TACKLING COMMON ISSUESWITH SERVICE ADVISORSDAVID LEWIS… see PAGE 16

REGULATORY COMPLIANCE NEEDS MGMT. OVERSIGHT TERRY DORTCH… see PAGE 20

BAD FACEBOOK REVIEWS

REQUIREQUICK ACTION

DAVID KAIN… see PAGE 24

THE RIGHT TECH WORK

SCHEDULE BOOSTS OUTPUT CHUCK WENZLER

… see PAGE 18

DECEMBER 2015 VOLUME 1, ISSUE 8

Register Now And Save For Feb. 9-11 CBT Conference & Expo

MINING YOUR ROs FOR INSIGHTSA sample of 100 recent repair orders can reveal if your service department is taking the wrong kinds of jobs. ... see PAGE 6

KPIs ON SERVICE ADVISOR PERFORMANCEDon’t just track how many ROs are being written; you also want to know labor billings and parts sales with an average order. ... see PAGE 8

Check out our daily newscast on

servicedrivetoday.com

a CBT Automotive Network publication

Patrick Lencioni Nick Saban Marcus Lemonis Jason Dorsey

A T L A N T A

Magazine archives at servicedrivetoday.com

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JOE VERDEThe #1 Training Company In The Car Business

“I went from 14 to 25 units!”“Our dealership has completely turned around and we’re up 127 units a month!”

JVTN® – #1 AGAIN & AGAIN

JOE VERDE SALES & MANAGEMENT TRAINING WORKSHOPS

n How To Sell A Car, Stay Off Price & Close The Sale Today Want a 20%-50% boost in sales and gross overnight? Sign up now or take the course on JVTN®.

n How To Close, Overcome Objections & Negotiate Tired of missing deals that should have become deliveries? Live & Online...Call today.

n Internet & Phone Leads Dealerships miss 8 out of 9 deliveries from these lead sources. We fix that, live in this workshop and online at JVTN®.

Sales Workshopsn Managing For Growth & Profit

Our ‘Team Leadership’ workshop is the critical class managers never got on “Managing Salespeople & Profits”. Attend this workshop first.

n Working Deals (aka: Negotiation) Improve your sales, gross & CSI with this easy 20-minute, customer friendly, 3-Step Process on every deal you work.

n Hold Effective Training Meetings Your salespeople are individual gold mines, and they just need your help to produce more. Attend this workshop and turn ‘sales meetings’ into “Training Sessions”.

Management Workshops

Don’t Miss Out – Seats Are Limited!

Call Now • 888-712-6647

What Is JVTN®

Joe Verde Sales & Management Training, Inc. is known world-wide, as the go-to source for Retail Sales Management and Salesperson training & processes in our workshops and online. We’re the only training source that covers all of the skills & processes for selling cars, training, coaching & managing sales-people, and tying F&I and Service into the retention process. I initially developed JVTN® for our dealers who get their ini-tial training in our sales and management workshops, so they can continue to develop their skills back in the dealership.JVTN® mirrors our classes, and on JVTN® we cover... • The sales process from the greeting to heading inside to work

the deal, handling price, closing & handling objections, plus advanced courses on closing, objections & negotiation.

• Working the deal at the desk to deliver more at max gross.• Transitioning to Finance, then to Service before delivery. • ‘Targeted’ delivery and initial sold customer follow up. • A continuous retention process, to turn sales today into add-

ed no cost / high profit sales in the future with each customer.Then we have Follow Up, Prospecting, Internet & Phone Leads – and another dozen courses on critical skills and pro-cesses, plus Service and F&I courses on “Selling” & “Re-taining” customers to guarantee more long-term retention.

JVTN® makes it easy for managers to hold great training...

n Your full subscription includes training for 2 of your managers in our live workshop so they understand the goal & process.

n Each course has a complete Leader’s Guide on what to do before, and what to discuss or practice after, each chapter.

n Teach & Verify ... Each chapter has a quiz and each course has Certification so managers know salespeople not only take each chapter, but also retain what they learn.

n We have your back, with a dedicated staff of Certified JV Training Coaches to help your managers stay on track and help your sales team develop their skills.

JVTN® makes it easy for salespeople to develop their skills...

n Every course & chapter includes a complete workbook filled with the processes / scripts / techniques covered.

n Each salesperson (and managers) can track their activities to identify what training to ‘target’ so they continually improve.

n And dozens of other features & 1,000s of chapters on skills, habits & attitude they can ‘like’ to review again and again. With JVTN® you will sell more units at higher gross PVR,

stop your salesperson turnover, and retain customers for life.If higher sales, gross & net profit are your goals...

JVTN® Makes In-Dealership Training Easy

Call Now • 888-712-6647

Train On JVTN® Today – Improve Sales Today

“About a year ago while on vacation, I brought Joe’s book, ‘A Dealer’s Guide to Recovery & Growth’, and I couldn’t wait to learn more about Joe’s training.

We have since attended Joe’s 2-Day Manager Workshop and we’ve implemented JVTN®.

Our dealership has completely turned around. We now have a sales process everyone follows, we track everything we do, we set goals religiously, and have weekly training meetings with our salespeople.

We were selling around 50 units a month, and in March we had an all-time record month and sold 184!

Joe, thank you for getting us on track and pointing out that there is no secret to success, it’s working smarter, not harder like we were doing.”

– Marvin Potter, GM, Matthews Auto Group, Vestal, NY

JO

E VERDE SALES

& MANAGEMENT TR

AINING,INC.

30YEARS OF EXCELLENCE

1985–2015

1985 – 2015

From 36 to 348,000!To change what you earn

change what you say! In the early 1950s, there was a drugstore chain and each had a counter for sodas, malts and sandwiches. In a meeting on profits, management realized their highest profit margin item was an egg.Back then, eggs cost 10¢ a dozen. They sold each egg for 5¢, 60¢ a dozen, and made 50¢ gross profit. The problem; they couldn’t figure out how to sell more eggs.They’d tried to sell more, but they had only increased total egg sales by about three dozen (36) extra eggs per week.They met with a sales trainer, Elmer Wheeler, and said they wanted to sell more eggs, and asked him to create a “presentation” for their counter people.He said, “Sure,” and on the spot, he wrote a 4-word presentation on the back of his business card and told them to send his checks to the address on the front.His simple 4-word presentation took their egg sales from just 36 extra eggs a week, to 348,000 extra eggs a week.

His 4-word presentation?People often added a fresh egg to a malt or milkshake, so when a customer ordered one, instead of asking, “Did you want an egg in your malt?”, they held an egg in each hand and asked, “1 egg or 2?”Whether you’re selling eggs or cars…

Sales are missed by a few words, and not by a few dollars.

Get my book, “Top 7 Revenue & Profit Sources” (free, below) and I’ll show you exactly where to look to immediately increase sales with no new expenses. Then get to class and turn on JVTN®. If you do, you’ll double or triple your sales, net and income like Marv (see the gray box) and so many others.

Double Your Net &

Double Your Income!

Get Joe’s Book FREE

Go To: JoeVerde.com/CBT

MORE CUSTOMERSBUYING MORE

STAYING LONGER

SCHEDULEDRETENTION

86% of drivers who return for regular maintenance are also more likely to purchase their next vehicle from the same dealership.1

Visit easycare.com/servicedriveOr Call Us Today at 855.772.6590

LEARN HOW TO CAPTURE THESE OPPORTUNITIES!

© 2015 Automobile Protection Corporation – APCO. EasyCare is a registered trademark of APCO. MOTOR TREND® is a registered trademark of TEN: The Enthusiast Network Magazines, LLC. 1PPM Driving Retention, Profits - March 2013, Auto Dealer Today.

JOE VERDEThe #1 Training Company In The Car Business

“I went from 14 to 25 units!”“Our dealership has completely turned around and we’re up 127 units a month!”

JVTN® – #1 AGAIN & AGAIN

JOE VERDE SALES & MANAGEMENT TRAINING WORKSHOPS

n How To Sell A Car, Stay Off Price & Close The Sale Today Want a 20%-50% boost in sales and gross overnight? Sign up now or take the course on JVTN®.

n How To Close, Overcome Objections & Negotiate Tired of missing deals that should have become deliveries? Live & Online...Call today.

n Internet & Phone Leads Dealerships miss 8 out of 9 deliveries from these lead sources. We fix that, live in this workshop and online at JVTN®.

Sales Workshopsn Managing For Growth & Profit

Our ‘Team Leadership’ workshop is the critical class managers never got on “Managing Salespeople & Profits”. Attend this workshop first.

n Working Deals (aka: Negotiation) Improve your sales, gross & CSI with this easy 20-minute, customer friendly, 3-Step Process on every deal you work.

n Hold Effective Training Meetings Your salespeople are individual gold mines, and they just need your help to produce more. Attend this workshop and turn ‘sales meetings’ into “Training Sessions”.

Management Workshops

Don’t Miss Out – Seats Are Limited!

Call Now • 888-712-6647

What Is JVTN®

Joe Verde Sales & Management Training, Inc. is known world-wide, as the go-to source for Retail Sales Management and Salesperson training & processes in our workshops and online. We’re the only training source that covers all of the skills & processes for selling cars, training, coaching & managing sales-people, and tying F&I and Service into the retention process. I initially developed JVTN® for our dealers who get their ini-tial training in our sales and management workshops, so they can continue to develop their skills back in the dealership.JVTN® mirrors our classes, and on JVTN® we cover... • The sales process from the greeting to heading inside to work

the deal, handling price, closing & handling objections, plus advanced courses on closing, objections & negotiation.

• Working the deal at the desk to deliver more at max gross.• Transitioning to Finance, then to Service before delivery. • ‘Targeted’ delivery and initial sold customer follow up. • A continuous retention process, to turn sales today into add-

ed no cost / high profit sales in the future with each customer.Then we have Follow Up, Prospecting, Internet & Phone Leads – and another dozen courses on critical skills and pro-cesses, plus Service and F&I courses on “Selling” & “Re-taining” customers to guarantee more long-term retention.

JVTN® makes it easy for managers to hold great training...

n Your full subscription includes training for 2 of your managers in our live workshop so they understand the goal & process.

n Each course has a complete Leader’s Guide on what to do before, and what to discuss or practice after, each chapter.

n Teach & Verify ... Each chapter has a quiz and each course has Certification so managers know salespeople not only take each chapter, but also retain what they learn.

n We have your back, with a dedicated staff of Certified JV Training Coaches to help your managers stay on track and help your sales team develop their skills.

JVTN® makes it easy for salespeople to develop their skills...

n Every course & chapter includes a complete workbook filled with the processes / scripts / techniques covered.

n Each salesperson (and managers) can track their activities to identify what training to ‘target’ so they continually improve.

n And dozens of other features & 1,000s of chapters on skills, habits & attitude they can ‘like’ to review again and again. With JVTN® you will sell more units at higher gross PVR,

stop your salesperson turnover, and retain customers for life.If higher sales, gross & net profit are your goals...

JVTN® Makes In-Dealership Training Easy

Call Now • 888-712-6647

Train On JVTN® Today – Improve Sales Today

“About a year ago while on vacation, I brought Joe’s book, ‘A Dealer’s Guide to Recovery & Growth’, and I couldn’t wait to learn more about Joe’s training.

We have since attended Joe’s 2-Day Manager Workshop and we’ve implemented JVTN®.

Our dealership has completely turned around. We now have a sales process everyone follows, we track everything we do, we set goals religiously, and have weekly training meetings with our salespeople.

We were selling around 50 units a month, and in March we had an all-time record month and sold 184!

Joe, thank you for getting us on track and pointing out that there is no secret to success, it’s working smarter, not harder like we were doing.”

– Marvin Potter, GM, Matthews Auto Group, Vestal, NY

JO

E VERDE SALES

& MANAGEMENT TR

AINING,INC.

30YEARS OF EXCELLENCE

1985–2015

1985 – 2015

From 36 to 348,000!To change what you earn

change what you say! In the early 1950s, there was a drugstore chain and each had a counter for sodas, malts and sandwiches. In a meeting on profits, management realized their highest profit margin item was an egg.Back then, eggs cost 10¢ a dozen. They sold each egg for 5¢, 60¢ a dozen, and made 50¢ gross profit. The problem; they couldn’t figure out how to sell more eggs.They’d tried to sell more, but they had only increased total egg sales by about three dozen (36) extra eggs per week.They met with a sales trainer, Elmer Wheeler, and said they wanted to sell more eggs, and asked him to create a “presentation” for their counter people.He said, “Sure,” and on the spot, he wrote a 4-word presentation on the back of his business card and told them to send his checks to the address on the front.His simple 4-word presentation took their egg sales from just 36 extra eggs a week, to 348,000 extra eggs a week.

His 4-word presentation?People often added a fresh egg to a malt or milkshake, so when a customer ordered one, instead of asking, “Did you want an egg in your malt?”, they held an egg in each hand and asked, “1 egg or 2?”Whether you’re selling eggs or cars…

Sales are missed by a few words, and not by a few dollars.

Get my book, “Top 7 Revenue & Profit Sources” (free, below) and I’ll show you exactly where to look to immediately increase sales with no new expenses. Then get to class and turn on JVTN®. If you do, you’ll double or triple your sales, net and income like Marv (see the gray box) and so many others.

Double Your Net &

Double Your Income!

Get Joe’s Book FREE

Go To: JoeVerde.com/CBT

MORE CUSTOMERSBUYING MORE

STAYING LONGER

SCHEDULEDRETENTION

86% of drivers who return for regular maintenance are also more likely to purchase their next vehicle from the same dealership.1

Visit easycare.com/servicedriveOr Call Us Today at 855.772.6590

LEARN HOW TO CAPTURE THESE OPPORTUNITIES!

© 2015 Automobile Protection Corporation – APCO. EasyCare is a registered trademark of APCO. MOTOR TREND® is a registered trademark of TEN: The Enthusiast Network Magazines, LLC. 1PPM Driving Retention, Profits - March 2013, Auto Dealer Today.

Roger PenskeOwner of Team Penske, The Penske Corp.

Mark FieldsPresident & CEO, Ford Motor Company

Dale PollakFounder, vAuto | Senior VP, Cox Automotive

Bill Fox2015 NADA Chairman

Jeff DykeExecurive Vice President, Sonic Automotive

Joe VerdePresident, Joe Verde Sales & Management Training, Inc.

Alan MulallyFormer President and CEO, Ford Motor Company

Craig MonaghanPresident and CEO, Asbury Automotive Group

Jared RoweDivision President, Media, Cox Automotive

Mike JacksonChairman, CEO & President of AutoNation, Inc.

Sandy SchwartzPresident, Cox Automotive

Nick SabanHead Football Coach, Alabama Crimson Tide

A MEMBER OF THE CBT AUTOMOTIVE NETWORK

In addition to our daily newscasts and eNewsletters, our monthly magazine, Car Biz Today, is your trusted source for the latest news and trends in the retail automotive industry.

SIGN UP FOR YOUR FREE SUBSCRIPTION TODAY AT CBTNEWS.COM

DEALERS, GMs, SALESPEOPLE, SERVICE MANAGERS, F&I MANAGERS, MARKETINGDIRECTORS, BDC MANAGERS AND ALL OTHER DEALERSHIP PERSONNELCheck out CBTNEWS.com for news, information, best practices, training tips from

the nation’s top automotive trainers, in-depth interviews with industry experts and more.It’s completely FREE to all dealership personnel!

30

26

Letter From The Editor

Dear Readers,

In our pages and in my letters in recent editions, I’ve tried to keep you updated on all of the material developments with our CBT Automotive Sales, Service and Marketing Conference & Expo – which is not an easy task, trust me. As an attendee, you of course will be primarily concerned with the practical value of the guidance you hear from our speakers. To that end, you’ll want to read our update inside about the addition of several panel discussions. Apart from creating a seamless bridge from our keynote addresses to the conference breakout sessions, these panel discussions will bring you top minds and business leaders in retail automotive breaking down some of the most vexing issues for dealers. The early registration deadline (for a $200 discount) for our Feb. 9-11 conference in Atlanta is fast approaching, so go to www.cbtconferenceandexpo.com to sign up today.

Also in this edition, we bring you insights on repair order metrics key performance indicators, management tools on which every service manager relies but which are constantly evolving. Make a point of reading the piece from Don Reed of DealerPro Training about how a routine, random sample of your ROs can provide insights into where your team is struggling or succeeding, insights that you might have missed in the everyday crush. Also, you’ll want to

check out thoughts from John Fairchild of Fairchild Automotive Solutions on how to identify and track KPIs that truly reveal your service advisors’ performance.

In that same ilk of how setting up the proper system from the get-go pays off, you won’t want to miss an article by Chuck Wenzler of M5 Management Services Inc. about boosting output simply by reconfiguring technicians’ work schedules, rather than undertaking a building expansion. And Terry Dortch of Automotive Compliance Consultants reminds you that constant compliance with all of the federal laws and regulations that govern a dealership’s departments (including the service department) demands planned oversight from top management.

Finally, every service manager knows that responding to a negative online review by a service customer demands his or her immediate response. David Kain of Kain Automotive tells you why the need for the dealership’s reply is particularly paramount when the review is on Facebook.

Here’s hoping for a busy December in your service department.

JON MCKENNAManaging Editor

In This Issue

SERVICEDRIVEMAGAZINE

President And Publisher Jim Fitzpatrick

Vice President/COO Bridget Fitzpatrick

Managing EditorJon McKenna

Creative DirectorRandall Veugeler

Art DirectorErica Abrams

Production ManagerLaura Payne

DesignersShay HarbaughBrian Hassinger

April MillerChristina Zavlanos

Web DesignJeff Pearson

Director of Marketing& Events

Alex Branam

Marketing AssociateRoxanne Luhr

Subscription ManagerEmily Wiggins

SERVICE DRIVE TODAY

Emailnewsroom@servicedrivetoday.com

Phone 678.221.2955

MEDIA SALES REPRESENTATIVEGary Blitzer

gblitzer@cbtnews.com d 678.221.2955c 770.330.6821

SUBSCRIPTIONS

To subscribe electronically,

log on to ServiceDriveToday.

com and click the subscribe

link on the side bar.

Alternately, forward your

company name, your name,

address, phone number

and email address to

info@ServiceDriveToday.com

or CBT Automotive Network,

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Entire contents ©2015 Service Drive. All Rights Reserved.

16

6 Peruse a batch of your latest ROs to identify key service work trends By Don Reed, DealerPro Training

8 ROs written isn’t the only vital KPI for advisor performance By John Fairchild, Fairchild Automotive Solutions

10 Heavyweights in auto retailing fortify February CBT Conference agenda

12 Fluid diagnostics should be part of every MPI but often aren’t By Ron McElroy, Magna-Guard Inc.

14 Ask The Pros

Leading service trainer gives thoughts on common advisor issues By David Lewis, David Lewis & Associates

18 Alternative time structures can significantly boost your techs’ output By Chuck Wenzler, M5 Management Services Inc.

20 Use this road map to dealership compliance with laws and regs By Terry Dortch, Automotive Compliance Consultants

22 On The Set With Service Drive Today

24 Address bad customer reviews on Facebook as quickly as you can By David Kain, Kain Automotive

Combine competitive pay with incentives for hourly BDC agents By Bill Wittenmyer, ELEAD1ONE

28 Management approaches that keep a rein on departments’ competition By Mark Tewart, Tewart Enterprises Inc.

Info about customers’ preferences maximizes your CMS and CRM By Michael Roppo, Automotive Domain Results

ONLINE FEATURESVisit www.ServiceDriveToday.com

ServiceDriveToday.com 4 Service Drive DECEMBER 2015

Roger PenskeOwner of Team Penske, The Penske Corp.

Mark FieldsPresident & CEO, Ford Motor Company

Dale PollakFounder, vAuto | Senior VP, Cox Automotive

Bill Fox2015 NADA Chairman

Jeff DykeExecurive Vice President, Sonic Automotive

Joe VerdePresident, Joe Verde Sales & Management Training, Inc.

Alan MulallyFormer President and CEO, Ford Motor Company

Craig MonaghanPresident and CEO, Asbury Automotive Group

Jared RoweDivision President, Media, Cox Automotive

Mike JacksonChairman, CEO & President of AutoNation, Inc.

Sandy SchwartzPresident, Cox Automotive

Nick SabanHead Football Coach, Alabama Crimson Tide

A MEMBER OF THE CBT AUTOMOTIVE NETWORK

In addition to our daily newscasts and eNewsletters, our monthly magazine, Car Biz Today, is your trusted source for the latest news and trends in the retail automotive industry.

SIGN UP FOR YOUR FREE SUBSCRIPTION TODAY AT CBTNEWS.COM

DEALERS, GMs, SALESPEOPLE, SERVICE MANAGERS, F&I MANAGERS, MARKETINGDIRECTORS, BDC MANAGERS AND ALL OTHER DEALERSHIP PERSONNELCheck out CBTNEWS.com for news, information, best practices, training tips from

the nation’s top automotive trainers, in-depth interviews with industry experts and more.It’s completely FREE to all dealership personnel!

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 7 6 Service Drive DECEMBER 2015

hat can service department directors and managers learn from a repair order? Plenty.

More specifically, I’m referring to a customer pay RO. In this article, I’ll refer to it as a “retail” RO. I want to discuss how you can use an examination of retail ROs to effectively evaluate the performance of your dealership’s service operations team, while needing as little as 30 minutes per week to gather and present the data.

PERUSE A BATCH OF YOUR LATEST ROs, AND

VALUABLEINSIGHTS AWAITWatch for negative trends with one-item jobs, older cars generating little work, skipping of menus and inspections.

BY DON REED

DON REEDCEO of DealerPro Training

After 26 years in the automobile business as a dealer, GM, sales manager, service manager, service advisor and salesperson, Don began a new career as a consultant and trainer. As CEO of DealerPro Training and founder of The Don Reed PRO Training Network, he has worked with hundreds of dealerships and major dealer groups across the U.S., Canada and the U.K. to increase profits in their fixed operations. He was rated a Top 10 Speaker at the NADA convention for four consecutive years. Visit the firm’s website at DealerProTraining.com.

to $250. You need to wake up to the problem of these reconditioning jobs and dollars coming into your service department every day, but your service team not giving customers the option of saying, “Yes” to needed repairs or services.

I am not talking about a hard sell, not at all. Your team simply should inspect the vehicle and then advise the customer ( just like you do with the used car manager) of the needed services. Then, let the customer decide whether he or she wants a safe and reliable vehicle.

EVERYONE GETS A MENU REVIEWED When a customer declines “Menu” services, your people should note “customer declined maintenance” on the RO so that the decision becomes part of his or her service history. Your advisors should give a menu presentation to 100% of your customers in order to train them to pay attention to preventive maintenance. Again, this is not a hard sell but rather advising the customer about necessary maintenance.

