Auto Service World
Feature   November 1, 2009   by David Halpert

How Knowing Your Customers Can Increase Motor Oil Sales

Don't Just Go With the Flow:

Tight margins have given motor oil the reputation of being a necessary evil within the aftermarket. Given its importance to each and every service business, this is undeserved.

For jobbers, it’s likely that oil-purchase conversations with customers won’t last more than two minutes. And, in terms of bulk sales, few shop owners stray from their trusted brand, or from the grade most commonly used in the course of their daily operations, usually 5W-30 or 10W-30.

However, in a product category spread out among so many types and grades, how do you ensure you’re offering the best coverage to your customers? Are there other opportunities for extra profit in those precious minutes over the phone between you and the customer? And are there foreseeable changes that we can expect in the near future when it comes to the motor oil side of the business?

If jobbers are working within a specific territory or region it’s likely they already know their customer base very well, but when it comes to niche applications jobbers should ask more questions to ensure they’re aware of all the options.

“The key thing is to always probe an application when they’re calling. If [a technician] just needs 5W-30, they’ve got that in their vault tank or their drums. They have it already in their shop. In most cases technicians who are working on cars are not working off packaged products,” says Dennis Favaro, product manager for Valvoline. “If they want something, they’re probably calling to get something out of the ordinary. If not, they’re calling and telling the counterperson, ‘I want a case of 5W-30,’ [so] it might be a little more involved in terms of different applications.”

One of the most noticeable trends oil manufacturers have been seeing is the increased use of 5W-20 and a decrease in the amount of 5W-30 used in terms of volume.

“In general, 5W-30 and 10W-30 are the most popular grades in Canada, and we can see an increasing need for 5W-20 as well, because with the technology out there today the trend is 5W-20 will grow fast,” says Amanda Li, marketing director for Shell Lubricants Canada under its Pennzoil/Quaker State brands.

“We have been seeing an increase in the past few years and we can foresee it will keep growing as well.”

“A lot of [technicians] are going to have to carry 5W-20 in bulk because a lot of products for vehicles now run on 5W-20, some to the point where technicians are getting dual compartment tanks for the volume of 10-W30, which is now a smaller percentage of what it used to be,” continues Favaro. “They may have a hybrid tank [in their shop] that has two compartments, a 5W-20 and 5W-30. But now you’re finding that 5W-20 is actually catching up to 5W-30 as a percentage of sales in Canada.

“In the U.S., 10W-30 is in full decline, 5W-30 has started its decline, and 5W-20 is in full growth mode in terms of grade.

The volume’s not changing. It’s just everything is being pushed down to the 5W-20 as more OEMs go there.”

Basically, success with motor oil comes from asking questions, both in the oil you choose to distribute, and when talking to your technician customers.

“With this many products available, the interface between the jobber and the customer becomes critical, as well as [the relationship] with his supplier. Does your supplier carry all of these products? Do they have them in stock? Can you trust them to send you a high-quality product that you can trust?” says Brian Shaw, Canadian sales manager for Noco Lubricants. “Right now we’re seeing a lot of discounting in the private label. As a result, some of the private-label products in the U.S. are of questionable origin and product quality.”

“If you have some relationship with your [technician] customers, then you can also ask them in which area you need more. What type of customers do you have? Do you have more high-mileage type of customers? What type of cars [come into your shop], so you can do the right recommendation on the oil and different products? I think it’s about understanding the customers and your offering. Help them when they try to find new needs and it’s win/ win,” continues Li.

When it comes to your customers, there are always new opportunities out there for jobbers willing to ask the necessary questions. Be sure to question whether you’re getting the most out of your current oil suppliers.

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