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You're 100% correct Joe! Somebody is doing their oil changes... and in a lot of cases, it's not who you (most shop owners) think. 

Most shop owners I speak with think they "own" the customers; They're "my customers". Truth is - you don't own them and there's a bunch of people trying to get their business. 

Above that, when you think about it, the bland old oil change is the ONLY service most car owners know they need. They don't wake up thinking about a brake job or timing belt - not even an alignment. With that said, the next issue shop owners have to remember is that no matter how good a tech you are (or think you are) or how much better you are than the other guy... you can't fix the car driving down the road. 

You've got to get the customer to stop in and get service. Then, you better be prepared to take the time to check the car - and offer the services required. I could go on and on about that - but for the purpose of responding to the oil change issue, I think most shop owners just ignore it. After all... where else would "my customers" take their car, right? 

Ha! If you don't think YOUR CUSTOMERS are shopping - then it's time to think again. 

I often ask shop owners if they shop at stores like Walmart, Costco or Target. In most cases they respond "yes, sure I do".

Okay, couldn't you get just about everything you really need from any ONE of those? Really. I'm not talking about specific brands that you may prefer, but overall, they all sell the same thing. 

So you shop too! If you didn't, you would only shop at one. 

Focus on getting the oil change service - and when the car in in your shop - do the inspection that's needed and make the offers. It's the only way to succeed in today's market. 

Hope this helps!

Matthew Lee
"The Car Count Fixer"

Get my book FREE
Fix Your Car Count in 17 Minutes... Guaranteed!

 

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  • 2 weeks later...

We just surveyed April's repair orders, and found we do an oil change on 67.7% of our RO's. That seems about right for the way I market my business. 

I have the cheapest full synthetic oil change around, and market the crap out of it. I do a full synthetic oil change cheaper than Jiffy Lube will do a regular oil change, then I discount it further with a coupon. I do full synthetic so cheap, I don't even offer dino oil any more. I hear all the time that only cheapskates will come to my shop with that sort of marketing, and will bleed me dry. If that's so, how do I have a $513 ARO at 60% GP? 

Our customers (and yours too) see an oil change as a commodity. As far as they know, an oil change is an oil change. It's a lot like gasoline to them. Sure, there are some people who will only put a specific name brand gasoline in their car, but that's not most people. If two gas stations sat side by side, and one had gas priced at 25% more, which one would do a better business? Which gas station would sell more Coke and Potato chips?

Be the service center that sells the commodity for less than the guys down the street, sell more Coke and Potato Chips (and brake jobs) as a result.

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3 hours ago, Dan Reichow said:

How cheap is cheap

$47.50 regular price, but most people show up with the $29.95 mailer coupon. If not the mailer, they at least will want the $34.95 coupon from my web site. I rarely sell the oil change at full price.

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I'll have to look at my oil cost tomorrow, but I do know that it's only 53 cents a quart more than the blend I was buying. That makes the synthetic oil change cost about $2.50 more than the blend oil change was, and I raised the coupon price by ten bucks. I make more money on the coupon oil change, and it's a smoking deal for the customer.

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10 hours ago, AndersonAuto said:

I'll have to look at my oil cost tomorrow, but I do know that it's only 53 cents a quart more than the blend I was buying. That makes the synthetic oil change cost about $2.50 more than the blend oil change was, and I raised the coupon price by ten bucks. I make more money on the coupon oil change, and it's a smoking deal for the customer.

Straight costs (parts and direct labor only) are $19.40 assuming my lube dude is doing the oil change. GP is then 35% if they're using the coupon with the cheapest price. But GP on the LOF isn't the point. The point is getting the car in to do the inspection and talk about what the car needs besides the oil change.

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16 minutes ago, AndersonAuto said:

Straight costs (parts and direct labor only) are $19.40 assuming my lube dude is doing the oil change. GP is then 35% if they're using the coupon with the cheapest price. But GP on the LOF isn't the point. The point is getting the car in to do the inspection and talk about what the car needs besides the oil change.

IDK, that seem very low to me. How much are you paying your lube tech, and what is his average hourly production. Not being an ass, but your number seems too low for my area and the ongoing costs to do business here.

