We got a lot of action on the show with dealerships vs. independents and who has the advantage, but Jeremy's got a client at his shop, Freedom Auto Repair, who's also a marketing professor, and he calls up Jeremy like, “Hey, I caught the episode you did, independents vs. dealerships. Great stuff, but you guys forgot one thing…”
What did we forgot? We typically cover everything, right? We went pretty deep on that and we even got emails saying how knowledgeable we are, but he said that we forgot trust, which is interesting cause that's a word a lot of people take for granted. You just assume that being good and wanting to take care of your customers and getting five star reviews is what's paramount, but trust is the cornerstone of your business before anything else!
So that's what we're going to talk about today: trust. Remember that both independents and dealerships have the advantage, and it's all about the execution. HOWEVER, our professor friend is coming at it from the standpoint of a consumer, and to him, there's more trust in the independent world. Why is that, though? You could also make the case that a dealership would be more trustworthy.
Well, Jeremy asked him and he said, “Give me a break! After what they put me through to buy the car, there's absolutely no way I'm going back to them for anything!”
So the sales department screwed it up… Service lost them before they even got a shot.
I've always thought that it's an interesting dynamic how our dealer clients that are schmucky at sales usually treat service as an afterthought, and dealers that are more ethical care about both. The shady guys end up being the ones that are like, “If I didn't have to have service, I wouldn't,” but then there ends up being a certain reckoning, especially if you're selling used cars that are just as shady and you're practically stuffing people in them, service has to take that brunt, right?
I guess in the end I get his point of view, but it's sad though.
I actually had the same sort of conversation with the voice of God about that. He – our voice of God on the show, not God himself – was telling me how he doesn't trust independents because every time he's gone to his shop in Orange County, he's had issue after issue and he's been towed back and forth.
Check out the episode to hear the voice of God himself break character to tell us his story… So he's on the freeway driving back up to LA after visiting his family when his car stops going. Now, God is a sensible, conservative deity so he's got a $4,000 '09 Toyota Yaris. He'd keep hitting the pedal and it wouldn't go so he pulled over to the side of the road. He gets it towed to his family's mechanic – the same mechanic that presumably works on Jesus and the Virgin Mary's car and truck – and he says it'd be $1,400 and done by Wednesday.
The guy gets it done Tuesday. Great, God thinks to himself. Under-promising and over-delivering, just like I would do with my prophets.
So then he goes back and picks up the car, and then it makes a screeching noise on the way out. He has to bring the car back and it turns out that the motor needed to be fixed in addition to the water pump pulley that was fixed before so that was another $300 on top of the $1,700. On the plus side, they charged for the part and not the labor.
Jeremy follows this up with the question if the shop ever asked for service records, which the answer is no. He then asks God if the car had another issue, what would they say, and it was probably to bring it back in.
Now, that's a frustrating thing for customers: Why don't you just bring it back in? You want the car fixed the first time! No matter how far they bend over backwards to help the customer, the fact is the car is still broken when they should have figured out the full extent of what needed to be fixed the first time.
In fact, the morning of the episode, God's car had another problem, and now he's sunk so much money into it that he has no choice but to own it now after putting a little more than 100k miles on it.
That would never happen at a dealership. Dealers never NOT inspect a car and present the work. Well, I'm just being facetious because they can potentially be just as bad. That's an interesting perspective, though, right? When they don't inspect the car and tell you what to plan for, then you assume it's their fault because you just got it worked on.
Jeremy would take it a step further and use the word ‘expert' regardless of if they're dealership or independent, because there's a big difference between an amateur or pro doing the inspection. He had a customer a couple weeks ago that brought in a car she had just bought. She took it to a quick look, and they did $500 worth of God knows what but they weren't able to identify a blown head gasket. So they ended up doing a radiator flush and a transmission service that didn't do anything to fix a head gasket that overheated. What ended up being the problem was that it had an aftermarket cooling fan instead of the factory one, which definitely should have been identified before any type of maintenance was done on the car. One of the big differences between an expert and an amateur is that someone that isn't an expert treats it like a transaction and they don't look out for everything.
