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Advance Auto Parts Strategy of FREE undermines auto repair shops

Joe Marconi

By Joe Marconi
in Automotive Parts & Suppliers

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mspecperformance Mentor

mspecperformance

Posted
Posted

 

I got a call the other day from a shop owner who happens to own a repair shop in the town I live in. He told me that a new Advance Auto Parts store has opened up down the road and they want him to buy from them. I asked him how he felt about buying from Advance Auto Parts. He told me that he really has an issue due to all the signage in front of the store: Free Wiper Blade installation, Free Battery Testing, Free Battery Installation, Free Alternator Testing and Free Starter Testing. There’s even a sign that says, Loaner Tool Sets Available!

I don’t know how you feel, but as a shop owner I cannot align myself with a company that devalues the work we do. It’s hard enough to generate a profit these days, but to compete with the same business that wants me to buy from them? That’s insane.

Advance Auto Parts claims that they target the DIY, not my customers. But the truth is, everyone sees and hears their advertising. So my customers here the “Free message” over and over. And, let’s not kid ourselves: If Advance Auto Parts can convert a few motorist to try to do auto repairs themselves; that would be just fine for Advance Auto Parts. All at the expense of the auto repair shops.

The bottom line here is truly the Bottom Line. Advance Auto Parts has to answer to Wall Street and its investors. I have to answer to one person…myself. And I will not compromise my beliefs for anyone or any company.

So Advance Auto Parts and Tech Net, say goodbye to someone that has been a life-long friend.

 

 

 

What I don't think shop owners take seriously enough is how much psychology plays a role in our business life especially in the customer's mind. A customer that would never ever ever ever step foot into an Advanced Auto for any type of FREE work is still bombarded with the idea that testing starters and alternators has no value along with whatever else they give away for free. I would even go as far as to say you look like a complete hypocrite in front of your customers at times. Lets look at this example... You have a customer that comes in that has a charging system problem. You offer to check his charging system for $29.99 (or whatever you charge). He looks perplexed and says Advanced does it for free as per the signage he sees and the marketing they blast everywhere. You do your very best to not throw Advanced under the bus by saying they are amateurs but lets be honest, that's exactly what you want to say and something along with your pitch will sound like that. Customer agrees to do the test and then after agrees to do the job of an alternator replacement with you. At some point a nice delivery car pulls up with Advanced Auto all over it and a gentleman steps out and is wearing a Advanced Auto uniform delivers Advanced Auto branded parts. What do you think is going through the mind of the customer?

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mspecperformance Mentor

mspecperformance

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If providing a nationwide warranty is your concern then there are a lot of options and a lot of banner programs that you can buy into. I forget who bosch uses however you can buy into the program for a few dollars a month to offer a 12/12, 24/24 or 36/36. Otherwise as I understand it there is very little on going monthly commitment to be apart of a banner program to get some of the perks. I guess it depends on the banner program but the point is there are options.

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HarrytheCarGeek Experienced

HarrytheCarGeek

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Ok..so we have kcked Avance down the road..nowwhat. Do you align yourself with another banner program? Do you offer the warranty and hope your customer dont break down 3000 miles from home and you are at the mercy of the shop they were towed to? Do we just not offer any warranty at all and hope for the best? I hear ya but I dont hear any solutions. Like I said..I cant afford the NAPA banner and the Federated Banner knda sux. There is an Auto Value distributor here in town but the last I looked they sucked also. ??????????????????????????????????????????????????????????????????????????????????????????

 

Realistically how many of your customer's travel out of state with their cars?

 

I have a few that travel to Florida from New Jersey, their cars are well care for, and I use the AC Delco plan, I also subscribe to the Federated program, but realistically none of my customer expect me be responsible for their car down in Florida if they breakdown over there. Although they do expect me to be honest with them and let them know the condition of their vehicle if they were to embark on such a trip.

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tyrguy Collaborator

tyrguy

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Realistically how many of your customer's travel out of state with their cars?

 

I have a few that travel to Florida from New Jersey, their cars are well care for, and I use the AC Delco plan, I also subscribe to the Federated program, but realistically none of my customer expect me be responsible for their car down in Florida if they breakdown over there. Although they do expect me to be honest with them and let them know the condition of their vehicle if they were to embark on such a trip.

