Walmart sells a bag of M&M peanuts for $.50. If you’re at a service station the price of that same packet of peanuts jumps to one dollar. If you’re at a five-star hotel and that bag of peanuts is sitting in your room the price jumps dramatically higher to six dollars. Understand it’s the exact same product, yet the prices are distinctively different. Let’s use this information and consider what this means to our dealerships.

Convenience

In this simple example, it seems to me no one can question the main distinction in this price variation is convenience. If you want a bag of M&Ms in your hotel room, you don’t have to even leave your bedroom to devour a bag of peanuts after a long day. They have you right where they want you, tired and hungry. If you’re willing to get back into your car and locate the nearest Walmart that is five miles away to purchase your bag of peanuts have at it! You’ll save $5.50 for an effort that will likely take you over 40 minutes to complete the purchase.

Most of us consider our time extremely important and wouldn’t even consider the trip to Walmart. Those of us that brave the effort to go to Walmart, would likely end up spending $25 because they do such a great job helping customer’s impulse to buy other items. We need to think this way about our dealerships hours of availability for our customers. Is the visit providing free snacks and beverages as the customers wait for their vehicle to be serviced? Are you asking your customers to wait for extended times to get into the service appointment because you need more technicians? Is your facility and restrooms spotless clean with hand towels and soap available in abundance?

Price

Many dealerships don’t make good margins in fixed operations because they believe they must be the low cost provider. If this was the case, we would need no other restaurants than McDonald’s to supply all our dining out needs. Yet quality restaurants like Morton’s steakhouse are in excess of $100 for a complete dinner, instead of the McDonald’s price of five dollars for an extra value meal. Without question the customer experience at Morton’s steakhouse is going too far exceed that of a local McDonald’s restaurant.

In a well-run dealership there will be in excess of $100,000 special tools from the manufacturers. They will have factory trained master technicians that the dealership invested over $40,000 to train. They will have prompt scheduling within 48 hours of the customer request and treat internals as if they were customers. You are worth pricing your services at a level the dealership can be very profitable producing.

Living the Excuse

We can no longer live with the excuses. Justifying our lack of actions because that’s the way we’ve always done it…It’s time to develop your dealership away from the McDonald’s experience, and be totally committed to provide your customers with an experience they would receive at Morton’s steakhouse. I strongly believe that dealership with the best fixed operations will win, in good or bad times in the car business. Exceptional service will always sell cars, when they have a distinct difference.

Sincerely,
Rob Gehring, President
Fixed Performance Inc.
1-888-205-8718
rgehring@fixedperformance.com

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