Dave Wright, fixed operations director at Shaheen Chevrolet in Lansing, Mich., sees a future in which his service department will do far more maintenance work than warranty and customer-paid repairs.
Dealership aims to cultivate customer relationships via quick service
Oil changes, which often generate little or no profit for dealerships, will be a key component of that future. Why? Wright says the more often customers come back for fresh oil and a filter, the more chances the dealership has to sell them additional maintenance -- and another vehicle.
Shaheen Chevrolet opened a new eight-lane quick service facility in a building separate from the main service department in late April. Its goals are to attract 3,500 to 4,000 customers per month -- more than double the current level -- and get customers in and out in half an hour or less while breaking even on the investment. The dealership has had a three-lane quick service area since 2000.
Wright described the new, $2.2 million express service facility as a "customer retention center" that will keep people coming back with fast, high-quality service at a competitive price.
"It costs us $3,100 to bring someone to our dealership who's never been here before to buy a car. For us to retain that customer, honestly, costs us nothing," Wright told Fixed Ops Journal.
"The biggest reason people desert dealerships, regardless of brand, is convenience. That's always first. Price is usually number four or five on the list. You've got to be convenient to do business with, and you've got to make it convenient for the guest," Wright said.
"If you don't, someone else will."
Six of the eight lanes in the 15,000-square-foot facility are dedicated to oil changes and other routine maintenance. The other two are reserved for tire installation but can be used for oil changes when needed.
All eight have pits so a technician can change the oil underneath while two others above rotate tires, check the battery, brake pads, fluids and air filters and other maintenance points.
Customers are allowed to stay in their vehicles, which are elevated only a few inches to allow the tires to be removed.
A vehicle health report that shows tread depth, brake pad thickness, alignment readings and other maintenance points is generated on a video screen as the customer watches while sitting in the vehicle.
"That way the customer knows what needs to be done and what may need to be done in the future, so they are involved in the decision making. They can make an intelligent, informed decision. Most people don't maintain their cars because they don't know what needs to be done. No one tells them," Wright said.
"The goal is to involve and inform the customer and make them part of the process, where they have full disclosure, full knowledge of what's going on with their vehicle. They can make an intelligent decision," Wright said.
Oil changes are about half of Shaheen's current service orders, and Wright sees it becoming a bigger portion as vehicle quality improves and warranty work declines. Most customer-paid repairs now are on older vehicles, which he estimated average seven years old and 85,000 miles.
To get that business, Wright said dealerships have to think long term and build a relationship with customers that starts with oil changes and other routine maintenance, even if it only breaks even.
"We're farmers, not hunters. We feel we're cultivating a relationship, as opposed to going for the kill. A hunter will try to kill something, where a farmer knows they need to till the field, sow the seed, fertilize it, cultivate it and water it to make that crop grow. A hunter is out for immediate gratification so he's going for the gusto," he said.
"They're going to get their oil changed somewhere," Wright said. "If they find you convenient, and find you're educational and trustworthy, they're going to continue to do business with you until you burn that bridge."
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