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By Jonathan Ganther
Hey guys. I'm new to the forum and was looking for this subject but couldn't find it. Sorry If I'm posted something that's already been discussed. I own a brake shop in Austin, TX. We do anywhere from 10-20 brake jobs a day. We only do brakes so I don't know how much full service auto shops deal with this problem but... Customers are constantly calling in claiming they've bought the best parts or they want to provide their own parts because they've done research and know what is best. This drives me crazy. First of all they don't know whats best. Then after being told no they get offended and act like tons of shops allow this. What is the best way to handle these customers? Just send them away? I'll quote them a price using our parts and they act as though its a rip off. What shops are doing this for their customers? I feel like I'm letting jobs get away from me. Any experience with this?
By Joe Marconi
We all have our favorite customers. You know who there are. They’re the ones that throw their keys on the service counter in the morning and say, “Do what you need to do and I’ll see you at 5 p.m.” They never question your price, they trust you and they keep coming back. But does that person define your true profile customer? The answer is probably yes. But it’s not the only criteria. It’s a little more complicated than that.
Defining your true profile customer starts with you. It starts with who you are, why you are in business and the culture of your company. By the way, determining your true profile customer has nothing to do with excluding certain people due to their income level. The young 23-year-old college graduate who sets aside part of her paycheck to shop at Whole Foods does so because she believes in the company and for what they stand. It’s not about what she “supposedly” can or cannot afford. She is Whole Foods’ profile customer because she aligns herself with that brand. And Whole Foods welcomes her with open arms.
Many of my profile customers endured tough economic times during the Great Recession of 2008. They lost their ability to pay for some of the things they previously could afford. What they didn’t lose was their loyalty to my company. So, what did we do? We helped them through that difficult time. We helped them manage their car care needs better, offering services that would save on fuel, reduce repair costs, and reduce breakdowns. We showed them how to squeeze every mile out of their tires and brakes. We took care of them and we still do to this day. We consider them family and we don’t turn our backs on family. One thing we didn’t do, and will never do, is compromise on price to get a job. That would not be fair to all my customers, my employees or the company.
With regard to pricing your services and repairs, it’s a delicate balance between being profitable and competitive. But I don’t know of any shop that prefers a customer walk away or sends someone to another shop because he or she cannot afford a particular price. A smart service advisor will give options, prioritize the work needed, and offer finance options.
If you’re a startup company, your doors are wide open to everyone. You need customers and car counts, and you need them right away. But as your business matures, you begin to realize that not everyone is your customer. And there’s nothing wrong with this realization. As you build your customer base, you begin to see that there are customers that respect the work you do, align themselves with your culture and appreciate what you do for them and for the community. They become your profile customers.
Let’s say you sponsor a youth baseball team in your area, help out at community events and involved with local fundraisers. You will become known as the business person that cares about the community and children. That’s making your business stand out among the rest. As you define who you are, you also attract those that want to do business with you and support your brand.
While I do recommend treating everyone the same, I don’t recommend trying to be everything to everyone. That’s not a sound marketing strategy—that’s a recipe for failure. Defining your customer and targeting your market does not isolate consumers. It actually increases market share. Here’s an important fact: In your geographical area, automotive shops basically do the same thing; they repair and service automobiles. So, how is a consumer going to choose you over another? You need to stand out. You need to be different. You need to build a brand culture and establish a marketing position that will make people take notice. By the way, every successful company, large and small, understands its true profile customer and creates a marketing plan on attracting them.
One last thing: When you build a business around your culture, you put the focus on your brand and the value you provide. This strategy is one of your pathways to success. When you combine value with culture, you will have an enduring and profitable company.
If you want to build a great company, ask yourself these questions: Why are you in business? What’s your life’s purpose? Your culture? Build a marketing strategy and a brand message around the answers to these questions. Not all people will take notice, but your profile customers will.