A problem with many advisors is that they effectively make the customer’s decision by failing to give them the opportunity to say, “Yes.” In other words, many advisors never even present a menu to your customers! A recent survey from J.D. Power showed

that only 27% of advisors even present maintenance menus, but when they do, customers respond affirmatively 46% of the time. How do you like that closing ratio?

TRY RO ANALYSIS FOR EACH ADVISOR So, what do you think? Is it worth 30 minutes of your time to perform this RO analysis? Obviously it is, because the exercise will cut through all of the excuses you’ve been hearing or offering as to why your sales per RO are so low.

How often should this analysis be done? Once a week. Who should conduct it? The service director/manager. Who should see the results: The dealer, GM, all service advisors, the service drive sales manager and the shop foreman should meet weekly to review the results. Additionally, it is a great idea to review the numbers with all of your techs in a shop meeting at least once a month.

If you are interested in total accountability for individual performance in your department, then try preparing this RO analysis for each advisor. You will be able to identify who is providing your customers with a high level of service, and who is not. Service advisors who do a great job both for their customers and their dealers unfortunately fall into a minority. Service directors should separate their top performers from the underachievers, so they can identify who needs training and who deserves a pat on the back for a job well done. SD

To begin with, gather 100 of your recent retail ROs. Next, create an Excel spreadsheet and across the top, enter these headings. You will need to review each of those 100 ROs and make a check mark in the appropriate column, as I have done below:

Note, for example, that on RO #03214, a lube, oil and filter change (LOF) was performed but was the only item on the RO (1-Item). The mileage on the vehicle serviced was between 26,000 and 50,000 miles (26-50). The customer did sign the RO (Sign). Simple enough, right?

Now, once you have checked and recorded all 100 ROs, total the number of “X” entries in each column. Report that number at the bottom and calculate it as a percentage of the total ROs, as follows with my hypothetical example:

WHERE A SAMPLE OF 100 ROs LEADS

As you can see, 60 percent of the ROs had an LOF performed. The customer declined maintenance (CDM) on 20% of the ROs, and on 20% bought a service that is recommended or required based on age and mileage (Menu). Sixty percent bought only one item while 40% purchased multiple items (Multiple). Twenty percent of the customers had less than 25,000 miles on their vehicles (0-25), another 20% had 26,000 to 50,000 miles, 40% had between 51,000 and 75,000 miles (51-75), and 20% had 76,000 or more miles (76+). Twenty percent of the customers received an estimate (Est), another 20% had a 27-point inspection completed (27pt), ad 80% signed the RO.

HOW MANY 1-ITEM CUSTOMERS? Now, let’s analyze what this spreadsheet teaches us about the performance of our hypothetical service operations team.

The most glaring problem stems from 60% of repair customers buying only one item. If your dealership writes more than half of its ROs in the 1-Item column, that means you probably average about 1 to 1.2 hours per retail RO. This is the equivalent of terminal cancer for increasing service absorption and for long-term profits in fixed operations!

You must understand that 1-Item ROs fail to train your

customers to pay attention to preventive maintenance needs. In the long run, their cost of ownership will increase, because clearly no one on your team is advising them about recommended and/or required services for a safe and reliable vehicle. Mechanical failures lead to mechanical repairs, which are costlier than preventive maintenance.

A high percentage of 1-Item ROs indicates your technicians are not inspecting all of the vehicles they service. (The same warning is sounded about the 20% of ROs with a completed 27-point inspection.) Plus, if your 1-Item ROs exceed 50% of the total, then your advisors are not advising. Your goal should be 15% of ROs or fewer.

OLDER VEHICLES MUST DRIVE WORK Another interesting trend to note in my table is that 60% of the ROs surveyed are for vehicles with more than 50,000 miles. Research shows that starting with the fourth year of ownership, the average customer will spend about $450 per year to service and/or repair their vehicle, or three times as much as during the first three years. In your dealership, you will probably find that about half of your customer pay ROs have more than 50,000 miles, with a high proportion of that group at more than 75,000 miles.

Common sense tells us that many of these vehicles are due for some form of maintenance or repair. How often should your team perform a 27-point inspection of a used vehicle with more than 50,000 miles on the odometer, yet your tech identifies only one item to repair or service? Never!

Compare your service department’s per-vehicle used car reconditioning costs you’re your average dollar sales per customer pay RO on vehicles with more than 50,000 miles. I’m guessing reconditioning will be $500 to $700 per vehicle and customer pay ROs will be $175

RO# LOF CDM Menu 1-Item Multiple 0-25 26-50 51-75 76+ Est 27pt Sign

03214 x x x x

03218 x x x x x

03220 x x x x

03225 x x x n/a

03229 x x x x x

3 1 1 3 2 1 1 2 1 1 1 4

60% 20% 20% 60% 40 20% 20% 40% 20% 20% 20% 80%

RO# LOF CDM Menu 1-Item Multiple 0-25 26-50 51-75 76+ Est 27pt Sign

03214 x x x x

“You must understand that 1-Item ROs fail to train your

customers to pay attention to preventive maintenance

needs.”

“The [RO analysis] will cut through all of the excuses you’ve been hearing or

offering as to why your sales per RO

are so low.”

Every customer should receive a full services-menu review, even if it makes him

or her a bit edgy.

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 7 6 Service Drive DECEMBER 2015

hat can service department directors and managers learn from a repair order? Plenty.

More specifically, I’m referring to a customer pay RO. In this article, I’ll refer to it as a “retail” RO. I want to discuss how you can use an examination of retail ROs to effectively evaluate the performance of your dealership’s service operations team, while needing as little as 30 minutes per week to gather and present the data.

PERUSE A BATCH OF YOUR LATEST ROs, AND

VALUABLEINSIGHTS AWAITWatch for negative trends with one-item jobs, older cars generating little work, skipping of menus and inspections.

BY DON REED

DON REEDCEO of DealerPro Training

After 26 years in the automobile business as a dealer, GM, sales manager, service manager, service advisor and salesperson, Don began a new career as a consultant and trainer. As CEO of DealerPro Training and founder of The Don Reed PRO Training Network, he has worked with hundreds of dealerships and major dealer groups across the U.S., Canada and the U.K. to increase profits in their fixed operations. He was rated a Top 10 Speaker at the NADA convention for four consecutive years. Visit the firm’s website at DealerProTraining.com.

to $250. You need to wake up to the problem of these reconditioning jobs and dollars coming into your service department every day, but your service team not giving customers the option of saying, “Yes” to needed repairs or services.

I am not talking about a hard sell, not at all. Your team simply should inspect the vehicle and then advise the customer ( just like you do with the used car manager) of the needed services. Then, let the customer decide whether he or she wants a safe and reliable vehicle.

EVERYONE GETS A MENU REVIEWED When a customer declines “Menu” services, your people should note “customer declined maintenance” on the RO so that the decision becomes part of his or her service history. Your advisors should give a menu presentation to 100% of your customers in order to train them to pay attention to preventive maintenance. Again, this is not a hard sell but rather advising the customer about necessary maintenance.

A problem with many advisors is that they effectively make the customer’s decision by failing to give them the opportunity to say, “Yes.” In other words, many advisors never even present a menu to your customers! A recent survey from J.D. Power showed

that only 27% of advisors even present maintenance menus, but when they do, customers respond affirmatively 46% of the time. How do you like that closing ratio?

TRY RO ANALYSIS FOR EACH ADVISOR So, what do you think? Is it worth 30 minutes of your time to perform this RO analysis? Obviously it is, because the exercise will cut through all of the excuses you’ve been hearing or offering as to why your sales per RO are so low.

How often should this analysis be done? Once a week. Who should conduct it? The service director/manager. Who should see the results: The dealer, GM, all service advisors, the service drive sales manager and the shop foreman should meet weekly to review the results. Additionally, it is a great idea to review the numbers with all of your techs in a shop meeting at least once a month.

If you are interested in total accountability for individual performance in your department, then try preparing this RO analysis for each advisor. You will be able to identify who is providing your customers with a high level of service, and who is not. Service advisors who do a great job both for their customers and their dealers unfortunately fall into a minority. Service directors should separate their top performers from the underachievers, so they can identify who needs training and who deserves a pat on the back for a job well done. SD

To begin with, gather 100 of your recent retail ROs. Next, create an Excel spreadsheet and across the top, enter these headings. You will need to review each of those 100 ROs and make a check mark in the appropriate column, as I have done below:

Note, for example, that on RO #03214, a lube, oil and filter change (LOF) was performed but was the only item on the RO (1-Item). The mileage on the vehicle serviced was between 26,000 and 50,000 miles (26-50). The customer did sign the RO (Sign). Simple enough, right?

Now, once you have checked and recorded all 100 ROs, total the number of “X” entries in each column. Report that number at the bottom and calculate it as a percentage of the total ROs, as follows with my hypothetical example:

WHERE A SAMPLE OF 100 ROs LEADS

As you can see, 60 percent of the ROs had an LOF performed. The customer declined maintenance (CDM) on 20% of the ROs, and on 20% bought a service that is recommended or required based on age and mileage (Menu). Sixty percent bought only one item while 40% purchased multiple items (Multiple). Twenty percent of the customers had less than 25,000 miles on their vehicles (0-25), another 20% had 26,000 to 50,000 miles, 40% had between 51,000 and 75,000 miles (51-75), and 20% had 76,000 or more miles (76+). Twenty percent of the customers received an estimate (Est), another 20% had a 27-point inspection completed (27pt), ad 80% signed the RO.

HOW MANY 1-ITEM CUSTOMERS? Now, let’s analyze what this spreadsheet teaches us about the performance of our hypothetical service operations team.

The most glaring problem stems from 60% of repair customers buying only one item. If your dealership writes more than half of its ROs in the 1-Item column, that means you probably average about 1 to 1.2 hours per retail RO. This is the equivalent of terminal cancer for increasing service absorption and for long-term profits in fixed operations!

You must understand that 1-Item ROs fail to train your

customers to pay attention to preventive maintenance needs. In the long run, their cost of ownership will increase, because clearly no one on your team is advising them about recommended and/or required services for a safe and reliable vehicle. Mechanical failures lead to mechanical repairs, which are costlier than preventive maintenance.

A high percentage of 1-Item ROs indicates your technicians are not inspecting all of the vehicles they service. (The same warning is sounded about the 20% of ROs with a completed 27-point inspection.) Plus, if your 1-Item ROs exceed 50% of the total, then your advisors are not advising. Your goal should be 15% of ROs or fewer.

OLDER VEHICLES MUST DRIVE WORK Another interesting trend to note in my table is that 60% of the ROs surveyed are for vehicles with more than 50,000 miles. Research shows that starting with the fourth year of ownership, the average customer will spend about $450 per year to service and/or repair their vehicle, or three times as much as during the first three years. In your dealership, you will probably find that about half of your customer pay ROs have more than 50,000 miles, with a high proportion of that group at more than 75,000 miles.

Common sense tells us that many of these vehicles are due for some form of maintenance or repair. How often should your team perform a 27-point inspection of a used vehicle with more than 50,000 miles on the odometer, yet your tech identifies only one item to repair or service? Never!

Compare your service department’s per-vehicle used car reconditioning costs you’re your average dollar sales per customer pay RO on vehicles with more than 50,000 miles. I’m guessing reconditioning will be $500 to $700 per vehicle and customer pay ROs will be $175

RO# LOF CDM Menu 1-Item Multiple 0-25 26-50 51-75 76+ Est 27pt Sign

03214 x x x x

03218 x x x x x

03220 x x x x

03225 x x x n/a

03229 x x x x x

3 1 1 3 2 1 1 2 1 1 1 4

60% 20% 20% 60% 40 20% 20% 40% 20% 20% 20% 80%

RO# LOF CDM Menu 1-Item Multiple 0-25 26-50 51-75 76+ Est 27pt Sign

03214 x x x x

“You must understand that 1-Item ROs fail to train your

customers to pay attention to preventive maintenance

needs.”

“The [RO analysis] will cut through all of the excuses you’ve been hearing or

offering as to why your sales per RO

are so low.”

Every customer should receive a full services-menu review, even if it makes him

or her a bit edgy.

In any arena, business as well as sport, top performers are identified through constant, ongoing performance evaluations. Service advisors are no different. Amid the frantic pace of a service drive, the absence of performance-tracking definitely can

affect the bottom line, and quickly.

A key performance indicator (KPI) is a business metric used to gauge activities that are crucial to the business’ success. KPIs differ based on the individual enterprise’s goals, but they are alike in that they are ap-plied in order to identify trends and suggest a strategic response.

Before KPIs can be identified for service advisors, the following conditions must be met:

✘ A defined service drive process✘ Clear goals for each advisor✘ An easy method of measuring each KPI, and consistency in reporting performance✘ Willingness from management to fix and amend inconsistencies in setting and measuring KPIs, so as to avoid de-motivating the staff

Looked at another way, KPIs are a set of standards against which to compare actual results. For both ser-vice advisors and their managers, KPIs are a success gage for the service drive. Ultimately, they help the manager and the advisors assess toward their shared goals.

Now that we’ve established a foundation for KPIs, what should we measure with service advisors?

Advisor KPIs need to be a stretch but still attainable. It is critical that advisors can view at any given time how their scores compare with established standards for each KPI. Most KPIs are measured on a comparable month basis, or month-to-date along with a projection for the end of the month if the advisor continues at the current pace.

Parts-heavy operations include tires, batteries, filters, wip-ers and pour-in additives. In-vestigate the percentages of these commodity sales by ad-visor, to learn if an advisor is underperforming.

Train and coach advisors to watch and affect own performanc-

es on this metric.

Low parts per RO may indicate low mar-gins on the parts themselves. Service de-

partments should check their gross margins on RO parts regularly.

COMMODITIES SALES/RO,AS A PERCENTAGE OF ROs WRITTENTires, brakes, filters and flushes are considered com-modity sales and should be compared to the number of customer pay ROs written.

To troubleshoot, watch and see whether ad-visors are asking for the additional business at write-up and when presenting additional ser-vice needs.

Equip your advisors and techs with informa-tion about what, how and when regarding

The number of ROs written isn’t the only vital stat; various sales per RO are important ratios. BY JOHN FAIRCHILD

JOHN FAIRCHILDPresident and Performance Coach of Fairchild Automotive Solutions

John has more than 35 years of experience in fixed-operations management and consulting, and trains fixed-ops staff to improve performance and customer service. He started working in auto repair and parts at age 15 and over time held numerous positions at dealerships, including general manager. Visit the website https://fairchildautomotivesolutions.com.

Track These KPIs ToMEASURE YOUR SERVICE ADVISORS’ PERFORMANCE

Certain conditions must be met before KPIs are devised for your service advisors.

At this point, let me discuss the main customer pay metrics for improving advisor retail performance.

ROs WRITTEN BY ADVISOR AND DEPARTMENTThe number of repair orders that your advisors write is a metric that is very revealing, both for the individu-al advisor and the service department as a whole. Here are a few things to deliberate when measuring this KPI:

As a department, are we tracking to exceed our car counts vs. historical data? Are we going to have more customers this month than last, and more than the same month last year?

As an advisor, am I writing enough ROs per day, or too many to truly do a quality job for the cus-tomer’s and dealership’s interests? (The indus-try standard is typically 12 to 15 ROs per advisor per day.)

Advisors who are not writing enough ROs, es-pecially in conjunction with underperformance with other KPIs (such as low labor dollars per RO), should get the service manager’s attention and training. Advisors who cannot pick up the pace AND quality of the ROs they write over a period of time should be replaced or reposi-tioned within the dealership.

If your service department is slack on car count, in the short term service managers and advisors should ramp up their follow-up with existing customers and recruitment of new ones.

Examples of activities to value are setting the customer’s next appointment, following up with previously declined work, e-mailing or calling customers who have received recall notices, and reaching out to customers who recently have de-fected or seem likely to go elsewhere.

Substantial increases in RO counts over

sustained periods indicate a pressing need for additional manpower. Stick to the guideline of 12 to 15 ROs a day per advisor, and don’t wait too long to act.

CUSTOMER PAY LABOR PER ROCustomer pay labor per RO is a metric that is likely to be a bit specific to your dealership’s car lines, demo-graphics of your location and a few other factors. This metric actually breaks down for further analysis, so if your advisors are lagging in this metric, examine the following components:

Customer pay effective labor rate MULTI-PLIED by the customer pay flat rate hours per RO EQUALS the labor per RO. For example, ELR = $100.00 X 1.0 FRH = $100 labor per RO.

If a service manager’s investigation concludes the ELR is low, then look for excessive discounts or mishandling of the estimating process.

If the investigation reveals the ELR is OK but the FRHs are low, then analyze ROs to learn whether legitimate additional service needs are being presented to the customer.

Train and counsel advisors accordingly on sales strategies and estimating skills, in order to im-prove this metric.

CUSTOMER PAY PARTS PER ROThis metric also will vary based on a few different ele-ments. As a rule, the parts-to-labor ratio should range from 1:1 to 1:1.6. While parts do follow the labor, you can take certain actions to improve this ratio.

If the parts per RO metric seems low compared with labor, it may mean “parts-heavy” jobs are being undersold.

benefits a customer will receive if the services are performed.

Instruct advisors to offer these services based on mileage, if your records show no history of their being performed.

Make sure your techs are on the same page and recommending the services based on vehicle condition as well as mileage intervals.

MPIs AND POSTPONED SERVICES-CODINGMore specifically, I am talking here about how many multi-point inspections and condition codes are booked vs. the number of customers getting assistance. This ac-tually presents legal and ethical issues as well. You don’t want a customer to leave your store not knowing about a potential safety concern.

However, regarding retail success, the bigger issue is whether the service departments are leaving money on the table by not inspecting certain cars. They should

review ROs daily, and coach and counsel employees as needed. It is such a critical issue that service man-agers should consider performance as mandatory and non-negotiable.

Use the dealership’s historical data as well as estab-lished industry and group benchmarks to set your tar-gets. Managers should supply their teams with up-to-date metrics, posted in conspicuous places with regular updates. E-mail distribution of KPI performance is an-other way to keep everyone informed.

The visibility of your metrics scoreboard will strengthen accountability and spawn competitive am-bitions among your crew members. Make sure you in-clude both comments of praise and action items in areas that need attention.

Finally, some additional service advisor retail KPIs to consider are 1) Tech flat-rate hours produced, 2) The numbers of appointments scheduled and of customers who show, and 3) The numbers of carryovers and open ROs older than 10 days.

“Advisors who are not writing enough ROs …should get the service manager’s attention and training.”

“Amid the frantic pace of a service drive, the

absence of performance-tracking definitely can affect the bottom line,

and quickly.”

Advisors and techs need to get on the same page about when to recommend particular services.

SD

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 9 8 Service Drive DECEMBER 2015

In any arena, business as well as sport, top performers are identified through constant, ongoing performance evaluations. Service advisors are no different. Amid the frantic pace of a service drive, the absence of performance-tracking definitely can

affect the bottom line, and quickly.

A key performance indicator (KPI) is a business metric used to gauge activities that are crucial to the business’ success. KPIs differ based on the individual enterprise’s goals, but they are alike in that they are ap-plied in order to identify trends and suggest a strategic response.

Before KPIs can be identified for service advisors, the following conditions must be met:

✘ A defined service drive process✘ Clear goals for each advisor✘ An easy method of measuring each KPI, and consistency in reporting performance✘ Willingness from management to fix and amend inconsistencies in setting and measuring KPIs, so as to avoid de-motivating the staff

Looked at another way, KPIs are a set of standards against which to compare actual results. For both ser-vice advisors and their managers, KPIs are a success gage for the service drive. Ultimately, they help the manager and the advisors assess toward their shared goals.

Now that we’ve established a foundation for KPIs, what should we measure with service advisors?

Advisor KPIs need to be a stretch but still attainable. It is critical that advisors can view at any given time how their scores compare with established standards for each KPI. Most KPIs are measured on a comparable month basis, or month-to-date along with a projection for the end of the month if the advisor continues at the current pace.

Parts-heavy operations include tires, batteries, filters, wip-ers and pour-in additives. In-vestigate the percentages of these commodity sales by ad-visor, to learn if an advisor is underperforming.

Train and coach advisors to watch and affect own performanc-

es on this metric.

Low parts per RO may indicate low mar-gins on the parts themselves. Service de-

partments should check their gross margins on RO parts regularly.

COMMODITIES SALES/RO,AS A PERCENTAGE OF ROs WRITTENTires, brakes, filters and flushes are considered com-modity sales and should be compared to the number of customer pay ROs written.

To troubleshoot, watch and see whether ad-visors are asking for the additional business at write-up and when presenting additional ser-vice needs.

Equip your advisors and techs with informa-tion about what, how and when regarding

The number of ROs written isn’t the only vital stat; various sales per RO are important ratios. BY JOHN FAIRCHILD

JOHN FAIRCHILDPresident and Performance Coach of Fairchild Automotive Solutions

John has more than 35 years of experience in fixed-operations management and consulting, and trains fixed-ops staff to improve performance and customer service. He started working in auto repair and parts at age 15 and over time held numerous positions at dealerships, including general manager. Visit the website https://fairchildautomotivesolutions.com.

Track These KPIs ToMEASURE YOUR SERVICE ADVISORS’ PERFORMANCE

Certain conditions must be met before KPIs are devised for your service advisors.

At this point, let me discuss the main customer pay metrics for improving advisor retail performance.

ROs WRITTEN BY ADVISOR AND DEPARTMENTThe number of repair orders that your advisors write is a metric that is very revealing, both for the individu-al advisor and the service department as a whole. Here are a few things to deliberate when measuring this KPI:

As a department, are we tracking to exceed our car counts vs. historical data? Are we going to have more customers this month than last, and more than the same month last year?

As an advisor, am I writing enough ROs per day, or too many to truly do a quality job for the cus-tomer’s and dealership’s interests? (The indus-try standard is typically 12 to 15 ROs per advisor per day.)

Advisors who are not writing enough ROs, es-pecially in conjunction with underperformance with other KPIs (such as low labor dollars per RO), should get the service manager’s attention and training. Advisors who cannot pick up the pace AND quality of the ROs they write over a period of time should be replaced or reposi-tioned within the dealership.

If your service department is slack on car count, in the short term service managers and advisors should ramp up their follow-up with existing customers and recruitment of new ones.

Examples of activities to value are setting the customer’s next appointment, following up with previously declined work, e-mailing or calling customers who have received recall notices, and reaching out to customers who recently have de-fected or seem likely to go elsewhere.

Substantial increases in RO counts over

sustained periods indicate a pressing need for additional manpower. Stick to the guideline of 12 to 15 ROs a day per advisor, and don’t wait too long to act.

