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First Time Customers - How to convert oil change customers to repair and maintenace


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So we have been doing call backs for recommendations that we make from our vehicle inspections from oil changes and have noticed that a lot of these customers indicate that they get their repairs done at another repair facility but come to us for their oil changes. We are in a unique situation as we are a repair facility that is attached to a car wash so a lot of customers come here for their oil changes because we offer a free interior and exterior cleaning of their vehicle with every full service oil change, or repair over $35. We would like to covert some of these oil change customers into repair and maintenance customers so they look at us for more than just oil changes on their vehicles. We were thinking about offering a discount for first time repair customers but wasn't sure if this was the right thing to do to entice first time customers to try us out with their repair or maintenance needs. Has anyone else experienced an issue similar to this and if so, how did you overcome this image/problem from your customers?

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Two things stand out to me from your comments:

1. The fact that you offer a full interior and exterior cleaning with an oil change or $35 repair.

2. The fact that you want to give more away to first time repair customers.

I believe both of these are not the right things to do.

 

Unfortunately, I believe your oil change customers are using you for the free detailing service you provide, for a very low rate. $35 for an oil change and detailing is selling yourself way short IMO.

If you broke it down by the hour, I'm guessing your tech is spending more then half an hour doing the oil change and cleaning. Even at half an hour, you're only billing $70/hr with no associated parts sales to bump up your profit/hr for that bay.

Now I know LOF is a somewhat necessary evil in this industry, but it still doesn't mean you should participate in the race to the bottom on pricing everything else.

Looking at it another way, if the interior/exterior wash takes 20 minutes, and your labour rate is a conservative $90, the price of the wash is $30 by itself. Can you afford to do oil changes for $5?

 

If you're looking at giving away washes, I'd say you need to set your minimum purchase quite a bit higher before giving a wash away.

Something like $100 you get an exterior wash and $200 you get an interior/exterior wash.

 

People (especially Americans) have been conditioned to think that low price and free stuff is the only way to quantify value in auto repair.

This needs to stop. Period.

Show them the value in your top notch customer service (as your name implies, you should be charging 5 star prices to go with your 5 star service).

You seem to have a good start by doing callbacks on your previous recommendations, but you have to start pricing your services reasonably and stop catering to "D" customers who are looking for the lowest price and only come to you for a free detailing.

 

You can take my comments with a grain of salt, since I'm not a shop owner yet, so I don't have first hand experience with what works and what doesn't.

On the other hand, I've done a lot of reading on how to build a profitable auto repair shop, so I am making an educated guess here.

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Thanks for the comment bstewart. I don't think I may have done a good job of explaining how our business is completely setup. We are a full service car wash with a separate profit center as an auto repair facility. We have anywhere from 15 to 45 people working at the car wash side of the business everyday. They are there for that side of the business regardless of who comes in for oil changes or any auto repair service for that matter as those individuals are servicing the car wash customers. The tech only does the LOF and the customer receives a wash code to take to the car wash side to redeem their car wash and interior cleaning. The car wash employees are paid hourly just like any other car wash employees are paid throughout the country averaging around $8/hr. That is considerably lower than a technician is typically paid and because they are going to be there anyways, the "cost" of the labor to our business is considerably lower than if we had to dedicate automotive technicians to clean the cars. For our business, adding the free cleaning is something unique that no other repair facility in our area is setup to offer and sets us apart from the competition. It has increased our car counts considerably, which is what we were hoping for in the first place. I agree with what you are stating in regards to catering to lower end customers. For us, I think its been difficult to try and differentiate ourselves from an oil change facility to a full service repair facility in our customers perceptions of our business.

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Oh that makes a little more sense, that you are a car wash first, repair shop second.

I don't disagree about increasing your car counts, but be sure that you aren't losing money each time you bring in a new customer.

 

Perhaps you could look at it another way, diverting your car wash customers to your repair shop, rather then your LOF customers to your repair shop.

Maybe with the purchase of a high priced detailing (I don't know your numbers, but maybe over $60 or something), you give them a coupon for $10 off their next auto service, but it can't be used for LOF.

Or maybe $10 off a service with $50 minimum purchase. So just getting a LOF wouldn't qualify.

Studies have been done that show $10 is a sufficient amount to get people motivated to buy something, so I wouldn't go higher then that.

 

I would also say to definitely update your signage, make sure everyone knows that you do full service auto repairs and preventative maintenance.

Just remember that the perception of quick lube shops is that they want to screw people by upselling stuff that people don't need.

I'd be sure to give your customers a professional recommendation list and estimate based on their inspection, not just have a handwritten list of stuff the car "needs" or have the tech just tell the customer.

Edited by bstewart
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  • Have you checked out Joe's Latest Blog?

         3 comments
      Got your attention? Good. The truth is, there is no such thing as the perfect technician pay plan. There are countless ways to create any pay plan. I’ve heard all the claims and opinions, and to be honest, it’s getting a little frustrating. Claims that an hourly paid pay plan cannot motivate. That flat rate is the only way to truly get the most production from your technicians. And then there’s the hybrid performance-based pay plan that many claim is the best.
      At a recent industry event, a shop owner from the Midwest boasted about his flat-rate techs and insisted that this pay plan should be adopted by all shops across the country. When I informed him that in states like New York, you cannot pay flat-rate, he was shocked. “Then how do you motivate your techs” he asked me.
      I remember the day in 1986 when I hired the best technician who ever worked for me in my 41 years as an automotive shop owner. We’ll call him Hal. When Hal reviewed my pay plan for him, and the incentive bonus document, he stared at it for a minute, looked up, and said, “Joe, this looks good, but here’s what I want.” He then wrote on top of the document the weekly salary he wanted. It was a BIG number. He went on to say, “Joe, I need to take home a certain amount of money. I have a home, a wife, two kids, and my Harly Davidson. I will work hard and produce for you. I don’t need an incentive bonus to do my work.” And he did, for the next 30 years, until the day he retired.
      Everyone is entitled to their opinion. So, here’s mine. Money is a motivator, but not the only motivator, and not the best motivator either. We have all heard this scenario, “She quit ABC Auto Center, to get a job at XYZ Auto Repair, and she’s making less money now at XYZ!” We all know that people don’t leave companies, they leave the people they work for or work with.
      With all this said, I do believe that an incentive-based pay plan can work. However, I also believe that a technician must be paid a very good base wage that is commensurate with their ability, experience, and certifications. I also believe that in addition to money, there needs to be a great benefits package. But the icing on the cake in any pay plan is the culture, mission, and vision of the company, which takes strong leadership. And let’s not forget that motivation also comes from praise, recognition, respect, and when technicians know that their work matters.
      Rather than looking for that elusive perfect pay plan, sit down with your technician. Find out what motivates them. What their goals are. Why do they get out of bed in the morning? When you tie their goals with your goals, you will have one powerful pay plan.
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