For those who don’t know, CES is the Consumer Electronics Expo in Vegas where they show sex toys, cars, and everything in between: cell phones, computers, you name it.
Fisker unveiled their electronic SUV, the Fisker Ocean. It’s going to be $37,500 or a lease of $379 a month with a 30,000 mile limit for the year. Tesla’s 10,000 mile a year lease option is $535, so they’re going right for Tesla on that price. It’ll be interesting to see what their second swing looks like because last time they couldn’t even get their cars off the lot before a lot of the people they hired ended up jobless. Who’s going to want to take that chance again, right?
Next we got the Vision AVTR from Mercedes-Benz. This one’s a strange phenomenon for the German car company, because they’re usually all about performance, and the experience of driving the car itself. Not so with this one. This one is different, because it’s all about the experience inside – it’s basically a cocoon. This Avatar-themed concept car not only detects your pulse, but also your breathing. It even has multi-function controls that detect your fingerprints. In the automotive realm, I consider myself a technically-minded person but this one is so out there, it’s crazy.
Visa and Sirius XM came up with this idea of automated payments for tolls, gas, and food right from your car. You don’t even have to pull out your wallet! I really like the idea of paying for tolls and parking without ever having to stop or go to a parking meter.
BMW is getting in on it, too. They announced the Zero-G Lounger, which is a car seat that can recline up to 60 degrees. The seatbelt then moves along with the passenger and the headliner has a TV that comes out. Anyone who’s ever been to a dentist’s office where they hand you a remote and let you watch Netflix or Apple TV knows what I’m talking about.
What is the common link between all these concept cars and features?
Notice that, so far, I’ve barely said a word about performance. That’s because the designers of these concept cars are all about making these new car designs more eco-friendly, and more luxurious. In 2020, the truth could not be clearer: The car is a commodity, now more than ever. But that’s what’s unreal, isn’t it? You’re not really driving anymore. It’s all about checking your e-mail or watching Netflix. That’s got me thinking what content companies could be planning to be consumed in vehicles within the next 10 years. People are going to want Netflix, Hulu, and Disney+ in their car, don’t you think? That introduces a whole new way to monetize!
Now, a name you might not have expected to hear in this group is Sony. They showed off their own electric concept car, the Vision S, and while this doesn’t necessarily mean that they’re making a car, they did show off the technology inside: a dashboard with six screens, audio in the seats – basically a home entertainment system inside your car. What they’re doing makes me think that all the car companies are going to want to jump in on this. They see the writing on the wall.
And then you’ve got Damon’s new Hypersport electric motorcycle, which supposedly goes 200 miles per hour with a 200 mile range. What’s also crazy is that they’re using Blackberry software in the bike’s operating system. I didn’t even know Blackberry was still around!
I don’t know how you get into CES… but all this cool stuff has got me thinking maybe we should go next year!
Before I get into the audience question, let me talk to you about Chris Hogland, who offers some valuable insight on this week’s show. He’s a coach here at Chris Collins, Inc. who’s out there fixing stores for us, and one of the things he brings to the table is that he’s one of the guys that sees opportunities before he sees obstacles – in fact, a lot of the time, the obstacles ARE opportunities.
Now, one of his experiences in his career was being recruited by Tesla after being a BMW tech. This was at the very beginning of Tesla, so he was a part of when they were still trying to build their network across the country.
He had read a lot about Tesla – mostly that they were hemorrhaging money – but he still jumped in with both feet, because it was something different and he was looking for a new challenge. Here he was, a mechanic from Oklahoma, going through orientation with guys from MIT, Stanford, etc. It was entertaining, but also sobering – exciting, but he also felt like he was in over his head. Who wouldn’t?
Fast forward to now. I don’t have to tell you how good things are looking for Tesla moving forward – but even Chris wouldn’t have guessed back then that they’d be selling as many cars as they are today.
I’ve picked Chris’s brain plenty of times to see what exactly about Elon’s management style led them this far, and I think it would have to be his obsessive laser focus that he has. It’s a bit arrogant at times, but he believes in what he’s doing so much that it’s better to ask for forgiveness instead of permission.
Earlier this month, I talked about Tesla’s unfair advantage. Between downloading data from the cars, autonomous driving, and circumventing the dealer network, they have so much momentum that no one can catch up. Meanwhile, BMW and Toyota are still hoping that hydrogen will start coming around!
Point is, Tesla got off to a rough start because they were doing things very unconventionally, and they were more concerned about building a network and testing their system rather than profit. Again, it’s that culture of cutting edge – of change and ingenuity – that’s paying off for them right now.