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Oil costs 2.58 a quart. 5 quarts is $12.90. Filters average a couple bucks. Lube dude costs $15 an hour. Figure .3 to do the oil change, that's $4.50.  12.90+2+4.50=19.40  

The lube dude's hourly production is good, but he's new so I don't have great tracking on him yet.

Again, I don't really care if I make a dime on oil changes. I'd do them for free if I had to. Making money on oil changes is not the point of the oil change.

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3 hours ago, AndersonAuto said:

Oil costs 2.58 a quart. 5 quarts is $12.90. Filters average a couple bucks. Lube dude costs $15 an hour. Figure .3 to do the oil change, that's $4.50.  12.90+2+4.50=19.40  

The lube dude's hourly production is good, but he's new so I don't have great tracking on him yet.

Again, I don't really care if I make a dime on oil changes. I'd do them for free if I had to. Making money on oil changes is not the point of the oil change.

Let's agree to disagree. The game is truly simple, if all you did were oil changes at your current practices, how long could you stay in business? I have no more to say.

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On 6/2/2017 at 3:50 PM, HarrytheCarGeek said:

Let's agree to disagree. The game is truly simple, if all you did were oil changes at your current practices, how long could you stay in business? I have no more to say.

If all I did were oil changes, I'd be in the oil change business. I'm not.

The game truly is simple. Get the customer in the door by just about any means possible, do a quality inspection, and present them with the findings. You can't do that if you aren't getting the car in the door, and the easiest way to get the car in the door is by enticing them with a great deal on the most basic of maintenance needs. 
 

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So, for those of you not using cheap oil changes, how do you get new customers?  Are you on busy streets?  Do you have strong SEO?  What other options are out there for systematically growing your auto repair business?  Just from a pure numbers perspective it seems like AndersonAuto is making the cheap oil changes work.

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So, the root of my question relates to a system for gathering new customers.  Starbucks has one advantage we don't: addictive caffeine.  You either have a system that you know about, have a system you don't know about or you don't have a system.  So back to my question, what other systems are out there that are effective?  I suspect that being on a very busy street could qualify for this but I'm on the back side of town, so drive by traffic hasn't really worked for me.

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2 hours ago, jfuhrmad said:

 Starbucks has one advantage we don't: addictive caffeine.

But that's not what gets the customer thru the front door the first time or what gets them to try coffee in the first place.

Discounting IMO is a fairly unimaginative way to attract new customers. It is easy, it is effective but comes with baggage that I dont wish to deal with. That being said, I would ask the following:

What are your shops unique competitive advantages?

If you were in Anderson's market, what would you claim to do or do that would make you a better choice? ( I pick on Anderson because he states cheap oil changes is the way to bring in new customers)

If It were me, a first class web site with customer reviews is a must. People need to look you up and "see" you online. What they see online needs to directly correlate with what they get in person.

For me, we have all ASE certified Master Technicians, we use factory scan tools and factory information systems to service your car. We are the experts who can fix what others cant. We have a fleet of 26 loaner cars we freely offer for any type of service. We back all of that up with a nationwide 36 month 36,000 mile warranty. We have a sparkling clean waiting room for your convenience (if waiting). We take care of factory warranty and recalls for our customers. We do whatever we can to make it convenient to do business with us.

Now, how to get the message out? Website #1. Optimize it and set up a pay per click campaign but dont compete for the common searches (oil change, alignment and tires come to mind). Join the local chamber and get out there and kiss babies and shake hands. Get involved in community events, donate time and effort, it will get the best results. Direct mail is quickly loosing it's effect here in the city but I would try it in the smaller markets. In everything you do talk about quality, convenience and expertise. In all polls those are the things that matter to people. When you make price the most compelling thing it becomes the most important which tends to commodify what we do. (oil changes). We wash every car we service, makes people feel good about their car.

Put all the focus on what you do well, better than anyone else (then do it!)

Hope this at least gives you somewhere to start.

 

 

 

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I felt compelled to "chime in" on this topic again because of where the discussion is going. It seems to me that in a lot of ways, shop owners "miss the point". 

What's the point? The point is that no matter how good you are - how honest a shop you run - or how much you've spent on tools, equipment and scanners - you still can NOT do anything to a car unless it's in your shop. 

This was actually stated above by Anderson Automotive when he said... "The game truly is simple. Get the customer in the door by just about any means possible, do a quality inspection, and present them with the findings. "

BINGO! Get the customer in. 

