In today’s day and age, when profit margins are tighter than ever, and service providers are looking to any available advantage, the 2011 Ontario Service Providers Forum jumped to the rescue in the morning’s first session, featuring Kevin McCartney of Automotive Support Services, a California based company.
In his enlightening presentation heralding the benefits of not only the preventative, but highly predictive maintenance to today’s vehicles, McCartney described a world in which shop owners can truly scramble with breakdown service less and perform a smaller number of low margin oil changes, while at the same time, turning out greater profits.
This is possible, says McCartney, because vehicles are simply built differently today than they were in the past, whereas many shop owners and technicians are still playing by the same rules they were taught in the 1970s.
“Modern oil does not warrant the 5000km change interval it did when tires were changed every 30,000kms, water pumps were replaced at 50,000km, and cars had carburetors and distributors. In fact, some of you in the room might not even know what those are,” said McCartney. “What’s changed about your inspections?”
In a very telling straw poll, upon that query being offered to the audience, not one hand was raised to indicate any significant new inspection policy to account for the changes in vehicle technology.
On major change, advocated by McCartney is the shifting of loyal customers from an oil maintenance regime that has the customer in your shop four times per year, at $50 per visit, to one that sees them in your bays twice annually, for $100 per visit. And, much to the delight of curious shop owners in attendance, McCartney showed how that bi-annual model is actually more profitable.
“When you think about all the services and work that goes unreimbursed in a standard $50 dollar oil change, from the technician’s time to booking to scheduling, when you do the same work only twice, for the same total dollar amount, your profitability automatically goes up.”
That being said, McCartney says there is much more to it than that. Given that your customer’s vehicle is only on the lift twice per year under this model, the onus is on owners and technicians to up the ante when it comes to their inspection programs.
“You’ll always sell more work with a robust inspection program twice a year, than you will with a rudimentary inspection conducted four times per year,” he said. “Does your inspection include current ramping and coils, mode 5 and 6 monitor records, oil monitors, ATF condition? It should. You all know that if that customer’s car has an engine light come on a few days after their oil change, in their mind, you should have caught that, whether that’s a reasonable expectation or not.” he said.
“The bottom line is that new cars require far less scheduled maintenance, but they require far more diagnostic skill. A shop with the appropriate skill and tooling can distinguish themselves by using their skills to virtually eliminate unscheduled shop visits,” he added.