I was right– The automotive apocalypse is coming!
Now that I have your attention, and before you sell all of your Tesla stock in a huge panic, let me explain…
Do you remember the first show of this year? We called it Tesla's Unfair Advantage, and I mentioned the idea that, one day, roads would be full of “robo-taxis.” Well, Toyota has apparently seen the writing on the wall and agreed with me, because they’ve just invested $400 million into Pony.ai, a company that makes driverless cars. They’re jointly based out of China and Silicon Valley, and have teamed up with Toyota to test self-driving cars on public roads in Beijing and Shanghai.
After these initial tests in China we'll probably get limited releases in other big cities like LA. It will obviously take some time, but I’d confidently bet that robo taxis are gonna roll out within the next 10 years. And Toyota aren't the only ones to invest in driverless cars! Ford is pushing to have self-driving cars by 2021, and Tesla and Google have been testing their own self-driving cars for nearly a decade!
So, like I said at the top (but in far less apocalyptic terms), this is going to create a huge wave in our industry. Mark my words, big changes are coming, and we need to brace for impact.
But, for the immediate future, who does this really affect?
When they do get to market, it will probably affect Uber and other ridesharing services the most. I say that because driverless cars are going to make these rideshare networks obsolete… Unless they invest in the asset. Right now, with how ridesharing works, the drivers are the ones investing in the actual physical assets. But these ridesharing companies stand to gain all the revenue if they own these self-driving assets.
Imagine what it would be like once driverless rideshares are mainstream; all the things you can do on a two-day drive to Kansas City. Work, rest, play video games. Hell, if the car has wifi, you could just kick back and binge Netflix… If
Before the audience questions, I'd like to talk about…
The Top Five Mistakes That Parts Managers Make.
I'm going to start off by saying that we should just appreciate parts more. Having the right parts at the right time is at the crux of getting a car fixed and out the door when you promise to, so send parts more love!
Parts gets a bad rap about not being that fun but I actually find a lot of parts staff to be pretty fun. A great parts manager who runs a tight ship and does everything right makes everyone else's lives a lot easier, so maybe think of sharing bonuses with the department, inviting them to meetings, or even taking them out to dinner!
They don't track lost sales.
Think back to proficiency vs. efficiency. Sometimes you ask a parts manager, “Do you track lost sales?” and they say yeah but then you go to their printout of lost sales and there's three for the month.
They're not tracking lost sales! And then it turns into a whole philosophical debate about what a lost sale is.
A lost sale is when somebody calls in for a quote and you don't have it in stock. What we're trying to do is get our fill rate up, so if three people called in for the same water pump in a month, that would show you there's a trend starting.
It's a parts manager's job to get ahead of the trends that manufacturers give the department but let me tell you why parts managers don't do it: because in a lot of systems, if you hit something two or three times and it was a lost sale, it's going to order it – and they don't want to have to look at their stock order. They want it to be automatic. But the system isn't going to automatically order something that they never sold just to have it in stock!
But that's the wrong way to look at it! I would want to at least go through my stock and see it and not be lazy about it. Anything at the back counter that somebody calls in for but we don't have, I would be dinging that as a lost sale and then looking at it every month.
They won't go get the part.
If somebody else has the part TODAY, send a runner to go get it. In the end, it's going to cost you less than if you were to overnight it!
When I'm in that scenario, a lot of the times I can find a courier to get it. If you don't have somebody, you can find a retired off-duty fireman to pick it up for 10 bucks. You can even Uber it to yourself!
If you can get a part TODAY with less money than overnighting it, why the hell not?! Whether it's a dealership, independent, truck, car, whatever, what you're doing at the end of the day is improving the customer experience.
They don't have a real system of handling the shop.
So a lot of parts managers have done this thing where they try to have a balance of both high paid parts guys and runners but they're not committing one way or the other and their expenses end up being too high.
You've gotta pick a way: either have a bunch of high paid parts guys or have one high paid parts guy with a bunch of runners.
The idea of runners is that you can have one parts guy to pull a ticket, the runners know where it is, and they can go find it and run it to this tech in that stall. You can have kids (and I don't mean actual children…) as runners for $15 an hour or whatever minimum wage is in your area, but I find that a lot of parts departments are running this hybrid where they try to have their cake and eat it too and it just ends up being inefficient in some way.
Too many parts managers are okay with seeing a line of techs at the back counter, standing around. That's $300 an hour being wasted!
They don't get out of their office.
Another mistake parts managers make is they don't wander around, they don't go into the shop, they don't ‘touch' everybody; they just sit in their office like it's a cave, running reports and checking emails.
Your role as a leader is to be up and about, be seen, have your presence felt, know what everybody's doing. Maybe – I don't know – spend more than half of your time outside of your office!
The parts department becomes a silo.