Now, understanding that people (that means YOU too) only buy what you want or know you need - there is no other automotive service that car owners know they need besides an oil change. You don't need to promote discounts and deals on alignments, timing belts or anything else. People just don't know they need that - or at least they don't wake up in the morning thinking... "I wonder where I can get a new timing belt?".

In short, the only service they know they need is a simple oil change. You still can't do that unless they're in your shop

The other part that I feel is being overlooked stems from the TITLE of this thread:

Who’s doing the oil change on YOUR customer’s car?

Question. Who says they're YOUR customer? Do you OWN that customer? I don't think so. 

Let me explain it (and prove that YOU do the same) as most of your "so called" customers. 

Do you shop at Walmart? Target? Costco? Think about it. Without being specific about brands or preferences you may have - couldn't you get EVERYTHING from any one of those stores?? Really... think about it. They all carry pretty much the same stuff. They all have pretty much the same price. So why do YOU shop at two or three of them?? 

I don't need the answer - but the point is that the people you THINK are YOUR CUSTOMERS do the same thing. 

So how do you fix that?

Well, sorry, but I've got to ask you another question. 

When was the last time you followed up with customers? (Notice I said customers, not YOUR customers, right?)

But really, when was the last time you did something to contact them - without sending them some stupid postcard that screams "BUY SOMETHING".

I am guessing you haven't.

How about doing these

1) Send THANK YOU cards - real printed thank you cards - WITHOUT including any offers. There's a way to include them, but you've got to do it the right way. 

2) Pick up the phone and follow up - yes, a short call to say "thank you" and "How did we do?"

3) Customer correspondence like a real, printed, sent-by-mail newsletter. 

You know that statistics prove that over 56% of customers LEAVE YOUR SHOP FOR ANOTHER SHOP because they think you don't care! Do you? Or do you just sit around and HOPE that they know you care?

Look, the fact is that the selling starts AFTER you sell the customer. You follow up, thank them, call them and be sure everything is okay, send ongoing "reminders" like Newsletters, Text them oil change reminders (remember, you can't service the car as it rolls by your door! ;) and stuff like that .

I know... sounds like work. 

Well, here's the hard truth. There isn't a MAGIC BULLET! If you're looking for that, try checking beside the Unicorn that's sitting next to the pot of gold at the end of the rainbow. I think I saw it there! 

Sorry for the long post and sarcasm - but I get a little steamed when shop owners think they own the customer.  

Hope this helps!

Matthew Lee
"The Car Count Fixer"

Get "The Official Guide to Auto Service Marketing"

Fix Your Car Count in 17 Minutes... Guaranteed!

The Shop Owner's Unfair Advantage FREE Access

 

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I recently started doing a better job with contacting the customer after the sale. We used to call everyone about 3 days out, but as we grew it got to be a burden placing 400+ phone calls a month for follow up. Our goal in these calls was to be as unobtrusive as possible, so we made an effort to call the home phone number during the day and leaving a message. Unfortunately most people now use cell phones only, so that plan doesn't work anymore.

The latest fix to that is to send text messages. We use an automated service for this. Customers seem to appreciate the follow up, and appreciate that we didn't interrupt them doing it. Unlike an email, no one ignores the text message. We get replies to most text messages within a few minutes of sending them, so it's something we do have to actively manage. If someone asks a question or has a problem, they expect a response fairly fast. Fortunately, I've got Patrick to help manage the near constant stream of text messages.

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3 hours ago, JustTheBest said:

I felt compelled to "chime in" on this topic again because of where the discussion is going. It seems to me that in a lot of ways, shop owners "miss the point". 

What's the point? The point is that no matter how good you are - how honest a shop you run - or how much you've spent on tools, equipment and scanners - you still can NOT do anything to a car unless it's in your shop. 

This was actually stated above by Anderson Automotive when he said... "The game truly is simple. Get the customer in the door by just about any means possible, do a quality inspection, and present them with the findings. "

BINGO! Get the customer in. 

 

I feel compelled to chime in as well.......