CUSTOMER PAY LABOR PER ROCustomer pay labor per RO is a metric that is likely to be a bit specific to your dealership’s car lines, demo-graphics of your location and a few other factors. This metric actually breaks down for further analysis, so if your advisors are lagging in this metric, examine the following components:

Customer pay effective labor rate MULTI-PLIED by the customer pay flat rate hours per RO EQUALS the labor per RO. For example, ELR = $100.00 X 1.0 FRH = $100 labor per RO.

If a service manager’s investigation concludes the ELR is low, then look for excessive discounts or mishandling of the estimating process.

If the investigation reveals the ELR is OK but the FRHs are low, then analyze ROs to learn whether legitimate additional service needs are being presented to the customer.

Train and counsel advisors accordingly on sales strategies and estimating skills, in order to im-prove this metric.

CUSTOMER PAY PARTS PER ROThis metric also will vary based on a few different ele-ments. As a rule, the parts-to-labor ratio should range from 1:1 to 1:1.6. While parts do follow the labor, you can take certain actions to improve this ratio.

If the parts per RO metric seems low compared with labor, it may mean “parts-heavy” jobs are being undersold.

benefits a customer will receive if the services are performed.

Instruct advisors to offer these services based on mileage, if your records show no history of their being performed.

Make sure your techs are on the same page and recommending the services based on vehicle condition as well as mileage intervals.

MPIs AND POSTPONED SERVICES-CODINGMore specifically, I am talking here about how many multi-point inspections and condition codes are booked vs. the number of customers getting assistance. This ac-tually presents legal and ethical issues as well. You don’t want a customer to leave your store not knowing about a potential safety concern.

However, regarding retail success, the bigger issue is whether the service departments are leaving money on the table by not inspecting certain cars. They should

review ROs daily, and coach and counsel employees as needed. It is such a critical issue that service man-agers should consider performance as mandatory and non-negotiable.

Use the dealership’s historical data as well as estab-lished industry and group benchmarks to set your tar-gets. Managers should supply their teams with up-to-date metrics, posted in conspicuous places with regular updates. E-mail distribution of KPI performance is an-other way to keep everyone informed.

The visibility of your metrics scoreboard will strengthen accountability and spawn competitive am-bitions among your crew members. Make sure you in-clude both comments of praise and action items in areas that need attention.

Finally, some additional service advisor retail KPIs to consider are 1) Tech flat-rate hours produced, 2) The numbers of appointments scheduled and of customers who show, and 3) The numbers of carryovers and open ROs older than 10 days.

“Advisors who are not writing enough ROs …should get the service manager’s attention and training.”

“Amid the frantic pace of a service drive, the

absence of performance-tracking definitely can affect the bottom line,

and quickly.”

Advisors and techs need to get on the same page about when to recommend particular services.

SD

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 9 8 Service Drive DECEMBER 2015

Industry execs like Jared Rowe, Rachel Richards, Dale Pollak and Stuart Bailey will explore vital dealer issues in detail during panel sessions.

As the agenda continues to expand for the CBT Automotive 2016 Sales, Service and Marketing Conference & Expo, dealership professionals are getting the opportunity to hear a range of highly

topical guidance that is unprecedented for a conference in their industry.

Interested attendees can go www.cbtconferenceandexpo.com now to utilize an easy registration process and get full information about the most comprehensive conference for the industry.

NEW PANEL DISCUSSIONS BRIDGE AGENDAIn recent weeks, CBT Automotive Network, which will

hold the event Feb. 9-11 in Atlanta, has created extremely focused panel discussions to be held immediately after each day’s keynote address, and which will be conducted by some of the best leaders and minds in retail automotive.

“Dealers and their managers will discover these panel discussions not only offer fresh new viewpoints on some of their biggest business challenges, but also create a wonderful bridge between our keynote speeches and the 65 breakout sessions,” said Jim Fitzpatrick, founder and CEO of CBT Automotive Network.

“Our panelists will challenge the attendees to run their dealerships and their industry in entirely new ways, to respond to a complex and increasingly digitally driven marketplace.”

PANEL TOPICS ON MARKETING, USEDCARS, CULTUREOn Feb. 9, after keynoter and millennials expert Jason Dorsey finishes his address on secrets of selling to Gen Y, Brian Pasch, founder of PCG Digital Marketing, will lead a panel discussing important trends in auto marketing.Other panelists now include Jared Rowe, the president of Cox Automotive’s media division; Rachel Richards, VP and chief marketing officer at Sonic Automotive; and John Fitzpatrick, president and CEO of Force Marketing.

The next day’s keynote speaker is business leadership author and speaker Patrick Lencioni, who will discuss strategies for dealers to keep their most valuable and productive employees. After he concludes, a high-profile

RetailAutomotiveMovers And ShakersJoin Panels That Enhance The AppealOf CBT Automotive Conference & Expo

WHEN: Feb. 9-11, 2016

WHERE: Omni Hotel at CNN Center in downtown Atlanta

HOW TO SIGN UP: Early bird registration is still going on (a $200 savings), but the deadline is approaching. Complete information is available and being constantly updated at www.cbtconferenceandexpo.com.

panel will explore the future of used vehicle sales.

It will be led by Dale Pollak, the president and founder of vAuto. His fellow panelists currently include Stuart Bailey, VP of marketing and pre-owned vehicles at Asbury Automotive; Larry Dorfman, chairman and CEO of EasyCare, which powers the Motor Trend Certified program; Jeremy Anspach, CEO and co-founder of PureCars; and Jim Fitzpatrick.

On Feb. 11, University of Alabama head football coach Nick Saban is the first keynote speaker, explaining how he assembles and motivates a successful team in both football and the dealerships he owns.

As Saban leaves off, a panel on building a winning culture in the dealership environment takes over. It now includes Joseph Michelli, the New York Times best selling author of the Mercedes-Benz and Starbucks obsessions with customer experience, as well as CBT’s Jim Fitzpatrick.

The conference’s final keynote speech concludes the event after that panel is completed. It will be delivered by Marcus Lemonis, host of the CNBC business-oriented reality show “The Profit,” and offer his philosophy and discipline for winning in business every day.

Between the keynote addresses, panel discussions and 65 breakout sessions, critical insights will be delivered to virtually every manager in a dealership, from dealers and GMs to GSMs and new/used car sales managers, F&I managers to marketing directors, service and parts managers to comptrollers and BDC managers.

VENDOR INTEREST IS BRISKAnother important and appealing aspect of the Sales, Service and Marketing Conference & Expo concerns the leading vendors of goods and services to dealerships, which will be exhibiting at the event.

Platinum sponsors for the conference are EasyCare and AutoTrader. After exhibit space sold out for the event, CBT added another 10,000 square feet for booths – only to see that quickly sell out as well.

“The response from exhibitors was intense and rewarding, reflecting the retail automotive industry’s need for a conference that focuses on every aspect of running a successful dealership, and in turn the ability of vendors to present to a large and diversified audience of dealership professionals,” Fitzpatrick said.

REASONS TO REGISTER NOWDealers and their managers, vendor representatives and others with an interest in retail automotive can register now to attend the conference by logging on at www.cbtconferenceandexpo.com. The early bird registration period will expire soon, but in the meantime attendees can save $200 by signing up now.

Nick Saban Patrick Lencioni Jason Dorsey

Stuart Bailey Larry Dorfman Jeremy AnspachJared Rowe Dale Pollak Rachel Richards

Marcus Lemonis

SD

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 11 10 Service Drive DECEMBER 2015

Industry execs like Jared Rowe, Rachel Richards, Dale Pollak and Stuart Bailey will explore vital dealer issues in detail during panel sessions.

As the agenda continues to expand for the CBT Automotive 2016 Sales, Service and Marketing Conference & Expo, dealership professionals are getting the opportunity to hear a range of highly

topical guidance that is unprecedented for a conference in their industry.

Interested attendees can go www.cbtconferenceandexpo.com now to utilize an easy registration process and get full information about the most comprehensive conference for the industry.

NEW PANEL DISCUSSIONS BRIDGE AGENDAIn recent weeks, CBT Automotive Network, which will

hold the event Feb. 9-11 in Atlanta, has created extremely focused panel discussions to be held immediately after each day’s keynote address, and which will be conducted by some of the best leaders and minds in retail automotive.

“Dealers and their managers will discover these panel discussions not only offer fresh new viewpoints on some of their biggest business challenges, but also create a wonderful bridge between our keynote speeches and the 65 breakout sessions,” said Jim Fitzpatrick, founder and CEO of CBT Automotive Network.

“Our panelists will challenge the attendees to run their dealerships and their industry in entirely new ways, to respond to a complex and increasingly digitally driven marketplace.”

PANEL TOPICS ON MARKETING, USEDCARS, CULTUREOn Feb. 9, after keynoter and millennials expert Jason Dorsey finishes his address on secrets of selling to Gen Y, Brian Pasch, founder of PCG Digital Marketing, will lead a panel discussing important trends in auto marketing.Other panelists now include Jared Rowe, the president of Cox Automotive’s media division; Rachel Richards, VP and chief marketing officer at Sonic Automotive; and John Fitzpatrick, president and CEO of Force Marketing.

The next day’s keynote speaker is business leadership author and speaker Patrick Lencioni, who will discuss strategies for dealers to keep their most valuable and productive employees. After he concludes, a high-profile

RetailAutomotiveMovers And ShakersJoin Panels That Enhance The AppealOf CBT Automotive Conference & Expo

WHEN: Feb. 9-11, 2016

WHERE: Omni Hotel at CNN Center in downtown Atlanta

HOW TO SIGN UP: Early bird registration is still going on (a $200 savings), but the deadline is approaching. Complete information is available and being constantly updated at www.cbtconferenceandexpo.com.

panel will explore the future of used vehicle sales.

It will be led by Dale Pollak, the president and founder of vAuto. His fellow panelists currently include Stuart Bailey, VP of marketing and pre-owned vehicles at Asbury Automotive; Larry Dorfman, chairman and CEO of EasyCare, which powers the Motor Trend Certified program; Jeremy Anspach, CEO and co-founder of PureCars; and Jim Fitzpatrick.

On Feb. 11, University of Alabama head football coach Nick Saban is the first keynote speaker, explaining how he assembles and motivates a successful team in both football and the dealerships he owns.

As Saban leaves off, a panel on building a winning culture in the dealership environment takes over. It now includes Joseph Michelli, the New York Times best selling author of the Mercedes-Benz and Starbucks obsessions with customer experience, as well as CBT’s Jim Fitzpatrick.

The conference’s final keynote speech concludes the event after that panel is completed. It will be delivered by Marcus Lemonis, host of the CNBC business-oriented reality show “The Profit,” and offer his philosophy and discipline for winning in business every day.

Between the keynote addresses, panel discussions and 65 breakout sessions, critical insights will be delivered to virtually every manager in a dealership, from dealers and GMs to GSMs and new/used car sales managers, F&I managers to marketing directors, service and parts managers to comptrollers and BDC managers.

VENDOR INTEREST IS BRISKAnother important and appealing aspect of the Sales, Service and Marketing Conference & Expo concerns the leading vendors of goods and services to dealerships, which will be exhibiting at the event.

Platinum sponsors for the conference are EasyCare and AutoTrader. After exhibit space sold out for the event, CBT added another 10,000 square feet for booths – only to see that quickly sell out as well.

“The response from exhibitors was intense and rewarding, reflecting the retail automotive industry’s need for a conference that focuses on every aspect of running a successful dealership, and in turn the ability of vendors to present to a large and diversified audience of dealership professionals,” Fitzpatrick said.

REASONS TO REGISTER NOWDealers and their managers, vendor representatives and others with an interest in retail automotive can register now to attend the conference by logging on at www.cbtconferenceandexpo.com. The early bird registration period will expire soon, but in the meantime attendees can save $200 by signing up now.

Nick Saban Patrick Lencioni Jason Dorsey

Stuart Bailey Larry Dorfman Jeremy AnspachJared Rowe Dale Pollak Rachel Richards

Marcus Lemonis

SD

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 11 10 Service Drive DECEMBER 2015

New car sales may be the face of all dealerships but fixed ops generate approximately 60 percent of all profits. One of the most important tools or process within this department is your multi-point inspection (MPI). It is your key

to identifying and maximizing additional service opportunities.

Surprisingly, the most neglected MPI category is vital fluids maintenance, which includes transmission, pow-er steering and brake fluids as well as gear oils. It is also one of the highest-margin categories, on average $108 per service.

FIRST CONTACT SETS THE TONECompleting a MPI at customers’ first visit and all subse-quent intervals, and walking them through the inspec-tion and testing results, are essential in developing trust and confidence in your maintenance practices and ser-vices. This is your opportunity to demonstrate the con-sistency, quality and credibility of your inspections and service recommendations. This also is when and where loyalty and retention to your dealership are developed and maintained.

The bottom line: A thorough and complete MPI dra-matically increases your opportunities to increase tick-et averages and overall sales, with no increase in mar-keting costs or car counts.

In the past decade, there has been a paradigm shift in why and when to recommend vital fluid services. It is not just original equipment manufacturer (OEM) time-in-service or mileage anymore. Fluid condition is the most important qualifier in determining when to rec-ommend and perform fluid preventative maintenance.

Why, then, are vital fluids omitted from many OEMs’ lists of preventative maintenance service? Manufacturers have been courting higher J.D. Power customer satisfaction ratings by marketing their cars as having a lower “cost of ownership.” One way to ac-complish this is to reduce or eliminate servicing vi-tal fluids. They promote their cars as being supplied with (protected by) “lifetime fluids,” no servicing needed – just gas up and go.

WHY FLUID TESTING IS NECESSARYHistorically, OEMs have specified vital fluid service intervals based on time-in-service or mileage – one recommendation for normal driving conditions and an

T h e C a l i f o r -

nia Bureau of Automotive Re-

pair (BAR) recognizes this conundrum and has published its

stance on recommending services, especially those that are not covered or recommended by the OEMs. The BAR’s “Preventative Maintenance Services Best Prac-tices” are as follows:

✔ Obtain customer authorization and in-spect the vehicle before making service recommendations.

✔ Openly and honestly communicate with your customer.

✔ Ask customers about vehicle driving conditions.

✔ Ask customers about driving habits and vehi-cle maintenance repair history.

✔ Communicate maintenance service recom-mendations made by the manufacturer.

✔ If recommending an accelerated maintenance service that deviates from the vehicle manufac-turer’s recommendations, explain why.

The MPI is all about empowerment. When you pro-vide your technicians and service advisors with the tools and means to communicate clearly with integri-ty, you empower your customers to base their preven-tative maintenance decisions on credible information and visual aids that speak to the problem as well as the solution.

7 STEPS TO INCLUDE FLUIDS IN A MPIThe following seven-point process provides a program to add fluid diagnostics to your MPI that is simple to implement.

Offer a complementary fluid analysis as part of your MPI.your MPI.

The truth about ‘lifetime fluids,’ and the bottom-line impact of including fluids in your inspections.BY RON MCELROY

RON MCELROYCEO and founder of Fluid Rx Diagnostics by Magna-Guard Inc.

Ron is the founder or co-founder of five companies. In his career, he has received two “best new product” awards and four “product innovation” awards for automotive products that integrates electronics into OEM systems and change the dynamics of fluids preventative maintenance services.

WHY FLUIDSMAINTENANCEShould Be Included in Every MPI

accelerated recommendation for severe driving con-ditions. Additionally, today’s vital fluids are subjected to increases in heat torque that shorten their lifecycle. Yes, chemical engineering is better than ever; however, no fluid alchemy exists that prevents fluid breakdown. This prompts the question: Are “lifetime fluids” a prod-uct of technology or a marketing strategy?

MANY VEHICLE OWNERS’ MANUALS STATE:Regular maintenance is essential to obtain the highest

level of performance from your vehicle. In additional to scheduled maintenance, your vehicle requires ongoing general maintenance such as fluid checks and visual in-spections. Be sure to perform these procedures regularly to ensure the most trouble-free operation of your vehicle. With proper maintenance and care, your vehicle will last longer and deliver economic efficiency and more depend-able performance.

If the goal is to service fluids before they become depleted, then fluid diagnos-tics is the best strategy to identify when services should be recommended and performed.

OEMS RETHINK ‘LIFETIME FLUIDS’Some OEMs, it should be noted, have recently retreated from their “lifetime fluids” stance. Many have returned to time-in-service recommendations, especially when the vehicle is operated under severe driving conditions, which is the case for most cars.

Ask customers for permission to perform the tests, and give them a brochure or explain the technology being used and the benefits of proper fluid preventative maintenance.

Perform the fluid test ASAP in accordance with fluid sampling guidelines, and document the results.

Walk through the OEM’s fluid service recommendations and then share the results of each fluid test with your customer. Point out which fluids are “GOOD” as well as those that require service. Explain to your customer that changing fluids before they become depleted can reduce fuel consumption, optimize performance and reliability, and extend the vehicle’s service life.

Offer to perform all required or suggested fluid services, and give your customer the cost and a time estimate for completing them.

After servicing a fluid, perform a post-fluid test to ensure the service was successfully complet-ed. The fluid must test “GOOD,” or the service must be repeated.

ONE SERVICE MANAGER’S STORYThe most authoritative voices come from the profes-sionals who implement these programs on a daily basis. One such professional is Don Fritz, service manager at Rogers Toyota in Lewiston Idaho. Here is what he wrote about adding fluid diagnostics to his depart-ment’s MPIs:

“I don’t think I have ever actually discussed the results of implementing fluid testing in my service department. I was introduced to the fluid diagnostic sheets a few years ago in the Tacoma, Washington area. It sounded like a great way to tie fluid conditions into our multi point in-spection instead of just recommending based off of time, miles or color.

“The beauty of being able to present inspection results with confidence to customers showed immediate results. The “RED,” “YELLOW,” “GREEN” theme works seam-lessly with our MPI’s “PASS,” “CAUTION,” “FAIL.” This generated additional confidence that led to defini-tive word tracks that the advisors began using, and they closed more sales.

“The first time I saw this make a significant impact was when I implemented the process in one of my express service lanes. We averaged nearly 40 cars per day but we were consistently at the bottom of the list compared to our other stores in the group. Fluid exchange services were tracked monthly by the organization, and the results were emailed and posted. We began using the diagnostic sheets, gave the advisors simple menus and a few word tracks, and the needle moved quickly! We went from the bottom of the list to the number 2 or 3 position, which was over much larger stores in the group.

“I implemented this process at the dealership I am at, and we immediately saw a 300% increase in fluid exchange services.  We are pacing for much more than that, since everyone has acclimated to the process and believe in the product. Seeing is believing; this eliminates any argument out of presenting fluid conditions to your customers.”

IMPROVING YOUR BOTTOM LINEEvery day, hundreds of vehicles roll out of service

bays with at least one depleted fluid. This contributes to the generally accepted projections of $80 billion-plus of unperformed vehicle services for 2015. If your MPI does not include fluid diagnostics, then your techs and service advisors are missing the opportunity to get your customers to say, “Yes” to needed fluid services.

“Yes, chemical engineering is better than ever, but

no alchemy can prevent fluid breakdown.”

SD

The first discussion between a service advisor and customer about an MPI shouldcover vital fluids.

An analysis card for fluids like power steering and transmission can be very influential on customers.

1

2

3

4

5

6

7

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 13 12 Service Drive DECEMBER 2015

New car sales may be the face of all dealerships but fixed ops generate approximately 60 percent of all profits. One of the most important tools or process within this department is your multi-point inspection (MPI). It is your key

to identifying and maximizing additional service opportunities.

Surprisingly, the most neglected MPI category is vital fluids maintenance, which includes transmission, pow-er steering and brake fluids as well as gear oils. It is also one of the highest-margin categories, on average $108 per service.

FIRST CONTACT SETS THE TONECompleting a MPI at customers’ first visit and all subse-quent intervals, and walking them through the inspec-tion and testing results, are essential in developing trust and confidence in your maintenance practices and ser-vices. This is your opportunity to demonstrate the con-sistency, quality and credibility of your inspections and service recommendations. This also is when and where loyalty and retention to your dealership are developed and maintained.

The bottom line: A thorough and complete MPI dra-matically increases your opportunities to increase tick-et averages and overall sales, with no increase in mar-keting costs or car counts.

In the past decade, there has been a paradigm shift in why and when to recommend vital fluid services. It is not just original equipment manufacturer (OEM) time-in-service or mileage anymore. Fluid condition is the most important qualifier in determining when to rec-ommend and perform fluid preventative maintenance.

Why, then, are vital fluids omitted from many OEMs’ lists of preventative maintenance service? Manufacturers have been courting higher J.D. Power customer satisfaction ratings by marketing their cars as having a lower “cost of ownership.” One way to ac-complish this is to reduce or eliminate servicing vi-tal fluids. They promote their cars as being supplied with (protected by) “lifetime fluids,” no servicing needed – just gas up and go.

WHY FLUID TESTING IS NECESSARYHistorically, OEMs have specified vital fluid service intervals based on time-in-service or mileage – one recommendation for normal driving conditions and an

T h e C a l i f o r -

nia Bureau of Automotive Re-

pair (BAR) recognizes this conundrum and has published its

stance on recommending services, especially those that are not covered or recommended by the OEMs. The BAR’s “Preventative Maintenance Services Best Prac-tices” are as follows:

✔ Obtain customer authorization and in-spect the vehicle before making service recommendations.

✔ Openly and honestly communicate with your customer.

✔ Ask customers about vehicle driving conditions.

✔ Ask customers about driving habits and vehi-cle maintenance repair history.

✔ Communicate maintenance service recom-mendations made by the manufacturer.

✔ If recommending an accelerated maintenance service that deviates from the vehicle manufac-turer’s recommendations, explain why.

The MPI is all about empowerment. When you pro-vide your technicians and service advisors with the tools and means to communicate clearly with integri-ty, you empower your customers to base their preven-tative maintenance decisions on credible information and visual aids that speak to the problem as well as the solution.

7 STEPS TO INCLUDE FLUIDS IN A MPIThe following seven-point process provides a program to add fluid diagnostics to your MPI that is simple to implement.

Offer a complementary fluid analysis as part of your MPI.your MPI.

The truth about ‘lifetime fluids,’ and the bottom-line impact of including fluids in your inspections.BY RON MCELROY

RON MCELROYCEO and founder of Fluid Rx Diagnostics by Magna-Guard Inc.

Ron is the founder or co-founder of five companies. In his career, he has received two “best new product” awards and four “product innovation” awards for automotive products that integrates electronics into OEM systems and change the dynamics of fluids preventative maintenance services.