We’re in an industry where a lot of people are doing things the way they’ve been doing them since 1930 instead of looking for a better way. At Tesla, if a change to the tradition makes sense, then they’re doing it today. I’ve been to Tesla and I’ve been to Detroit, and I feel like Detroit’s fat and slow while Tesla is quick and nimble – no offense to anybody in Detroit.
With all that fascinating stuff out of the way, we have an audience question. Remember: if you submit a question, we’re going to send you some swag. That includes a Service Drive Revolution package with a shirt, a mug, and some other fun stuff.
“I got hired to be a service advisor and parts man but when I got hired, I had zero experience. As a service advisor, I know it’s my job to be 100% attentive to the customer, but between running to my techs for information, parts runs, answering the phones, and calling customers with quotes, etc., I find that I’m not giving my customer the attention they need. How can I effectively balance everything so that I can be there for the customer, create a trusting environment, and connect with them while fulfilling my other responsibilities? My heart aches for the customer because I know we can do better for them.”
Good question – and I like your enthusiasm. There’s a bunch of answers to that, and one is being honest with your customers upfront and telling them the truth. Just tell them the process and what happened like, “We’re going to check it out and figure out what’s wrong with it, then we’re going to have to source the parts.”
100 years ago when I was an advisor, I would tell them, “Here’s the process. It’s going to get dispatched to tech. Once the tech has it in their stall, they’re going to check it out and they’re going to tell me what’s wrong with it. I’m going to call you right then.”
My intention behind doing it was getting the customers to pick up the phone when I called. Ask them what their day is like.
“Are you going to be in meetings today? What’s the best number to call?”
I would go through all these things and they knew to be ready for my call because it could mean the car staying another day if they didn’t. It never turned them off. It actually pulled them in closer to me, because I was putting like this: if you’re not available to do your part, I can’t do mine– right?
I used to always ask the other advisors, “Why don’t you tell customers the truth?”
Be honest about whether it’s going to take a day or two to get the parts. Walk them through what the timeline to repair is. The key is finding a way to be proactive – anticipate the customer’s needs as well as your own, and have the true goal of getting their car back in a timely manner. You might not be able to change the process, so if you feel bad that you’re not meeting their expectations, change what their expectations should be! Set the record straight!
Another thing you could do is find a vendor that will deliver. I know a lot of independent shops where the parts get delivered twice a day. There might be weird situations where you might have to get something from a dealership but a lot of times you can also hire a parts runner. There are apps out there like TaskRabbit where you could pay someone $20 to go pick up the part if you can’t afford a full-time driver. Add that to the quote and pass it along to the customer.
When you look at some of these problems and think they’re outside of your control, they’re really not. You just need to think a little more outside the box. That’s the entire point of Service Drive Revolution — to get Advisors to think outside the box of what the Service Drive is.
When I wrote service, a lot of the advisors felt like victims. I knew the system sucked, but that wasn’t going to stop me from controlling the narrative, because – let’s face it – there’s never a perfect system.
If you’re an even remotely ambitious person, then your gut answer is probably going to be yes. But let me blow your mind….
…You might not realize it, but you’re already self-made. I’m self-made. We’re ALL self-made! A homeless person in Downtown LA is every bit as self-made as a so-called “self-made” millionaire!
Whether you’re successful, or you’re an utter disappointment to your parents, what you make of your life is 100% up to you. That’s why, on this week’s Service Drive Revolution, I put together a little list of what I believe is important to be successful as a self-made person, and turn around the outcome if you feel like you aren’t successful yet.
Own It If you blame everybody else instead of owning up to the results of your own actions, then it’s going to be a waste of your time. You control how hard you work, what time you get up, what you eat, how much you work out, what you think, who you surround yourself with, what you watch on TV, what book you read. It’s all up to you. We make decisions every day that take us towards or away from what makes us successful.
Love Yourself This is the point where a lot of people fail. It’s too easy to give into the fear of failure where we fail once and then never try again. Think about this: if you forgive your best friend after they’ve made a mistake but you wouldn’t forgive yourself, then maybe you don’t love yourself as much as you love other people. Don’t get me wrong – it’s great to love other people, so why not do the same if not more to yourself? Accept that you’re not perfect and that you’re going to make mistakes, but also acknowledge that you can do better.
Self-Talk Do you talk to yourself in the way where you are highlighting and giving energy to your talents, or are you giving energy to your faults? Once you understand what your strengths are, you need to build your self-talk around them. Put your time and energy into those things and don’t beat yourself up over things you’re not good at. Talk to yourself like you’re good at anything you want to be good at. Look at it this way – you just haven’t decided to be good at it. You haven’t decided that it’s a priority and you don’t WANT to spend the rest of your life learning it… yet. Just because it’s not something you enjoy doesn’t necessarily mean it’s a weakness. How you look at those things, and how you self-talk about those things, ends up affecting where you go and what you achieve, so self-talk is a big deal.
