Quantcast
Jump to content

Start LLC for $0 at IncFile


Start LLC for $0 at IncFile


Start LLC for $0 at IncFile

Free Dealership Oil Changes Backfire


Recommended Posts

The daughter of a long time customer came to our shop the other after the dealer, during their free Oil Change service, informed her that she would need brakes on all four wheels. (This dealer gives free oil changes with the purchase of a new car) She called her father from the dealership and the father emphatically told her to get the car out of the dealer and bring it straight to Joe. She brought with her the invoice that clearly stated: “Brakes needed front and rear, pads at 3mm”.

 

After a road test and a four wheel brake inspection, we found that she only needed rear brakes. The front measured at 5-6mm. In addition, the car was due for its annual NY State inspection, the wiper blades were torn, and the tires needed rotating. She authorized the rear brakes, the wiper blades, the Sate Inspection and I included rotating and balanced the tires at no charge.

 

She was happy and upset (at the dealer) at the same time. I did not discredit the dealer, but did bring up the fact that sometime free is not a good value.

 

This situation got me thinking. This car had 42,000 miles on it and has been going back to the dealer since new for the free oil changes. So, in that time, the dealer was unable or could not establish a relationship strong enough for this customer to trust them. When the customer needed repair work that would actually cost them money, my relationship won out.

 

I think this is a lesson for all of us, don’t give up on what makes us so strong as independent shop owners: The relationships we have with our customers.

 

I plan on working hard finding out what customers have purchased new cars recently with free service and market to these people that free is not to be confused with value. I also plan on inviting these customers for my FREE safety check, after all these are still my customers and I want to make sure their cars are safe and maintained.

 

Let’s brainstorm on this and see if we can share ideas. The customer may still go to the dealer for that free service, but their hearts are still with us. WE need to capitalize on this.

Link to comment
Share on other sites


general heavy-duty 728x90


general heavy-duty 468x60


general heavy-duty 250x250

Joe it sounds like you have really built up a loyal group of customers that truly trust you....that's great! We have only been in business now going on 3 years and sometimes it feels like its a real uphill battle convincing customers that we are just as and even sometimes more trustworthy and skilled to service their vehicles. For your FREE safety inspection, what were you planning on including in this......the 24 point oil change inspection?

Link to comment
Share on other sites

I have to ask myself - do customers really believe they are getting 'free' oil changes or, as another dealer was advertising, free tires for as long as you own the vehicle? I can maybe see a struggling shop giving away $15 worth of oil and a filter in the hopes that they generate some traffic and build a customer base but eventually someone (the consumer) pays for that oil change in some form. I can't even imagine how the tire deal works. They must have a clause that you need to bring in the car for an 'inspection' every month or else the deal is void.

 

I guess this marketing does work though. Locally the 'free oil change for life' marketing campaign started with 1 dealer and within no more than 2-3 months every dealer in the area was on-board. I doubt they would join if it was a money loosing deal.

Edited by JohnzCarz
Link to comment
Share on other sites

Joe it sounds like you have really built up a loyal group of customers that truly trust you....that's great! We have only been in business now going on 3 years and sometimes it feels like its a real uphill battle convincing customers that we are just as and even sometimes more trustworthy and skilled to service their vehicles. For your FREE safety inspection, what were you planning on including in this......the 24 point oil change inspection?

 

We have a mulitpoint inspection checklist we perform with every LOF service, we will use this (without the LOF, of course). I need to think about how I contact these customers. I wil probably tie it around a service reminder, knowing that thier oil service was done already. I am not concerned about the give-away either. I have learned in the past, that every good deed comes back to us and the rewards of the good deeds outweigh any short term monitary loss.

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
  • Similar Topics

    • By Joe Marconi
      It's hard to believe that it's almost a year since COVID-19 hit.  And for many businesses, and repair shops, it's been a challenge.  While many areas around the country have not seen a downturn, there are other areas that have been harshly impacted.
      Areas such as mine have seen a decline in miles driven per customer of up to 50% or more.  Just consider working from home, the drastic decline of going out to dine and other activities, a decrease in after-school activities, a decease in youth sports, buying online and every other action that has become the norm, and it adds up to a negative impact for so many shops.
      NOW, you know ME.  I always put a positive spin on everything.  At this too shall pass. COVID-19 will be behind us and we need to prepare for great times ahead.  
      I urge everyone to focus on people: Your family, your employees, your customers, and the community.
      With regard to your customers, they will remember you and their experience long after the water pump or mass air filter you replaced in their car.  
      If you are having a decline in sales, here a few tips:  Establish your new goals, look at your expenses, reevaluate your breakeven, make sure your labor and part margins are in line.  BUT, never forget that your most important strategy is the culture of your business. 
      Lastly, cherish every minute with family.  This Crisis has brought Clarity. And let's never forget the things that money cannot buy. 
       
