Are you raising your labor rates correctly to ensure maximum profits?
Today on the show, we talk about how you can raise your labor rates and actually reduce your declines.
Mia explains to us what service advisors really mean when they say certain things to their customers.
Mia Griggs will help us guide the conversation of what Service Advisors really mean. If I’m allowed to speculate, what you’re saying is Service Advisors say one thing, but what they really mean is something else.
It’s a ying and a yang. We’re going to interpret a Service Advisor’s language for everybody because they might have it wrong. They might think that what the Service Advisor is saying really is what they mean.
But the magic is reading between the lines and understanding that’s not at all what they mean.
What do Service Advisors Actually Mean?
Mia Griggs starts off the conversation and explained to Christian and I,
1) “No Problem At All”
“I want to get your thoughts on what service advisors really mean and then I’ll tell you my thoughts.
When an advisor says, “no problem at all”, what do you think that means?”
Saying “No problem at all” to a customer… Usually that probably means there was a problem with the inconvenience. When people say no problem, it’s assuming there was a problem in the first place. Like other people would think it’s a problem, but it’s not.
After listening to our discussion Mia came in and told the both of us,
“When people say ‘No Problem’, what they’re really saying is it’s definitely a problem and I cannot wait for you to get out of my dealership. We were pretty close.”
2) “Let me see what I can do”
Mia then brings up this next dialogue that service advisors have with their customers,
“What about this one? Let me see what I can do.”
Right off the bat, the thought that came to my head was, “I’m never calling you back.”
Christian then comes in and told us what this statement means to him,
“I’m going to go around the corner for five seconds out of your view and then come back and say I can’t help you.”
For Mia, this statement means,
“I’m getting the service manager involved because I am sick of you.”
3) “Let me check on the status of your car and I will update you shortly”
For me, this means that the customer caught me at a weird time. Their car hasn’t even seen the shop, I have no idea what’s going on, and I’m just saying this to get you off my back.
Christian read the statement back in his head and he said this,
“All I can think of is there is a really easy way for me to ask what your name is? Because I forgot.”
Mia agreed with me and told us,
“Let me check with the tech and I will give you an update shortly… Really means that your car hasn’t even been pulled into the shop. It’s not even remotely close”
4) “We ran into a bit of a problem”
I thought this meant parking lot damage and Christian told Mia that this means the customer’s car fell off the lift.
Mia replied to our answers and said,
“You’re both right. It basically means that the technician broke your car and I don’t know how to tell you. The fact that I’m being tasked with the responsibility to tell you is absolute BS, because they shouldn’t have to tell you and please don’t shoot the messenger.”
5) “Let me crunch some numbers and get back to you”
I told Mia that this basically means we don’t have a special pricing guide. The customers are going to have to go to parts and wait.
One of the biggest sins is that with all the technology out there and everybody’s in love with tablets. However, a lot of places can’t just put together the idea of having a digital pricing guide that you can pull up by the VIN number and give a customer a price.
It drives everything, but it’s so hard sometimes for service advisors to put together an estimate that they just get past them because they don’t have time.
6) “If you weren’t completely satisfied with your visit, please let us know beforehand so we can take care of it”
When I hear something like this, I automatically think the service advisors are begging for CSI.
Mia Griggs said,
“AKA, if you give me a bad survey, I lose my bonus! Please don’t give me a bad survey.”
She also builds upon our conversation and says,
“I feel like that word track of asking them if you aren’t satisfied, let’s figure it out… That’s one of the very few word tracks that I like, to me, actually, no, that’s not true. One of the few that only works, but it’s actually one of the most genuine word tracks that you can use, at least in my opinion, because you let me know. Yeah, exactly. Like it’s not the, let me see what I can do. It’s like, hey, if there’s a problem, let’s figure it out. That one actually does seem genuine to me.”
7) “Your oil change should only take 30 to 45 minutes”
When I heard this, I just thought of how it’ll take 30 to 45 minutes once it actually gets to a technician… So you’re probably looking at about two hours!
Mia builds off of this statement and says,
“That’s pretty much like telling the customer, we’re at least half a car behind in the shop right now. I’m hoping that you’re not religiously keeping track of the time and won’t realize that it’s probably going to be closer to an hour or two hours.”
Moving on from Mia’s incredible list about the dialogue between a service advisor, I want to talk about Labor Rates.
Let’s talk about raising your labor rates and getting less declines.
What do y’all think I mean by this?
Mia answered this by saying,
“I think that it goes hand in hand with working smarter, not harder, kind of a thing. People equate quality with high dollar amounts or higher dollar amounts. So something that is more expensive, people are automatically going to assume that it’s better quality. If you have a higher labor rate, people are gonna assume you do better work, which I would hope you do. Thus, you’re probably attracting customers that know the investment that they need to make and are willing to spend the money.”
I respected Mia’s response, however, this is not what I’m talking about and this surprised her. Her response did make sense, but just not exactly the area I’m focusing on.
What do I actually mean by raising your labor rates and getting fewer declines?
So if you go into a service department and you have a lot of declines and I asked the service advisors,
“Why are customers declining a hundred percent of the time? What is the answer?”
Because of the price and how it’s too expensive.
So the service advisors say that.
But now if I go and call 10 customers that declined work, what are the customers going to say?
Mia answered by saying,
“Nobody told me that.”
Which is true because if we don’t let the customers know what kind of service we need to perform for them, they will never know whether to accept or decline.
So how do we increase our labor rates?
The idea is raise your labor rate, get your effective labor rate up to where you can afford to have enough advisors that have enough time to call the customers, stop having your advisors write 25 a day, slow it down. Actually, you know, have, uh, an effective labor rate that isn’t from 1984, you know, and run a healthy business that we’re actually calling customers and we’re calling them.
We have the best chance of getting the worker w you know, doing the job when we call them early in the day, telling them at three o’clock or four o’clock they’re on their way to pick it up, or it’s not effective. And so that’s the thing that raises your labor rate and gets less declines. It’s about getting the system dialed in to where we’re communicating with the customers and then building trust.
That’s, you know, the other equation here is that they have to trust them like us, but in a lot of situations, we get the drive fixed. We get the trust thing fixed. We’re petting the dog and it’s the tax in the back end in that communication, which most of it falls on the service advisors.
But the technicians are only going to recommend things and run it up to the service advisor. If they believe they’re going to call and sell it too. It’s a trust system between the technicians and the service advisors.