Your Friends The further up the ladder of success you go, it’ll affect the people you attract and the people you hang around with. Are the friends making you better or worse? I don’t know anybody who didn’t have to get rid of their friends going up the ladder, because once you’re more successful than them, there might be drama. You might find that they’re not happy for you– they’re jealous. They project their insecurities, their fears, their self-loathing… and you can’t afford to be around that energy. It’s okay to find new friends – people who talk about what CAN happen and see the world as an opportunity, not a curse. More importantly, be around people who have made it through hard times, because you’re going to go out and start something, and it might go terribly wrong. It’s nice to think positive, but the truth of the matter is that nothing is ever easy.
You Can’t Feel Entitled You’re not entitled to anything. If you can’t get excited about this country’s economy and all the opportunities that we have, you’re watching too much TV. You need to get away from the negative news and understand that opportunity is everywhere.
Commitment If you want to be self-made, you have to commit to something in a way where even you can’t tell yourself you won’t do it. Countless people give up as soon as it gets hard, even when they have the recipe for everything up to that point. Anyone can say, “Well, I did my best.” Nobody was really asking you to do your best – they were asking you to win! When you say you did your best, that’s a lie. You could’ve gotten up a little earlier, done a little more research, asked one more person for help with an idea, or watched somebody who’s doing it at a higher level. There’s always something more you can do.
Change the way you think. Look for the positive in things and you’ll start to see opportunity. Perform to your full potential and don’t just show up average every day, because you’re better than that. You haven’t even realized what you’re capable of until you own it and go through these steps.
With all that in mind, I’m going to answer some questions from the audience…
“If you had to choose, would you pick washing customers’ cars, picking them up, or drop-off service?”
See, here’s the thing… I always find it difficult to respond to hypotheticals like this because, simply put, that’s not reality!
A lot of people want their car picked up AND they want it washed. It’s not about which job is more difficult, or less glamorous… It’s about providing the best experience for the customer.
But, to give you a more serious answer– It’s not hard to facilitate both.
“Our dealership hired a new fixed ops manager who wants to make it so every car that is booked in for the day comes into the shop the second the appointment is booked. Am I crazy to be worried about this? Our appointments are booked at 15 minute intervals starting at 8 AM. I just can’t wrap my head around how this will work. I’m stressed just thinking about it. Have you seen this before? What happens with diag? Upsells? Intervals? Help!”
You know what? You should try it because he might be right.
We have this little thing we do called instant inspection. Every car that comes in, we immediately have a tech greet them and put the car in the air, and we inspect everything right then. What happens is, if the customer looks at the car with the tech, our closing ratios go up, and at the moment of write up, you know pretty much 90% of the time what the car needs. Parts can pull the parts, put them in the car, and a tech can just finish it. It’s super efficient and works really well so I think you should give him a try.
You can click that link and read the whole thread, but the gist of it is:
“I’ve talked to two dealerships who seem interested in hiring me. I have never worked at a dealership, let alone as an advisor, so I’m a little cautious about taking the job. I’ve worked at a little engine shop for the last 8 years. I’m the lead tech, and basically the guy under the owner. However, I don’t strictly just work on stuff. I sell equipment, I work up estimates, I call with estimates, I recommend work, I listen to how the customer reacts so I know how to word something and/or give them options I think they would be okay with. So what should I expect? Is the pay worth it? How could I excel? The hours don’t seem great, but my current hours aren’t great. Both dealerships told me the average income is $40,000 – 100,000. I currently make about 32,000 with no benefits.”
First off, the most we’ve seen an advisor make is $420,000 a year, give or take. The truth of the matter is that I started as a porter and then became a service advisor. I don’t know if I would’ve been a good advisor if I wasn’t a porter first. What got me hooked was that the more we made friends with the customers and the more we perfected our craft, the more money we made. I remember being 20 years old, making $120,000, and telling my mom I was making more than some lawyers.
The downside is that you get stuck in the industry because… where else would you make that kind of money? Everywhere else, people work twice as hard and make a quarter of what you could be making as a service advisor. People in the food industry literally work seven days a week, and they’re making $16 an hour. As an advisor, if you can connect with customers and approach it like a pro, you can make a GREAT living.
The last thing I want to add is, if you interview for any job in the service department, write a thank you letter and mail it through the post office near the dealership so they get it the next day. Not too many people mail handwritten letters anymore, and we look for advisors who go that extra mile that nobody else does. If, for some reason, you can’t do that, then send an e-mail. The important thing is to show that you can follow up and connect with customers quickly.
But more importantly: remember to love yourself, because no one else can do it for you!