This story was originally published by Joe Marconi in Ratchet+Wrench on August 3, 2018
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By Joe Marconi
I recently made a call to my Internet provider to discuss and issue I was having. After multiple attempts at trying to explain my problem, the customer service rep on the other end of the phone had no clue how to solve my problem. She was nice, extremely polite, and had the voice of an angel. She was well-trained, but not in the art of problem solving.
Great customer service is not about being nice to people, it’s all about understanding the customer’s needs and coming up with solutions to their problems. Train your service personnel in the art of proper etiquette, but also in the art of problem solving. Empower your people to also make decisions. Set limits, but give them the authority to solve issues without every problem reaching your desk.
By Elite Worldwide Inc.
When it comes to customer complaints, most shop owners are aware that there’s some economic price they’ll ultimately have to pay for the complaint, but will typically have no idea how much each complaint actually costs. This article will aim to bring some clarity to this long-disputed issue.
When a customer complains, the first direct cost that you’re going to incur is the loss of your time. This is the time you spend listening to the customer, discussing the resolution, and following up with the customer to ensure that their complaint has been properly resolved. Let’s call this direct expense “customer communication time”. I realize that the amount of time will vary with each complaint, so let’s assign 25 minutes as a realistic number for your average complaint time. These 25 minutes are comprised of 5 minutes when the customer first calls you with a complaint, 15 minutes when they return for correction or resolution, and then an additional 5 minutes for follow up.
Now let’s look at the time spent on the internal communication that comes along with each complaint. This is the time that you spend with your technicians and service advisors discussing the cause, the resolution, and the prevention of future complaints. I feel that 15 minutes is a realistic number when it comes to this internal communication. We’ll also need to consider the same amount of time, at a minimum, of an employee’s time spent to help you resolve the issue. So, your internal communication will cost you at least 30 minutes with each complaint.
Let’s shift gears and talk about the cost of customer attrition, and the marketing cost that will come along with each customer complaint. Let’s presume that you run a good business, and are able to properly address each concern to retain 80% of the customers who complain. In this scenario, you’ll still be losing 20% of those customers with complaints. In other words, out of every five complaints it’s safe to say you’ll lose one customer, so you should consider the marketing cost of each complaint to be 1/5th of the cost of generating a new customer.
Lastly, you need to consider the “loss of productivity” that is associated with each customer complaint. Simply put, while your employees are discussing the complaint with you, they are unable to generate additional income for the company.
Based on everything we have discussed, here is the math you can use to calculate the total cost of each complaint, which you and your employees may find to be quite surprising.
Note: The below cost of customer complaints calculation is predicated on a shop labor rate of $100 per hour, the shop producing $200 per hour per technician, and the cost of generating a new customer being set at $30.
25 minutes of customer communication (25min/60min X $100) $42
30 minutes of internal communication (30min/60min X $100) $50
Direct marketing cost to replace 1 of 5 ($30/5) $6
Loss of productivity (30 min) (30min/60min X $200) $100
If you think that $198 is a big number, please bear in mind we’re talking about the cost of customer complaints themselves, not the cost of additional repairs, services etc. that need to be performed to satisfy the customer. In addition to the $198, we haven’t taken into consideration the economic damage to your reputation, the damage to employee morale, and the loss of income that is associated with the loss of the customer and/or the direct cost of any repair.
This considerable cost is one reason why the industry superstars invest in training, they go the extra mile to deliver extraordinary service, and they follow up with each and every customer to ensure that they met with the customer’s expectations. These top shop owners know that they are far better off investing a little more money in their people, than they are spending that money resolving customer complaints. So do absolutely everything that you can do to provide exemplary service, and ensure that each and every customer… is a satisfied customer.
Since 1990, Bob Cooper has been the president of Elite, a company that strives to help shop owners reach their goals and live happier lives, while elevating the industry at the same time. The company offers coaching and training from the industry’s top shop owners, service advisor training, peer groups, along with sales, marketing and shop management courses. You can learn more about Elite by visiting www.EliteWorldwide.com.
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