WHY FLUIDSMAINTENANCEShould Be Included in Every MPI

accelerated recommendation for severe driving con-ditions. Additionally, today’s vital fluids are subjected to increases in heat torque that shorten their lifecycle. Yes, chemical engineering is better than ever; however, no fluid alchemy exists that prevents fluid breakdown. This prompts the question: Are “lifetime fluids” a prod-uct of technology or a marketing strategy?

MANY VEHICLE OWNERS’ MANUALS STATE:Regular maintenance is essential to obtain the highest

level of performance from your vehicle. In additional to scheduled maintenance, your vehicle requires ongoing general maintenance such as fluid checks and visual in-spections. Be sure to perform these procedures regularly to ensure the most trouble-free operation of your vehicle. With proper maintenance and care, your vehicle will last longer and deliver economic efficiency and more depend-able performance.

If the goal is to service fluids before they become depleted, then fluid diagnos-tics is the best strategy to identify when services should be recommended and performed.

OEMS RETHINK ‘LIFETIME FLUIDS’Some OEMs, it should be noted, have recently retreated from their “lifetime fluids” stance. Many have returned to time-in-service recommendations, especially when the vehicle is operated under severe driving conditions, which is the case for most cars.

Ask customers for permission to perform the tests, and give them a brochure or explain the technology being used and the benefits of proper fluid preventative maintenance.

Perform the fluid test ASAP in accordance with fluid sampling guidelines, and document the results.

Walk through the OEM’s fluid service recommendations and then share the results of each fluid test with your customer. Point out which fluids are “GOOD” as well as those that require service. Explain to your customer that changing fluids before they become depleted can reduce fuel consumption, optimize performance and reliability, and extend the vehicle’s service life.

Offer to perform all required or suggested fluid services, and give your customer the cost and a time estimate for completing them.

After servicing a fluid, perform a post-fluid test to ensure the service was successfully complet-ed. The fluid must test “GOOD,” or the service must be repeated.

ONE SERVICE MANAGER’S STORYThe most authoritative voices come from the profes-sionals who implement these programs on a daily basis. One such professional is Don Fritz, service manager at Rogers Toyota in Lewiston Idaho. Here is what he wrote about adding fluid diagnostics to his depart-ment’s MPIs:

“I don’t think I have ever actually discussed the results of implementing fluid testing in my service department. I was introduced to the fluid diagnostic sheets a few years ago in the Tacoma, Washington area. It sounded like a great way to tie fluid conditions into our multi point in-spection instead of just recommending based off of time, miles or color.

“The beauty of being able to present inspection results with confidence to customers showed immediate results. The “RED,” “YELLOW,” “GREEN” theme works seam-lessly with our MPI’s “PASS,” “CAUTION,” “FAIL.” This generated additional confidence that led to defini-tive word tracks that the advisors began using, and they closed more sales.

“The first time I saw this make a significant impact was when I implemented the process in one of my express service lanes. We averaged nearly 40 cars per day but we were consistently at the bottom of the list compared to our other stores in the group. Fluid exchange services were tracked monthly by the organization, and the results were emailed and posted. We began using the diagnostic sheets, gave the advisors simple menus and a few word tracks, and the needle moved quickly! We went from the bottom of the list to the number 2 or 3 position, which was over much larger stores in the group.

“I implemented this process at the dealership I am at, and we immediately saw a 300% increase in fluid exchange services.  We are pacing for much more than that, since everyone has acclimated to the process and believe in the product. Seeing is believing; this eliminates any argument out of presenting fluid conditions to your customers.”

IMPROVING YOUR BOTTOM LINEEvery day, hundreds of vehicles roll out of service

bays with at least one depleted fluid. This contributes to the generally accepted projections of $80 billion-plus of unperformed vehicle services for 2015. If your MPI does not include fluid diagnostics, then your techs and service advisors are missing the opportunity to get your customers to say, “Yes” to needed fluid services.

“Yes, chemical engineering is better than ever, but

no alchemy can prevent fluid breakdown.”

SD

The first discussion between a service advisor and customer about an MPI shouldcover vital fluids.

An analysis card for fluids like power steering and transmission can be very influential on customers.

1

2

3

4

5

6

7

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 13 12 Service Drive DECEMBER 2015

Do you have questions? We have experts who can answer them. We have partnered with some of the top fixed operations con-sultants in the business who are ready, willing and able to share their knowledge and advice with you. All you have to do is email your questions to Newsroom@ServiceDriveToday.com, and we’ll take care of the rest. Pros:

Askthe Jody Devere, CEO of AskPatty.com Inc.: As of 2012, more women than men have driver’s licenses, a reversal of a longtime gender gap. So, it makes sense why women represent a higher percentage of

dealership service customers across the U.S., and why that number is growing.

I believe your main challenge here is reining in any perceived notion that you are attempting high-pressure up-sell techniques. You need to overcome women customers’ anxiety that you may be trying to take advantage of her ‘just because she is a woman,’ by suggesting the dealership’s calendar. Offering any additional services may put her on guard, especially if she is conscientious about following the manufacturer’s service intervals in her owner’s manual.

Women do not want to be seen as a target who can be taken advantage of due to lack of knowledge or understanding the terminology of services you are offering, even if they actually do need to consider them. So, here are a few approaches that could help:

1) Hold monthly women-only car care clinics. This is a great way to build relationships and educate women vehicle-owners on maintenance needs and your service offerings.2) Have your advisors and techs speak in plain English, not in car-tech terms, when they explain what the customer may need. Seek to educate.3) Urge those advisors and techs to be helpful and avoid talking down to women customers. Body language and tone of voice are important.4) Forget that you’re selling. This seems counterintuitive, and it’s a hard lesson for anyone at a retail business to learn. But, the most important thing service advisors can do is to stop selling and focus on building relationships.5) Remember that clarity and transparency work best. Don’t oversell a particular service, but do be honest with the woman customer about important items that need attention.

Vern Poyner, general manager of the myCARFAX Program at CARFAX:Conversion rates will differ for each service department, but many shops participating in our free myCarfax Service Shop program tell us they consistently write up additional ticket orders

for recall customers. Ted Britt Chevrolet, for example, has about a 30 percent conversion rate. Reassuring first-time recall customers about your knowledge of their vehicle is one key to converting them. A courtesy inspection (Ted Britt does one for all recall customers) and access to the vehicle’s service history help your team support their service recommendations, even for first-time customers. Whenever possible, let customers know your expert team can take care of the recommended services at the same time as the recall. Minimizing their wait is a big plus for

Garrett Ming, CEO of KABIAutomotive Systems:You need to staff to meet your shop’s workflow demand, not to match a competitor’s unrealistic schedule. A one-size-fits-all staffing approach like your competitor is using creates

increased labor costs, due to techs standing around during the slower times in any given day. In most shops, as with most freeways, there are times during the day of increased traffic flow and times when traffic flow slows down. The most important areas to consider when you are creating a production staffing schedule are time-of-day

JARRETT IN TALLAHASSEE, FLA.: “One of our competitors advertises for quick-lane techs by telling them they must work for 11 hours a day five days a week for a seven-week stretch, then work all six days (Monday through Saturday) on the eighth week. We think that is too intense a schedule, but we might be forced to change our approach to compete. What do you think?”

the customer, since time in the shop often matters more than how much it will cost. They know they’ll have to pay to have the work done eventually, so killing two birds with one stone and no added wait time can make the difference between a yes or no. A good practice to help track upsells on recall customers is to measure the ticket value and separate out recall work from added services. Noting first-time recall customers in your DMS will help pinpoint those who come in for a follow-up visit. It’s a good idea to track work done for these customers at the time of the recall and in the future, since it will help determine the recall conversion rates for your service department. It also helps you more accurately forecast revenues from recall visits and adjust your customer service efforts around recalls to maximize ticket orders. Make sure you’re doing everything possible to foster those relationships and turn one-time recall visits into long-term loyal customers.

and day-of-week demands, lunch/break coverage, and a balance of lube-to-general techs. The best way to measure time-of-day and day-of-week demand is to create a report from the computer system you use to create repair orders, or from an operational system you use to optimize your workflow. If possible, look at your last 30 days to get a good sample size and break it down in 30-minute intervals – 7:00 to 7:30, 7:30 to 8:00, etc. Create another report to show your day-of-week workflow. Graph the results, and you’ll quickly see your time-of-day and day-of-week demands. Taking into account breaks (lunch, rest, etc.) and days off in your staffing and scheduling is also very critical to having consistent success in meeting your customer’s

expectations on timely service. Staggering your lunch breaks over a three-hour timeframe avoids the lunch hour production drop-off. Consider your time-of-day demand when setting your break schedules, and your day-of-week demand when setting your techs’ scheduled days off. Getting your tech staffing mix right – lube to general tech – will have a huge impact on meeting your customers’ expectations on timely maintenance service, as well as on your general techs’ ability to perform all necessary additional work found during the inspection. One out of three initial jobs entering your shop (an initial job is usually a LOF, rotation, inspection) has additional work needed. Timeliness on the initial work leads to more sales.

ARNOLD IN FLAGSTAFF, ARIZ.: “I have noticed that an unusual percentage of our women customers in service, significantly more so than male customers, only want to go by the manufacturer’s suggested service calendar. They don’t want to hear about our recommended service calendar. Do you have any thoughts on why this is?”

JIM IN LEAVENWORTH, KAN.:“What do you think a realistic conversion rate to additional service or repairs should be for recall customers who haven’t previously had any work done in our shop? Should we track conversion rates both for work done at the same time as the recall work, and for future work?”

ServiceDriveToday.com 14 Service Drive DECEMBER 2015

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Q What are effective ways to instill a genuine belief in a service advisor in the products and services he is selling?

David Lewis: “The most important thing that dealers have to do is, they have to provide for a service advisor with better leadership and better training. That’s what it all boils down to. If a service advisor doesn’t believe in the product or service he’s selling, it’s because he or she has not been sold it by their leader. “A lot of times, we take these service advisors and we make technicians into service advisors, and we don’t continually work with them and we don’t continually train them. This is a function of leadership. Just like a salesperson, they need to be trained on a daily basis. Every service manager should be having a 10- to 15-minute session every day with his service advisors going over certain things and certain aspects of the job, the products and the customers. “If I feel as a service advisor that you as a leader don’t care, then I won’t care. If I don’t feel that you have confidence in the products and services, then I won’t have confidence in the products and services. “If I feel your entire role is just to make money, make money, make money – that you don’t truly care about the customer – that’s the attitude and approach I will take. This is a big issue with service advisors. They have very, very little training, and their leadership has even less training.”

Q What are the biggest weaknesses you see in the ways service advisors try to establish trust with their customers, and how do you suggest addressing them?

David Lewis: “The first thing everyone in a service department has to understand is that the customer does not want to be there. No one wakes up in the morning and says, ‘Hey, I’ve got a great day planned. I’m going over to the car dealership and I’m going to get my oil changed and my tires rotated. This will be a lot of fun.’ So, the customers don’t want to be there. “The second problem that we have is that throughout time, we have always tried to upsell our customers, and we try to upsell them at two opportunities. First, we upsell them in the walk-around. They arrive, we do our meet and greet, we take them out to the car, we bring along our pad and iPad and we do a walk-around. Most customers realize what [service advisors] are doing. It’s two parts – yes, you’ve got to make sure everything’s good and correct, but it’s always to upsell us. The second time we’re upselling the customer is after the service technician does the multi-point inspection. Now we’re selling while the tech is talking to the customer, or we’re calling the customer on the phone later trying to upsell them again. “This is driving our customers to our competitors, the secondary repair facilities. The reason the secondary care facilities are doing so well these days is because of the perception that they are less expensive than the dealership, that we are constantly trying to upsell them. In a dealership, we’re looking for an upsell rate where we are upselling them $200, $300, $400 for every car that comes in. When you go to the secondary repair facilities, their upsells are usually $60, $70 or $80 per vehicle. “For example, say I bring my car in to [a dealership service department] for an oil change and tire rotation.

You always seem to find something wrong with my brakes or my front-end alignment, or I will have a leak here or a leak there. When I go to Jiffy Lube to have work done, Jiffy Lube only upsells me certain things. Their average upsell is about $80 per car; that’s what they’re looking to get. So, a customer doesn’t feel they’re getting taken advantage of, because it’s all maintenance-related items. “That being said, how do we address [the trust weaknesses]? The first thing we need to do is, we need to understand the customer, to understand that they don’t want to be there and they have a fear of us. The second thing we need to do is, we only need to do our upsell one time. We either upsell everything in the walk-around, or we upsell everything after the service technician does their multi-point inspection. “Number three, it’s a very good technique to always get a takeaway item in your upsell. So I might say to you, ‘You know, the technician noticed a couple of things. He noticed that your front brake pads are down to the ribbon, and this is a dangerous situation. He also noticed you have a situation with a ball joint. It’s not that bad, it doesn’t need to be corrected today, but it’s something we need to look at down the road.’ Let the customer know that there are issues but don’t try to sell them everything. Let them know you care. “And finally, this is the most important thing: Whenever you upsell a customer anything, you must

create visuals. Customers think that we’re doing things in their car that don’t need to be done or that we’re not doing them at all. It’s like if you go to the dentist and he tells you you have a cavity, but you don’t have it drilled at the time. Then you go back a couple of years later, he looks at the film and tells you everything is fine. You say, ‘Wait, I thought I had a cavity!’ It’s the same with your customer. “If you want to build trust with your customer, whatever you’re going to upsell them, you’ve got to show them – whether it be visually in person or be a picture or video. So, when your customer needs front brake pads, I’m going out there and I’m either going to show them a quick 10-second or 15-second video, or I’m going to take some pictures and show them what their brakes look like and what a new set of brakes should look like. They can see for themselves that the pads need to be replaced immediately. “Visuals will help you create more trust and help you create more sales.”

DAVID LEWISPresident of David Lewis & Associates

David’s firm is a national training and consulting business that specializes in the retail automotive industry. He also is the author of four industry-related books, “The Secrets of Inspirational Selling,” “The Leadership Factor,” “Understanding Your Customer” and “The Common Mistakes Automotive Salespeople Make.” Visit his website at www.DavidLewis.com.

Q What makes a service advisor effective or ineffective in conducting the walk-around, which is widely regarded as an important sales opportunity?

David Lewis: “I believe an ineffective walk-around is when you create pressure on the customer to buy something. Pressure can be determined differently by each customer. Everybody has different thresholds of when they feel pressure gets to them. I am not a huge fan of selling in the walk-around presentation. I think people expect it, I think the items we sell in the walk-around are nickel-and-dime items, and I believe that it takes away from selling the bigger items. “Because when you do a walk-around, you can’t tell if the brakes are bad. So, what exactly are we doing? We’re selling things like tires, wiper blades and headlights. We do make money on tires, but here’s the problem: If I tell you that you need new tires, and if the customer is dropping the car off, guess what that customer is doing between when they leave and when you give them a quote? They’re shopping tire prices online, and the reason why I know this is because that is what I did. “I bring my car in religiously for an oil change and tire rotation every five to six months. The last time I was in, the guy does his walk-around and found that my tires were getting very low. He showed them to me. I agreed with him. He said, ‘Let me get you some prices on tires,’ and I said, ‘Great.’

“What I did was, when he walked away I took out my phone and took a picture of my tires to capture the model and size, and then when I got back to my office I went online and priced tires. He called me up later and told me four tires were going to cost me $1,280. I said, ‘Well, I think I will pass because I can get them installed for $890 somewhere else, with a front-end alignment.’ He said, ‘Let me see what we can do’ and then called me back to say they would match the price. When I went back to the dealership to pick up my car, I chatted with the service manager, and he said, ‘We made a whopping $17 selling you those tires. But, I didn’t want to lose you.’ “The thing is this: If he had waited until after the multi-point inspection, if he had called me or shown me a picture, I might have said, ‘Yes, do it right then.’ By doing the service walk, the walk-around, he prompted things in my mind and he allowed me to do my homework because I was given the extra time that was needed for research. “I believe in the walk-around. The walk-around is a very important thing. A walk-around might plant a few seeds, but it’s more there for safety [issues] and to make sure there are no scratches or dents or dings in the car, to make sure the customer doesn’t need anything in the back seat. It’s for me to create dialog with the customer. “I am just not a big fan of doing selling in the walk-around. If we do our research, we’re going to find we sell very little [in the walk-around], and the little we do sell we don’t make a lot of money on.”

They need to pick their spots forwhen to gofor the sale.

DAVID LEWIS: HOW TO MAKESERVICE ADVISORS

MOREEFFECTIVE

THIS MONTH, WE ASKED LEADING SERVICE AND SALES

TRAINER DAVID LEWIS FOR HIS THOUGHTS ON SEVERAL ISSUES THAT DEALERSHIPS FREQUENTLY HAVE WITH

THEIR SERVICE ADVISORS.

SD

Recognizing that this customer really doesn’t want to be bringing her car in for work is the first step to establishing trust.

You might be smarter to wait until after this multi-point inspection to try to sell the customer on additional repair services.

ServiceDriveToday.com ServiceDriveToday.com 16 Service Drive DECEMBER 2015 DECEMBER 2015 Service Drive 17

Q What are effective ways to instill a genuine belief in a service advisor in the products and services he is selling?

David Lewis: “The most important thing that dealers have to do is, they have to provide for a service advisor with better leadership and better training. That’s what it all boils down to. If a service advisor doesn’t believe in the product or service he’s selling, it’s because he or she has not been sold it by their leader. “A lot of times, we take these service advisors and we make technicians into service advisors, and we don’t continually work with them and we don’t continually train them. This is a function of leadership. Just like a salesperson, they need to be trained on a daily basis. Every service manager should be having a 10- to 15-minute session every day with his service advisors going over certain things and certain aspects of the job, the products and the customers. “If I feel as a service advisor that you as a leader don’t care, then I won’t care. If I don’t feel that you have confidence in the products and services, then I won’t have confidence in the products and services. “If I feel your entire role is just to make money, make money, make money – that you don’t truly care about the customer – that’s the attitude and approach I will take. This is a big issue with service advisors. They have very, very little training, and their leadership has even less training.”

Q What are the biggest weaknesses you see in the ways service advisors try to establish trust with their customers, and how do you suggest addressing them?

David Lewis: “The first thing everyone in a service department has to understand is that the customer does not want to be there. No one wakes up in the morning and says, ‘Hey, I’ve got a great day planned. I’m going over to the car dealership and I’m going to get my oil changed and my tires rotated. This will be a lot of fun.’ So, the customers don’t want to be there. “The second problem that we have is that throughout time, we have always tried to upsell our customers, and we try to upsell them at two opportunities. First, we upsell them in the walk-around. They arrive, we do our meet and greet, we take them out to the car, we bring along our pad and iPad and we do a walk-around. Most customers realize what [service advisors] are doing. It’s two parts – yes, you’ve got to make sure everything’s good and correct, but it’s always to upsell us. The second time we’re upselling the customer is after the service technician does the multi-point inspection. Now we’re selling while the tech is talking to the customer, or we’re calling the customer on the phone later trying to upsell them again. “This is driving our customers to our competitors, the secondary repair facilities. The reason the secondary care facilities are doing so well these days is because of the perception that they are less expensive than the dealership, that we are constantly trying to upsell them. In a dealership, we’re looking for an upsell rate where we are upselling them $200, $300, $400 for every car that comes in. When you go to the secondary repair facilities, their upsells are usually $60, $70 or $80 per vehicle. “For example, say I bring my car in to [a dealership service department] for an oil change and tire rotation.

You always seem to find something wrong with my brakes or my front-end alignment, or I will have a leak here or a leak there. When I go to Jiffy Lube to have work done, Jiffy Lube only upsells me certain things. Their average upsell is about $80 per car; that’s what they’re looking to get. So, a customer doesn’t feel they’re getting taken advantage of, because it’s all maintenance-related items. “That being said, how do we address [the trust weaknesses]? The first thing we need to do is, we need to understand the customer, to understand that they don’t want to be there and they have a fear of us. The second thing we need to do is, we only need to do our upsell one time. We either upsell everything in the walk-around, or we upsell everything after the service technician does their multi-point inspection. “Number three, it’s a very good technique to always get a takeaway item in your upsell. So I might say to you, ‘You know, the technician noticed a couple of things. He noticed that your front brake pads are down to the ribbon, and this is a dangerous situation. He also noticed you have a situation with a ball joint. It’s not that bad, it doesn’t need to be corrected today, but it’s something we need to look at down the road.’ Let the customer know that there are issues but don’t try to sell them everything. Let them know you care. “And finally, this is the most important thing: Whenever you upsell a customer anything, you must

create visuals. Customers think that we’re doing things in their car that don’t need to be done or that we’re not doing them at all. It’s like if you go to the dentist and he tells you you have a cavity, but you don’t have it drilled at the time. Then you go back a couple of years later, he looks at the film and tells you everything is fine. You say, ‘Wait, I thought I had a cavity!’ It’s the same with your customer. “If you want to build trust with your customer, whatever you’re going to upsell them, you’ve got to show them – whether it be visually in person or be a picture or video. So, when your customer needs front brake pads, I’m going out there and I’m either going to show them a quick 10-second or 15-second video, or I’m going to take some pictures and show them what their brakes look like and what a new set of brakes should look like. They can see for themselves that the pads need to be replaced immediately. “Visuals will help you create more trust and help you create more sales.”

DAVID LEWISPresident of David Lewis & Associates

David’s firm is a national training and consulting business that specializes in the retail automotive industry. He also is the author of four industry-related books, “The Secrets of Inspirational Selling,” “The Leadership Factor,” “Understanding Your Customer” and “The Common Mistakes Automotive Salespeople Make.” Visit his website at www.DavidLewis.com.

Q What makes a service advisor effective or ineffective in conducting the walk-around, which is widely regarded as an important sales opportunity?

David Lewis: “I believe an ineffective walk-around is when you create pressure on the customer to buy something. Pressure can be determined differently by each customer. Everybody has different thresholds of when they feel pressure gets to them. I am not a huge fan of selling in the walk-around presentation. I think people expect it, I think the items we sell in the walk-around are nickel-and-dime items, and I believe that it takes away from selling the bigger items. “Because when you do a walk-around, you can’t tell if the brakes are bad. So, what exactly are we doing? We’re selling things like tires, wiper blades and headlights. We do make money on tires, but here’s the problem: If I tell you that you need new tires, and if the customer is dropping the car off, guess what that customer is doing between when they leave and when you give them a quote? They’re shopping tire prices online, and the reason why I know this is because that is what I did. “I bring my car in religiously for an oil change and tire rotation every five to six months. The last time I was in, the guy does his walk-around and found that my tires were getting very low. He showed them to me. I agreed with him. He said, ‘Let me get you some prices on tires,’ and I said, ‘Great.’