Once again, thanks for reading, listening, and watching. We hope you have a great week, and we’ll see you again real soon!
If you’re the kind of person who isn’t willing to accept uncomfortable truths, then you’re probably going to hate this week’s Service Drive Revolution. I can admit it– the subject of this week’s episode is going to turn off a lot of our viewers…
…But it’s the truth. And the truth is the truth, whether you like it or not.
Something that I find very, very frustrating is the use of lip service instead of addressing the elephant in the room. For instance, the last time I spoke at the NADA show, I was given two big notes on my speech by their approval committee:
“Take out the part of the Pet the Dog story where you call your ex-wife Satan,” which is quite frankly the best part.
“Don’t talk about Tesla. It’s not a popular subject with the dealers.”
I don’t understand that last one. My job isn’t to tell dealers what they want to hear, it’s to tell the truth! If the truth is uncomfortable for them to hear, then they need that dose of reality.
For too long, I’ve been forced by the powers that be to censor myself or ignore the truth whenever I’ve wanted to talk about Tesla. It’s like how people say, “you shouldn’t talk about religion or politics.” I’ve always found that saying funny – I love to talk about religion and politics! You know why?
Because my opinions aren’t set in stone, and they shouldn’t be! When people open themselves up to a dialogue, and maybe even a bit of a debate about facts, instead of just blindly following something, then they might actually learn something.
The fact that we, as an industry, are incapable of admitting or acknowledging this truth is incredibly frustrating, and it’s an attitude that I’ve seen everywhere.
For example: A while ago, I was talking to this guy from BMW. The BMW guy says, “We’re number one in the country by a mile. We’re not going to do incentives to try to beat Mercedes like we have in years past.”
Now, he says that they’re the number one luxury car in America, but am I just supposed to take his word for it? Number one in every category?
So, my immediate thought is to ask, “Well, what about Tesla?”
And he says, “Tesla doesn’t count.”
What do you mean Tesla doesn’t count?? Last I checked, they have four wheels and people are buying them! The people buying Teslas would have bought another car if they weren’t buying a Tesla, so how do they not count?
It’s important to understand that Tesla has some unfair advantages over everybody else, and in order to understand those advantages, we need to talk about it.
That’s right – actually talk about it!
Not blow it off with, “Tesla doesn’t count,” or, “It’s an uncomfortable subject for dealers.”
Of course some of the dealers reading this are going to be irritated by the Tesla conversation. But I will tell you, time and time again, that you shouldn’t be – because it’s the truth! The sooner we start accepting the truth, the quicker we’re going to recover and get ahead of it.
You have to stop living in denial, otherwise you’re going to wind up like Blockbuster Video.
The funny thing is, I’ve been predicting this for a long time. Everyone knew and agreed that new car sales were going to drop, but what they didn’t understand was that Tesla was going to come in and gain market share inside of that smaller pool.
The heart of the matter is that customers are happy when they feel like they’ve been given a good value, which leads me to Tesla’s first unfair advantage…
Tesla went directly to the consumer.
In North America, you had to sell through a franchised dealer, except in some states like New York. I know, in Manhattan, a lot of the dealerships are owned by the manufacturer because they simply can’t afford the overhead and all that.
What happens when Tesla can sell directly to consumers and bypass dealers? First, the margin that would go to the dealers goes to them instead, and they get to keep more of the profits. The other thing is that they don’t have the overhead of flooring either.
If you don’t know what flooring is, go to chriscollinsinc.com and opt-in when the pop-up comes up. You’ll be granted access to two free videos – in the one titled Why Fixed Absorption is a House of Cards, I explain flooring. It’s essentially a line of credit for wholesale cars that dealerships pay, and it’s expensive as hell.
The other part of their advantage is software. Inside a Tesla car, you can go into a menu and, say, buy a software update that unlocks extra performance without ever having to go to a dealership. Most other manufacturers receive the information from a satellite, then they call you and tell you you’re due for service. But with Tesla, that satellite literally beams software updates down into the car and avoids service altogether. Any updates – whatever you need – you can do from the comfort of your driveway.
Don’t get me wrong, Tesla has service managers. However, they send out a new memo every two weeks or so and they’re constantly changing directives. If that happened to employees at a dealership, they would go crazy. You know why people at Tesla aren’t going crazy? They’re driving change in the industry, so the employees are a part of this culture where change is expected – and when you’re part of a culture like that, you feel like you’re doing something cutting edge and special.
Think back to the beginning of last week’s show when we talked about China. By 2026, no combustion cars can be sold there. It kind of counts down every year, but the manufacturers are trying to get ahead of that, right? The keyword is ‘trying,’ because nobody has the batteries, the technology, and the infrastructure like Tesla. They already have the best batteries, and they ones they have coming are supposed to blow away everyone who’s just trying to get to where they’re at.