By “silo” I mean that you think of parts as just ‘parts.' You don't think of them as a customer experience on their own.
From the customer's point of view, they're just getting a repair. They're solving a problem and getting back on the road. They don't care about all the different departments. It just doesn't matter to them.
When parts managers get what being a ‘silo' means, they can figure out how not to make the parts department into one. They start selling a lot more accessories because they start going to sales meetings, they go to advisor meetings, they're out in the service department talking to customers and they stop thinking about parts as their little castle that they have to protect with a moat around it. They start thinking of it as a bigger part of the revenue of the entire shop or dealership and they see how they can affect other departments.
That being said, those of you outside of parts shouldn't take them for granted either.
Parts procurement is a customer experience touch point. If you don't have the right part at the right time, that can take away from that five star experience we're trying to deliver to the customer.
That's where I think lost sales help with the fill rate; it's driven by being aggressive, being open, maybe stocking a couple of things that you wouldn't normally do, not by debating lost sales because you don't want to look at your stock order! In the long run, you want to be ahead of it.
When parts managers start going to meetings and talking to the sales department, I see them talking about accessories, which leads to them selling more; LEDs on trucks, bed liners, luggage racks, all that stuff.
So, there you have it: The top five mistakes that parts managers make, and how to avoid them. With the five mistakes out of the way, lets move on to…
“Hello Chris. I am 24 years old, single, and have no kids. I am looking to move into a dealership on the West Coast coming from Ohio. What strategies or methods can I use to attack the job search from a thousand miles away?”
So getting a job a thousand miles away is a bit more complicated than changing your mile range on Tinder, but I got advice on that. You're on your own with being single, however.
The best way is probably to send a nice cover letter with whatever results you're getting currently. Like, “Hey, I work in this service drive / I'm the top in CSI / I'm the top in sales and I'm looking to relocate.”
Jeremy, however, seems to disagree because he thinks service managers are too busy to read a letter. His recommendation is making a video of your skills, talents, and ability on your own YouTube channel and sending it out to all the service managers on the West Coast. Pick the city you want to be in and show them how you can help their dealership make more money.
So there you go. Service managers might be too busy to read a cover letter but they'll watch a two minute video and doing it through technology saves you money on postage.
“I am looking to change to an advisor from a technician. I am a customer service provider at heart. What tips do you have for me to be an awesome advisor/writer?”
Good one. We actually had a conversation about this in a previous episode. So, the hardest part of transitioning from a technician to a writer is that, as a tech, you already know what's wrong with the car or truck. However, you're gonna want to pretend like you don't know anything, and just get the information down.
Now, you might think that diagnosing the car on the spot is a good thing, but you want to avoid diagnosing it yourself at all cost. This is because you’ll wind up sabotaging the techs when they get the R.O. If you bypass the techs and diagnose it on the fly, you're killing the whole process.
That's the hardest part: unlearning how to fix a car or truck and learning how to communicate with customers and make friends. Watch the Pet the Dog video on YouTube so you can connect with the customer on a deeper level, not the commodity (the car).
“I listen to your podcast and have the OnDemand platform. I really love your training. I have a question though: if you have a small dealership, like me, where there are separate shifts for advisors out, do you do the meetings? I have three advisors. One comes in at 7, one at 7:30, and one at 8. They also leave in staggered shifts. I want to see what you think the best way to handle the morning shift meetings is. Do I wait for everyone to get there? I don't want to change everyone's schedules. Thanks.”
Another good one. So in our OnDemand training in Service Manager University, we teach to have shift meetings and what things happen at those shift meetings, because they kind of set the pace for the day. It gets everything going and we usually have games and those sorts of fun things going on that we announce and talk about.
I know it isn’t what you want to hear, but my advice would be to change their schedule. Have them all show up at 6:46 and then I would have one of them stay late and cover every third day.
So on Monday, one of them stays until 6:00, on Tuesday another one, on Wednesday another one, and they just rotate. You're going to work an hour longer once every third day, but the leverage that you'll have and the momentum of having them all in a room together will be way better.
Another thing I would pay attention to is, are you then staggering the techs in the shop? If your advisors are coming in at different times, but the shop is all starting at 7:30 or 8, I want those advisors there writing and loading the shop. What I like to do is start the techs an hour after the advisors so they've had a chance to write enough ROs. Then when every tech gets there, they have work to do. If techs start without work for the first 30 minutes of their day, they'll never really get in a groove and gain momentum.
So that's what I would do: start them all early and then have them rotate who stays late every third day. Great question.
Remember: if you submit a question on Facebook, LinkedIn, YouTube, or email [email protected] and your question makes it on the show, we'll send you some swag which includes an SDR T-shirt, hat, coffee mug, stickers, all kinds of stuff!
Thanks for reading and tuning in. We'll see you again next time on Service Drive Revolution!