I disagree. If we put a water pump on a car and they travel to Florida a short time later and it starts leaking, I would fully expect to be held responsible whether it was my fault or not.

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tyrguy Collaborator

tyrguy

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Posted (edited)

Okay, I misunderstood what you said. i thought you were saying that they didn't expect you to be responsible in any way. I'm assuming you meant that they don't expect you personally to go down to Florida and fix it, but they do expect you to get it handled thru these programs. So in essence, they do expect you to be responsible.

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HarrytheCarGeek Experienced

HarrytheCarGeek

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Posted (edited)

Okay, I misunderstood what you said. i thought you were saying that they didn't expect you to be responsible in any way. I'm assuming you meant that they don't expect you personally to go down to Florida and fix it, but they do expect you to get it handled thru these programs. So in essence, they do expect you to be responsible.

 

Look, in the business we are in, we do business with all kinds of people from the scum bags to very honorable people. I take pride in my work and my people to do the best job as the professionals that they are, if we made a mistake on a job we take responsibility for our actions. The problem present itself when you have opportunists and people of low moral values, they are just waiting for the opportunity to fleece you, what then? Are you going to allow yourself to be victimized? Do you have the ability to stand up for yourself and not be taken advantage of? Do you know enough to handle your lawyer and not be victimized my legal fees? I didn't until I took the Jurisdictionary course, best $250 I ever spent. (Full disclosure they give you a referral fee.)

 

Anyways, My point is that we are in business to make a profit, and part of that profit making endeavor is the responsibility of hedging risk. You can have the best customer service and use the best parts in the world, but if if you are not charging enough to stay in business and to handle a warranty claim you would soon be out of business. Knowing that is part of being a savvy business man.

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Elon Block Community Regular

Elon Block

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I can definitely understand your frustration.

The issue is: Manufacturers are struggling to be profitable.

They don't care what they have to do to be profitable. If they have to sell it retail.
If they have to sell wholesale, it doesn't matter.

Tire manufacturers, AC Delco... the list is endless... are all selling Direct to the consumer.

In this case, parts stores also have to do what they must do, to be profitable, to stay in business.

So, they either have to have dozens of repair shops, like yours, that buy all their parts from them.

Or they have to sell to the public.

It can be frustrating when parts stores are advertising they can do all that stuff for free but
the question becomes who's going to replace the parts.

For example, even if the parts store replaces a battery, they're not going to do it correctly,
so now a warning light is on or the clock isn't working properly.

So, the customer still needs an expert, like you to take care of the issue, which gives you an opportunity
to gain a new loyal customer that will come to you next time they need service of any kind.

One of my clients has an Advance right next to him and was worried about the same thing.

What he did was build a relationship with the manager and now, that manager sends
all the customers that need services right over to him.

He bumped his sales by 5% just by doing that.

By the way, here are some interesting statistics about the DIY trends:
http://campaign.r20.constantcontact.com/render?m=1101171307072&ca=32e8a809-81a2-4fea-aad3-30cdfb857ae8

Everything is about turning challenges into opportunities.

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mspecperformance Mentor

mspecperformance

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I can definitely understand your frustration.

 

The issue is: Manufacturers are struggling to be profitable.

 

They don't care what they have to do to be profitable. If they have to sell it retail.

If they have to sell wholesale, it doesn't matter.

 

Tire manufacturers, AC Delco... the list is endless... are all selling Direct to the consumer.

 

In this case, parts stores also have to do what they must do, to be profitable, to stay in business.

 

So, they either have to have dozens of repair shops, like yours, that buy all their parts from them.

 

Or they have to sell to the public.

 

It can be frustrating when parts stores are advertising they can do all that stuff for free but

the question becomes who's going to replace the parts.

 

For example, even if the parts store replaces a battery, they're not going to do it correctly,

so now a warning light is on or the clock isn't working properly.

 

So, the customer still needs an expert, like you to take care of the issue, which gives you an opportunity

to gain a new loyal customer that will come to you next time they need service of any kind.