I’m not going to pretend that I know where it’ll all end up, but there’s a lot to learn by NOT ignoring Tesla. Their success doesn’t mean doom and gloom for everyone else. Whenever industries are turned upside down, there are other opportunities.
Service isn’t going away. Even on electric cars, you’re going to need tires, brake fluid, etc. – things are always going to break. What’s changing is that you came up through sales and, all of a sudden, sales are going direct to consumer.
If that makes you not want to own service shops, then maybe it’s just not your passion. Maybe you’re just massaging your ego through however many cars you sell.
That’s what’s interesting about our industry. There’s going to be opportunity even by the time the roads are full of robo taxis, but it’s going to be on the service side and Service Drive Revolution.
But enough about the “uncomfortable subject” of Tesla. I’d like to wrap this one up with two audience questions:
“I’m new to service advising, but I’m using your channel to learn as much as possible in conjunction with my training I’m going through at the dealership. As a novice service advisor with zero mechanical experience, what are some of the basic questions you get and answer most often?”
Now, that’s a great question… but it’s the wrong question. What you want to understand is that your role as a service advisor isn’t to diagnose anything; it’s NOT. Your role is to make the customer really comfortable so they can explain their concerns with their car, then you let the technician do all the work.
Think of it this way: the technician’s the doctor and you’re the nurse receptionist. It’s the doctor’s job to diagnose. Yours is to make friends with the patient, get them to fill out the paperwork, and tee up the doctor for success.
The only variable in it would be that you could recommend maintenance when it’s due, but you do NOT need to know anything about the car as much as you need to be really, really good with connecting to customers on a deeper level. The car is a commodity. In fact, 70% of clients end up going to independent shops after their warranty is up, so the car isn’t as special as we think it is – it’s an excuse to make friends with the customer. (I would suggest reading the Millionaire Service Advisor because there are some good stories and analogies in there for you on how to be a service advisor!)
If you’re listening to the podcast, this last question is a doozy so I’ll sum up the important part:
“At my store, our department was paid off of gross but now our pay plan has been adjusted so that we’re strictly paid a percentage based on CSI. It makes us advisors not want to sell as much and focus more on customer satisfaction and retention. In the end, it feels unfair that our pay is based off the opinions of random strangers. What are your thoughts?”
Let me stop you right there. What sticks out like a sore thumb to me is that you’re assuming the customer is a stranger. If you’re leaving your customer as a complete stranger, then that’s your fault.
Think about it – you get more money if you can connect with customers because that dictates how much you can sell. Get the customer to know you on a deeper emotional level and vice versa. Not only will they trust you, but you’ll get the better CSI and you sell more.
When you look at the big picture, manufacturers want relationships with dealers that can get good CSI. In fact, it’s like a credit score – you might not even be able to buy other dealerships or get hot cars from the manufacturer if you’re not in good standing.
Take a step back and stop being selfish, because what’s good for the dealership is what keeps us employed… So whether these “strangers” like us is a big deal.
You simply can’t have high sales without happy customers. Countless advisors are great on sales, but risk getting fired over poor CSI. If you don’t have the right system (like the kind you learn through our online training!), you push people too far, and the customer feels taken advantage of. All that’s left to do at that point, assuming you want to keep your job, is to admit you’re going about it the wrong way and CHANGE your approach.
Remember that we have the best OnDemand platform with Service Manager University, where you can get complete customer service training and technician training, available at chriscollinsinc.com. We appreciate everybody reading, listening, and watching, and we hope to see you again real soon!
It sounds simple, but the truth is, most people lack the drive they need to get the results they want. They tell themselves, “Why bother?” before they even start. You know the type, we see them every year: In January, bodies pile into the gym and it gets so crowded that you can barely get in the door. Then, come February, it’s empty again! Not because these people found a better gym… Because they quit. Do you want to be one of those people?
No. Hell no.
If you’re anything like me, being that guy is your worst nightmare. That’s why, this year, I’m challenging everyone to set real, tangible goals for themselves, and to work every day to achieve them. The New Year is only a day away, so I need you to take the plunge now. Why?
Because we’re not just starting a new year this week– We’re setting the pace for a whole new decade!
Ask yourself: Are you where you imagined yourself to be ten years ago? If you’re not, how could you have worked harder? What can you do to make sure that, this time, you get where you want to be in ten years? Picture it, and then work every day to make it happen. That’s the only way it happens: You have to work on it every day. Results won’t come overnight, and you won’t always win. But with the right attitude, I promise that you’ll win more than you lose.