There are a lot of different people out there. You state GET THE CUSTOMER THRU THE DOOR......how do you keep the consumer out? As the self proclaimed car count fixer getting car count as you have learned is fairly easy. Getting quality car count not so much. While you appear to be an advisor, I have run a repair shop for the last 30 years. In my early days I spent a lot of time and energy sorting thru consumers with unreasonable expectations. While easy for you to say get cars thru the door, when you spend a lot of time and energy for someone who does not appreciate it or value it it reduces GREATLY the time and energy needed to deal with customers properly.

So imagine if you will a batting cage. Each ball represents a customer/car. a large % of them are off target but if you dont swing you can "hit" them. So you spend all day swinging at balls and occasionally one crosses the plate. It catches you off guard and you cant focus on it quickly enough or completely enough and you foul it off. Sure, you may occasionally hit a single or double but I would bet more than not you foul it off because you were trained by all the ones that did not cross the plate, but you swung at them anyhow. If you were to slow things down, dial in the machine to only pitch over the plate how many home runs would you hit?

 

Now, understand the example you use above states we are all large retail corporations whos value lies in pricing (walmart, costco, and Target) and the reality is we are mostly small, individually owned automotive SERVICE centers. Our true value is in TRUST, EXPERTISE and CONVENIENCE. Price is not a primary concern for our CUSTOMERS, yes we need to be competitive but we should focus on value, not price. We dont need a ton of opportunity, just enough over the plate to hit home runs.

All the other things you've suggested are retention items that do not get cars in the door the first time. Each suggestion you have made is critical in keeping in touch with you customer and showing them you care about THEM. Once you have made this connection you can stop trying to get them in with price...it no longer matters. They will then chirp loudly about how wonderful you are and the friends they send in are coming in for the same treatment, not a cheap oil change. This approach vs the suggested one is much easier to manage and far less stressful IMO.

Just another viewpoint of the game.

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33 minutes ago, Wheelingauto said:

we should focus on value

A full synthetic oil change for under $30 is a heck of a value. 😉

There are a lot of different business models that can work. Your method is effective for you, and mine is effective for me. Nothing wrong with either.

A lot of it depends on your demographic. I happen to have a really good demographic that most shops would envy. The local demo has money, but not so much that they buy new cars on a whim. There are a lot of stay at home moms that actively look for bargains so they can make a single income stretch a little further, but at the same time they know that they can't trust their vehicle to just anyone. This is where being super competitive on the commodities like an oil change come in. Lure them in with the oil change, then impress them with the great facility and staff. Steady car count and good ARO have been the result. Because of my demographics and the kind of operation we run, we get very few of the "problem" customers that most people associate with bargain hunters.

Like I said in another thread, who cares if you get rich by serving people looking for a discount oil change? You're still rich, right?

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I have always argued there is more than one successful business model and thats why I chirp about mine as much as you do yours. We both run successful operations and large ones. I just dont want someone who runs a smaller operation who might be struggling to think the only way out is discounting and maximizing car count. Too many shops think car count is the answer and most of the time it is not. But its the easiest thing to fix.

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Hi Wheelingauto! Your post is right on, but I wanted to "chime in" again just to clarify a few points. 

You stated "While you appear to be an advisor"..., please understand I started in this industry as a shop owner. Yes, I struggled at the start. I wasted a ton of money on stuff that just didn't work. It wasn't until I understood HOW to run campaigns that I started to make money. If you can't track it... dollar for dollar... don't do it. Otherwise it's just HOPE marketing. Spend the money and HOPE.

Today I help shop owners in a lot of different ways - from direct mail to digital, online and text messaging. So in short, I really do understand the difficulties of running a business - specifically and auto repair busines. I'm telling you this because I'm not sure you knew that. 

When I used the example of Walmart, Target and Costco, the intention was only to show that you probably "split" your business too - so why would you expect your customers don't? I'm sure you can provide all the services - but they still "shop" at other shops. It's a fact. 

With that said, I also agree with your comments about your true value is in TRUST, EXPERTISE and CONVENIENCE. Agreed and understood. 

But here's the difference. It appears to me that you're "doing something" right. You say you're a big shop - and I congratulate you on that success. You've developed a customer base that continues to return - and that's the BEST model you can have. Those people already know, trust and like you. 

On the other hand, I'm sure there are shops out there (and reading this) that want to GET to where you are. So they need a different model - at least to start. 