 

One of my clients has an Advance right next to him and was worried about the same thing.

 

What he did was build a relationship with the manager and now, that manager sends

all the customers that need services right over to him.

 

He bumped his sales by 5% just by doing that.

 

By the way, here are some interesting statistics about the DIY trends:

http://campaign.r20.constantcontact.com/render?m=1101171307072&ca=32e8a809-81a2-4fea-aad3-30cdfb857ae8

 

Everything is about turning challenges into opportunities.

 

 

We have all dealt with a person coming from an advanced or autozone with a problem that you had to fix. I think it is very 1 dimensional to think now you have turned that person into an educated customer or for better words, a customer on your side. Taking your example, you can also say now you have given that customer the idea that he can still go get his own parts and attempt to do things himself or have another inept person work on his car and you are going to clean up the mess. I have had this happen both ways where we have turned people into returning customers (rare) or they think its ok to call us to fix their mess (wrong). I'll even go as far as to say we are expecting people to be rational and learn from these types of experiences that you get what you pay for. I can cite numerous examples where that is a complete fallacy. A large majority of people will continue to put a square into a round hole.

 

Part of the reason why we don't have too many returning customers is we do cater to a slightly different demographic. Our target customer is someone who really would never step foot into an advanced to borrow tools or get free services. It does not however mean they are not influenced by the marketing and advertising of FREE FREE FREE that Advanced and the like are putting out there. The psychological influence of big box store marketing affects us all.

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mspecperformance Mentor

mspecperformance

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Harry, being in Florida I do a lot of work for people travelling. Years ago I had an older lady come in for an est for A/C repair. I explained my warranty (at that time) was in house. She declined the work and went to one of the national retailers. After discussing it with several of my "snowbird" friends I felt it would be in my best interst to offer a nayionwide warranty of some sort. I was with Federated for 2 years. Great program if the customer is broken down more than 25 miles from the shop. What was distressing was the fact that if it was towed back here I DIDNT GET PAID LIKE THE GUY 25 MILES AWAY. The local store that was my federated partner didnt pay shinola. After an estimated loss of over 2G in labor over the course of the 2 years I switched to Tech Net. better coverage and I GET PAID. I have looked at several other programs and none seemd to be a good fit. NAPA required you to stock parts..why..when my Napa store is 3 blocks away and so poorly stocked they dont have parts for their own delivery vehicles. The local store that represents Auto Value is staffed with the most inept countermen I ever had to work with. No one locally offers Bosch.

The bigger question here is HOW DID AMERICA GET TO THE FREE MIND SET? Ya gotta know nothing is FREE. I feel we need to do more to advance our PROFFESIONALISM. Again I would say we need some form of PROFESSIONAL RECOGNITION that is promoted in some form nationally. We need to stand up to the states and municipalities that expect us to pay fees and follow regulations when they wont police the shops that dont. We need the same recognition (and pay) that an electrician, plumber even doctors get. What sets these trades apart? Apprentice programs, state testing of their skills..regulation and policing of those trades. UNTIL WEARE RECOGNIZED AS THE PROFFESIONALS WE ARE THE FREE SHIT WILL KEEP COMING. The wiper blades and batteries are only secondary to the bigger problem.

 

Jeff,

 

 

I could see where that is a concern of yours where you aren't getting paid on a claim while other shops will. I am not sure of what the costs of the program are but being the devil's advocate so to speak, I am going to assume that the costs go into a program that allows you to offer a nationwide warranty outside of your shop which you could not do otherwise. If a parts supplier is going to give you warranty dollars, they should be doing so with or without you participating in paid into warranty program and rather off the merit of your parts purchasing relationship.

 

In this case I would most certainly go with the best parts supplier first and foremost and weigh them based upon what they are doing for your business. I certainly would rather have a parts supplier that does not compete with my business or have a negative influence on it than to just save myself a few dollars on warranty claims. I try and look at the ROI beyond just clear cut dollars and cents.

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Elon Block Community Regular

Elon Block

Posted
Posted

Mspec,

I agree with you about not wanting to attract the die-hard
DIYer or even the person that's looking for anything for free.