That’s why on Service Drive Revolution this week, I sat down with Mario Pernillo, my Coach Super here at Chris Collins Inc. In just four months, Mario lost over 30 pounds. 30 pounds! And he didn’t do it by setting a lofty goal or by taking shortcuts. He set a simple goal, and he achieved it by sticking to it every day. And if Mario can do it, I guarantee that you can.
But before we get started, there’s something you should know:
I’m excited to announce that, starting now, Service Drive Revolution will be releasing weekly! We’re also going to be launching a new mini-episode every Friday called a Drive-By. These are two- to five-minute motivational clips to help inspire you as you head into the weekend. And if that’s not enough, every Drive-By will include a special sneak peek of the next week’s episode of Service Drive Revolution, so you definitely won’t want to miss those.
That’s right: Service Drive Revolution will be coming at you twice a week in 2020, so get ready!
Now… Back to Mario.
Mario started at 267 pounds, and the closest thing to a turning point for Mario was when he lost a foot race to his son, Jordan. To understand what a big deal this is, keep in mind that I’ve seen him race technicians and advisers in dress shoes, and I’ve never seen anybody beat him in a sprint. To pinpoint why he lost, Mario thought, “Did I not run right? Did I have the wrong form? Am I getting old? Did I lose it? Is he beating me?” but, ultimately, he realized that he had given Jordan an advantage by letting himself go.
He was out of shape (as he comically put it, “Round is a shape!”), but he never thought about it… Until he lost, that is.
To Mario, you don’t realize how quickly you make every excuse in the book to cover your losses, and you don’t truly accept a loss until you admit that you lose.
After Mario accepted it, he couldn’t just do nothing. At the end of the day, he was carrying too much weight. So he asked himself: What can I do so this never happens again? When am I going to work out? How long am I going to work out for? His goal wasn’t to lose 30 pounds. His goal was to work out.
Now, Mario is down to 230. He gets excited to go on runs, with a minimum requirement of a mile every day, no matter what. From his perspective, there’s an excitement that comes from being in tune with his body.
He describes it as a mindset: Everything you want to accomplish is simple if you put your mind to it and work at it every single day, so he keeps going. It’s not about the quick win, right? It’s a long-term game. I hope that you’ll keep that in mind, and that Mario’s story inspires you going into 2020.
But that’s not all we talked about this week. I also answered some service advisor’s questions. That’s right– anyone can submit a question to Service Drive Revolution. And if we read it on the show, we’ll send you some fun swag, like Service Drive Revolution t-shirts, hats, coffee mugs, and notepads.
Our first set of questions this week came from a service manager at a small shop. His quick lube techs have been missing a lot of M.V.P.I. (Multiple Point Vehicle Inspections), so he’s thinking of teaming them up with A techs to deal with the high volume of daily appointments. He has three advisors, and wanted my thoughts on bringing on a fourth. He also asked my opinion on a new pay plan for his advisers.
There are a couple things to address here:
If you don’t have the right balance of techs inspecting the cars, you need a process for training techs to become better at inspecting. Those quick lube techs need a career path to become C or B techs within a year or so, and the way you’re doing quick lube isn’t going to work no matter what you do. If you have veteran techs coming over there, there’s a chance you’re either going to pay them to do those inspections, or it’s going to be unproductive and they’re not going to want to do it for long. This means you’ll eventually need to reset the whole shop. This isn’t an issue that can be fixed with a bandaid. You need the right structure in the shop, which is completely different than what you’re thinking.
The question, “Should I add another advisor?” leaves out several important variables. What are your hours in your shop? How many repair orders are you writing? What time are you open? You’re saying you have 50 appointments a day, but that doesn’t tell me how many RO’s you’re writing. If you have 50 appointments, are you writing 75? We do have a formula for that, but we need to know how many RO’s we’re writing at the end of the day.
Your pay plan is not how I would do it. You probably know this from being an advisor yourself, but you should pay your advisors on customer pay, warranty, internal, parts and labor, and don’t pay them on gross. Advisors don’t know or understand what gross is. You’re paying advisors on something they don’t understand. I never understand why dealerships complain about their parts to labor ratio falling off over the years while they’re paying advisors only on labor. You probably know this from being an adviser, but every RO has a part, so your advisors should get paid on parts. You miss out on tons of part sales by not paying the advisors on parts. Lower the percentage and pay them on customer paying warranty, then pay them on internal.
In the end, it’s all about the customer experience, and I don’t understand why you would want a customer’s first impression to be advisors who don’t want to write up their car when they bring it in. I assure you this happens when advisors aren’t being paid on internal. I see and hear it all the time, and if you’re listening or reading and thinking, “Well, that’s what their salaries for,” or “That’s their job,” or “Oh no, my advisors don’t do that,” then you’re crazy.
