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By Elite Worldwide Inc.
Whenever a customer tells you they can’t afford to do the repairs, and they ask you if you can help them out “this one time’”, you need to give careful thought before you lower your price.
First of all, there is a cardinal rule in sales that says before lowering your price, you need to build more value in your service. Yet as we all know, there are going to be some occasions where no matter how good your sales skills are, the customer simply won’t have the ability to pay for the recommended services. In such cases, you and your advisors will have three options. One, you can let the customer walk; two, you can drop your price; or three, you can follow the proven path we have provided to tens of thousands of advisors over the years.
First of all, if you let them walk, both you and the customer have lost. They’ve lost the time they’ve invested in having their vehicle inspected, and when they leave your shop their problems still exist. You’ve lost the marketing dollars you invested in bringing the customer through your door, you’ve lost the time you’ve invested in inspecting the vehicle and estimating the job, and you’ve lost the opportunity to help someone in need.
The second option you have is to lower your price, and while you may close that sale, you’ll also be sending a message to your customer that if they wouldn’t have asked for a discount, they would have paid too much. If that’s not bad enough, it gets worse, because they know if they ever decide to come back they’ll need to negotiate with you, regardless of the prices you quote. The good news is, there’s a third option, and it’s one that’s used by the top shop owners in America with great success….
Putting first things first, you’ll need to see if the customer qualifies for any legitimate discounts you offer, such as Senior Citizen, AAA or Military discounts. You can also limit the number of repairs to the ones they can afford at the time. Another option (which works well in some cases), is to scale back on some of the benefits, such as the length or terms of the warranty. If you and your customer find none of those solutions to be acceptable, you can consider telling them that you will keep their vehicle at your shop (space allowing), and perform the repairs if and when your time allows (when another customer cancels their appointment at the last minute and your tech has the downtime, for example). What your customer would be sacrificing is the immediacy and convenience.
Please bear in mind that when making any decision to lower your price, you need to ask yourself who is ultimately going to pay for the discount, because the answer will inevitably be your other customers. Secondly, if you have the right advisors, with the right principles, they’ll know in their hearts it’s just not right to charge two people different prices for the same service. To put it another way, I’m sure you would not want your mom or dad walking into any business and buying a product or service when you know the customer right before them… paid less. Never forget, principles, not shell games, lead to two things: higher profits, and the ability to sleep at night knowing you are not playing games… with other people’s money.
Since 1990, Bob Cooper has been the president of Elite Worldwide Inc. (www.EliteWorldwide.com), 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 the industry’s #1 peer group of 90 successful shop owners, training and coaching from top shop owners, service advisor training, along with online and in-class sales, marketing and shop management seminars. You can contact Elite at [email protected], or by calling 800-204-3548.
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Yesterday, went for a drive through North Jersey, was very concerned to see that independent shops are putting permanent signs with the $19.95 oil change offers, the $59 A/C recharge, and the $5 dollar flat fix. This reeks of desperation, clearly the industry is coming due for a strong correction. At my shops this month we are starting to see price resistance from the lower income segment, we are having to exert price flexibility for price discovery which we are finding to be 10% to 20% from list pricing. The mid to upper segments are still going strong.
By Joe Marconi
In my 38 year business career, it has always been an issue with summer vacations. We want our employees to enjoy life, but the summer is our busiest time. What are shop owners doing to maintain production, while balancing vacation time?
I'm finding the more I look into tire prices from box stores the more embarrassing my tire prices become. In the past month or so I've found tires for sale at Wal-mart, Discount Tire, and Fleet Farm cheaper than I can buy them. Have any of you ran into this? If so does your supplier match prices and make it so you can profit a bit?
By Elite Worldwide Inc.
By Chris Monroe of Elite
We have all felt that empty feeling in our gut when a client walks back in the door with the “look” shortly after installing that new set of tires on their BMW. As they uncomfortably begin to describe some rim damage that didn’t exist when the car was dropped off…yuck.
Yes, you have policies in place to address such situations, but for whatever reason, the training on quality control has failed and now you are left to deal with the fallout. What next?
It is obvious there is a quality control issue that must be addressed, but how you take the next steps are very critical to the image of your business, as well as the credibility of your team.
The first step is to remain calm while reviewing with the client their concerns. Walk out to the vehicle and allow them to express what they feel is of issue. Once you have listened and observed with sincerity, start the process of restoration.
In our case, we had an incorrect set up on the tire machine with a low profile run-flat that ultimately allowed contact with the rim. This scratched the lip in multiple places. In addition, the technician continued with the installation without stopping to involve the advisor so we could get in front of the issue with the client. The technician did tell the advisor, but the timing was such that the client looked at the assembly on the car prior to checking out. Imagine how much easier this would have been had the advisor gotten to the client immediately to make them aware and assure them that we would professionally restore or replace the wheel.
Needless to say, I spent the next day with each and every technician reviewing the situation and the importance of why we have policy and process in place. Our technicians are now well aware of what to do (stop immediately and report the issue to the advising team) if damage occurs or could occur to a client’s vehicle, and understand the importance of getting in “front” of these concerns.
A better example this week where a technician wisely notated worn lug nuts and a partially damaged center cap “before” we began work. He gave the advisor a quick heads up that enabled a client visit to the vehicle to see in person and discuss the concerns. Not only did we replace the brakes on the car, but also replaced 20 lug-nuts and 4 center caps! The service concluded with the client scheduling another vehicle for service and thanking our team for being honest and helping resolve the issues. (This ain’t rocket science folks)
If you are in the automotive service business, incidents can and will happen. Coach and train your team on how to handle these situations, and demonstrate how important timing is with advising your client. Your shop's reputation and credibility ride on it.
This article was provided by Chris Monroe, an industry leading shop owner who recently won the 2018 Tire Dealer of the Year Award, and a Business Development Coach who helps other shop owners reach their goals through the Elite Coaching Program.
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