At the NADA convention this weekend, Ford Motor Co. will encourage more of its dealers to sign up for the automaker’s Quick Lane brand of quick-service shops. I wrote last month about Quick Lane’s revenue growth and expansion ambitions, and I wanted to share some added information that came out of conversations with Ford and readers.
Commenters on that earlier story posted an interesting debate on the merits of Quick Lane, with some dealers saying the units are unprofitable and the added revenue doesn’t justify the costs. O.C. Welch, a Ford-Lincoln dealer in South Carolina, told me he regrets building his Quick Lane. With free-maintenance offers becoming more common with new-vehicle purchases, the business case for a quick-service operation is weakened, Welch said.
Don Cape, Quick Lane’s national sales manager, told me the Quick Lane network’s profitability has been improving year over year. Through November 2010, nearly 90 percent of Quick Lanes are profitable, up 5 percentage points from the year before, he said.
Cape acknowledged Welch’s point about free maintenance. He then added that dealers also need to make their facilities inviting to those maintenance customers in order to retain them long-term. More free maintenance actually should drive volume and increase the need for a quick-service unit at dealerships, he said.
Quick Lane dealerships also generally have higher service retention rates, Cape said. The latest numbers show a 3 percentage point advantage, he said. Cape encourages dealers looking at Quick Lane to consider off-site locations. They do even better, with a 7.5 percentage-point service share advantage over non-Quick Lane dealers.
“When you go off site, you have a greater opportunity (for incremental sales), especially with competitive makes,” he told me. At those offsite locations, 50 percent or more of customers drive competitive makes vs. about a quarter at dealership locations.
Dealers getting the Quick Lane pitch at this weekend’s convention will be smart to consider all the above points of view about their success -- or lack thereof. Oh, and ask lots of questions.