“What I did was, when he walked away I took out my phone and took a picture of my tires to capture the model and size, and then when I got back to my office I went online and priced tires. He called me up later and told me four tires were going to cost me $1,280. I said, ‘Well, I think I will pass because I can get them installed for $890 somewhere else, with a front-end alignment.’ He said, ‘Let me see what we can do’ and then called me back to say they would match the price. When I went back to the dealership to pick up my car, I chatted with the service manager, and he said, ‘We made a whopping $17 selling you those tires. But, I didn’t want to lose you.’ “The thing is this: If he had waited until after the multi-point inspection, if he had called me or shown me a picture, I might have said, ‘Yes, do it right then.’ By doing the service walk, the walk-around, he prompted things in my mind and he allowed me to do my homework because I was given the extra time that was needed for research. “I believe in the walk-around. The walk-around is a very important thing. A walk-around might plant a few seeds, but it’s more there for safety [issues] and to make sure there are no scratches or dents or dings in the car, to make sure the customer doesn’t need anything in the back seat. It’s for me to create dialog with the customer. “I am just not a big fan of doing selling in the walk-around. If we do our research, we’re going to find we sell very little [in the walk-around], and the little we do sell we don’t make a lot of money on.”

They need to pick their spots forwhen to gofor the sale.

DAVID LEWIS: HOW TO MAKESERVICE ADVISORS

MOREEFFECTIVE

THIS MONTH, WE ASKED LEADING SERVICE AND SALES

TRAINER DAVID LEWIS FOR HIS THOUGHTS ON SEVERAL ISSUES THAT DEALERSHIPS FREQUENTLY HAVE WITH

THEIR SERVICE ADVISORS.

SD

Recognizing that this customer really doesn’t want to be bringing her car in for work is the first step to establishing trust.

You might be smarter to wait until after this multi-point inspection to try to sell the customer on additional repair services.

ServiceDriveToday.com ServiceDriveToday.com 16 Service Drive DECEMBER 2015 DECEMBER 2015 Service Drive 17

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 19 18 Service Drive DECEMBER 2015FO

UR -W

EEK SC

HEDU

LE 1 TECHNICIAN MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY SUNDAY

1 ON ON ON OFF OFF OFF OFF

2 ON ON ON OFF OFF OFF OFF

3 ON ON ON OFF OFF OFF OFF

4 ON ON ON OFF OFF OFF OFF

5 ON ON ON OFF OFF OFF OFF

6 OFF OFF OFF ON ON ON OFF

7 OFF OFF OFF ON ON ON OFF

8 OFF OFF OFF ON ON ON OFF

9 OFF OFF OFF ON ON ON OFF

10 OFF OFF OFF ON ON ON OFF

SD

CHUCK WENZLERConsultant and Coach at M5 Management Services Inc.

Chuck is a fixed operations professional with more than 25 years of managerial experience. He has worked for several dealerships and later moved into training and consulting, both independently and for utoNation and M5. He specializes in fixed operations clients at M5.

CAN INCREASE SERVICE WORK OUTPUTWITHOUT NEEDING A BUILDING EXPANSION

The right approach can ramp up productivity within your current bays, and still offer enough time off.BY CHUCK WENZLER

I often hear service managers lament that they need a larger building to run at peak efficiency. However, before a dealership breaks ground on a new or expanded service operations area, it must first pursue all avenues for increasing production

capacity via managing technician productivity, dispatch techniques, shop structure and work schedules.

In this article, I am going to focus specifically on increasing capacity through alternative work schedules.

In many service departments, techs start at the same time every morning. The service drive may open at 7 a.m., but techs may not start work until 7:30 or 8. It is very difficult for service advisors to write enough repair orders first thing in the morning to assign each tech a job as soon as he arrives. Techs rarely actually start working at their designated start time, so many hours of lost production result.

Staggering start times is one way to overcome this. Rather than having all techs work a standard 8 a.m. to 5 p.m. shift with an hour off for lunch, the service director could stagger shifts to accommodate workflow. One group of techs could work from 7:30 to 4:30, another from 8 to 5, a third from 8:30 to 5:30.

However, this is not the same as increasing overall shop capacity. Many dealerships need to make room for additional techs to increase the flat rate hour-capacity of their service departments. They may not have available stalls to accommodate additional techs, but brick and mortar are expensive, and not all dealerships have enough land to expand.

The options I present in this article to increase shop capacity address three key areas. First, they extend hours of operation in the service department, providing the dealership employs enough techs to fill the schedule. Second, some of my examples provide techs with additional days off, which younger employees particularly tend to value. Third, the service department could add techs, increase productive capacity and expand hours of operation without a physical expansion.

4/10s WITH A SATURDAY ROTATIONI have found techs and advisors generally respond well to this configuration. Techs work four 10-hour days once week, and four 10-hour days plus an eight-hour Saturday the next week. Thus, they have three days off one week and two the next. Assuming the

INNOVATING ON WORK SCHEDULES

WEEK

ONE TECHNICIAN MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY SUNDAY

1 OFF ON ON ON ON ON OFF

2 ON OFF ON ON ON ON OFF

3 ON ON OFF ON ON ON OFF

4 ON ON ON OFF ON ON OFF

5 ON ON ON ON ON ON OFF

6 OFF ON ON ON OFF OFF OFF

7 ON OFF ON ON OFF OFF OFF

8 ON ON OFF ON OFF OFF OFF

9 ON ON ON OFF OFF OFF OFF

10 ON ON ON ON OFF OFF OFF

WEEK

TWO TECHNICIAN MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY SUNDAY

1 ON OFF ON ON ON OFF OFF

2 ON ON OFF ON ON OFF OFF

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5 OFF ON ON ON ON OFF OFF

6 ON OFF ON ON ON ON OFF

7 ON ON OFF ON ON ON OFF

8 ON ON ON OFF ON ON OFF

9 ON ON ON ON OFF ON OFF

10 OFF ON ON ON OFF ON OFF

WEEK

ONE TECHNICIAN MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY SUNDAY

1 ON ON ON ON OFF OFF OFF

2 OFF ON ON ON ON OFF OFF

3 OFF OFF ON ON ON ON ON

4 ON OFF OFF ON ON ON ON

5 ON ON OFF OFF ON ON ON

6 ON ON ON OFF OFF ON ON

7 ON ON ON ON OFF OFF OFF

8 OFF ON ON ON ON OFF OFF

9 OFF OFF ON ON ON ON ON

10 ON OFF OFF ON ON ON ON

11 ON ON OFF OFF ON ON ON

12 ON ON ON OFF OFF ON ON

FOUR

-WEEK

SCHE

DULE

2 TECHNICIAN MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY SUNDAY

1 OFF OFF OFF ON ON ON OFF

2 OFF OFF OFF ON ON ON OFF

3 OFF OFF OFF ON ON ON OFF

4 OFF OFF OFF ON ON ON OFF

5 OFF OFF OFF ON ON ON OFF

6 ON ON ON OFF OFF OFF OFF

7 ON ON ON OFF OFF OFF OFF

8 ON ON ON OFF OFF OFF OFF

9 ON ON ON OFF OFF OFF OFF

10 ON ON ON OFF OFF OFF OFF

It’s convenient for dealership service customers to bring in their vehicles on weekends, but only if we treat Saturdays and Sundays as “real” days, meaning the department is open a full day with all normal services offered.

With this schedule, techs rotate four four-day weeks with four five-day weeks. Saturdays and Sundays are staffed, but techs never have fewer than two days off per week. In fact, during the four-day-week stretch, they will get four days in a row off at one point. In the example shown below, Tech 1 will have Friday, Saturday and Sunday off, then also get Monday off to start the week as he rotates to the No. 2 slot in the schedule.

Just as with a schedule based on four-10 hour shifts with Saturday rotation, pairing of techs and advisors should strongly be considered. Caution must be taken not to leave customer vehicles disabled during an

extended (three to four days) time-off period. This problem can be addressed by partnering techs of equal skill levels, and having only one of them off work at a time. If a repair cannot be completed, then the partner resumes the job as he comes on shift.

Communication between the tech, advisor and dispatcher must be seamless. In the below scenario, not only was the number of work days expanded but also the tech count was increased to 12 from eight without a building expansion.

3/13s WITH A 4-WEEK ROTATIONThe concept of working personnel on schedules of three 13-hour workdays has become quite popular in many industries, such as healthcare. This approach would let a service department stay open for six days and evenings, and it is possible to cycle through the work schedule every eight weeks, making it easy to administer.

The eight-week cycle is best utilized with complete sets of personnel, meaning lateral support groups, “super groups” and teams. These complete sets of techs operate within their own individual shops and are either working or off-duty as a group.

This does mean there would be only one day of rest between work stints every eighth week, but a seven-day break would come every eighth week. Also, given the long work days, service leaders should expect techs to become fatigued, and production to suffer, toward the middle of the third day – especially in hot months if the facility’s air conditioning is not great.

Note that in the chart below, Techs 1 through 5 have seven days off following their fourth work week, and that Sunday hours can easily be incorporated into this schedule.

In a 3/13 work schedule, pairings of techs with advisors should be mandatory. Each group should have a “mirrored” partner that includes an advisor. In order to ensure effective communication between the groups regarding carryover work, they should meet on the evening before or the morning following shift changes. As with the four-10-hour-day schedule, all efforts should be made to avoid having vehicles disabled during an extended (three to seven days) time-off period. Pairing techs with equal skill levels can help avoid this situation.

ADDING A SECOND SHIFTGenerally, second shifts are added to accommodate internal and fleet work, freeing up the day shift to handle regular customers’ needs. Several types of work schedules can accommodate a second shift, although attracting employees willing to take them on can be difficult. Two of the alternatives a service department might consider are:

Internal work only second/night shift: Should capacity be your primary issue, you could benefit by moving all or most of the internal work to a second shift. Expenses are minimized because no cashier is required, the parts department can pre-pull many necessary parts before the shift starts, and no customer relations personnel are needed. Plus, a shop foreman, group leader or lead tech can function as a working manager, eliminating the need for a service manager

during the shift.Another tweak is to perform limited customer pay

work until a certain time, like midnight. However, personnel expenses (advisor and/or cashier) will rise.

Full-service second shift: A full-service second

shift can make better use of the facilities and help the service department make greater market penetration. Due to additional personnel needed to operate the second shift effectively (advisors, cashiers, parts staff, etc.), expenses increase considerably.

4/10s WITH SATURDAY ROTATION

4/10s WITH SAT./SUN. ROTATION

3/13s WITH 4-WEEK ROTATION

service department is open eight hours on Saturdays, techs will average 44 hours per week.

This structure also allows for staggered starts or a late-starting shift (e.g., 11 a.m. to 10 p.m.). A service director could further enhance this schedule by rotating days off, which would give the techs a four-day weekend once every 10 weeks. And, as in the example that follows, a dealership that once could accommodate only eight techs now has room for 10.

4/10s WITH SAT./SUN. ROTATIONIn many dealerships, “Sunday” is a dirty word. But let’s face it, our aftermarket competitors (Pep Boys, NTB, Goodyear, Wal-Mart, etc.) all stay open on Saturdays AND Sundays and are very successful doing so. At many, Sunday is their busiest day, second only to Saturday.

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 19 18 Service Drive DECEMBER 2015

FOUR

-WEEK

SCHE

DULE

1 TECHNICIAN MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY SUNDAY

1 ON ON ON OFF OFF OFF OFF

2 ON ON ON OFF OFF OFF OFF

3 ON ON ON OFF OFF OFF OFF

4 ON ON ON OFF OFF OFF OFF

5 ON ON ON OFF OFF OFF OFF

6 OFF OFF OFF ON ON ON OFF

7 OFF OFF OFF ON ON ON OFF

8 OFF OFF OFF ON ON ON OFF

9 OFF OFF OFF ON ON ON OFF

10 OFF OFF OFF ON ON ON OFF

SD

CHUCK WENZLERConsultant and Coach at M5 Management Services Inc.

Chuck is a fixed operations professional with more than 25 years of managerial experience. He has worked for several dealerships and later moved into training and consulting, both independently and for utoNation and M5. He specializes in fixed operations clients at M5.

CAN INCREASE SERVICE WORK OUTPUTWITHOUT NEEDING A BUILDING EXPANSION

The right approach can ramp up productivity within your current bays, and still offer enough time off.BY CHUCK WENZLER

I often hear service managers lament that they need a larger building to run at peak efficiency. However, before a dealership breaks ground on a new or expanded service operations area, it must first pursue all avenues for increasing production

capacity via managing technician productivity, dispatch techniques, shop structure and work schedules.

In this article, I am going to focus specifically on increasing capacity through alternative work schedules.

In many service departments, techs start at the same time every morning. The service drive may open at 7 a.m., but techs may not start work until 7:30 or 8. It is very difficult for service advisors to write enough repair orders first thing in the morning to assign each tech a job as soon as he arrives. Techs rarely actually start working at their designated start time, so many hours of lost production result.

Staggering start times is one way to overcome this. Rather than having all techs work a standard 8 a.m. to 5 p.m. shift with an hour off for lunch, the service director could stagger shifts to accommodate workflow. One group of techs could work from 7:30 to 4:30, another from 8 to 5, a third from 8:30 to 5:30.

However, this is not the same as increasing overall shop capacity. Many dealerships need to make room for additional techs to increase the flat rate hour-capacity of their service departments. They may not have available stalls to accommodate additional techs, but brick and mortar are expensive, and not all dealerships have enough land to expand.

The options I present in this article to increase shop capacity address three key areas. First, they extend hours of operation in the service department, providing the dealership employs enough techs to fill the schedule. Second, some of my examples provide techs with additional days off, which younger employees particularly tend to value. Third, the service department could add techs, increase productive capacity and expand hours of operation without a physical expansion.

4/10s WITH A SATURDAY ROTATIONI have found techs and advisors generally respond well to this configuration. Techs work four 10-hour days once week, and four 10-hour days plus an eight-hour Saturday the next week. Thus, they have three days off one week and two the next. Assuming the

INNOVATING ON WORK SCHEDULES

WEEK

ONE TECHNICIAN MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY SUNDAY

1 OFF ON ON ON ON ON OFF

2 ON OFF ON ON ON ON OFF

3 ON ON OFF ON ON ON OFF

4 ON ON ON OFF ON ON OFF

5 ON ON ON ON ON ON OFF

6 OFF ON ON ON OFF OFF OFF

7 ON OFF ON ON OFF OFF OFF

8 ON ON OFF ON OFF OFF OFF

9 ON ON ON OFF OFF OFF OFF

10 ON ON ON ON OFF OFF OFF

WEEK

TWO TECHNICIAN MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY SUNDAY

1 ON OFF ON ON ON OFF OFF

2 ON ON OFF ON ON OFF OFF

3 ON ON ON OFF ON OFF OFF

4 ON ON ON ON OFF OFF OFF

5 OFF ON ON ON ON OFF OFF

6 ON OFF ON ON ON ON OFF

7 ON ON OFF ON ON ON OFF

8 ON ON ON OFF ON ON OFF

9 ON ON ON ON OFF ON OFF

10 OFF ON ON ON OFF ON OFF

WEEK

ONE TECHNICIAN MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY SUNDAY

1 ON ON ON ON OFF OFF OFF

2 OFF ON ON ON ON OFF OFF

3 OFF OFF ON ON ON ON ON

4 ON OFF OFF ON ON ON ON

5 ON ON OFF OFF ON ON ON

6 ON ON ON OFF OFF ON ON

7 ON ON ON ON OFF OFF OFF

8 OFF ON ON ON ON OFF OFF

9 OFF OFF ON ON ON ON ON

10 ON OFF OFF ON ON ON ON

11 ON ON OFF OFF ON ON ON

12 ON ON ON OFF OFF ON ON

FOUR

-WEEK

SCHE

DULE

2 TECHNICIAN MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY SUNDAY

1 OFF OFF OFF ON ON ON OFF

2 OFF OFF OFF ON ON ON OFF

3 OFF OFF OFF ON ON ON OFF

4 OFF OFF OFF ON ON ON OFF

5 OFF OFF OFF ON ON ON OFF

6 ON ON ON OFF OFF OFF OFF

7 ON ON ON OFF OFF OFF OFF

8 ON ON ON OFF OFF OFF OFF

9 ON ON ON OFF OFF OFF OFF

10 ON ON ON OFF OFF OFF OFF

It’s convenient for dealership service customers to bring in their vehicles on weekends, but only if we treat Saturdays and Sundays as “real” days, meaning the department is open a full day with all normal services offered.

With this schedule, techs rotate four four-day weeks with four five-day weeks. Saturdays and Sundays are staffed, but techs never have fewer than two days off per week. In fact, during the four-day-week stretch, they will get four days in a row off at one point. In the example shown below, Tech 1 will have Friday, Saturday and Sunday off, then also get Monday off to start the week as he rotates to the No. 2 slot in the schedule.

Just as with a schedule based on four-10 hour shifts with Saturday rotation, pairing of techs and advisors should strongly be considered. Caution must be taken not to leave customer vehicles disabled during an

extended (three to four days) time-off period. This problem can be addressed by partnering techs of equal skill levels, and having only one of them off work at a time. If a repair cannot be completed, then the partner resumes the job as he comes on shift.

Communication between the tech, advisor and dispatcher must be seamless. In the below scenario, not only was the number of work days expanded but also the tech count was increased to 12 from eight without a building expansion.

3/13s WITH A 4-WEEK ROTATIONThe concept of working personnel on schedules of three 13-hour workdays has become quite popular in many industries, such as healthcare. This approach would let a service department stay open for six days and evenings, and it is possible to cycle through the work schedule every eight weeks, making it easy to administer.

The eight-week cycle is best utilized with complete sets of personnel, meaning lateral support groups, “super groups” and teams. These complete sets of techs operate within their own individual shops and are either working or off-duty as a group.

This does mean there would be only one day of rest between work stints every eighth week, but a seven-day break would come every eighth week. Also, given the long work days, service leaders should expect techs to become fatigued, and production to suffer, toward the middle of the third day – especially in hot months if the facility’s air conditioning is not great.

Note that in the chart below, Techs 1 through 5 have seven days off following their fourth work week, and that Sunday hours can easily be incorporated into this schedule.

In a 3/13 work schedule, pairings of techs with advisors should be mandatory. Each group should have a “mirrored” partner that includes an advisor. In order to ensure effective communication between the groups regarding carryover work, they should meet on the evening before or the morning following shift changes. As with the four-10-hour-day schedule, all efforts should be made to avoid having vehicles disabled during an extended (three to seven days) time-off period. Pairing techs with equal skill levels can help avoid this situation.

ADDING A SECOND SHIFTGenerally, second shifts are added to accommodate internal and fleet work, freeing up the day shift to handle regular customers’ needs. Several types of work schedules can accommodate a second shift, although attracting employees willing to take them on can be difficult. Two of the alternatives a service department might consider are:

Internal work only second/night shift: Should capacity be your primary issue, you could benefit by moving all or most of the internal work to a second shift. Expenses are minimized because no cashier is required, the parts department can pre-pull many necessary parts before the shift starts, and no customer relations personnel are needed. Plus, a shop foreman, group leader or lead tech can function as a working manager, eliminating the need for a service manager

during the shift.Another tweak is to perform limited customer pay

work until a certain time, like midnight. However, personnel expenses (advisor and/or cashier) will rise.

Full-service second shift: A full-service second

shift can make better use of the facilities and help the service department make greater market penetration. Due to additional personnel needed to operate the second shift effectively (advisors, cashiers, parts staff, etc.), expenses increase considerably.

4/10s WITH SATURDAY ROTATION

4/10s WITH SAT./SUN. ROTATION

3/13s WITH 4-WEEK ROTATION

service department is open eight hours on Saturdays, techs will average 44 hours per week.

This structure also allows for staggered starts or a late-starting shift (e.g., 11 a.m. to 10 p.m.). A service director could further enhance this schedule by rotating days off, which would give the techs a four-day weekend once every 10 weeks. And, as in the example that follows, a dealership that once could accommodate only eight techs now has room for 10.

4/10s WITH SAT./SUN. ROTATIONIn many dealerships, “Sunday” is a dirty word. But let’s face it, our aftermarket competitors (Pep Boys, NTB, Goodyear, Wal-Mart, etc.) all stay open on Saturdays AND Sundays and are very successful doing so. At many, Sunday is their busiest day, second only to Saturday.

Road map provided to work with managers to ensure all federal and state laws and regs are followed. BY TERRY DORTCH

TERRY DORTCHPresident of Automotive Compliance Consultants

Terry is a former auto dealer and operator and also has worked as a GM, general sales manager, F&I director and F&I manager in a dealership environment. His company specializes in retail automotive compliance with federal and state laws and regulations. See the website at www.compliantnow.com.

REGULATORY COMPLIANCEIN SERVICE AND OTHER DEPARTMENTSNeeds A Dealer’s General Oversight

his/her authority.

✖ Training of board members and ownership.

✖ The compliance budget.

✖ Compliance reports to management.

Given that, a dealer or GM must ask themselves:

➤ When was compliance last discussed at a board meeting?

➤ Does the dealership compliance officer have meaningful authority in the dealership and own-ership of compliance-related issues?

➤ Does the compliance officer have access to up-per management?

➤ Has the dealership budgeted funds for compliance?

➤ Are compliance reports reviewed by owner-ship and upper management regularly?

FOR THE SERVICE MANAGERIn the service department, common compliance prob-lems include:

★ Failure to maintain a current safety manual, train all shop employees on abiding by it, and conducting continual reviews of the manual, shop conditions and employee adherence. One com-mon oversight is for the service department to forget about required signage like “Exit” or “Not An Exit” signs on doors.

★ Missing egress or exit route maps as required by law. Be sure these maps are current and visible in public areas.

★ Parts, parts shelving and crates that block ac-cess to electrical panels.

★ Failure to keep personal safety equipment near grinders, welders and similar tools and machinery.

★ Missing fire extinguishers or extinguishers, or units that are not properly marked or situated where they are easily visible.

★ Failure to set up hazardous materials and emer-gency response programs that cover safety data sheets, employee evacuation, disposal of used oil and refrigerants, etc.

Service personnel also should maintain and inspect quick lube, service and body shop lifts annually to com-ply with OSHA’s local emphasis program (LEP). Insist that technicians who work on EV and hybrid vehicles comply with OSHA regulations pertaining to safety gloves.

FOR THE F&I MANAGERThe F&I department must be sure to:

✓ Have available for consumers, copies of sales and marketing materials for each product offered by the dealership. Your F&I staff should make sure customers review these materials prior to a purchase decision.

✓ Review and verify that the content of sales and marketing materials for each product sold is cur-rent and accurate, contains proper disclosures and accurately states what is and what is not covered.

✓ Have customers sign off when they decline to buy a product.

✓ Clarify in writing the benefits the produce will deliver to the customer and why the cost is there-fore reasonable.

