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Start Critically Reviewing The Frequency Of Every Service Labor Operation You Perform, And Today

It will expose when your advisors are failing to suggest work that the customer needs and benefits your dealership. BY ROB GEHRING

shutterstock_141127069Service advisors in today’s dealerships serve as a critical component in fixed operations performance. Customer retention and satisfaction in the service department is directly related to developing the “customer for life” that every dealership desires. If your customers are satisfied with their service experience, then the vast majority of them will price their next vehicle purchase at your dealership first.

The difference between a good advisor and a poor performer translates into hundreds of thousands of dollars in annualized parts and labor sales revenue. There are many ways to measure advisor performance; however, in this article I’ll discuss developing a quantifiable process that I believe can make all of them superstars at your dealership.

Most DMS programs for dealerships produce a report that will illustrate the dealership’s labor operation (“labor op”) frequencies. It will illustrate at a glance, for example, that oil changes are the most common labor op that the dealership performed during a selected time interval. The list can bring to light an incredible number of opportunities for lmprovement at your dealership.

Are Some Labor Ops Suggested At All?

For example, looking at your list you will likely find your service staff is performing a fair amount of tire rotations. However, when might find the number of tire balance operations very low in comparison. There’s no question that tires wear down and should be balanced every 20,000 miles or so, to extend their useful life. If they are never balanced, eventually when they are rotated they will produce a vibration when a vehicle is driven at highway speeds.

Logically, your customer will become irritated that his or her car starts vibrating after it was brought in for service. Your service department will be blamed. The customer definitely won’t expect to pay for the fix, which is to balance the tires.

However, if this individual had been offered both a rotation and balance – with the expectation that tire rotation would be prolonged and the chances of vibration when changing tire position minimized – then imagine how different his or her attitude would be. I bet that customer would be apologetic and ask how much would you charge to correct the poor judgment they showed in not accepting your offer for a tire balance.

Givens this logical scenario, you have to wonder why this tire balance labor op is such a poor performer for the dealership. The sad reality is that it probably isn’t probably isn’t being offered at all (looked at with rose-colored glasses, you might say your advisor staff’s presentation of benefits presents an area of opportunity). Typically, I find either the manufacturer doesn’t recommend a particular labor operation, or the service staff doesn’t believe in its value.

Look At Desired Frequency, Other Factors

Before you can determine the causes for an underperforming labor op, you must first decide what is an acceptable frequency. For example, start by determining at what mileage intervals is it reasonable for your service advisors to make recommendations to your customers. Does your team consider it reasonable to offer a fuel system cleaning treatment every 15,000 miles? Is your technician compensation adequate for that particular labor operation? Would there be acceptable profit to the dealership after the parts are purchased and the tech paid?

When you thoroughly review of labor op performance, you must examine all factors that help you understand performance in total. I have found dealerships that service a large number of pickup trucks rarely perform differential services to replace fluids. On a four-wheel-drive pickup truck, two differentials and the transfer case each have fluids that need servicing. Handling all three of these fluids changes on a pickup would cost several hundred dollars, so the dealership must explore why it is not performing more of these services for its customers. How could hundreds of pickup trucks come through its service department every month, and only a few differential fluids packages be sold?

Before concluding your examination of your dealership’s list of labor operations, you need to ask yourself this question: “Does my advisor team perform a standard feature benefit presentation consistently on every labor op?” The only acceptable answer to this question is “Yes.”

shutterstock_81673459One Op Makes Big Difference

Let’s use a further example of a brake fluid flush. Some manufacturers believe that brake fluid should be changed every two years or 30,000 miles; others don’t include it as a recommended maintenance procedure at all. Service staff have their own viewpoints on the value of changing brake fluid, but the reality is that fluid will draw moisture due to its chemical composition. As water infiltrates brake fluid over time, moisture content will exceed 3 percent.

Now, perhaps your service department might not even offer this service or have the equipment to perform it. Your techs might insist some of the bleeder screws get rusty and cause more trouble than the labor operation pays, so they won’t recommend it. Or, maybe your service advisors will refuse to recommend changing brake fluid if it isn’t in the owner’s manual.

As it happens, most manufacturers of auto maintenance products like BG Products Inc. make dip strips that measure the copper content of fluids. The tool I love is a battery-operated strip that measures the percentage of water in brake fluid. It lights up red if the water content exceeds 3 percent.

I visited a service department client where only two brake fluid changes had been performed over the prior 12 months. During the visit, we implemented a process in the service drive in which this tool was used to check every vehicle as it came in for work. This dealership sold 30 brake fluid flushes over the next month alone! That extrapolates into an additional $43,200 over the next 12 months for this one labor op improvement.

Give Every Op Same Attention

Imagine what the return might be at your dealership if every service labor operation on your list was given the same level of attention. A best practice is to select one labor op every week and gather the service team for a meeting with role-playing feature benefit presentations, based on suggested mileage intervals for that labor op. Once every operation is covered, start the cycle again. The point is to keep your team focused on becoming the professionals your dealership needs, acknowledge the improvements and discuss the opportunities.

If your dealership implements this program, I believe you will find that every key performance indicator in your service and parts departments improves dramatically. Your service team will become confident about recommending needed maintenance items and better care for their customers. Your customers will become more educated about why these maintenance procedures should be performed on their vehicle, and feel about better spending the money with you. Your techs’ efficiency and productivity indicators will climb as their on-task hours and income rise.

The days of your advisors saying, “You’re due for a transmission flush,” and believing they have done their job properly by simply recording that the customer declined, have got to be put behind you.

 

Source: Service Drive Magazine, September 2015 Issue

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