The next question is much more straightforward:
“Do you believe that the parts department should contribute to advisor pay as long as we are paying the advisor on labor and parts?”
The truth is, every manufacturer has an accounting manual. Take for example the accounting manual for General Motors. GM does a parts transfer, and that covers what the service advisers are doing or offsets them. A percentage of the back counters gross gets transferred to the service department. Another example: a BMW financial statement splits the advisors, the warranty administrator, and the cashier with parts.
What you want to do is go to the office manager and ask to see the accounting manual. It will tell you what to do. This isn’t about my opinion, it’s about how the financial statements are set up. Some are set up with transfers, some are set up to split the advisers, and every manufacturer will have that information in their master accounting manual. It will tell you how you should account for all the expenses. Secondly, if you’re in a 20 group or you’re comparing numbers with another dealer of the same manufacturer, it’s best if you’re following the right accounting practices.
You’re both asking all the right questions, but you’re going to mess this up if you don’t have the right direction. You have the right ideas and the right ambition, but you stand to lose millions of dollars by not offering your managers the right training. That’s why I’d like to take this opportunity to point out that for just $8 a day, our online Service Drive Revolution On-Demand platform can provide the exact training you need for your service advisors, techs, and managers.
Our program is the best adviser training in the industry. It will help you rethink how to lay out the shop, figure out pricing strategies, and build a system that creates more sales per customer. With our Service Manager University, Technician Tree Recruiting, and Pet the Dog customer service training, your techs will learn how to sell, manage their time, and increase their flat rate. It’s worth way more than $8 a day. It’s worth thousands of dollars. Your ROI will be huge, and Service Drive Revolution On-Demand might be the best investment you will ever make in your life, even better than if you bought Apple stock.
Bandler is one of the founders of NLP, neuro-linguistic programming, and the story is that Kate met Bandler at one of his workshops and said, “You’re using NLP on me to teach me NLP.”
He said, “Yeah, of course I am. That’s how you learn better and how it’ll stick.”
“Well, why doesn’t anybody teach school teachers how to use NLP to teach?”
“I don’t know.”
They decided to write this book together for school teachers, which is not only one of the best ways to learn NLP but it’s going to teach you how to train your employees better.
Next, Away carry-on suitcases. This is something I bought all of my coaches for Christmas this year, and there are a couple things I love about it. It has a bag to store dirty clothes and bands to cinch down your clothes so you can pack even more clothes in it, and it has a charger for your phone. If you’re like me, and you need to travel for work, I guarantee that an Away suitcase will change your life.
Another highlight of 2019 for me personally was seeing Bon Iver live. Bon Iver is what you’d call an indie band, and their sound definitely isn’t for everybody, but as a fan of their music I’m happy to say that their live show didn’t disappoint.
Last but not least, my favorite thing of 2019 was all of you tuning in to Service Drive Revolution, whether you’re watching on YouTube, or listening on Apple Podcasts or Spotify. So, with that in mind, the three episodes of Service Drive Revolution that got the most downloads in 2019 were:
If you haven’t listened to these yet, I recommend you check them out.
That’s going to do it for this week on Service Drive Revolution. Remember: Set a goal for yourself this year, and work every day to accomplish it. We have a whole new decade starting this week, and a lot of potential to live up to. I hope that you have a happy New Year! We appreciate everybody listening, reading, and watching every week, and we will see you again real soon!
In many ways, the auto service industry has been a forgotten-about part of business for a long time—maybe even forever. New service advisors are trained by the advisors before them, who were trained by the advisors before them, and so on and so forth. There’s very little evaluation of the efficacy of the practices that get passed from advisor to advisor and almost no innovation. More often than not, these systems don’t work well and they definitely aren’t scalable. So what we’re left with is potentially talented advisors who are working 75 hours a week and getting disappointing results. But it’s just the way things are, right?
Wrong. Very wrong.
For those of us who have always chosen to do things differently, it was hard to watch this trend continue over the years. At a certain point, I knew we needed to disrupt the auto service industry in a big way. So I launched the Service Drive Revolution podcast to do just that by teaching you scalable and profitable systems that allow you to maintain a high quality of life and have fun all at the same time. We know what we’re doing and how to do it well, so we want to help you get to the top of your game too. This isn’t about making change for just one advisor either…it’s about revolutionizing the whole industry and lifting it up across the board.