✓ Have established and published prices for each of the F&I products offered.

✓ Make sure dealership policy and practice re-quire that each customer be treated equally re-garding the sale of ancillary products and their cost.

✓ Monitor product sales to ensure that commis-sion-based employees are not taking advantage of certain individuals and classes with the prices of ancillary products.

✓ Use a menu, and be sure it clearly describes the products being sold, their cash prices and their financed costs.

Three additional advisories for the F&I staff are:

Utilize adverse action letters when necessary: These must be delivered either in person, at the time of the transaction, by mail within 30 days of the denial, or electronically within 30 days of the denial to anyone who applies for credit and is denied. An adverse action letter also is required when terms differ from those re-quested, and the customer therefore does not accept them.

Usually, the bank with which the dealership has pur-sued financing for the customer will produce and dis-tribute this notice. However, when the dealer makes the credit decision or denies credit without shopping the application to a bank or finance company, the dealer must take that action.

Provide risk-based pricing notice when neces-sary: Dealers must provide a risk-based pricing notice to customers who receive credit on material terms that are less favorable than those extended to a substantial proportion of the customer base. An alternative to a RBPN is an exception notice, which should be deliv-ered to all customers on whom the dealership runs credit prior to entering into an agreement.

Safeguard customer information: The dealership must protect private customer information from iden-tity theft to comply with the Gramm-Leach-Bliley safe-guards rule and financial privacy regulations. Do not leave deal jackets or other sensitive customer informa-tion (worksheets, contracts, notes scribbled on note-pads and up cards) anywhere where it might be read and/or stolen. This need also extends to the service department, where customer information appears on write-up sheets, repair orders, etc.

FOR THE HR MANAGEREmployment laws continually require auto dealerships to review harassment laws with employees. Discrimi-nation suits based on gender, race and other factors that get the EEOC can cost an offending dealership $1 mil-lion or more in compensatory and punitive damages, if the business is found liable.

So, dealerships and their HR staffs should pursue these hiring best practices:

✘ Have clear written anti-discrimination and ha-rassment policies in place.

✘ Train management on how to handle and fol-low through on employee claims.

✘ Train all employees on anti-discrimination and harassment policies and proper conduct. Every employee needs to know to whom to report inap-propriate conduct.

✘ Enforce the rules and procedures established in the dealership, regardless of the position an of-fender may hold. SD

Compliance with federal and state laws and regulations affects several departments in an auto dealership, most assuredly including the service operation. However, oversight of overall compliance must be driven by the dealer or GM,

or a dealership’s risk of a costly and/or dangerous violation increases.

In this article, I want to present a framework for administering an auto retailer’s total compliance from the head office level, recognizing that specific compli-ance duties will be policed and handled by individual departments.

Broadly speaking, today’s federal (and often state) laws and regulations govern a dealership’s:

✔ Service and body shop operations, including OSHA regulations that pertain to worker safety and health; and OSHA/EPA regulations that per-tain the storage, handling and disposal of materi-als classified as hazardous, including air bags.

✔ Sales and financing, pertaining to advertising, sales, consumer financing and aftermarket sales practices.

✔ Privacy and data security, pertaining to both the customer’s and employees’ information.

✔ Human resources, pertaining to Equal Employ-ment Opportunity Commission employment, hir-ing, harassment and discrimination practices and policies.

COMPLIANCE IS A TOP-DOWN ACTIVITYWhile every employee has a role to play in a dealer-ship’s legal and regulatory compliance, commitment to operating a compliant business must come from the top. If your business is audited and found in violation of these laws, the owner pays!

In dealerships whose owner takes an active role in com-pliance, generally I find that:

➜ Department heads know of their compliance obligations, and who may take actions necessary on compliance issues.

➜ All employees know their responsibilities.

➜ Errors are discovered and corrected before they become costly.

Managing compliance internally (i.e., not turning to an outside consulting firm) starts with training. Include senior managers in that training to equip them with big-picture concerns, and include department manag-ers and their staffs to ensure they know their hands-on responsibilities.

On compliance processes, a dealership benefits from a compliance risk assessment, which can be performed internally or by a third party. It helps identify and iso-late compliance risks, weaknesses and strengths. A risk assessment involves “boots on the ground,” with eye-balls on the nitty-gritty of current processes and proce-dures. Information from the risk assessment will pro-vide your business with a good map toward an efficient compliance program.

Whichever route you take, following is a by-depart-ment breakdown of compliance responsibilities (with this disclaimer: No one article can comprehensively cover all regulations governing the modern auto deal-ership. For that detail, you need to consult a compliance professional.)

FOR THE DEALER AND GMRegulators recognize the necessity for owners and se-nior managers to be involved in compliance. Remem-ber, at the start of any examination into your practices, government officials will review:

✖ Board meeting minutes and supporting mate-rials during the period under review, looking for coverage of compliance matters.

✖ The role of the chief compliance officer and

At this point of the transaction, the dealership needs to start thinking about complying with laws and regs on after-market sales.

Lift safety is one of the priorities for compliance in your service department.

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 21 20 Service Drive DECEMBER 2015

Road map provided to work with managers to ensure all federal and state laws and regs are followed. BY TERRY DORTCH

TERRY DORTCHPresident of Automotive Compliance Consultants

Terry is a former auto dealer and operator and also has worked as a GM, general sales manager, F&I director and F&I manager in a dealership environment. His company specializes in retail automotive compliance with federal and state laws and regulations. See the website at www.compliantnow.com.

REGULATORY COMPLIANCEIN SERVICE AND OTHER DEPARTMENTSNeeds A Dealer’s General Oversight

his/her authority.

✖ Training of board members and ownership.

✖ The compliance budget.

✖ Compliance reports to management.

Given that, a dealer or GM must ask themselves:

➤ When was compliance last discussed at a board meeting?

➤ Does the dealership compliance officer have meaningful authority in the dealership and own-ership of compliance-related issues?

➤ Does the compliance officer have access to up-per management?

➤ Has the dealership budgeted funds for compliance?

➤ Are compliance reports reviewed by owner-ship and upper management regularly?

FOR THE SERVICE MANAGERIn the service department, common compliance prob-lems include:

★ Failure to maintain a current safety manual, train all shop employees on abiding by it, and conducting continual reviews of the manual, shop conditions and employee adherence. One com-mon oversight is for the service department to forget about required signage like “Exit” or “Not An Exit” signs on doors.

★ Missing egress or exit route maps as required by law. Be sure these maps are current and visible in public areas.

★ Parts, parts shelving and crates that block ac-cess to electrical panels.

★ Failure to keep personal safety equipment near grinders, welders and similar tools and machinery.

★ Missing fire extinguishers or extinguishers, or units that are not properly marked or situated where they are easily visible.

★ Failure to set up hazardous materials and emer-gency response programs that cover safety data sheets, employee evacuation, disposal of used oil and refrigerants, etc.

Service personnel also should maintain and inspect quick lube, service and body shop lifts annually to com-ply with OSHA’s local emphasis program (LEP). Insist that technicians who work on EV and hybrid vehicles comply with OSHA regulations pertaining to safety gloves.

FOR THE F&I MANAGERThe F&I department must be sure to:

✓ Have available for consumers, copies of sales and marketing materials for each product offered by the dealership. Your F&I staff should make sure customers review these materials prior to a purchase decision.

✓ Review and verify that the content of sales and marketing materials for each product sold is cur-rent and accurate, contains proper disclosures and accurately states what is and what is not covered.

✓ Have customers sign off when they decline to buy a product.

✓ Clarify in writing the benefits the produce will deliver to the customer and why the cost is there-fore reasonable.

✓ Have established and published prices for each of the F&I products offered.

✓ Make sure dealership policy and practice re-quire that each customer be treated equally re-garding the sale of ancillary products and their cost.

✓ Monitor product sales to ensure that commis-sion-based employees are not taking advantage of certain individuals and classes with the prices of ancillary products.

✓ Use a menu, and be sure it clearly describes the products being sold, their cash prices and their financed costs.

Three additional advisories for the F&I staff are:

Utilize adverse action letters when necessary: These must be delivered either in person, at the time of the transaction, by mail within 30 days of the denial, or electronically within 30 days of the denial to anyone who applies for credit and is denied. An adverse action letter also is required when terms differ from those re-quested, and the customer therefore does not accept them.

Usually, the bank with which the dealership has pur-sued financing for the customer will produce and dis-tribute this notice. However, when the dealer makes the credit decision or denies credit without shopping the application to a bank or finance company, the dealer must take that action.

Provide risk-based pricing notice when neces-sary: Dealers must provide a risk-based pricing notice to customers who receive credit on material terms that are less favorable than those extended to a substantial proportion of the customer base. An alternative to a RBPN is an exception notice, which should be deliv-ered to all customers on whom the dealership runs credit prior to entering into an agreement.

Safeguard customer information: The dealership must protect private customer information from iden-tity theft to comply with the Gramm-Leach-Bliley safe-guards rule and financial privacy regulations. Do not leave deal jackets or other sensitive customer informa-tion (worksheets, contracts, notes scribbled on note-pads and up cards) anywhere where it might be read and/or stolen. This need also extends to the service department, where customer information appears on write-up sheets, repair orders, etc.

FOR THE HR MANAGEREmployment laws continually require auto dealerships to review harassment laws with employees. Discrimi-nation suits based on gender, race and other factors that get the EEOC can cost an offending dealership $1 mil-lion or more in compensatory and punitive damages, if the business is found liable.

So, dealerships and their HR staffs should pursue these hiring best practices:

✘ Have clear written anti-discrimination and ha-rassment policies in place.

✘ Train management on how to handle and fol-low through on employee claims.

✘ Train all employees on anti-discrimination and harassment policies and proper conduct. Every employee needs to know to whom to report inap-propriate conduct.

✘ Enforce the rules and procedures established in the dealership, regardless of the position an of-fender may hold. SD

Compliance with federal and state laws and regulations affects several departments in an auto dealership, most assuredly including the service operation. However, oversight of overall compliance must be driven by the dealer or GM,

or a dealership’s risk of a costly and/or dangerous violation increases.

In this article, I want to present a framework for administering an auto retailer’s total compliance from the head office level, recognizing that specific compli-ance duties will be policed and handled by individual departments.

Broadly speaking, today’s federal (and often state) laws and regulations govern a dealership’s:

✔ Service and body shop operations, including OSHA regulations that pertain to worker safety and health; and OSHA/EPA regulations that per-tain the storage, handling and disposal of materi-als classified as hazardous, including air bags.

✔ Sales and financing, pertaining to advertising, sales, consumer financing and aftermarket sales practices.

✔ Privacy and data security, pertaining to both the customer’s and employees’ information.

✔ Human resources, pertaining to Equal Employ-ment Opportunity Commission employment, hir-ing, harassment and discrimination practices and policies.

COMPLIANCE IS A TOP-DOWN ACTIVITYWhile every employee has a role to play in a dealer-ship’s legal and regulatory compliance, commitment to operating a compliant business must come from the top. If your business is audited and found in violation of these laws, the owner pays!

In dealerships whose owner takes an active role in com-pliance, generally I find that:

➜ Department heads know of their compliance obligations, and who may take actions necessary on compliance issues.

➜ All employees know their responsibilities.

➜ Errors are discovered and corrected before they become costly.

Managing compliance internally (i.e., not turning to an outside consulting firm) starts with training. Include senior managers in that training to equip them with big-picture concerns, and include department manag-ers and their staffs to ensure they know their hands-on responsibilities.

On compliance processes, a dealership benefits from a compliance risk assessment, which can be performed internally or by a third party. It helps identify and iso-late compliance risks, weaknesses and strengths. A risk assessment involves “boots on the ground,” with eye-balls on the nitty-gritty of current processes and proce-dures. Information from the risk assessment will pro-vide your business with a good map toward an efficient compliance program.

Whichever route you take, following is a by-depart-ment breakdown of compliance responsibilities (with this disclaimer: No one article can comprehensively cover all regulations governing the modern auto deal-ership. For that detail, you need to consult a compliance professional.)

FOR THE DEALER AND GMRegulators recognize the necessity for owners and se-nior managers to be involved in compliance. Remem-ber, at the start of any examination into your practices, government officials will review:

✖ Board meeting minutes and supporting mate-rials during the period under review, looking for coverage of compliance matters.

✖ The role of the chief compliance officer and

At this point of the transaction, the dealership needs to start thinking about complying with laws and regs on after-market sales.

Lift safety is one of the priorities for compliance in your service department.

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 21 20 Service Drive DECEMBER 2015

ON THE SET WITH

Jeff Wardell of StealthShopper, with Corinne Lillis of Service Drive Today.

Kirk Manzo of Assurant Solutions, with Corinne Lillis of Service Drive Today.

Brenda Stang of Shifting Gears Training, with Joe Gumm of Service Drive Today.

Phil Penton of SureCritic.

Mark Tewart of Tewart Enterprises. Matt Raymond of Haltermans Auto Group.Adam Robinson of Hireology, with Corinne Lillis of Service Drive Today.

Jim Roche of Xtime, with Corinne Lillis of Service Drive Today. Ricky Lopez of Ross Media, with Corinne Lillis of Service Drive Today. Ryan Leslie of DealerRater, with Joe Gumm of Service Drive Today.

Writer, author & trainer Grant Cardone.Brent Albrecht of Friendemic, with Corinne Lillis of Service Drive Today.Jody Devere of AskPatty.com, with Joe Gumm of Service Drive Today.

Lisa Copeland of Fiat Austin (Tex.). Dan Mondello of DealerTeamwork, with Corinne Lillis of Service Drive Today. Aaron Wirtz of Subaru of Wichita, with Corinne Lillis of Service Drive Today.

22 Service Drive DECEMBER 2015 ServiceDriveToday.com

ON THE SET WITH

Jeff Wardell of StealthShopper, with Corinne Lillis of Service Drive Today.

Kirk Manzo of Assurant Solutions, with Corinne Lillis of Service Drive Today.

Brenda Stang of Shifting Gears Training, with Joe Gumm of Service Drive Today.

Phil Penton of SureCritic.

Mark Tewart of Tewart Enterprises. Matt Raymond of Haltermans Auto Group.Adam Robinson of Hireology, with Corinne Lillis of Service Drive Today.

Jim Roche of Xtime, with Corinne Lillis of Service Drive Today. Ricky Lopez of Ross Media, with Corinne Lillis of Service Drive Today. Ryan Leslie of DealerRater, with Joe Gumm of Service Drive Today.

Writer, author & trainer Grant Cardone.Brent Albrecht of Friendemic, with Corinne Lillis of Service Drive Today.Jody Devere of AskPatty.com, with Joe Gumm of Service Drive Today.

Lisa Copeland of Fiat Austin (Tex.). Dan Mondello of DealerTeamwork, with Corinne Lillis of Service Drive Today. Aaron Wirtz of Subaru of Wichita, with Corinne Lillis of Service Drive Today.

22 Service Drive DECEMBER 2015 ServiceDriveToday.com

IF YOU DON’T ALREADY KNOW ABOUT US...

YOU SHOULD.

ForceMarketing.com | Atlanta • New York | 800-610-8905

The friends-and-family aspect of that platform means you want the domino effect to be positive, if possible.BY DAVID KAIN

We’ve all heard the phrase, “It’s all fun and games until someone gets their eye poked out.” I think the auto industry’s current relationship with social media is like that. Right now, it’s mostly fun and games as

dealers get their feet wet with social media, but just wait until an angry customer trashes their store in the digital world.

Dealerships need to be particularly sensitive about negative reviews on Facebook. People have come to expect businesses to get panned as often as they are praised on sites like Yelp, but a bad experience stands out more on Facebook, where the overall atmosphere is positive and community centric. Also, that commu-nity aspect means an irritated customer may well try to draw friends and family into discussing this particular business, which is another different aspect of Facebook.

All of us are tempted from time to time to respond with strong emotion, even in a business situation. Deal-ership managers don’t have that luxury, but our cus-tomers don’t have to live by the same rules.

At my family’s dealership, we used to say that guests who don’t buy cars don’t fill out surveys. But that was bad advice then and it’s really bad advice now. All day long, your showroom and service department visitors are posting “live updates” about their experiences on dealership social media platforms. In this article, I will discuss how the mother of one of my client’s customers took the dealership to task about how her daughter and son-in-law were treated – in real time, on the store’s

Facebook page. In one day, this established dealership with a pristine reputation online and offline went from hero to zero (almost literally the case, considering how many one-star reviews resulted), all because a mother felt her child was treated poorly.

Controlling Bad Reviews Is DifficultMost dealerships have a strategy in place to recruit online reviews from happy guests, and that approach works well to build a four- or five-star reputation on Google, Cars.com, Yelp, DealerRater, etc. This was a lot more difficult in the early days of review sites, but with practice dealers have become proficient and acknowl-edge their team members for a job well done in encour-aging satisfied customers to praise the store online.

Unfortunately, they are not as adept in controlling the situation when a dissatisfied customer takes them to task on social media. Bad reviews on search engines like Google and review sites like Yelp tend only to be noticed by active shoppers for vehicles, car repairs, and other products and services. So, those online environ-ments are somewhat static. However, Facebook is a

appreciate the customer amending his or her online complaint.

It also is imperative for dealerships to foster a culture of vigilant customer awareness at all times, he says, and insist on its team talking professionally and courteously in every interaction.

son-in-law had been wronged.

She commented that the dealership didn’t seem to

understand the power of social me-dia and recruited hundreds of online friends to

take aim at the business. Believe me, they did.

I bet you can guess how this played out. Family, friends and then casual observers quickly sided with the customer. Post after post slammed the dealership, and then several one-star reviews were written on the dealership’s Facebook page. Within 48 hours, the origi-nal poster had created a hash tag and a community site to collect reviews on the dealership as well as on any other local businesses that were not performing up to expectations.

It was crowd-sourcing at it most organic level. I would imagine that Angie’s List was started under sim-ilar circumstances.

The Effectiveness Of ‘We’re Sorry’Meanwhile, the dealer was blindsided and quickly gath-ered his leadership team to work toward a solution. He posted on the dealership’s Facebook page saying how sorry he was, that he understood why the customer was upset and that he would work diligently to resolve the problem to the customer’s satisfaction.

His acknowledgement of the customer’s side of the

story and immediate use of the word “sorry” rath-er than the typical “I apologize if this offended

…” seemed to work well. Customers who were pleased with the dealership’s work were in-spired to come to the dealer’s defense and gave positive reviews, which slowed the tide of criticism even though it seemed to motivate the mother to recruit more anti-viewpoints.

Ironically, the dealership discovered (on Facebook) that its body shop manag-er’s daughter knew the customer. Man-agement used this connection to calm the situation and finally was able to arrange a resolution that satisfied the customer. The

mother ended up posting that the dealer-ship had handled the situation, and the so-

cial storm ended.

However, a painful lesson was learned: Any customer who feels mistreated by a dealer-

ship employee can and probably will complain about the experience online, and if that custom-

er uses Facebook, the ramifications can be serious.

Lessons For All DealershipsIt is not an overreaction to suggest that every dealer-ship should receive ongoing social media sensitivity training. Mitch Gallant, the assistant GM for the Cap-ital Auto Group in Regina, Saskatchewan, Canada, rec-ommends quick engagement before a social blow-up can occur. He teaches his team to alert management immediately if a customer expresses a concern to them personally.

If the complaint does end up on social media, Gallant recommends an immediate “We’re sorry” be posted to that platform to express empathy, and an invitation to the customer to a phone or in-person conversation to settle the problem. He has found this approach works well because irritated customers tend to behave better in person than behind a computer screen, and more in-clined to work things out.

Once the problem has been resolved, Gallant says, a dealership should politely mention that it would

dynamic environ-ment in that someone doesn’t need to be shopping at all to be waylaid by someone else’s negative review. With users checking Facebook multiple times each day, the review probably will ap-pear on their feed without their seeking it out.

Early Intervention Is NeededMy dealership client now recognizes it could have averted a big headache if it would have launched the same rapid escalation process it uses to tackle major business emergencies. The problem escalated here be-cause an after-market vendor performed an upgrade and did some minor damage to the new vehicle in the process. A dealership employee went outside of his own body shop to save money, but the repair didn’t meet the customer’s expectations and after three weeks, the GM was playing catch-up.

Before that GM could handle the problem, the cus-tomer’s mother posted a one-star review (only because zero wasn’t available) and insisted her daughter and

DAVID KAINPresident of Kain Automotive

David has a unique background that includes automotive retail, OEM executive leadership and digital sales train-ing and consulting. His 20 years in retail included various positions in sales and service at Jack Kain Ford, where he remains a partner today. He also was the COO and co-founder of FordDirect.com, the Internet lead provider to Ford and Lincoln dealers. In 2003, he developed Kain Automotive. Visit his website at www.KainAutomotive.com.

Once customers log on to enter a review on your dealership’s Facebook page, remember that they will

be trying to draw others to their opinion.

Ttatty / Shutterstock.com

Take Extra Care To ManageYour Dealership’s

CUSTOMERREPUTATIONON Facebook

“It is not an overreaction to suggest that every dealership should receive ongoing social media sensitivity training.”

Never forget the impact of reviews on Facebook.

TO CONCLUDE, HERE IS MY CHECKLIST FOR PRESERVING A POSITIVE

REPUTATION ON SOCIAL MEDIA:Sustain a 24/7/365 customer satisfaction culture

Orient your team to the impact of social media reviews with live digital “field trips,” like gathering around a computer running Facebook

Encourage happy customers to review your dealership on your social media sites (Facebook in particular)

Teach employees how to recognize the signs of customer dissatisfaction, and to involve managers quickly

Teach every department manager how to effectively resolve customer concerns quickly SD

“A bad experience stands out more on Facebook, where the overall atmosphere is positive and community centric.”

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 25 24 Service Drive DECEMBER 2015

The friends-and-family aspect of that platform means you want the domino effect to be positive, if possible.BY DAVID KAIN

We’ve all heard the phrase, “It’s all fun and games until someone gets their eye poked out.” I think the auto industry’s current relationship with social media is like that. Right now, it’s mostly fun and games as

dealers get their feet wet with social media, but just wait until an angry customer trashes their store in the digital world.

Dealerships need to be particularly sensitive about negative reviews on Facebook. People have come to expect businesses to get panned as often as they are praised on sites like Yelp, but a bad experience stands out more on Facebook, where the overall atmosphere is positive and community centric. Also, that commu-nity aspect means an irritated customer may well try to draw friends and family into discussing this particular business, which is another different aspect of Facebook.

All of us are tempted from time to time to respond with strong emotion, even in a business situation. Deal-ership managers don’t have that luxury, but our cus-tomers don’t have to live by the same rules.

