AndersonAuto

What Wheeling said, and why on earth would you not buy a reman transmission and bolt it in yourself? Seems like a great way to give away some good labor revenue along with a few hundred in part markup.

I track overall conversion rates through the web site, but it doesn't break down phone call vs appointment request form. I'm willing to bet that someone who fills out the appointment request is more likely to show up, because they're committing to an appointment up front. But I certainly wouldn't want to omit my phone number from the web site, because the people who are calling are already unwilling to commit without more information, hence the phone call. Without the phone call option, I would guess a very low percentage of those people would come in.

Yup. We're down to fluids, filters, nuts, bolts, and wheel weights. And I have to keep on top of my filters to make sure I don't have 30 oil filters that fit one year of one model car. I just sent back the last of my brake pads and rotors. Wish I had never stocked them.

It would probably be a big let down. It's a nice shop and all, but I've seen a lot of really nice shops. There's nothing amazing or complicated about it. It's mostly a combination of getting great people, designing a pay plan that encourages them to do what you want them to do, and a 100% commitment to the marketing. There are other aspects of course, but that's the core of it. My friend Tommy in Texas just creams me on gross sales, and his net profit is crazy. I finally got to see his shop about a year ago. It was underwhelming to say the least. But it showed me without a doubt that if Tommy can get it done in his shop, I should be able to do it blind folded with one hand tied behind my back in mine. So far I'm not, but I'm catching up.

Well, hell. You'd think I could figure out a message board by now. I guess not.

Euro cars and anything diesel are not included with the oil change coupon. The house brand oil we use for the coupon oil changes doesn't fit euro cars. We also don't have a set euro oil change price because they all seem to be so different. We will discount a euro car's oil change by the same dollar amount that the coupon would take off the standard oil change price. In your case I would charge whatever the oil change would cost, less the coupon discount, then try to upsell the rest of the required services for $115. No, we never do. To me, it feels like bait and switch. The customer has a coupon for a full synthetic oil change, but now you're telling them they should buy something better? The question that would come to mind is "what kind of crap were you going to put in my car if I don't buy better oil?" The increased revenue would be minor, and the customer would rightfully distrust you. How's that brake job sale going to go after that? Oil change specials are something that takes time to develop. I think most shops try them once or twice, and don't do it again. They also don't do proper tracking. I can tell you that my mailers, which have an oil change coupon and a tiered discount, give me an ROI of 680%. That's $$ spent to Gross Revenue after discount, not net profit, just to be clear. My minimum ROI for any marketing to make it worth while is 300%. But it takes time to get there. You can't just do it once and decide it didn't work. We track every coupon or discount, every month, without fail. The key to it is knowing what you're actually getting out of it, instead of listening to your service advisor bitching about coupon LOF customers who don't spend a dime. One of my advisors who has been with me for almost 10 years used to complain non-stop about the coupon oil changes. He's on a 100% commission pay plan as are all my advisors and wanted to not include the coupon oil changes in his pay plan. He was absolutely sure they were killing his ARO and GP%. I just pulled out the tracking and offered to remove all the repair orders with mailer coupons for him. All $35,000 worth. He declined. Quality service advisors working on a properly structured 100% commission pay plan. A good advisor is very smart and can think on his or her feet, but also has a great personality that people like right away. The rest you can teach. The pay plan is very important because it keeps the advisor laser focused on what you want them to produce. In my case, GP Dollars, ARO, GP%, Parts GP%. It's also tiered to reward them for better gross sales. Your advisors need to do just that, advise. They don't need to be pushy, and certainly not lie to a customer. The average car we see is 120K and 10 years old. There's more than enough work needing to be done without trying to push them into something they don't need. It's also commitment. You have to be committed to the marketing plan. It's stupid expensive and it hurts to get started. When I kicked off my mailer program I was doing about 75K a month in gross sales. Over the next 12 months I spent almost 100K in marketing, mostly coupon mailers. You have to be committed to it, and give it time to develop. The key though is the inspection. The entire purpose of the oil change is to inspect the car. Unless you're jiffy lube with minimum wage guys and buying oil for half what I pay, the oil change is a loser no matter what. Your techs hate doing them, your advisors hate selling them, and the shop makes little to no money even at full price. But... if you do a proper inspection and properly present it to the customer, and make it easy for your customer to buy, you'll come out ahead. I've been told I don't know how many times that I need to remove current customers from my oil change marketing list. You've already got them as a customer, why continue to discount them? You wouldn't want to train them to just look for the coupon would you? I can't imagine a bigger mistake. I absolutely want to train my customers to look for the coupon oil change. It's the only service that every customer knows they need, and they have a sticker or a light to tell them when.There is no worn tie rod light. On most cars, there is no worn brake pads light. The only way my customer knows that these things are an issue is if someone tells them. The shop that tells them there's a problem is the shop that gets the work 90% of the time. And you can't tell them there's a problem until the car is in your shop. There's absolutely no getting around this fact. So, get the car in the shop. Simple, right? Convenience. Make it easy for the customer to do business with you. We're open early, and open late. 7a-7p six days a week. Full crew on Saturday too. No half day half crew garbage. If I have a Saturday waiter oil change that needs brakes and ball joints, I can give them a ride home, and have their car done by the end of the day. Techs make money, advisors make money, shop makes money, customer isn't out of a car on a work day. Everyone is happy.