On a recent episode of Service Drive Revolution, Jeremy O’Neal of AdvisorFix and I shared five ways you can increase your return on investment, or ROI, in your service department that most wouldn’t think of or expect. And even if you’re already aware of them, our insights will offer a different angle—a little twist, if you will— that’ll help you do them even better. Here they are:
1. Chase profits – NOT gross revenue
If you’ve been told that in order to get fixed absorption in the service industry, you need to chase gross revenue, which I’d be willing to bet most of you have….you’ve been lied to. (If you don’t know what fixed absorption is, you need to—go to chriscollinsinc.com, wait about 30 seconds, and opt-in when the pop-up comes up and I’ll send you a video explaining why fixed absorption is a house of cards.) When you chase gross, you’re essentially just chasing traffic, which often leads to discounting services until you end up making less per hour of labor that you sell. The secret is to understand how much profit you actually make for each hour of labor and make pricing adjustments to reach an effective labor rate accordingly. Stop counting cars and start focusing on what’s most profitable for your particular business and market. This takes what Ben Benstock called in an earlier episode, investing in “return on learning”, or ROL, meaning taking the time to test things out and learn in order to get it right. It pays off. You can listen to Ben’s episode here. Jeremy also got into what this looks like on the independent business side of things in this episode—listen to hear what he has to say.
2. Stop playing the short game
It can be really tempting to play the short game, focusing on saving money in the short term and cutting corners to get more done. But, as the phrase suggests, the short game is really short-sighted. Just because you’re saving a buck or two up right now doesn’t necessarily mean that you’re making a smart decision for your business. One example I shared on the episode is one of my coaching clients, who got stuck in this vortex of paying technicians to do alignment checks for whatever reason. At some point, he decided to stop because he didn’t want to pay techs to do them anymore, just because he got tired of the consistent expense and he liked that he was saving the money up front. I asked him how much he was paying a tech for an alignment check and it came down to about $9 a pop. Then I did the math: If you’re only trying to sell alignment checks to clients that are at the 12 month or 12,000 mile mark, 80% of them are going to be out of alignment—maybe even 100% sometimes. Say you offer 10 clients an alignment check and 5 of them take it. If the check tells 4 of those 5 that they need an alignment, they’re probably going to go for it. At anywhere from $500 to $700 per alignment, you’re bringing in anywhere from $2000 to $2800 right there. And it all starts with paying those techs $9 per check, or $40 in total up front. So by playing the short game, this guy was saving $40. In being more strategic and opting for a long game, he’s making thousands. We shared a few more examples in the episode.
3. Remember that people want to buy an experience more than anything
When it comes down to it, your best clients may be coming into your shop for your service, but the reason why they keep coming back is because of the experience you offer. This starts with the way you make them feel, building trust and listening to them—petting the dog, as I call it—and extends to actual experiences that you provide for them. For example, let’s say you’re at a dealership and you have customers that haven’t been to the shop in six months and they’re out of warranty. Just calling to remind them that their warranty is up probably won’t go too well, so how else can you get them in the shop? Send them a handwritten letter and invite them into the shop to meet their technician, put their car in the air and do a visual inspection with them, offer door prizes…the whole nine yards. Make it fun and interesting for them. When I’ve offered this experience in what I call Car Doctor Service Clinics, the record we did in sales in one day was $120,000. No matter what we did in sales, we’d make about double that amount over the next couple of months afterward. Experiences that help customers want to buy what you’re offering instead of coming to terms with what they’re being sold are a great way to drive ROI. Jeremy has some great examples on the episode of how to do this in independent shops too.
Pro-tip: Step up your game even further by creating events that people want to take pictures of and share. Get lions in there, baby penguins…whatever it takes to get people sharing their experience with others.
4. Get your salespeople in the service drive
The best dealerships that sell the most cars have salespeople in the drive. Salespeople looking at their appointments the day before. They’re introducing themselves to the customer, offering to get an appraisal on their car. If the customer bought the car there, the salesperson has already pulled up where they’re at with the car and what their payment is. Salespeople can often get the customer a better option at close to the same price using the tools they have access to. The thing is, the showroom doesn’t always get the most traffic, but the service drive has a ton of traffic. So if you’re working on 100 cars every day, you should be able to sell five cars a day out of the service drive. Instead of spending a ton of money on advertising new car sales to get people into the showroom, get your salespeople into the service drive where you already have tons of clients every day.
5. Invest in your people
I can’t tell you how often I hear from service advisors who are hungry for new training but their bosses won’t cover it. More often than not, these aren’t expensive trainings—a lot of them are online and cost less than $10 a day. This is related to the mistake of playing the short game, focusing on the upfront cost rather than thinking about the longer-term gain. The fact of the matter is, better trained advisors will probably make you more money in the long-run. Plus, paying for their training will probably increase their level of job satisfaction, so they’ll want to work harder and stick around longer. Investing in your team’s development up front is always worth it.
We share a few more tips and tricks in the episode, so give it a listen to learn even more. We also talk about what’s wrong with Jeremy’s soul and how I feel about mountain biking, if you’re looking for a different kind of entertainment.