At my family’s dealership, we used to say that guests who don’t buy cars don’t fill out surveys. But that was bad advice then and it’s really bad advice now. All day long, your showroom and service department visitors are posting “live updates” about their experiences on dealership social media platforms. In this article, I will discuss how the mother of one of my client’s customers took the dealership to task about how her daughter and son-in-law were treated – in real time, on the store’s

Facebook page. In one day, this established dealership with a pristine reputation online and offline went from hero to zero (almost literally the case, considering how many one-star reviews resulted), all because a mother felt her child was treated poorly.

Controlling Bad Reviews Is DifficultMost dealerships have a strategy in place to recruit online reviews from happy guests, and that approach works well to build a four- or five-star reputation on Google, Cars.com, Yelp, DealerRater, etc. This was a lot more difficult in the early days of review sites, but with practice dealers have become proficient and acknowl-edge their team members for a job well done in encour-aging satisfied customers to praise the store online.

Unfortunately, they are not as adept in controlling the situation when a dissatisfied customer takes them to task on social media. Bad reviews on search engines like Google and review sites like Yelp tend only to be noticed by active shoppers for vehicles, car repairs, and other products and services. So, those online environ-ments are somewhat static. However, Facebook is a

appreciate the customer amending his or her online complaint.

It also is imperative for dealerships to foster a culture of vigilant customer awareness at all times, he says, and insist on its team talking professionally and courteously in every interaction.

son-in-law had been wronged.

She commented that the dealership didn’t seem to

understand the power of social me-dia and recruited hundreds of online friends to

take aim at the business. Believe me, they did.

I bet you can guess how this played out. Family, friends and then casual observers quickly sided with the customer. Post after post slammed the dealership, and then several one-star reviews were written on the dealership’s Facebook page. Within 48 hours, the origi-nal poster had created a hash tag and a community site to collect reviews on the dealership as well as on any other local businesses that were not performing up to expectations.

It was crowd-sourcing at it most organic level. I would imagine that Angie’s List was started under sim-ilar circumstances.

The Effectiveness Of ‘We’re Sorry’Meanwhile, the dealer was blindsided and quickly gath-ered his leadership team to work toward a solution. He posted on the dealership’s Facebook page saying how sorry he was, that he understood why the customer was upset and that he would work diligently to resolve the problem to the customer’s satisfaction.

His acknowledgement of the customer’s side of the

story and immediate use of the word “sorry” rath-er than the typical “I apologize if this offended

…” seemed to work well. Customers who were pleased with the dealership’s work were in-spired to come to the dealer’s defense and gave positive reviews, which slowed the tide of criticism even though it seemed to motivate the mother to recruit more anti-viewpoints.

Ironically, the dealership discovered (on Facebook) that its body shop manag-er’s daughter knew the customer. Man-agement used this connection to calm the situation and finally was able to arrange a resolution that satisfied the customer. The

mother ended up posting that the dealer-ship had handled the situation, and the so-

cial storm ended.

However, a painful lesson was learned: Any customer who feels mistreated by a dealer-

ship employee can and probably will complain about the experience online, and if that custom-

er uses Facebook, the ramifications can be serious.

Lessons For All DealershipsIt is not an overreaction to suggest that every dealer-ship should receive ongoing social media sensitivity training. Mitch Gallant, the assistant GM for the Cap-ital Auto Group in Regina, Saskatchewan, Canada, rec-ommends quick engagement before a social blow-up can occur. He teaches his team to alert management immediately if a customer expresses a concern to them personally.

If the complaint does end up on social media, Gallant recommends an immediate “We’re sorry” be posted to that platform to express empathy, and an invitation to the customer to a phone or in-person conversation to settle the problem. He has found this approach works well because irritated customers tend to behave better in person than behind a computer screen, and more in-clined to work things out.

Once the problem has been resolved, Gallant says, a dealership should politely mention that it would

dynamic environ-ment in that someone doesn’t need to be shopping at all to be waylaid by someone else’s negative review. With users checking Facebook multiple times each day, the review probably will ap-pear on their feed without their seeking it out.

Early Intervention Is NeededMy dealership client now recognizes it could have averted a big headache if it would have launched the same rapid escalation process it uses to tackle major business emergencies. The problem escalated here be-cause an after-market vendor performed an upgrade and did some minor damage to the new vehicle in the process. A dealership employee went outside of his own body shop to save money, but the repair didn’t meet the customer’s expectations and after three weeks, the GM was playing catch-up.

Before that GM could handle the problem, the cus-tomer’s mother posted a one-star review (only because zero wasn’t available) and insisted her daughter and

DAVID KAINPresident of Kain Automotive

David has a unique background that includes automotive retail, OEM executive leadership and digital sales train-ing and consulting. His 20 years in retail included various positions in sales and service at Jack Kain Ford, where he remains a partner today. He also was the COO and co-founder of FordDirect.com, the Internet lead provider to Ford and Lincoln dealers. In 2003, he developed Kain Automotive. Visit his website at www.KainAutomotive.com.

Once customers log on to enter a review on your dealership’s Facebook page, remember that they will

be trying to draw others to their opinion.

Ttatty / Shutterstock.com

Take Extra Care To ManageYour Dealership’s

CUSTOMERREPUTATIONON Facebook

“It is not an overreaction to suggest that every dealership should receive ongoing social media sensitivity training.”

Never forget the impact of reviews on Facebook.

TO CONCLUDE, HERE IS MY CHECKLIST FOR PRESERVING A POSITIVE

REPUTATION ON SOCIAL MEDIA:Sustain a 24/7/365 customer satisfaction culture

Orient your team to the impact of social media reviews with live digital “field trips,” like gathering around a computer running Facebook

Encourage happy customers to review your dealership on your social media sites (Facebook in particular)

Teach employees how to recognize the signs of customer dissatisfaction, and to involve managers quickly

Teach every department manager how to effectively resolve customer concerns quickly SD

“A bad experience stands out more on Facebook, where the overall atmosphere is positive and community centric.”

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 25 24 Service Drive DECEMBER 2015

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 27 26 Service Drive DECEMBER 2015

PAYING YOURDEALERSHIP’SBDC REPSHOURLY?Then Don’t Just AssumeThey Will Be Productive

BILL WITTENMYERPartner at the ELEAD1ONE division of Data Software Services LLC

Bill has over more than 20 years of experience in the automotive space and currently manages multiple divisions within his organization including sales, marketing, OEM relationships and large-client accounts. He speaks at several prominent automotive forums each year. Before joining ELEAD1ONE, he spent several years in dealership operations management.

A daily bonus incentive should be woven into this agent’s word tracks.

Monthly bonuses should be awarded at a BDC staff

meeting, which also can serve as a mentoring session.

Pay rates need to be competitive with other businesses, and you need to keep designing new incentives.BY BILL WITTENMYER

Afriend of mine says all the time that “Our pay raise becomes effective when we are.” It is his way of saying that we earn more when we do more, when we become more productive. Sounds simple and logical enough, but devising a productive pay plan

actually is one of the more challenging undertakings at a dealership, especially where business development centers are concerned.

BDCs are an important channel to sell service work, as well as vehicles, at many dealerships. Many different thought processes and operational considerations are involved when it comes to paying BDC representatives. It is not easy – in fact, it can be monumentally difficult – for a dealer to balance optimal efficiency and BDC pro-duction vs. cost and ROI.

CONCEDE THAT THIS IS A TOUGH JOBIn discussing the broad options for compensating BDC reps in this article, let’s first face the obvious: Running a BDC as a manager, or working as a phone agent, is diffi-cult. Very few people aspire to make calls all day, every day. It’s a tough job that most of us would regard as re-petitive and mundane.

Also, dealers should recognize that the skill set a good BDC agent must possess is not commonplace. Just think about the number of different phone scenarios he or she must executive properly, especially from the service department’s point of view. With those calls, the BDC rep becomes the voice of fixed operations and

must understand and maintain numerous operation codes and technical information; juggle scheduling constraints, tech levels and hour optimizations; and meet customer service and experience expectations.

Finding people with those talents isn’t easy; retaining

them is even harder. However, high labor turnover is detrimental to the BDC’s expense structure and nega-tively affects customer experience. To run a successful BDC, a dealer must implement a pay plan that is attrac-tive enough to recruit and retain talent, but that also maximizes operational efficiency and productivity.

With those challenges as a backdrop, let me add that every dealership’s culture is unique. So, a “one size fits all” pay plan for BDC agents is ill advised. Dealer-ships in heavily populated metro markets have differ-ent challenges than those in rural areas, including BDC compensation. The keys to success for any BDC lie in performance and monitoring of production, which includes tying monthly activities and goals to the pay plan.

PROS AND CONS FOR HOURLY PLANWhen developing a pay plan for BDC agents, a dealer must consider both structures: salary or hourly rate. If each approach didn’t have many advantages and chal-lenges, the choice certainly would be easier.

While salaried BDC staff means no overtime and (presumably) improved retention, job stagnation, lack

of performance and disproportionate costs-to-reve-nue-generation ratios can become problems. Hourly wages enable dealerships to employ more agents, re-duce per-person base compensation and control benefit costs. Dealers also get more flexibility in hours of BDC operation. However, overtime expenses can climb, and reps sometimes become less productive during their regular hours in order to ensure they work overtime.

DON’T CUT CORNERS ON BASE WAGEDealers must weigh several important provisions in considering an hourly pay plan for their BDC, but the most significant is to pay agents an hourly wage above the average for all industries in their region and for comparable local markets. I believe if they pay more, they will attract a higher-quality talent base.

Choices diminish if a BDC agent will make no more per hour than at the fast food restaurant down the street. That person will be inclined to take the fast food job, which is easier and carries less responsibility. Thus, the talent from which you can choose just dropped a grade level – maybe more.

It also is crucial to aggressively manage the BDC rep work schedule and hours, with the goal of avoiding overtime. Of course, you will always have employees who “call out” and need their shifts covered, but the dealership can prepare for that event with a deeper agent bench. If overtime is unavoidable, dealers need to make sure it is tied to call-outs and not to reps not com-pleting their original tasks during regular hours.

THE KINDS OF BONUSES THAT WORKA BDC that utilizes an hourly pay structure cannot thrive without incentives. Some of the best I see come in the form of contingency bonuses.

First, the dealership should implement a unique goal for a single daily bonus opportunity. For example, you could add in a one-day bonus (for a set dollar figure) for every vehicle detail upsold when scheduling a service appointment.

That incentive should be implemented as a “daily difference bonus,” and incorporated into agents’ word tracks. For every upsell executed, give the rep a bonus on top of the hourly pay. Change the goal and bonus amount each month; variety will keep the targeted goal fresh and provide an incentive for increased perfor-mance in targeted areas of production.

Also, a dealer could institute a monthly bonus based on less-defined concept, such as the “call of the month.” The criteria should be set each month, based either on a scoring system or on the general goals for that call. Criteria should stem from the goals set for your BDC, and all phone calls that fit that month’s criteria would need to be analyzed or reviewed.

At the same time the bonus is awarded, you should take advantage of the opportunity to review the call and to mentor the entire team. The bonus needs to be substantial in a BDC agent’s eyes – say, $200. You could include other monthly call quality bonuses for second and third place.

I have seen such bonuses promote a happier and more satisfied workplace and let BDC agents showcase their skills. They don’t always have to be monetary; restaurant certificates or event tickets accomplish the same purpose.

GETTING STARTEDTo summarize, these are the key considerations to max-imize the effectiveness of a BDC agent hourly pay plan:

• Offer above-average pay. If you pay average hour-ly wages, expect average talent and performance.

• Set performance goals, and align incentives. The goals your dealership has for its BDC must be estab-lished and clearly understood – number of attempted dials, successful contact ratio, survey completions, av-erage call length, number of script variations through-out the day, etc. Then, the pay plan needs to incent those goals judged as most crucial to the dealership.

• Keep directions simple and concise. Employees who don’t understand the incentive or how to achieve it will lose belief and focus, and fail to accomplish the goal. Don’t overcomplicate the qualifiers or the scoring methodology for the incentives and call reviews.

• Change things up. Keep monthly goals and bo-nuses fresh. Reward different skill sets by changing the goals every month. This gives BDC agents more opportunities to succeed and works on their areas of deficiency.

• Measure performance and provide feedback. It’s critical to measure every day the important BDC ac-tivities that your dealership manages. Provide reps with feedback on success, and coach them on items that need improvement.

Regardless of what BDC pay structure your dealer-ship implements, the mission always is to define clear goals and manage activities and expectations through-out the day, every day. A pay plan is merely a guide to achieve the goals that your dealership has set for the BDC.

“In discussing the broad options for compensating BDC reps … let’s first face the obvious: Running a BDC as a manager, or working as a phone agent, is difficult.”

“Choices diminish if a BDC agent will make no more per hour than at the fast food restaurant down the street.”

SD

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 27 26 Service Drive DECEMBER 2015

PAYING YOURDEALERSHIP’SBDC REPSHOURLY?Then Don’t Just AssumeThey Will Be Productive

BILL WITTENMYERPartner at the ELEAD1ONE division of Data Software Services LLC

Bill has over more than 20 years of experience in the automotive space and currently manages multiple divisions within his organization including sales, marketing, OEM relationships and large-client accounts. He speaks at several prominent automotive forums each year. Before joining ELEAD1ONE, he spent several years in dealership operations management.

A daily bonus incentive should be woven into this agent’s word tracks.

Monthly bonuses should be awarded at a BDC staff

meeting, which also can serve as a mentoring session.

Pay rates need to be competitive with other businesses, and you need to keep designing new incentives.BY BILL WITTENMYER

Afriend of mine says all the time that “Our pay raise becomes effective when we are.” It is his way of saying that we earn more when we do more, when we become more productive. Sounds simple and logical enough, but devising a productive pay plan

actually is one of the more challenging undertakings at a dealership, especially where business development centers are concerned.

BDCs are an important channel to sell service work, as well as vehicles, at many dealerships. Many different thought processes and operational considerations are involved when it comes to paying BDC representatives. It is not easy – in fact, it can be monumentally difficult – for a dealer to balance optimal efficiency and BDC pro-duction vs. cost and ROI.

CONCEDE THAT THIS IS A TOUGH JOBIn discussing the broad options for compensating BDC reps in this article, let’s first face the obvious: Running a BDC as a manager, or working as a phone agent, is diffi-cult. Very few people aspire to make calls all day, every day. It’s a tough job that most of us would regard as re-petitive and mundane.

Also, dealers should recognize that the skill set a good BDC agent must possess is not commonplace. Just think about the number of different phone scenarios he or she must executive properly, especially from the service department’s point of view. With those calls, the BDC rep becomes the voice of fixed operations and

must understand and maintain numerous operation codes and technical information; juggle scheduling constraints, tech levels and hour optimizations; and meet customer service and experience expectations.

Finding people with those talents isn’t easy; retaining

them is even harder. However, high labor turnover is detrimental to the BDC’s expense structure and nega-tively affects customer experience. To run a successful BDC, a dealer must implement a pay plan that is attrac-tive enough to recruit and retain talent, but that also maximizes operational efficiency and productivity.

With those challenges as a backdrop, let me add that every dealership’s culture is unique. So, a “one size fits all” pay plan for BDC agents is ill advised. Dealer-ships in heavily populated metro markets have differ-ent challenges than those in rural areas, including BDC compensation. The keys to success for any BDC lie in performance and monitoring of production, which includes tying monthly activities and goals to the pay plan.

PROS AND CONS FOR HOURLY PLANWhen developing a pay plan for BDC agents, a dealer must consider both structures: salary or hourly rate. If each approach didn’t have many advantages and chal-lenges, the choice certainly would be easier.

While salaried BDC staff means no overtime and (presumably) improved retention, job stagnation, lack

of performance and disproportionate costs-to-reve-nue-generation ratios can become problems. Hourly wages enable dealerships to employ more agents, re-duce per-person base compensation and control benefit costs. Dealers also get more flexibility in hours of BDC operation. However, overtime expenses can climb, and reps sometimes become less productive during their regular hours in order to ensure they work overtime.

DON’T CUT CORNERS ON BASE WAGEDealers must weigh several important provisions in considering an hourly pay plan for their BDC, but the most significant is to pay agents an hourly wage above the average for all industries in their region and for comparable local markets. I believe if they pay more, they will attract a higher-quality talent base.

Choices diminish if a BDC agent will make no more per hour than at the fast food restaurant down the street. That person will be inclined to take the fast food job, which is easier and carries less responsibility. Thus, the talent from which you can choose just dropped a grade level – maybe more.

It also is crucial to aggressively manage the BDC rep work schedule and hours, with the goal of avoiding overtime. Of course, you will always have employees who “call out” and need their shifts covered, but the dealership can prepare for that event with a deeper agent bench. If overtime is unavoidable, dealers need to make sure it is tied to call-outs and not to reps not com-pleting their original tasks during regular hours.

THE KINDS OF BONUSES THAT WORKA BDC that utilizes an hourly pay structure cannot thrive without incentives. Some of the best I see come in the form of contingency bonuses.

First, the dealership should implement a unique goal for a single daily bonus opportunity. For example, you could add in a one-day bonus (for a set dollar figure) for every vehicle detail upsold when scheduling a service appointment.

That incentive should be implemented as a “daily difference bonus,” and incorporated into agents’ word tracks. For every upsell executed, give the rep a bonus on top of the hourly pay. Change the goal and bonus amount each month; variety will keep the targeted goal fresh and provide an incentive for increased perfor-mance in targeted areas of production.

Also, a dealer could institute a monthly bonus based on less-defined concept, such as the “call of the month.” The criteria should be set each month, based either on a scoring system or on the general goals for that call. Criteria should stem from the goals set for your BDC, and all phone calls that fit that month’s criteria would need to be analyzed or reviewed.

At the same time the bonus is awarded, you should take advantage of the opportunity to review the call and to mentor the entire team. The bonus needs to be substantial in a BDC agent’s eyes – say, $200. You could include other monthly call quality bonuses for second and third place.

I have seen such bonuses promote a happier and more satisfied workplace and let BDC agents showcase their skills. They don’t always have to be monetary; restaurant certificates or event tickets accomplish the same purpose.

GETTING STARTEDTo summarize, these are the key considerations to max-imize the effectiveness of a BDC agent hourly pay plan:

• Offer above-average pay. If you pay average hour-ly wages, expect average talent and performance.

• Set performance goals, and align incentives. The goals your dealership has for its BDC must be estab-lished and clearly understood – number of attempted dials, successful contact ratio, survey completions, av-erage call length, number of script variations through-out the day, etc. Then, the pay plan needs to incent those goals judged as most crucial to the dealership.

• Keep directions simple and concise. Employees who don’t understand the incentive or how to achieve it will lose belief and focus, and fail to accomplish the goal. Don’t overcomplicate the qualifiers or the scoring methodology for the incentives and call reviews.

• Change things up. Keep monthly goals and bo-nuses fresh. Reward different skill sets by changing the goals every month. This gives BDC agents more opportunities to succeed and works on their areas of deficiency.

• Measure performance and provide feedback. It’s critical to measure every day the important BDC ac-tivities that your dealership manages. Provide reps with feedback on success, and coach them on items that need improvement.

Regardless of what BDC pay structure your dealer-ship implements, the mission always is to define clear goals and manage activities and expectations through-out the day, every day. A pay plan is merely a guide to achieve the goals that your dealership has set for the BDC.

“In discussing the broad options for compensating BDC reps … let’s first face the obvious: Running a BDC as a manager, or working as a phone agent, is difficult.”

“Choices diminish if a BDC agent will make no more per hour than at the fast food restaurant down the street.”

SD

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 29 28 Service Drive DECEMBER 2015

INTRA-DEPARTMENTCOMPETITIONBetween Departments Is Great, Dog-Eat-Dog Is NotGiving staffs a direct stake in one another’s success is smart dealership management.BY MARK TEWART

MARK TEWARTPresident of Tewart Enterprises Inc.

Mark is a sales expert and professional speaker, trainer, consultant, entrepreneur and author of the best seller “How to Be a Sales Superstar – Break All the Rules and Succeed While Doing It.” He has a 27-year career ranging from sales to becoming an executive manager at age 27, to founder and president of four successful companies. He is a professional member of the National Speakers Association and the Author’s Guild. Visit his website at www.MarkTewart.com.

your department’s data on the board promotes person-ally responsibility. You should not rely on doc sheets, as their numbers usually are behind.

Once the group has discussed each department and filled in the projected profit and loss based upon work-ing days, take a few minutes to talk about one thing that each department can do to help another. Doing this helps creating a culture and environment based on teamwork and purposeful communication.

For the same reason, I suggest daily save-a-deal meetings with the available managers. Apart from pro-ducing possible ways to revive a sale that is in trouble, these meetings improve communications, teamwork and accountability to other departments.

JOB-SHADOWING HELPS MANAGERS’PERSPECTIVESI also believe job-shadowing by managers helps with communication, understanding and empathy. All man-agers should be required to periodically work in other departments for a day. Imagine if the new car or used car managers shadowed a service writer or service manager for a day. What do you think would happen to their perspective?

Also, all managers should periodically work the jobs of the people they manage. A sales manager should oc-casionally work the floor for a day, and a GM should staff an F&I job, etc. Managers should never lose the perspective of their staffs.

FIND CROSS-TRAINING OPPORTUNITIESThe days of silo management in dealerships may be coming to an end. As one example, technology has blurred the lines between the sales and F&I managers and process. Try moving your F&I managers into the

sales offices and use their current offices for contract-ing only. Cross-train the sales and F&I managers on one another’s positions. You should reap benefits from in-creased customer focus, faster processes and improved communication.

Also, require training in another function that occurs outside of the dealership. For example, try sending a service manager to a sales seminar and vice versa.

Plus, schedule social activities outside of the dealer-ship that give your teams an opportunity to interact in a relaxed fashion as regular people. At the end of the day, they will be able to understand one another and relate at work better.

HOW TO DEFUSE STAFF TENSIONSAs a dealer, you must also make sure to always han-dle conflicts between your departments immediate-ly. Inter-department wars start off as small embers of dissent; eventually, the fire can grow so large that it’s tough to put out without firing people. Ignoring prob-lems only makes them worse; you can’t sweep manure under a rug and expect the stink to go away.

With that in mind, let me provide some tips for re-solving conflicts:

1) Address the problem immediately, but only in private with the parties involved.

2) Be concise, handling only the issue at hand, and be firm. Address the issues, not the people.

3) Don’t let your emotions get the best of you. It leaves scars on you and your team.

4) Don’t let your managers play the one-up game (“Yeah, but you …”)

5) Avoid conflict words such as “always,” “never” and “but.”

6) Give suggestions and alternatives. Build your managers back up. Show them and tell them that you care.

7) Always end the meeting by talking in terms of “we,” not “I” or “you.”

