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KBenline    1

I am going to post things I learned going, "BACKWARDS". For those of you who don't know, I spent 6 years working for an auto repair managment company that you all know fairly well. I then purchased my own shop in 2003 and purchased the land my business is on in 2005. I implemented all the things we "taught" in our management classes and found out the hard way what works, what doesn't, and what can really hurt you if you are not careful. There are many things to share but I will start with marketing since that seems to be a hot topic. I can't cover everything in one post so I will summarize a lot and then add more detail as you respond with your comments and thoughts.

 

What I have learned the hard way is there are three things people will consider to choose your repair shop, I don't care how great you are at marketing it boils down to these three things. The first, is your reputation, the second is your pricing, and the third is how you communicate/treat them. You can advertise all you want but you will not get the results you are looking for until you really understand these three things. Here is what I have done for the three things:

 

1. I first had to think through how customers are going to discover my reputation. It happens through word of mouth referral, but that alone isn't enough. It happens through affiliations like the Better Business Bureau, the AAA, and other affiliations customer's are comfortable with. But, here is where you need to think differently than a typical shop owner. Most of my customers are clueless as to what ASE is, they only want to know if you are certified. They don't understand what a Bosch Service Center or a NAPA auto care center is from their perspective. They do understand the AAA, the BBB, and.....review sites, such as Yelp to name one. I found you don't need/want to advertise on these review sites because those people that are reviewing are not necessarily the customers you want coming in. I found most of these customer's don't have money and have too much time on their hands to post reviews. They are usually college age or younger or unemployed. However, you need to understand that customers will go there for some additional validation once they are comfortable enough with their other sources. I don't have time on this post to go into great detail but this is very important to understand and work it your advantage to keep your reputation in good standing. I had to really look at things differently and break my way of thinking on this one.

 

2. Pricing is an area I feel I really made a mistake on listening to too many auto repair management consultants who have been too far removed from the auto repair industry for too long to really understand the changes that have happened to our industry in the past five years. Can you charge more than dealer list price for parts, yes. Will it come back to bite you, good chance yes. The internet in all its search abilities have given customer's more education. This trend will continue and it will get tougher and tougher especially with the economy like it is. You need to be careful here. I used to charge more than dealer list price (I still do but not as aggressively and I pay attention to it more) and we started to get a reputation as an expensive shop, good, but expensive. This is okay but as soon as the economy hits get ready for the crickets to chirp with this philosophy. Even your good customers will decided to not bother you unless they feel it is like a really tough repair issue, because they don't want to "bother" you or to pay top dollar for what they think is "smaller" stuff. One key area to all of this is your diagnostic charge. This seems to set the whole process into motion. I completely changed my philosophy and procedures regarding what we were/are charging for diagnostics and it has solved a lot of problems. Diagnostics have almost become lost leaders like anything else but that philosophy has worked tremendously for me. It is easier now to get customers in the door and I get a lot less of "shopping" and "comparing" me when it is an easier process for the customer to say "yes". We have actually increased in sales and profits following this procedure. So, charge what you need to but be careful and understand that no matter what your reputation your pricing needs to be in line and reasonable.

 

Oh, and one other thing that the auto repair management consultants taught that I found out the hard way can bite you is charging more than the dealer. Be careful here because most customer's will not understand how a smaller shop like you needs to charge more than the dealer when the customer looks at the massive dealership and common sense tells them the overhead is way higher. I went down this road with "longer warrantys" (which I still offer) but it is still a hard pill for the customer to swallow, no matter how good you are. Customer's don't want to feel like they have been taken advantage of. The dealers are offering many good deals these days so have a battle plan ready. My battle plan is on the front page of my website and on my "specials" page. You can read at www.robertsautoservice.com and you will see how I compete with the dealer, make a profit, and make a customer feel good about choosing us.

 

3. Once customer's are comfortable with your reputation and feel your pricing is reasonable, how you treat them will make all the difference in the world. We have had countless customers tell us we were either a little more or a little less than another shop but how we communicated with them was night and day difference so they were choosing us. Customers talk to their friends, family, and coworkers about their auto repair problem. You can imagine the horror stories they get told. When they finally do call, you need to slow down and talk to them like you would a friend at first, not like a doctor/patient, that will come later. I don't care how busy you are. Once the customer feels the difference in the communication they will then start to tie in your reputation with it feel good about you. Then when you ease into the pricing/diagnosis, call them with authorization, you can become more doctor/patient like. Then when they pick the car up it goes from doctor/patient back to friend again. This ties everything together and not only gets the customer to come to you and then authorize the repairs, it turns them into marketing horsepower for you where they will tell others and write great reviews.

 

 

So, once you understand these three dynamics of reputation, pricing, and communication, and once you master them, then, and only then, will your loss leaders and marketing programs start to work and have great value. I will share these "loss leader" and "marketing" ideas with you all in a future post.

 

I would love to hear your comments.

 

Keith - Robert's Auto Service, San Diego, Ca.

 

 

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