TAMPA, FL â A dealership service departmentâs role should go beyond maintaining and fixing vehicles.
âWeâre also a support function of the sales department,â says Lee Harkins, a fixed-operations consultant. âOur job is to help sell cars. To support that effort, we must retain our customers.â
He moderates a panel-discussion session entitled, âFixed Operations: Customers for Life,â at The Wardâs Spring Training Conference here. Because of the current slump in vehicle sales, the main focus at a lot of dealerships has switched over to fixed operations, Harkins notes. âWeâve been getting a lot of attention.â
The service department is crucial to many dealerships, says Ray Fenster, e-commerce director for the Lindsay Automotive Group, with dealerships in Virginia, Maryland and the Washington, DC, area.
âMy passion is fixed operations because thatâs where the business is and thatâs where a sale is made,â Fenster says, referring to data indicating customers who are satisfied with a dealershipâs service department are more likely to buy their future vehicles at that store.
Considering the slump in vehicle deliveries, âitâs not new-car sales or used-car sales but fixed operations that run the business,â Fenster says.
Bob Horn, service manager of Firkinsin Bradenton, FL, says he makes it a point to introduce himself to customers taking delivery of cars.
American auto dealers might learn something from their Canadian counterparts, says Les Silver, a Manitoba native and chairman and CEO of Mobile Productivity Inc., a firm that provides dealerships with hand-held electronic devices for expediting vehicle inspections.
âCanadian dealers have been able to operate on smaller sales volumes because of their emphasis on parts and repairs,â he says. âThe biggest short-term opportunity for fixed operations is when the car is in your service department; what do you do to maximize that transaction?â he says.
Silver says offering free vehicle inspections help in that regard, because they can identify repair needs that potentially give dealerships additional service work and provide the customer with a car in good working order.
âCapitalize on existing traffic,â Silver says, although he notes most dealerships, for whatever reason, fail to offer the inspections. Airplanes are routinely inspected. Vehicles should be too, he says.
Customer retention is critical to a profitable service department, says panelist Neal East, CEO of Xtime Inc., a provider of online service-scheduling systems. But dealerships see as much as 70% of their service business fall off, particularly when warranties expire and customers end up taking their business elsewhere.
âItâs primarily our business, yet thereâs a big falloff,â he says. âOften that happens because of issues with trust and convenience.â
East says dealerships that âhideâ their service prices by failing to disclose them up front run the risk of engendering customer distrust, whether deserved or not.
Dealership service departments that are open only Monday through Friday can be perceived as having inconvenient hours, he says.
âAnd some dealership fixed operations donât have a holistic process,â East says. âA customer gets different answers from different people.â
Many dealerships spend money trying to increase vehicle sales through online efforts, such as search-engine optimization and search-engine marketing, Fenster says.
âBut how much of that effort is put into fixed operations?â he says. âIf you are a dealer in the Northeast, do you include âsnow tiresâ or âcollision repairâ as search terms? And how much real estate on your website is dedicated to fixed operations, especially in this economy?â
He recommends dealerships use customer-relationship management systems âto the maxâ by sending customers timely and useful service information.
âCustomers should know when they are due for an alignment or when their tires should be changed or rotated,â Fenster says. âAnd just as a dealership may use microsites for sales, they should use them for fixed operations.â
Horn warns not to âbombard people with garbageâ when sending service reminders and such.
âWe send coupons, rebate information, incentive information,â he says. âWe honor all oil-change coupons and track it; if youâre not measuring it, donât do it.â
His dealership also sends customers specific information relevant to the age of their vehicles. âVehicles of different ages have different service needs,â he says.