That was a wonderful lesson on trust from the voice of God himself, and now it's time for questions. If you have any more for us, go ahead and post them in the comments below. The first question comes from YouTube…
“I'm opening a Euro shop with a friend who's been a veteran in the auto industry, ASE master tech, been a shop foreman for a year or so. And he believes he knows the recipe for an independent shop to thrive. I'm new to the auto industry but doing my best to run front of the house. We use one of the major manager shop programs. As first time entrepreneurs and shop owners, what are the most important variables in maintaining a healthy financial environment, and can you list any typical problem areas as well? Thanks. I get a lot of inspiration from you guys.”
Jeez, I suggest you get in our coaching program and we'll help you, because if you were to say, what's the most important part of making a movie? Well, you got to have a script, and you got to have a good director. You got to cast the right actors, then the actors got to execute on the script. Then, sometimes, you film things that you thought were going to be good when you read the script, but they're not and you got to rewrite. Then, once you've filmed in the right locations, with the weather cooperating and the right equipment, then you got to edit it and promote it. So what's the most important part of that? Well, all of it!
So it's really hard to say what would be the most important part because you got to be able to produce the work in the shop. You got to have the systems to inspect the cars, create more work, communicate with customers, pricing strategies, marketing, all of that.
If you got a partner that has the back end of the shop taken care of, you need to focus on the front end and really make those customers feel good. Do accounting from day one. The other thing with that is a lot of people go into business for themselves, and they expect it to be easy and they don't understand that success has a gauntlet that you got to jump through and it's going to get harder before it gets easy. You're going to be tested a couple times to the point of giving up. If you set your mind to the idea that it's going to be harder than you think – your top techs are going to walk out at the wrong time, all that stuff – you'll be more successful. If your expectations are that things are going to go right, you're just going to be disappointed, and it's going to spin you. If you're easily spun, your energy is going to be spent in the wrong place!
Another thing is the partnership. Make sure you've got the compensation laid out as far as what happens. If your partnership doesn't work, now's the time to talk about how you exit, how you buy the other person out. Everybody just wants to win, so if it's pre-written out and everybody is amicable, then those end up being the rules to follow and it makes everything easier.
I'm actually putting some of this story in training: there was a time that I left being a general manager and I was buying my own dealership. There was a bout a year in-between. I didn't feel it was right to wokr at the dealership I was at and tried to buy my own. I wanted to be fair to the guy, and so, I wasn't working. I was going to meetings. I was talking to banks, I was talking to manufacturers. I was doing a little consulting, but I wasn't really working so I'd go to Vegas a lot and I ended up in a six month period making about 120 grand gambling. For a year, I never pulled money out of savings because I won gambling. I would go on a Friday and I would gamble through the weekend. It was fun.
I don't know that I could make my living gambling if that was my intention. This just happened, but I took it very serious and I read a lot of books about gambling. I think business is a lot like that. If anybody's played blackjack, let's say you're sitting at a blackjack table and you're betting $25 a hand. You've lost five hands in a row, and people's tendency is to pull their bet down. The thing I learned is, I'm not going to lose ten hands in a row, so if I put $50 and then I put $100, I just had to pay attention to what the limit was, right? So if the limit is $500, I want to start with $25, but I'm not going to get to $500 before I win.
Most people start playing not to lose instead of playing to win, and they play scared. I think business is like that. A lot of the times, when we hit an obsctacle, what you need to do is double down your effort, double down your studying of a subject, your preparation, your planning. People say, “I can't hire a good technician.”
I'm like, “Well, what have you done?”
You got to double down. You got to be better at recruiting. You got to be better at writing an ad. You got to be better at networking. And so, success in business is created by doubling down when things go wrong, not backing off. The other thing is you can't go betting $25 a hand if you don't have a bankroll. Part of the reason why I won is because I had a bank roll that I could lose for a period of time and double down and get it back.
And so, you shouldn't go into a business that you don't have the skill set for. If you're not a good leader, if you can't think creatively, if you don't have obstacles, if you don't like challenges, then you can't double down. If a challenge shuts you off and you go home with your tail between your legs, then you probably aren't meant for business, right? You got to have some cojones!
I think that's where people get messed up. They expect to win, and when they lose five hands in a row, they retreat when they should be doubling down. You got to push in. You can't pull back.