First, the oil change coupon doesn't include European cars. Most of them take a Euro specific oil and my house brand doesn't work. We will give a discount off the Euro oil change, which I don't have a set price for as they all seem to be a bit different. If someone comes in with a Euro car and my mailer, I do discount their oil change by the same dollars off that the coupon would save them on a non-euro car. To the heart of the question, assuming that it's a domestic/asian car, we would do the oil change for the coupon price, but try to upsell the remains of the 15K (or whatever miles) service. In your example, we would do the oil change for the coupon, and try to sell the remains of the service for $115. We don't. To me, it feels like bait and switch. I think it would put off more customers than revenue it gained. If they have a coupon for an oil change, they have every right to believe that they'll get a quality oil change at that price. If they come to your shop and you try to upsell to a better oil and filter, you just told them that if they don't buy the better stuff, you'll be putting crap oil and crap filter on their car. That customer might buy the upgrade, but odds are they won't buy anything else, and they won't be back. You've got to have the very best advisors that money can buy at your front counter. This is not to say they have to be pushy salesmen, but they have to be smart and people have to genuinely like them. Thinking on their feet is a must. I also give my guys 100% authority to do whatever they think is right for the customer. If I wish they had done something different, we'll talk about it so they can improve next time. The LOF is not a Lube Oil & Filter. It's a Labor Opportunity for the Future. The point of the oil change is not the oil change. It's all about the inspection and proper presentation to the customer. Every single oil change is extremely valuable, but the only way you'll know how valuable is to track every single oil change coupon you get back. You have to know exactly what your ROI is on that mailer. I think a lot of shops don't track this stuff, and think the oil change coupons are a loser. If done correctly, they're definitely not a loser. I think a big part of it is the commitment to the marketing. Cheap oil change marketing takes time to develop, and it's expensive. You're going to see a lot of oil change only repair orders in the beginning. Stick with it. Eventually you'll train your customers to look for your coupon when they need an oil change. A lot of shop owners see this as a bad thing. I see it as essential. In order to service a car it MUST be in your shop. There's literally no two ways around this. I've trained my customers to come see me when they need an oil change, and they all know we do everything. When we present the findings of the inspection, they've already been in my shop a couple of times, and trust us to do the work. Besides, it's convenient. Speaking of convenience, we do everything we can to make it easy to do business with us. Open early, and open late. 7a to 7p 6 days a week with a full crew. Need ball joints and a brake job to go with your Saturday oil change? No problem. We can have it out before close. Need a ride home while we take care of that? No problem.

I typed out a lengthy response, and fat fingered it. Bad things happen when you hit CTRL-ENTER repeatedly. I can't find a way to delete the posts. Mods, do your thing.

