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Many New Car Dealers are Closing…Your SMALL Window of Opportunity

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There’s been a lot of optimistic talk and media press lately about the projected increase in business for the independent repair shops due to the closing of many new car dealers. It appears that in order for the Big 3 to survive in a global market, there needs to be a thinning of the herd. The glut of too many domestic dealers has put the Big 3 at a competitive disadvantage with their Asian rivals. This would appear to be good news for us as independent repair facilities. But I wouldn’t bet the farm on this data…not just yet, anyway.


Here’s my position on this topic. GM, Ford and Chrysler will no doubt continue to reduce the number of dealerships as they restructure their businesses in order to regain their status among the world’s leading carmakers. This will take time, but it must be done. The government will also be a major factor in the outcome of this transformation, especially for GM and Chrysler.


Right now the public views GM, Ford, and Chrysler as troubled and failing. The press tells us how people are reluctant to buy American cars. The government has chastised the American carmakers past sins with claims of poor quality, poor business plans, ugly car models, and incompetent leaders who head these companies. I’m not going to debate public perception or the government’s view on this, but what I will tell you is that, if anyone thinks the domestic carmakers are going away or will end up as powerless companies, they are mistaken.


When the dust settles and with the dead wood removed, the dealers that are left will be in a stronger position then ever before. They will have effectively reduced the competition that prevented them from succeeding in the past. Plus, the dealerships that do survive will get full support and backing from their respective carmakers. GM, Ford, and Chrysler will fight with all their power to insure the success of their new dealer stores and will have the money to do it. In short, beware of what is coming.


As a young boy, my father taught me that there is always opportunity, especially during bad economic times. Large national chains will view the closing of the new car dealers as opportunity. A large dealership facility with a great location may be very inviting and fit into the expansion model of many national chains. Many dealership owners, after losing their franchise, will also view this as opportunity to reopen as large used car and service centers. That’s not to say they will be successful. Part of the reason that many new car dealerships are failing is their inept ability to provide quality customer service.


Independent auto repair facilities are still the first choice of the American motoring public and lead the way as far as customer service is concerned. But I do believe that the changing landscape of the auto industry will have an influence on our business as the public’s curiosity and confusion may direct them toward these newly founded businesses.


For us, independent auto service companies, there is also opportunity. But that window of opportunity will be short-lived. We must act now. What are you doing today that will secure your future? The timing has never been better to capture a larger market share in your area. You have the power to make a difference. But you must take action. You must increase your presence in your community and show strength during these tough times. People will remember that, when the economy turns around.


Consumers are confused right now. Many don’t know where they should get their car serviced. Many that were going to the dealers, are now seeking alternatives. You can capitalize on this. Create and direct all your advertising and marketing efforts toward increasing and securing your customer database. Your ad campaigns should focus on the fact that your company has been there through the difficult economic times and will be there in the future.


Don’t make the mistake and assume that the customers will flock to your door because a few dealerships in your area have closed. You need to be proactive to get those people to your bays.


Opportunity is knocking truly at our doors. The question is: How many will go and answer it?

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Yes, we have implemented a "Just Say Yes" policy where we try to do whatever we can to accommodate the customer on their terms. We also started a while you wait program and express bays to capture more customers. We also started advertising on TV and radio and stopped most of the paper advertising, including the yellow book. We hired another tech to help with customers who prefer to wait. Our car counts are sales are up this year by almost 20%. It works. You need to forge ahead while everyone else is retreating.

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We plan on a buget of about 5% of gross sales. We also intend to increase our exposure on the internet, emails and e-newsletters.


I stopped all local penny saver books, newspapers, local coupon magaizines in addition to the yellow book.


My ad in the yellow book will now be a small bold listing. Just in case someone hears about us and needs to look up our phone numbers.

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The local coupon publications did not work. For me it’s the wrong type of marketing. It brings in people ONLY looking for that coupon. Next week there off to the next place with their coupon.


I prefer brand advertising. I studied what type of customer is our model customer and then find different forms of media (Radio and TV, mostly) to reach out these people. This has been most affective

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  • Have you checked out Joe's Latest Blog?

      Most shop owners would agree that the independent auto repair industry has been too cheap for too long regarding its pricing and labor rates. However, can we keep raising our labor rates and prices until we achieve the profit we desire and need? Is it that simple?
      The first step in achieving your required gross and net profit is understanding your numbers and establishing the correct labor and part margins. The next step is to find your business's inefficiencies that impact high production levels.
      Here are a few things to consider. First, do you have the workflow processes in place that is conducive to high production? What about your shop layout? Do you have all the right tools and equipment? Do you have a continuous training program in place? Are technicians waiting to use a particular scanner or waiting to access information from the shop's workstation computer?
      And lastly, are all the estimates written correctly? Is the labor correct for each job? Are you allowing extra time for rust, older vehicles, labor jobs with no parts included, and the fact that many published labor times are wrong? Let's not forget that perhaps the most significant labor loss is not charging enough labor time for testing, electrical work, and other complicated repairs.  
      Once you have determined the correct labor rate and pricing, review your entire operation. Then, tighten up on all those labor leaks and inefficiencies. Improving production and paying close attention to the labor on each job will add much-needed dollars to your bottom line.
  • Upcoming Events

    • March 24, 2023 01:00 PM Until 09:00 PM
      Hi all,
      AutoLeap is hosting Amplify 2023, a virtual auto repair conference for shop owners, on March 24. We have 22 incredible speakers, and 13 industry associations and training institutes participating in this virtual event. The conference is free of cost.
      You can book your complimentary, virtual seat today using this link: https://bit.ly/3EXvfWY
      Amplify 2023 speakers include: Joe Marconi, Co-Owner AutoShopOwner and Elite Business Coach @Joe Marconi Aaron Stokes, ShopFix Academy Cecil Bullard, The Institute for Automotive Business Excellence Chris Cotton, AutoFix Auto Shop Coaching Darrin Barney, Elite “G” Jerry Truglia, Automotive Technician Training Services Greg Bunch, Transformers Institute Jeremy O'Neal, AdvisorFix The conference will cover essential topics such as:
      Navigating through the current industry challenges Tackling the technician shortage through employee retention Creating memorable customer experiences Growing & expanding your business in 2023 Financial planning & KPIs to measure And that’s not all.
      The interactive, dynamic conference also offers live networking opportunities, and fun games and prizes.
      You can book your complimentary, virtual seat today using this link: https://bit.ly/3EXvfWY
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