“Hi, Chris. I enjoy your videos a lot so thank you for making them. Following your tips has helped me in my career. The only trouble I have is, I always feel I want to know about cars and be able to explain to my customers in a comprehensive way what is going on, but I have also always felt that I have to work harder for their trust. I have a customer base now, but it was hard won by hard work and instilling confidence, but I still have trouble instilling confidence in my customers. I know it's going to be a lot harder for me, because I'm a woman, and I've had people ask me if they could speak to a man. How do I make my customers feel confident in their repairs despite my lack of mechanical knowledge and my sex?”
That's a lot. Four words that can help you out is to tell your clients, “I can help you.”
And then about the technical side of it is if you want to learn about cars, it's got to be a passion and you just do it because you want to increase your knowledge on it. The best service advisors on the planet don't really know a lot technically about the car. They know how to take care of the person and they fix the customer and let your technician in the shop fix the car. And then you're just the conduit. You're the ambassador that oversees all the technical details that happen with the repair or the service, and your job for your customer is to make sure that you deliver a perfect product. That's what you're there for.
I'll just go through my personal experience with this, but I was very young writing service. The first thing that you need to do is really pay attention to how you show up and what you look like. I wore suits because I was 19 or 20 and people questioned me because I was young. It's even harder when you're a female. I would really pay attention to how you dress and try to look more like a manager than a frumpy advisor. I don't know how you dress now, but I'm saying how you look very much matters. The appearance is the customer's first impression!
The second thing is it's all about the charisma and your skills with the customer. It has nothing to do with the car. I knew nothing about the car. I've told this story before, but there was this technician in the Volkswagen shop and his name was Shane. He got all the Volkswagen techs around in the shop and had this wooden crate. There was a round disc on there and he called me in the shop and asks me, “What is that?” in front of all the techs.
I said, “The brake rotor.”
It was a clutch disc. They all laughed, went to the boss, and were like, “How can he be a service advisor when he doesn't know the difference between a brake rotor and a clutch disc?”
They didn't get it. I was really good at connecting with people, and I was curious about people. I also wanted to serve people, I wanted to take care of them, I wanted to be a host. I felt a certain reciprocation. I took care of them and they kept coming ot me!
I loved that interaction and that dynamic that, the more I took care of them and the more I cared about them, the more loyal they were to me. That's really where you want to focus. Practice your charisma, read some books on it, pay attention to that. The way you look will get you far, and the second thing is every time a technician would give me an inspection sheet that had something I didn't understand, I would go back to the car and ask them to show me. That's how I learned over time, but never lose perspective of the fact that the more you know about cars, the more shortcuts you tend to take. That's why technicians have such a hard time when they come up to write service, because they know everything and they can diagnose it in the drive.
It ruins the customer experience! They end up taking shortcuts and they assume things. They don't let the process take care of itself. Because they're telling them in the drive, customers make decisions right then and there. We never got the car. We never wrote the RO. We never divorced him. That whole thing.
You want to know enough to be articulate, but at any point when you don't know something, just say you don't know and go ask the tech. No customer is going to be grudgy about that!
The most important part is how you look, how you present yourself, and how well you connect with customers. Talk to them about everything else but the commodity. The car or truck is irrelevant! What matters is their kids, their hobbies, their jobs, what they think about the local football team, politics, whatever.
I know people say not to talk politics, I would never share my opinion, but I was really curious how other people felt. I love to talk politics and have people tell me how they feel and ask them questions about why they think the way they do. Sometimes – 90% of the time – it's very disappointing because people just watch Fox News and that's all they know, and they don't really have an opinion. They're just following everybody else.
The female thing can be your advantage, but you have to compensate with close charisma and all that. You have to really show up with an A game.
Christian thought back to his coaching and the people that he's coached and remembers that some of the most successful service advisors that he's worked with are women. The common denominator between all of them was that, before they come into work every day, they'd walk in there and know that they belong. The first thing you need to do as an advisor, male or female, is recognize that you're in the exact place that you should be and you belong there. The moment you start to think like that, then your gender doesn't matter anymore.
We do acknowledge that it's harder. It's a boy's club. We're not discounting that, but you have to pretend like it isn't. That's what we're saying. It's a male-dominated thing and that's changing slower than it should, but some of the best managers in our coaching group are female.
It's interesting right now, people kind of have this desire to connect with other human beings because of COVID. It goes so much further beyond the car and the commodity, and trust is more important than ever. It's not sales training, it's trust training. That's the most important thing, whether it's independent shop or dealership.