June was awesome for me as well. We set another all time record month for both gross sales and GP$. Second month in a row we've done that. Time to pass out Benjamin's to everyone again!

Tyrguy beat me to it. My parts margin for the month is 55.58%. That's cost times 2.25 on average. If you're having a hard time getting 50% parts GP, or have no idea how it's even possible, you need to have a serious look at some management and advisor training. It's an important piece of the puzzle in keeping the lights on.

I agree. Joe's customer was looking to cut not only the cost of parts, but labor too. He could have given him the ball joints at cost and bumped the labor to make up for it, and the customer would have still DIY'd the thing. If that weren't the case, he would have tried to get Joe to install ball joints that he bought at AAP. The customer will eventually learn his lesson, or he'll be broke all his life paying for repairs (and not just auto repair) twice. Move along and serve the next customer who's willing to pay for your service.

It's a house brand oil from our local supplier, Allied Oil. It's Dexos approved, but we don't have to pay for the brand name. Very few customers know or care, and if they do we are glad to install whatever oil they want, but certainly not for 29.95. The filter is also a house brand from Factory Motor Parts. Super cheap, and hasn't given me a bit of trouble for over 4 years using them. Again, if someone cares, we'll be happy to upgrade the filter as well, for a price. We are certainly doing well with this. I did just short of 2 Million last year (as in 1.5 days business short) and as of today I'm up 17.89% over last year. The second half of last year was really strong, so I suspect that gain over last year will shrink a bit, but I expect to end the year at 2.2 and a 20% net. That said, oil change marketing does produce a fair number of "one and done" customers. Quite often they will spend money fixing other things they need on that first visit, but you may never see them again. It's just a part of the model. A lot of guys couldn't sleep at night knowing they're going to have 100 customers fall into the Lost Customer category in a given month. I just roll with it and keep pounding the marketing. We're certainly doing things to try reducing the outflow, but it will always be there to some extent.

I outlined all of this in another thread.

Really? I had actually started to type out a response, but decided that due to your tone it was just going to turn into a urination contest with no real point. If you think that after your rant directed at me, my telling you to relax is an attack, you've got much bigger problems than I thought. Thin skinned perhaps? In the mean time I'll continue to wish for a good solution to the technician licensing issue without being at risk of govt regulators finding an ever increasing need to justify their existence. Have a great afternoon. I know I am.

Dude, relax.

This is something I've struggled with. On the one hand, I completely agree that we need some sort of system to ensure that technicians are qualified. In the state of Kansas, as in most states, there are licensing requirements, tests to ensure competence, and continuing education requirements for a whole array of professions. You can't call yourself a Dr without passing medical board exams, you can't call yourself a CPA without passing the CPA exam. You also can't cut someone's hair or give them a massage. Or pull a permit for new construction for plumbing, electrical, or to be the general contractor. And probably a thousand other professions I can't think of at the moment. The qualification requirements to be a technician is to simply say "Hi, I'm a mechanic". But..... The states that do have auto repair regulatory bodies (the BAR in CA and other states) the main focus is on the front counter, not the techs. Those states seem to believe that the most damage comes from unethical shop owners, not incompetent techs. And if we did end up with a technician licensing regulations, would we end up like hair salons with the constant harassing of the techs by the state? I have a friend who was fined by the state because she had a spray bottle on her station that was unmarked. It contained water. After paying her fine, she had to make sure there was a label on the bottle that said "water". I don't know about you, but I'm not interested in that sort of meddling.

Yes, I am offering a full synthetic Dexos approved oil change for $29.95. The margins aren't much, but it's not zero. Just north of $5.00 if my lube dude does it. Pretty much zip if one of my master techs does it. But margin on the oil change isn't the point of the oil change. The inspection is. And no, we don't just load the RO up with wallet flushes. My advisors won't put up with that. We do a full and proper inspection on the vehicle, that we can demonstrate the need for any item at any time, and we present the findings to the customer. Since my advisors are great at their job, they sell a large portion of the work. I spent the weekend at the lake, and on Saturday my guys closed $17,751 at $555 a repair order. We're closing in on another record month, and should end up at about $220K. Then I'll net 20% of that. And I've promoted myself up to shuttle driver. Life is good.