As a dealer, there is no better feeling than going to work each day to a successful dealership staffed by suc-cessful, happy and professional team players. There is no worse feeling than trudging into an underperform-ing store drained by staff infighting and backstabbing. Do not tolerate inter-department strife that can ruin your team and your business. SD

success and failure of other departments, then he or she has skin in the game with those groups.

How would such a pay plan be set up? You could use a manager compensation pool that is based on the dealer-ship’s overall performance, or for example pay the new car manager a percentage of profits in F&I, used car sales or even service in a “cross-banded” system.

There’s an old saying in our industry that the used car department is the service department’s best cus-tomer, yet it is often treated the worst by service and waits the longest. You could create a days-from-recon-ditioning-to-sale component of compensation for both the used car and service directors or managers, thus in-centing them to work together. These pay components or bonuses also could have a punitive effect if desired outcomes are not achieved.

A successful business comprises successful depart-ments. Encourage your individual staffs to assume at

least some responsibility for their colleagues’ perfor-mance, using an overall dealership success bonus that fosters a “we” mentality.

CROSS-DEPARTMENTAL STRATEGY MEETINGSIf you aren’t already, try holding a weekly meeting be-tween top leadership and your managers. Heads of ev-ery department – new car, used car, F&I, Internet, BDC, service, parts, body shop and controller – should attend and be prepared to report on performance against five top metrics established for their groups. They will cov-er month-to-date numbers and extrapolate them to project future performance, based on working days.

I call this a “war board meeting,” as I prefer that each manager write his or her numbers on a large dry erase board that is broken into columns. Physically recording

“Encourage your individual staffs to assume at least some responsibility for their colleagues’ performance, using an overall dealership success bonus that fosters a ‘we’ mentality.”

I am betting you have experienced this pain as a dealer too many times: The new car department constantly fights with the used car department, which is always upset with the service group. Service and F&I dislike and disrespect both sales staffs, and everyone hates

the office manager.

It’s time to stop the insanity. I actually have heard a few dealers say they like their departments feuding, because each is trying to outdo the other so everyone stays aggressive and on their toes. My reply is, “Are you kidding me?”

A healthy level of competitiveness and willingness to stand up for your department are one thing. However, constant battles and bickering between a dealership’s departments will inflict far more damage than any good that results.

The success of every dealership starts with the cul-ture and work environment. Even an expensive luxury

home eventually will crumble if the foundation is bad. And, a business’ culture and environment are built upon having the right people doing the right things in the right way, i.e. character. In turn, character re-quires good leadership, and good leaders communicate effectively.

In every struggling dealership I’ve seen that is expe-riencing infighting with its departments, there has been little to no communication. Communication must come both from the top-down and bottom-up, and without it, your different departments will never understand and empathize with one another.

Now, let me address some potential approaches to improve communication, and minimize or eliminate in-ter-department wars in a dealership.

PAY BASED ON OTHER GROUP’S SUCCESSIf each one of your managers gets paid in part upon the

Combative dealership staff meetings are not what you want; aim for broad strategy meetings instead.

“Constant battles and bickering

between a dealership’s

departments will inflict far more damage than any

good that results.”

Not only should leaders of sales and service functions

be compensated in part on the other department’s

success, but also they should periodically work the

other group’s jobs.

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 29 28 Service Drive DECEMBER 2015

INTRA-DEPARTMENTCOMPETITIONBetween Departments Is Great, Dog-Eat-Dog Is NotGiving staffs a direct stake in one another’s success is smart dealership management.BY MARK TEWART

MARK TEWARTPresident of Tewart Enterprises Inc.

Mark is a sales expert and professional speaker, trainer, consultant, entrepreneur and author of the best seller “How to Be a Sales Superstar – Break All the Rules and Succeed While Doing It.” He has a 27-year career ranging from sales to becoming an executive manager at age 27, to founder and president of four successful companies. He is a professional member of the National Speakers Association and the Author’s Guild. Visit his website at www.MarkTewart.com.

your department’s data on the board promotes person-ally responsibility. You should not rely on doc sheets, as their numbers usually are behind.

Once the group has discussed each department and filled in the projected profit and loss based upon work-ing days, take a few minutes to talk about one thing that each department can do to help another. Doing this helps creating a culture and environment based on teamwork and purposeful communication.

For the same reason, I suggest daily save-a-deal meetings with the available managers. Apart from pro-ducing possible ways to revive a sale that is in trouble, these meetings improve communications, teamwork and accountability to other departments.

JOB-SHADOWING HELPS MANAGERS’PERSPECTIVESI also believe job-shadowing by managers helps with communication, understanding and empathy. All man-agers should be required to periodically work in other departments for a day. Imagine if the new car or used car managers shadowed a service writer or service manager for a day. What do you think would happen to their perspective?

Also, all managers should periodically work the jobs of the people they manage. A sales manager should oc-casionally work the floor for a day, and a GM should staff an F&I job, etc. Managers should never lose the perspective of their staffs.

FIND CROSS-TRAINING OPPORTUNITIESThe days of silo management in dealerships may be coming to an end. As one example, technology has blurred the lines between the sales and F&I managers and process. Try moving your F&I managers into the

sales offices and use their current offices for contract-ing only. Cross-train the sales and F&I managers on one another’s positions. You should reap benefits from in-creased customer focus, faster processes and improved communication.

Also, require training in another function that occurs outside of the dealership. For example, try sending a service manager to a sales seminar and vice versa.

Plus, schedule social activities outside of the dealer-ship that give your teams an opportunity to interact in a relaxed fashion as regular people. At the end of the day, they will be able to understand one another and relate at work better.

HOW TO DEFUSE STAFF TENSIONSAs a dealer, you must also make sure to always han-dle conflicts between your departments immediate-ly. Inter-department wars start off as small embers of dissent; eventually, the fire can grow so large that it’s tough to put out without firing people. Ignoring prob-lems only makes them worse; you can’t sweep manure under a rug and expect the stink to go away.

With that in mind, let me provide some tips for re-solving conflicts:

1) Address the problem immediately, but only in private with the parties involved.

2) Be concise, handling only the issue at hand, and be firm. Address the issues, not the people.

3) Don’t let your emotions get the best of you. It leaves scars on you and your team.

4) Don’t let your managers play the one-up game (“Yeah, but you …”)

5) Avoid conflict words such as “always,” “never” and “but.”

6) Give suggestions and alternatives. Build your managers back up. Show them and tell them that you care.

7) Always end the meeting by talking in terms of “we,” not “I” or “you.”

As a dealer, there is no better feeling than going to work each day to a successful dealership staffed by suc-cessful, happy and professional team players. There is no worse feeling than trudging into an underperform-ing store drained by staff infighting and backstabbing. Do not tolerate inter-department strife that can ruin your team and your business. SD

success and failure of other departments, then he or she has skin in the game with those groups.

How would such a pay plan be set up? You could use a manager compensation pool that is based on the dealer-ship’s overall performance, or for example pay the new car manager a percentage of profits in F&I, used car sales or even service in a “cross-banded” system.

There’s an old saying in our industry that the used car department is the service department’s best cus-tomer, yet it is often treated the worst by service and waits the longest. You could create a days-from-recon-ditioning-to-sale component of compensation for both the used car and service directors or managers, thus in-centing them to work together. These pay components or bonuses also could have a punitive effect if desired outcomes are not achieved.

A successful business comprises successful depart-ments. Encourage your individual staffs to assume at

least some responsibility for their colleagues’ perfor-mance, using an overall dealership success bonus that fosters a “we” mentality.

CROSS-DEPARTMENTAL STRATEGY MEETINGSIf you aren’t already, try holding a weekly meeting be-tween top leadership and your managers. Heads of ev-ery department – new car, used car, F&I, Internet, BDC, service, parts, body shop and controller – should attend and be prepared to report on performance against five top metrics established for their groups. They will cov-er month-to-date numbers and extrapolate them to project future performance, based on working days.

I call this a “war board meeting,” as I prefer that each manager write his or her numbers on a large dry erase board that is broken into columns. Physically recording

“Encourage your individual staffs to assume at least some responsibility for their colleagues’ performance, using an overall dealership success bonus that fosters a ‘we’ mentality.”

I am betting you have experienced this pain as a dealer too many times: The new car department constantly fights with the used car department, which is always upset with the service group. Service and F&I dislike and disrespect both sales staffs, and everyone hates

the office manager.

It’s time to stop the insanity. I actually have heard a few dealers say they like their departments feuding, because each is trying to outdo the other so everyone stays aggressive and on their toes. My reply is, “Are you kidding me?”

A healthy level of competitiveness and willingness to stand up for your department are one thing. However, constant battles and bickering between a dealership’s departments will inflict far more damage than any good that results.

The success of every dealership starts with the cul-ture and work environment. Even an expensive luxury

home eventually will crumble if the foundation is bad. And, a business’ culture and environment are built upon having the right people doing the right things in the right way, i.e. character. In turn, character re-quires good leadership, and good leaders communicate effectively.

In every struggling dealership I’ve seen that is expe-riencing infighting with its departments, there has been little to no communication. Communication must come both from the top-down and bottom-up, and without it, your different departments will never understand and empathize with one another.

Now, let me address some potential approaches to improve communication, and minimize or eliminate in-ter-department wars in a dealership.

PAY BASED ON OTHER GROUP’S SUCCESSIf each one of your managers gets paid in part upon the

Combative dealership staff meetings are not what you want; aim for broad strategy meetings instead.

“Constant battles and bickering

between a dealership’s

departments will inflict far more damage than any

good that results.”

Not only should leaders of sales and service functions

be compensated in part on the other department’s

success, but also they should periodically work the

other group’s jobs.

Regularly querying customers, coupled with your existing systems, are a powerful combination.BY MICHAEL ROPPO

MICHAEL ROPPODirector of Fixed Operations and Training /QPS at Automotive Domain Results

Michael has more than 30 years experience in training and consulting for Automotive Domain Results and its parent company, The Mironov Group. He helps dealers attain maximum profitability, customer satis-faction and retention by improving the quality of their management teams and the personnel who come in contact with their customers. Visit his website at AutomotiveDomainResults.com.

LEVERAGE YOURCMS & CRMTo Understand A Service Customer’s Expectations Better

Targeting decision-makers requires a consistent ap-proach to marketing your products and services in a value-added way. Make sure there are plenty of incen-tives for customers and prospects to do business with you and not your competition.

You can learn a great deal about your customers by simply talking to them on a regular basis. Asking them why they’re buying or not buying, what they may want to buy in the future and what other needs they have can give a valuable picture of what’s important to them.

Strong car and service sales are driven by emphasiz-ing the benefits and value that your products or services bring to your customers. If you know the challenges that face them, it’s much easier to offer them solutions.

KNOW THEIR CURRENT SERVICE PROVIDERSChances are your potential customers already are buy-ing something similar to your dealership’s products and service from another dealership. Before you can sell to a potential customer, you need to know:

✔ Who is that prospect’s current dealership and service provider?✔ Is that prospect happy with the current dealership or service provider?✔ What additional, valued benefits could your dealership offer that person?

The easiest way to identify a potential customer’s current dealer and service provider is by simply asking him or her. Generally, people are very happy to offer this information and to reveal whether they’re happy with their present dealer or auto service organization.

LEVERAGING DMS, CRM TOGETHERToday, when you look at automotive DMS systems like Automate’s and CRM-associated software, we real-ize that the scope of features and functionality is sig-nificant. DMS and CRM software used together can provide dealers with an arsenal of tools and powerful customer information to drive business forward in any economy. Proper utilization is of these systems is becoming the core of operational performance for all dealer profit centers.

These are the kinds of resources that allow smart service managers and advisors, sales managers and salespeople, parts counter people, and BDC and BDR staff (who usually are the ones held accountable for gathering, confirming and constantly updating perti-nent customer information) to ask the right questions and entering the answers into the dealer’s chosen DMS screens for every customer.

Efforts made in the area of building and maintaining information influence strong relationships in our in-dustry. With proper time, targeted communications to keep customers coming back over and over again are a must to be successful in our industry. Some DMS pro-viders like Automate partner with organizations that allow open access to information that can point to:

➜ Core CRM program marketing initiatives for dealers ➜ Best-in-class practices that are tailored to your customer’s specific needs ➜ Multi-channel approaches for a dealership to communicate with its customers in a regimented fashion, from the time they take ownership of a new vehicle until they purchase their next one

➜ E-mail and direct mail targeted messages for a customer’s birthday, anniversary, next recommended service, etc. ➜ Targeted information based on a customer’s buying preferences and response analytics

HOW THIS INFORMATION CAN BE USEDJust a few examples are:

★ Make the first service appointment immediately after the vehicle sale, say for

1,000 miles out★ Invite customers to a monthly service educational seminar or a welcome introduction for new and used car customer?★ Provide monthly service clinic invitation to new and current service customers★ Distribute ongoing customer service specials that influence value perceptions and customer retention

Efforts like these are a requirement if you want to drive all of the dealership’s sales and service marketing

efforts from a streamlined database in order to be more profitable. Storing your customer data, service history and inventory in one system rather than several lets you log onto one database to open service campaigns, influence more appointments, market special service programs, manage service customer records and parts inventories, run e-mail campaigns, properly desk a deal and conduct trade appraisals.

Utilizing an extensive array of CRM data (sales his-tory, sales modeling and customer history information) available from your DMS can help determine when to communicate service and sales messages to customers in a targeted manner.

SANER INVESTMENT IN TECHNOLOGYSmart dealers, leaders and managers who have been in the business for quite some time all have witnessed dealers investing in a myriad of technologies to better manage customers, marketing websites and inventory.

As many vendors present the benefits of using a particular DMS or Internet lead management systems (ILMS), it all looks pretty compelling. The dealer signs up and hopefully realizes some of those benefits, but then along comes along another vendor pitching a dif-ferent system – say, a website, CRM or e-mail marketing program. The dealer may sign up for those as well but capitalize on none of them.

After a few years, that dealer will look around and find he’s spent big bucks on every kind of technology available, but none of it works well for him. This means that collectively, it doesn’t really work well at all. Get smart!

“I cannot understate howimportant it is for a

service department to

pursue insights into its customers’ preferences.”

Your CRM becomes a more powerful tool once youpopulate it with more data about your customers’ buying habits.

SD

Understanding your customer’s needs, expectations and preferences is at the center of every successful dealership organization’s sales and service businesses. This is true regardless of whether a company sells its products and

services directly to individuals or to other businesses.

This core knowledge can be used to influence a po-tential or existing customer that buying from your deal-ership is in his or her best interests.

I cannot understate how important it is for a service department to pursue insights into its customers’ pref-erences. These insights can be garnered from your deal-ership’s DMS and CRM systems, working together to help you win service business from your competition. However, you first need to establish what you want to know about your customers’ preferences and how you will use it to steer them into buying from your dealer-ship more frequently and effectively.

ONGOING INFO ABOUT CUSTOMERS, PROSPECTSThe more you know about your customers, the more ef-fective your service sales and marketing efforts will be. It’s well worth making the effort to find out:

✘ Who they are?✘ What they are planning on buying?✘ Why are they buying it?✘ How soon are they planning to make the purchase?✘ Who will they buy it from? ✘ What do customers want to buy from you?✘ Why do customers need your dealership and your services?✘ What are the differences between your services and that of your competition? ✘ What do you specifically know about your customers?✘ Whom are they buying from now and why?

If you’re selling services to other businesses with a fleet of vehicles that get bought, sold and serviced frequently, you’ll need to know which individuals are responsible for making the buying decisions and take steps to ensure they can buy from your dealership.

Your service staff need to make a special effort to

converse with customers about their purchase needs

and preferred vendors.

“DMS and CRM software used

together can provide dealers with an

arsenal of tools and powerful customer information.”

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 31 30 Service Drive DECEMBER 2015

Regularly querying customers, coupled with your existing systems, are a powerful combination.BY MICHAEL ROPPO

MICHAEL ROPPODirector of Fixed Operations and Training /QPS at Automotive Domain Results

Michael has more than 30 years experience in training and consulting for Automotive Domain Results and its parent company, The Mironov Group. He helps dealers attain maximum profitability, customer satis-faction and retention by improving the quality of their management teams and the personnel who come in contact with their customers. Visit his website at AutomotiveDomainResults.com.

LEVERAGE YOURCMS & CRMTo Understand A Service Customer’s Expectations Better

Targeting decision-makers requires a consistent ap-proach to marketing your products and services in a value-added way. Make sure there are plenty of incen-tives for customers and prospects to do business with you and not your competition.

You can learn a great deal about your customers by simply talking to them on a regular basis. Asking them why they’re buying or not buying, what they may want to buy in the future and what other needs they have can give a valuable picture of what’s important to them.

Strong car and service sales are driven by emphasiz-ing the benefits and value that your products or services bring to your customers. If you know the challenges that face them, it’s much easier to offer them solutions.

KNOW THEIR CURRENT SERVICE PROVIDERSChances are your potential customers already are buy-ing something similar to your dealership’s products and service from another dealership. Before you can sell to a potential customer, you need to know:

✔ Who is that prospect’s current dealership and service provider?✔ Is that prospect happy with the current dealership or service provider?✔ What additional, valued benefits could your dealership offer that person?

The easiest way to identify a potential customer’s current dealer and service provider is by simply asking him or her. Generally, people are very happy to offer this information and to reveal whether they’re happy with their present dealer or auto service organization.

LEVERAGING DMS, CRM TOGETHERToday, when you look at automotive DMS systems like Automate’s and CRM-associated software, we real-ize that the scope of features and functionality is sig-nificant. DMS and CRM software used together can provide dealers with an arsenal of tools and powerful customer information to drive business forward in any economy. Proper utilization is of these systems is becoming the core of operational performance for all dealer profit centers.

These are the kinds of resources that allow smart service managers and advisors, sales managers and salespeople, parts counter people, and BDC and BDR staff (who usually are the ones held accountable for gathering, confirming and constantly updating perti-nent customer information) to ask the right questions and entering the answers into the dealer’s chosen DMS screens for every customer.

Efforts made in the area of building and maintaining information influence strong relationships in our in-dustry. With proper time, targeted communications to keep customers coming back over and over again are a must to be successful in our industry. Some DMS pro-viders like Automate partner with organizations that allow open access to information that can point to:

➜ Core CRM program marketing initiatives for dealers ➜ Best-in-class practices that are tailored to your customer’s specific needs ➜ Multi-channel approaches for a dealership to communicate with its customers in a regimented fashion, from the time they take ownership of a new vehicle until they purchase their next one

➜ E-mail and direct mail targeted messages for a customer’s birthday, anniversary, next recommended service, etc. ➜ Targeted information based on a customer’s buying preferences and response analytics

HOW THIS INFORMATION CAN BE USEDJust a few examples are:

★ Make the first service appointment immediately after the vehicle sale, say for

1,000 miles out★ Invite customers to a monthly service educational seminar or a welcome introduction for new and used car customer?★ Provide monthly service clinic invitation to new and current service customers★ Distribute ongoing customer service specials that influence value perceptions and customer retention

Efforts like these are a requirement if you want to drive all of the dealership’s sales and service marketing

efforts from a streamlined database in order to be more profitable. Storing your customer data, service history and inventory in one system rather than several lets you log onto one database to open service campaigns, influence more appointments, market special service programs, manage service customer records and parts inventories, run e-mail campaigns, properly desk a deal and conduct trade appraisals.

Utilizing an extensive array of CRM data (sales his-tory, sales modeling and customer history information) available from your DMS can help determine when to communicate service and sales messages to customers in a targeted manner.

SANER INVESTMENT IN TECHNOLOGYSmart dealers, leaders and managers who have been in the business for quite some time all have witnessed dealers investing in a myriad of technologies to better manage customers, marketing websites and inventory.

As many vendors present the benefits of using a particular DMS or Internet lead management systems (ILMS), it all looks pretty compelling. The dealer signs up and hopefully realizes some of those benefits, but then along comes along another vendor pitching a dif-ferent system – say, a website, CRM or e-mail marketing program. The dealer may sign up for those as well but capitalize on none of them.

After a few years, that dealer will look around and find he’s spent big bucks on every kind of technology available, but none of it works well for him. This means that collectively, it doesn’t really work well at all. Get smart!

“I cannot understate howimportant it is for a

service department to

pursue insights into its customers’ preferences.”

Your CRM becomes a more powerful tool once youpopulate it with more data about your customers’ buying habits.

SD

Understanding your customer’s needs, expectations and preferences is at the center of every successful dealership organization’s sales and service businesses. This is true regardless of whether a company sells its products and

services directly to individuals or to other businesses.

This core knowledge can be used to influence a po-tential or existing customer that buying from your deal-ership is in his or her best interests.

I cannot understate how important it is for a service department to pursue insights into its customers’ pref-erences. These insights can be garnered from your deal-ership’s DMS and CRM systems, working together to help you win service business from your competition. However, you first need to establish what you want to know about your customers’ preferences and how you will use it to steer them into buying from your dealer-ship more frequently and effectively.

ONGOING INFO ABOUT CUSTOMERS, PROSPECTSThe more you know about your customers, the more ef-fective your service sales and marketing efforts will be. It’s well worth making the effort to find out:

✘ Who they are?✘ What they are planning on buying?✘ Why are they buying it?✘ How soon are they planning to make the purchase?✘ Who will they buy it from? ✘ What do customers want to buy from you?✘ Why do customers need your dealership and your services?✘ What are the differences between your services and that of your competition? ✘ What do you specifically know about your customers?✘ Whom are they buying from now and why?

If you’re selling services to other businesses with a fleet of vehicles that get bought, sold and serviced frequently, you’ll need to know which individuals are responsible for making the buying decisions and take steps to ensure they can buy from your dealership.

Your service staff need to make a special effort to

converse with customers about their purchase needs

and preferred vendors.

“DMS and CRM software used

together can provide dealers with an

arsenal of tools and powerful customer information.”

ServiceDriveToday.com ServiceDriveToday.com DECEMBER 2015 Service Drive 31 30 Service Drive DECEMBER 2015

Roger PenskeOwner of Team Penske, The Penske Corp.

Mark FieldsPresident & CEO, Ford Motor Company

Dale PollakFounder, vAuto | Senior VP, Cox Automotive

Bill Fox2015 NADA Chairman

Jeff DykeExecurive Vice President, Sonic Automotive

Joe VerdePresident, Joe Verde Sales & Management Training, Inc.

Alan MulallyFormer President and CEO, Ford Motor Company

Craig MonaghanPresident and CEO, Asbury Automotive Group

Jared RoweDivision President, Media, Cox Automotive

Mike JacksonChairman, CEO & President of AutoNation, Inc.

Sandy SchwartzPresident, Cox Automotive

Nick SabanHead Football Coach, Alabama Crimson Tide

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