Here's the opportunity I was referring to.

The shops I work with are excited when a customer comes in
with a piece of paper that has a code printout from a parts
store - or even from one of the many independent shop owners

that's advertising free code reads.

Why? Because they have a proven, predictable method of
educating the customer on what that piece of paper really
represents and what has to happen next.

This allows the shop to do the following:

1) Get paid to run diagnostics.

[by the way, once the shop owner sees how easily this
works... they STOP giving any money away, including they
stop rolling the diagnostic fee up into the job. There's
no reason to give anything away for free, because you're a
professional.]

2) They have an opportunity to educate one more customer,
in their community on why they are the best option to
take care of all of their automotive needs.

3) Therefore, they add one more customer to their KPI
line that is titled: "Number of Loyal Customers".

And this is how the shop owner I was referring to increased
his monthly diagnostics fees by an average of $2,000 a month
for the last 6 months.

This doesn't count work that came out of doing the repairs
or anything else those vehicles needed, such as brakes, etc.

This is how you turn challenges into opportunities, which
equals a packed schedule. It equals full bays and money
in the bank.

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TheTrustedMechanic Community Regular

TheTrustedMechanic

Posted
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There have been a lot of changes at my store as well. Mostly new counter people that tend to slow thing down. My last discussion with the store manager was they werent doing all the free crap.May have to have that meeting again. The biggest reason I went with Advance/Car Quest was the Tech Net program. Didnt have the restrictions and stocking requirements of a NAPA and the Federated program didnt cover labor. Not much else to choose from around here.

I am a small one man shop. I am a NAPA AutoCare Center. I am the first referral to any Peace of Mind customer in my area and have even been contacted to handle other nationwide warranties the adminstrator handles. I don't remember what the stocking levels required are, but I think I met the requirements with oil and filters and I don't stock a ton of either. Break down what parts you do stock, hydraulic lines, fittings, fluids, chemicals, electrical terminals, etc. and see if your local store will work with you to help you see if you can meet the stocking requirement. After you do your inventory and match it up with NAPA, I think you will be surprised at just how much you do have as "In stock."

 

Not all of NAPA is great. Certain programs are nothing but increase their sales NOT yours. Some are great customer service opportunities and others are huge competitive advantages. All in all, it's a great program. The annual fee is more than offset by the quarterly volume rebate. There's a lot of positives and a whole lot more that I don't take advantage of. But it takes a servicing store that sees you as a partner, not merely a customer or an inconvenience.

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  • Have you checked out Joe's Latest Blog?

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      Want to End Your Technician Shortage? Focus on Retention!
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      I recently spoke with a friend of mine who owns a large general repair shop in the Midwest. His father founded the business in 1975. He was telling me that although he’s busy, he’s also very frustrated. When I probed him more about his frustrations, he said that it’s hard to find qualified technicians. My friend employs four technicians and is looking to hire two more. I then asked him, “How long does a technician last working for you.” He looked puzzled and replied, “I never really thought about that, but I can tell that except for one tech, most technicians don’t last working for me longer than a few years.”
      Judging from personal experience as a shop owner and from what I know about the auto repair industry, I can tell you that other than a few exceptions, the turnover rate for technicians in our industry is too high. This makes me think, do we have a technician shortage or a retention problem? Have we done the best we can over the decades to provide great pay plans, benefits packages, great work environments, and the right culture to ensure that the techs we have stay with us?
      Finding and hiring qualified automotive technicians is not a new phenomenon. This problem has been around for as long as I can remember. While we do need to attract people to our industry and provide the necessary training and mentorship, we also need to focus on retention. Having a revolving door and needing to hire techs every few years or so costs your company money. Big money! And that revolving door may be a sign of an even bigger issue: poor leadership, and poor employee management skills.
      Here’s one more thing to consider, for the most part, technicians don’t leave one job to start a new career, they leave one shop as a technician to become a technician at another shop. The reasons why they leave can be debated, but there is one fact that we cannot deny, people don’t quit the company they work for, they usually leave because of the boss or manager they work for.
      Put yourselves in the shoes of your employees. Do you have a workplace that communicates, “We appreciate you and want you to stay!”

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