THE CAR COUNT MYTH- WHERE IS YOUR CAR COUNT? (PART II)
In my last blog, I discussed how 60%-80% of car count is the responsibility of the team…not the owner! Click here to read part one if you haven’t read it!
So…what should the team be held accountable for?
- Controlling customer attrition. If we’re losing customers because the team isn’t doing an excellent job, providing superior customer service, following up, etc., then what’s the point in continuing to advertise to attract new customers?
- Attracting new, quality customers through referral and prospecting.
- Sustaining a consistently high quality of production (good workmanship and cleanliness).
- Growing higher capacity of production (so systems don’t break down and ruin customer service as we add more cars).
- Providing the very best “over-the-top” customer service possible.
- Taking ownership of the entire repair transaction. That means building trust and real value at each point of contact we have with the customer.
If your team does all of this correctly and also hits a good set of production and profit goals, your “internals” will be up to par and operating well.
I have observed many shops that do not see the importance of these things. In fact some do not believe it is possible to deliver them. They simply give up before they succeed. Some just keep throwing good money at the problem. Others completely stop spending advertising dollars because “nothing works.”
Can you fix your car count without fixing your internal processes?
The real myth here is that they think they can fix their car count without fixing their internal processes.
Most of you know firsthand (or instinctively) that churning and burning customers is deadly. Yes, you can advertise a special deal and get some cars into your shop. But did you ever stop and calculate the real cost of doing this? Did you determine the sustainability of this kind of approach? New customers are great, but not if they are no-value types who only come in for the discount and never return unless you give them another deep discount. These are the kinds of customers who never follow your maintenance recommendations or refer others.
There’s lots of talk out there in the industry and on the blogosphere about the necessity of increasing the money we spend per customer when attracting new customers in this economy. They talk about measuring return on investment for each ad campaign.
And yes, this makes sense…but you must take into consideration future repeat business, frequency of return visits, average RO, and most importantly the value of the referrals these customers give you.
In other words, if you are not retaining these customers, if they are not loyal, if they do not refer, and if they only come in for discounted services, you must account for all of these costs.
The dirty shame of all this is that many shop owners do not know how to truly measure these things so they can learn, grow and protect themselves from parasitic wolves in sheep’s clothing. These parasites are the so called management gurus and advertising vendors who seem to be successful and accepted by our peers, who seem to know what they are talking about…but really don’t.
They can call their new ideas “proven methods” all day long, but if they leave your bays empty — or full of no value customers who suck the life out of you — then your bank account will still stay in the red.
What’s the best way forward?
If you want to grow car count AND sustain good profitability as you go, the only way that works and can be sustained is to GIVE UP THE MYTHS AND FIX YOUR INTERNALS! Only then will you have a team that is helping instead of working against you. Only then will you not ruin most of the good customers you advertise in. Only then will you have the money and positive cash flow to fund a reasonable ad budget and advertising program that brings in the right customer…the kind who looks for a trust-based, mutually beneficial, long-term relationship.
I know…it sounds like a lot of work. And if up until now you have not been able to get your crew to act right, what’s going to change that?
I know…I’ve been there.
Years ago, I was so discouraged and jaded that — for a time — I completely gave up my dream of being a successful shop owner. I know it’s tough.
But you’ve got to make a decision right here and right now: fix it or get out.
If you don’t have the guts or the vision to take charge and lead your team to do these kinds of things, you had better get out now. It’s not going to get any better out there. Car count will continue to drop industry-wide. What are you going to do about it?
In the next installment, I’ll cover what you can do when you’re ready to take charge in your shop!