    • By Joe Marconi
      The Summer is in full swing, a time when many people take vacations and also spend time engaging in their favorite hobbies and activities. 
      How do you spend your free time?  
    • 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
      I will never forget the day when a customer, who didn't like the price, took cash out of his pocket, crumbled up the cash, and threw the money at me. 
      This customer clearly crossed the line, in my opinion. 
      Before I tell the rest of this "true" story, I would like to hear from you: How would you have handled this situation? 
       

    • Heavy Duty Parts Fleetcross
    • By Joe Marconi
      I thought this article from Ratchet and Wrench was an interesting perspective. Let me know what you think?  Joe Marconi 
      Is It Time to Raise Your Labor Rates?
      May 27, 2022   Nolan O'Hara   No Comments With increasing costs and rising inflation, many shop owners realize it may be time to raise their labor rates. But it’s always a battle. 
      There are several factors to consider, including customer satisfaction. Every shop owner needs to keep their pulse on the industry and make sure they're running an effective business, but when do you know, and what steps should you take when you’re considering raising your labor rates? 
      The Backstory
      Andy Massoll, founder and CEO of The Detroit Garage, has been working in the auto industry for over 20 years. His father opened their first store, Curt’s Service Center, which Massoll still operates as part of The Detroit Garage auto family. 
      Massoll understands the battle shop owners go through when considering raising their labor rates. He also knows there’s a misconception in the industry that gets a lot of shop owners into trouble: the difference between a door rate and an effective labor rate. 
      The Problem
      It’s difficult to run a shop, and it’s certainly not easy to find and keep professional technicians. It’s vital to know your numbers. Massoll bases his labor rates on his effective labor rate, analyzing his wages and costs. 
      Massoll says understanding your effective labor rate is critical and provides a better insight into your true costs, including the costs of obtaining and keeping your skilled labor. 
      “If I can’t obtain or retain (professional) talent … that is when, clearly, I need to pay more,” Massoll says.
      Shops need to control rates to balance customer expectations and run the business.
      The Solution
      Massoll keeps a close eye on his shops’ productivity. That means understanding how many billable hours your shop is producing and comparing the number of hours worked. 
      Understanding where your productivity is at is crucial in determining raising your labor rates. 
      “You can’t begin to make an educated guess on what (the) labor rate you should charge is until you truly know your labor costs,” Massoll says. “And it’s hard to know your labor costs if you don’t understand and know your labor proficiency or productivity.” 
      Close supervision is key, but you don’t need to write it all out on a whiteboard. Massoll uses a software program to make sure he has a keen understanding of his shops’ productivity. Their goal at The Detroit Garage is to always be at 100 percent productivity overall. That helps Massoll understand when it’s the right time to raise his rates. 
      Additionally, Massoll is on top of his numbers. He spends time in the weeds, analyzing his total number of labor hours and the labor dollars they sell per store over a month, comparing that to his employees’ wages, and understanding the true costs of his business.
      Massoll knows when it’s the right time to raise those rates because he’s spent the time analyzing his numbers, working to keep on top of a gross profit goal of 70 percent to 72 percent on labor. 
      The Aftermath
      Eventually, there comes a time when it’s necessary to increase those rates, and Massoll has done so fairly recently. 
      Economic factors are also important to consider—factors like rising parts costs and inflation. As inflation soared to around 7 percent in 2021, Massoll gave all his employees a 7 percent pay rate increase to counter that economic influence. Because of that, he increased his labor rates.
      The Takeaway
      With prices going up everywhere, Massoll’s biggest piece of advice for other shop owners is to charge appropriately for your work. 
      He says too many shop owners think of the decision emotionally, wanting to help their customers. Massoll acknowledges it needs to be a factual and calculated decision. 
      Massoll notes that he once had a long-term customer come in, who, when he paid for his bill, asked, “That’s it? That seems too cheap.” 
      Massoll explained to him that he was a good customer, and Massoll wanted to take care of him. The customer told him, “If you don’t charge me appropriately and be profitable in your business, and you go out of business, how does that help me the next time I need your service?”
      That’s a lesson that’s stuck with Massoll through the years. 
      “This industry is full of very good people; our business is in helping people. People have car problems, and we help them,” Massoll says. “But we do that for a monetary exchange. And too many business owners run their business with their heart, and when it comes to business, you have to be profitable.” 
       
       
       


  • Our Sponsors


Grammarly Writing Support


The #1 Writing Tool


Grammarly Writing Support

×
×
  • Create New...