In addition to that, I think everyone forgets the fact that you don't have to take a program and "carve it in stone". You can run it to see what the returns are like. I've run campaigns that die a very quick death and turn out to be a waste of money. But the key is that the gamble was a relatively small amount. As an example, a $500 direct mail campaign that dies isn't good - but it won't put me out on the street either. 

On the other hand, I've run campaigns that return a profit time and time again. So those are the ones you keep - and everything else gets deleted. 

The other issue that comes up ( and I don't think it's really been discussed here) is that as a shop owner, you can't rely on JUST ONE method. You've got to do a number of different things - and track each one - then keep what's working while you "kill" the rest. Think about it this way. Picture a person rubbing two sticks together to start a fire. Got it? Now picture that person rubbing two sticks together S-L-O-W-L-Y. Doesn't work, does it?

Not to bore you, but as another example, I work with a client who continues to add between 18-30 new customers every month. He's done this for well over a year - and most could probably start a new shop with just his new customers!  But understand that it's all done with a well thought out "Customer Referral Program". It's promoted to each and every customer - and promoted for a very specific reason. That reason is "tell your friends, family and co-workers". 

But I see lame offers all the time. Shops post their referral program on their website - something like "send us a customer and we'll give you 10% off your next service". Really? It doesn't work. I know it doesn't work - so why bother. In fact, doing something as "lame" as that, you could actually be insulting the intelligence of your customers - actually be turning them "off". 

I said that so you know that I don't think "cheap oil changes" are the only method of getting new customers. But it is one - and it's one that you can "try" - and do it in a way that you can "track". That's because the number's don't lie.

I also agree with your other comment about the fact a lot of shops think "car count" is the answer to their problems. In so many cases - it's NOT! There are 11 different ways to upsell customers (and please understand, when I use the term "UPSELL" I am NOT talking about selling customers stuff they don't need - I do not support or condone shops that just "go for the bucks") 

But think about that - 11 WAYS to sell your customers more - and do it all without being sneak, pushy or becoming a slimy salesman. How many shops do you think use ANY of them? I won't guess... because I talk to shop owners every day - and almost 99% of them don't use ONE! So if you're average RO is stuck at $175 - you don't need more cars - you need more sales. You need to sell more to the people standing right in front of you. 

I only wanted to respond to explain these points. 

Hope this helps!

Matthew Lee
"The Car Count Fixer"

Get "The Official Guide to Auto Service Marketing"

Fix Your Car Count in 17 Minutes... Guaranteed!

The Shop Owner's Unfair Advantage FREE Access

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8 hours ago, JustTheBest said:

When I used the example of Walmart, Target and Costco, the intention was only to show that you probably "split" your business too - so why would you expect your customers don't? I'm sure you can provide all the services - but they still "shop" at other shops. It's a fact. 

 

Simply put, I and others may split our retail commodity purchases between different stores for whatever reasons, I do not split up my "purchases" from service providers such as my landscaper, painter, dentist, contractors etc. We are in the automotive SERVICE business. We need to realize this is the position we are capable of being in (USP, Unique selling point) and should focus on this position rather than attempt to compete on commodity.

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I haven't found a single system that works. I have tried so many things, one of them was cheap oil changes that brought me more grief than a curse upon my head. The value I received from the bottom feeders that cheap oil changes brought me was developing a thick skin.

What are we doing now, that works? Social media, paper mail newsletters, billboards, email-newsletter articles, clinics, and participation on local events. Word of mouth comes through excellent customer service, and customized pricing. Without taking rents into account, our marketing budget runs between 6 to 8% of gross sales for the average six bay/lift shop.

Could I spend less on marketing? Yes, but then I would go back to the seesaw of feast or famine work flow.

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15 minutes ago, Wheelingauto said:

We need to realize this is the position

You're 100% correct! You will never get an argument from me about this. With that said, you're also correct about "commodity" purchases. So if your customer "views" you as a commodity, they will shop. The key is to influence them - and prove to them that you're NOT the commodity. But you still can't do that until they're in the door. 

Seems that you get the point - but most shop owners simply don't. They think that just because the customer "stumbled" into their shop - they are a customer for life - and you know that doesn't happen so quickly. 