I do cheap oil changes, although since switching to only using full synthetic it went up to $29.95. No desperation here. It's part of my business model, and working fantastic. Now that you mention it, a permanent sign is certainly cheaper than my mailers. I'll have to think about doing that.

There was once a guy who ran a Honda shop in Nebraska who put out an auto shop marketing booklet. I'll never forget the first 3 steps to auto shop marketing in that booklet. 1. Soap 2. Paint 3. Light

I think you may be a little confused about the definition of ELR. What you're describing is that you charge your full door rate on most services except LOF and tires. That's not what it means. Effective Labor Rate is the result of dividing the billed hours by the technician into the charged labor dollars to the customer. Let's assume that your door rate is $112. If your tech flags 10 hours and you bill the customer $1120, then your ELR is $112, or 100% ELR. But, if your tech flags 11.5 hours and you bill the customer $1000, then your ELR is $86.95, or 77.63%. Always do this calculation from your books and payroll. As in, what do the books (not the management system) say that you collected in labor charges for the period in question, and how many hours did you actually pay the tech? It's really easy for the advisor to "forget" to add labor hours to the RO, but the tech flags the time. Or, if you pay the tech based on the hours shown in your management system, the advisor can add hours without adding dollars to the RO. ELR is one of the fastest ways to check whether your advisor is giving away labor. If your ELR is way off, it doesn't point to the problem, but it shows you that there is a problem. Then you start auditing repair orders.

We have two "guard dogs". More like door greeters. The pit bull is mine, and the Rot puppy belongs to my manager. Neither one spends the night at the shop. The Rot sheds quite a bit and we have to sweep often, the Pit sheds but it's super short so you don't see it. We have a 2.5 acre lot, so the poop mess isn't a problem.

A full synthetic oil change for under $30 is a heck of a value. 😉 There are a lot of different business models that can work. Your method is effective for you, and mine is effective for me. Nothing wrong with either. A lot of it depends on your demographic. I happen to have a really good demographic that most shops would envy. The local demo has money, but not so much that they buy new cars on a whim. There are a lot of stay at home moms that actively look for bargains so they can make a single income stretch a little further, but at the same time they know that they can't trust their vehicle to just anyone. This is where being super competitive on the commodities like an oil change come in. Lure them in with the oil change, then impress them with the great facility and staff. Steady car count and good ARO have been the result. Because of my demographics and the kind of operation we run, we get very few of the "problem" customers that most people associate with bargain hunters. Like I said in another thread, who cares if you get rich by serving people looking for a discount oil change? You're still rich, right?

I recently started doing a better job with contacting the customer after the sale. We used to call everyone about 3 days out, but as we grew it got to be a burden placing 400+ phone calls a month for follow up. Our goal in these calls was to be as unobtrusive as possible, so we made an effort to call the home phone number during the day and leaving a message. Unfortunately most people now use cell phones only, so that plan doesn't work anymore. The latest fix to that is to send text messages. We use an automated service for this. Customers seem to appreciate the follow up, and appreciate that we didn't interrupt them doing it. Unlike an email, no one ignores the text message. We get replies to most text messages within a few minutes of sending them, so it's something we do have to actively manage. If someone asks a question or has a problem, they expect a response fairly fast. Fortunately, I've got Patrick to help manage the near constant stream of text messages.

I haven't used them, but I can tell you that they're pretty good at marketing themselves. I see them everywhere I go online, so they're good at reaching their target audience. I have no idea if that translates into more cars and better customers for their clients.

My shop is dramatically different from yours as far as space/racks goes, so I don't have good answers for most of your questions. I do know however that you should absolutely be charging for diagnostics. But don't call it diagnostics to your customer. Testing and inspection are the correct words, because that's what you're charging for. The tests and inspections may lead to a diagnosis, but that's simply a result of your expertise when looking at the results of the tests and inspections.