, including the hike in your business insurance, gas, time it takes your employees to clean them, registration costs how much would you say it probably costs you, per day, to loan the vehicles out??
Link to comment
Share on other sites

So I downloaded the app and just for kicks and giggles I put in a standard location that I could see needing a ride to. It was super seamless to use the app and get it set up but to my dismay it wanted to charge me almost $30 for one way. At that rate I could pay for the rental for one of my customers for a whole day without even a shop rate on the rental. Am I doing something wrong or where are these $5 fares??

Ouch! We are in a dense urban downtown (100k people in a 3mi radius of our shop). Most customers only need to go 1-2mi from our shop, which is typically only $5-6 on uber.

 

In rural areas, uber costs a lot more, and customers travel further. Double whammy.

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Have you checked out Joe's Latest Blog?

         3 comments
      Got your attention? Good. The truth is, there is no such thing as the perfect technician pay plan. There are countless ways to create any pay plan. I’ve heard all the claims and opinions, and to be honest, it’s getting a little frustrating. Claims that an hourly paid pay plan cannot motivate. That flat rate is the only way to truly get the most production from your technicians. And then there’s the hybrid performance-based pay plan that many claim is the best.
      At a recent industry event, a shop owner from the Midwest boasted about his flat-rate techs and insisted that this pay plan should be adopted by all shops across the country. When I informed him that in states like New York, you cannot pay flat-rate, he was shocked. “Then how do you motivate your techs” he asked me.
      I remember the day in 1986 when I hired the best technician who ever worked for me in my 41 years as an automotive shop owner. We’ll call him Hal. When Hal reviewed my pay plan for him, and the incentive bonus document, he stared at it for a minute, looked up, and said, “Joe, this looks good, but here’s what I want.” He then wrote on top of the document the weekly salary he wanted. It was a BIG number. He went on to say, “Joe, I need to take home a certain amount of money. I have a home, a wife, two kids, and my Harly Davidson. I will work hard and produce for you. I don’t need an incentive bonus to do my work.” And he did, for the next 30 years, until the day he retired.
      Everyone is entitled to their opinion. So, here’s mine. Money is a motivator, but not the only motivator, and not the best motivator either. We have all heard this scenario, “She quit ABC Auto Center, to get a job at XYZ Auto Repair, and she’s making less money now at XYZ!” We all know that people don’t leave companies, they leave the people they work for or work with.
      With all this said, I do believe that an incentive-based pay plan can work. However, I also believe that a technician must be paid a very good base wage that is commensurate with their ability, experience, and certifications. I also believe that in addition to money, there needs to be a great benefits package. But the icing on the cake in any pay plan is the culture, mission, and vision of the company, which takes strong leadership. And let’s not forget that motivation also comes from praise, recognition, respect, and when technicians know that their work matters.
      Rather than looking for that elusive perfect pay plan, sit down with your technician. Find out what motivates them. What their goals are. Why do they get out of bed in the morning? When you tie their goals with your goals, you will have one powerful pay plan.
  • Similar Topics

    • By Transmission Repair

      Premium Member Content 

      This content is hidden to guests, one of the benefits of a paid membership. Please login or register to view this content.

    • By Joe Marconi

      Premium Member Content 

      This content is hidden to guests, one of the benefits of a paid membership. Please login or register to view this content.

    • By carmcapriotto
      What if there's a fire in your shop? An oil spill? A natural disaster or God forbid, a death? How do you prepare for that? Well, This week, Hunt talks about preparing for the unexpected:
      Vision Expo: Hunt shares experiences and insights from attending the Vision Expo in Kansas City, emphasizing the importance of community and industry events. Importance of Preparedness: The significance of being ready for unforeseen incidents, such as theft or natural disasters, affecting auto repair shops. Insights from Roundtable Discussions and Classes: Valuable lessons from discussions and classes, including managing risks and implementing preventive measures. Understanding Insurance Coverages: The necessity of comprehending what business insurance covers, identifying coverage gaps, and making sure you have comprehensive protection. Preventive Measures Against Risks: Steps to minimize risks associated with fires, accidents, and other potential threats to auto repair shops. Contingency Planning: The need for having a solid contingency plan to tackle unexpected situations effectively. Financial Readiness and Strategic Planning: Emphasizes the role of financial preparedness and strategic planning in fostering long-term success and stability for auto repair shop owners.  
      Thanks to our partners, NAPA TRACS and Promotive
       
      Did you know that NAPA TRACS has onsite training plus six days a week support?
      It all starts when a local representative meets with you to learn about your business and how you run it.  After all, it's your shop, so it's your choice.
      Let us prove to you that Tracs is the single best shop management system in the business.  Find NAPA TRACS on the Web at NAPATRACS.com
      It’s time to hire a superstar for your business; what a grind you have in front of you. Great news, you don’t have to go it alone. Introducing Promotive, a full-service staffing solution for your shop. Promotive has over 40 years of recruiting and automotive experience. If you need qualified technicians and service advisors and want to offload the heavy lifting, visit www.gopromotive.com.
      Paar Melis and Associates – Accountants Specializing in Automotive Repair
      Visit us Online: www.paarmelis.com
      Email Hunt: [email protected]
      Get a copy of my Book: Download Here
      Aftermarket Radio Network
      Click to go to the Podcast on Remarkable Results Radio
    • By Joe Marconi

      Premium Member Content 

      This content is hidden to guests, one of the benefits of a paid membership. Please login or register to view this content.

    • By carmcapriotto
      This week, Hunt takes a deep dive into the hot-button issue of price increases within the auto repair sector. He offers a nuanced examination of vendor pricing, market dynamics, and the psychological elements of setting rates in your business. With examples from real-life scenarios, this episode is a treasure trove for auto repair shop owners striving for balance between profitability and customer loyalty in today’s volatile economic climate.
      • The Psychology of Pricing: Unpacking the reaction to vendor price increases and what it reveals about our own pricing strategies.
      • Market Dynamics: Exploring the balance between cost, value, and competition in the auto repair industry.
      • Strategic Decision-Making: How to navigate the complexities of pricing decisions to ensure business growth and sustainability.
      • Real-Life Examples: Actual examples from a shop owners' group debate to illustrate broader industry challenges.
      Thanks to our partners, NAPA TRACS and Promotive
      Did you know that NAPA TRACS has onsite training plus six days a week support?
      It all starts when a local representative meets with you to learn about your business and how you run it.  After all, it's your shop, so it's your choice.
      Let us prove to you that Tracs is the single best shop management system in the business.  Find NAPA TRACS on the Web at NAPATRACS.com
      It’s time to hire a superstar for your business; what a grind you have in front of you. Great news, you don’t have to go it alone. Introducing Promotive, a full-service staffing solution for your shop. Promotive has over 40 years of recruiting and automotive experience. If you need qualified technicians and service advisors and want to offload the heavy lifting, visit www.gopromotive.com.
      Paar Melis and Associates – Accountants Specializing in Automotive Repair
      Visit us Online: www.paarmelis.com
      Email Hunt: [email protected]
      Get a copy of my Book: Download Here
      Aftermarket Radio Network
      Click to go to the Podcast on Remarkable Results Radio


  • Our Sponsors










×
×
  • Create New...