You've got to have follow up systems - things that you do to PROVE to that customer that you are better, different, etc. I always said that the "selling" starts AFTER the job is done. You've got to PROVE your position. In other words... there's a few "dots" to doing this right... and you've got to take the time to "connect those dots". 

One other point I found interesting... you mentioned "USP". Most shop owners I speak with don't know what a USP is - never mind actually having one. Unique isn't just saying words like "better" or stuff like that. It's got to focus on something specific and UNIQUE. 

A little off topic, here's a "test" I developed to help shop owners develop their own USP. 

Create that USP. You can use multiple ones to "test" 

Write down a list of competitors in your market. 

If you can say "this statement also applies to shop XYZ too..." then it's not UNIQUE. They (USP's) can be difficult to create... and they do take time. But great USP's have built huge companies. 

Hope this helps!

Matthew Lee
"The Car Count Fixer"

Get "The Official Guide to Auto Service Marketing"

Fix Your Car Count in 17 Minutes... Guaranteed!

The Shop Owner's Unfair Advantage FREE Access
 

 

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19 minutes ago, HarrytheCarGeek said:

Social media, paper mail newsletters, billboards, email-newsletter articles, clinics, and participation on local events.

Great! For most shop owner's, they would look at all this and say "that's a lot of work". Duh... nothing good happens by itself. 

With respect to the discussion in this topic, it's been said that there ARE different models. You've gone through them... and have developed this strategy that works. But I would think it didn't happen in a few days... and you probably made some mistakes on the way. We all did! 

But the fact is you probably "tracked" things... found out what worked... and "look at you now"! Glad to see your "formula" is working!

Only problem is...it's work! Yeah! And the ones that squawk the most don't do anything! 

Hope this helps!

Matthew Lee
"The Car Count Fixer"

Get "The Official Guide to Auto Service Marketing"

Fix Your Car Count in 17 Minutes... Guaranteed!

The Shop Owner's Unfair Advantage FREE Access

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4 hours ago, xrac said:

What a great thread this has become. Definitely conversation and ideas that all shop owners should read. 

Because this is exactly what business owners should be talking about the business side of the trade.

Also, this is the side that mechanics that become business owners need to know, yet they shy away from it because it's perceived as superfluous.

Case in point, and to illustrate, most don't understand numbers.   If you ask them how much is a million, they would look at you puzzled. Instead of saying 1,000 x 1,000 or 100 x 10,000, etc. Or if you ask them what's half of 3/8 they couldn't tell you it's 3/16.

So, what is so important about the numbers? Well, how would you know what is the maximum possible output of your shop if you have no baseline knowledge, how could you quantify your efficiency rate? What would be the point of investing another 2% of of gross revenue into marketing when you couldn't take care of the additional customers.

I agree with you, great thread indeed.

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Like Matthew Lee Stated - Costco / and Others lock you into a Club pre purchase to have the ability to shop and or use their services , We went to all Synthetic oils - no conventional or Semisynthetic  oils .

With This said we offer Two ways for oil changes - We give Client a buy four get fifth Free - Or Prepaid Card --    5 For  ?. You do your math where it needs to be. Guess what You will see them Five Times and have extra Revenue ahead of time.    

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Thank you all for your "likes" and support on this topic. I think if you take the time to read it all - and learn about the "success" stories here, you quickly see that there's a lot of "moving parts" to do a good job with marketing. It's not just ONE thing that fixes everything. I promise. 

I said it earlier... it's like picturing a person rubbing two sticks together to start a fire. Got it? Now picture that same person rubbing two sticks together s-l-o-w-l-y! Doesn't have the same effect, right? 

When I talk to shop owners, they appear upset that there isn't one simple (secret) fix. It's the COMBINATION. 

I am just trying to put the finishing touches on a new book I've been writing. I will, of course, post it here when it's available. But what I've developed is a simple 3 step formula that works in Today's Economy. Anyone with specific questions about their situation - don't know where to start - what to do next - I would be happy to answer any questions you've got - ether on this forum or by dropping me line by clicking here or call me toll free at 1-888-772-2069.

Hope this helps!

Matthew Lee
"The Car Count Fixer"

Get "The Official Guide to Auto Service Marketing"

Fix Your Car Count in 17 Minutes... Guaranteed!

The Shop Owner's Unfair Advantage FREE Access
 

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