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Fixed Performance Inc Newsletter
Meeting Today's Challenge June 2008

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Controlling Costs

Getting the Most From Your Customer


 

Controlling Costs

Controlling operational costs are an essential part of managing today's environment. Many of our customers are faced with filling up the tank or of performing needed vehicle maintenance. We all know filling up the tank will win over performing vehicle maintenance. Miles driven by our customers are declining causing additional reduction in repair order counts. Let's look at some ways to reduce and control operational costs at your dealerships. Uniform vendors have an interesting way to add on costs for dealerships. Pull out the uniform bill for your dealership and be prepared for a surprise. You might find items such as air fresheners for your restroom at $10 rental per week. Who among us would find a need to rent mop handles? Mats for high traffic walking areas are another source of revenue for uniform vendors. These mats can be purchased at most discount wholesale clubs for about the cost of three weeks rental. Many dealerships could use co- op funds to purchase Mats with the company's logo on them making a high customer impact. Fender covers are often rented instead of purchased as well adding still more cost to the dealerships uniform bill. Don't forget to watch shop rags that many times get billed each week for the inventoried amount instead of usage. I have personally found as much as $13,000 annually expensed for these wasteful rentals at one dealership. Shop supplies must be tracked by individual technician use with management reviewing at least on a monthly basis. When technicians understand shop supplies are being tracked with questions asked them on individual use you can expect a 20% reduction on these costs. There are many ways to reduce costs for every dealership that need reviewed including advertising. As a consultant for dealerships obviously hiring the right consulting firm will be a benefit far outweighing the cost.

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Greetings!

Today dealerships are facing many challenges. The manufactures are no exception with General Motors stock today valued as low as $10.57 and Ford at only $4.46 per share. There are many reasons to be concerned however the focus must be on positive actions that must be taken today to survive this environment. To assist dealerships who are facing struggles with sales my company will perform at no cost telephone assistance to help dealerships survive these troubling times. Email me at rgehring@fixedperformance.com with a request and I promise you will be contacted as soon as possible to review your fixed operations.


  • Getting the Most From Your Customer
  • In tough times it's easy to consider ways to beat up your customers selling additional maintenance that isn't needed. Compromising integrity is never a way to prosper a dealership long-term. The best practice is to inspect the vehicle for needed items to be at peak performance and inform and educate the customer of their needs. Advisors must be truly that and give the customer professional input as to what their vehicle needs are. If the customer can not afford to perform all of maintenance needed at this time an advisor should instruct them as to what is the most important now. Customer retention will always be more important then manipulation. We have all experienced the well-trained salesperson that has a designed program to manipulate their customer into a purchase. My initial response to these types of sales tactics is to refrain from an assault and just leave the company never to return. The dealership that looks for the customers needed items on every vehicle and informs and educates them of these needs will win in the long term. Hundreds of thousands of maintenance dollars are missed on an annual basis at every dealership going without a recommendation. The dealership must place a strong focus on creating a positive customer experience on every visit. Review all of the processes with the goal of achieving this positive experience and long term growth and customer retention will follow.

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