Why you need to decide on the type of clients you want

You can choose between two business models: You can take the ‘kiss a lot of frogs’ approach or the ‘get better clients’ path.

If you want customers who only care about getting cheap oil changes, you’ll get cheap customers, explained Cecil Bullard, chief executive officer of the Institute for Automotive Business Excellence, during a recent webinar.

“[These customers] bring worn-out junk into your shop that’s going to take you more time, it’s going to create low productivity, it’s going to create high frustration, lots of rust, etc. And do you want to bring bottom-feeder customers in that are going to make you crazy? Or do you want to bring in customers that want great service and a really good product, which are better clients that will spend more money?” he asked in the AutoLeap-hosted webinar Best Advice for Running a Successful Auto Repair Business.

If you do, keep your labour rate low and offer cheap prices for oil changes. Otherwise, you can weed out those cheaper customers from the start with a higher labour rate.

“You want to build your price up to where the bottom feeder customer literally does not call you,” Bullard said. “Because you can’t make money on them, you don’t want to spend your time with them. If we put our energy on the 80 per cent of the population that fits the model we want and built our marketing around that [and] we brought a better customer in, we would have a better business. So decide the kind of client you want.”

Shops that charge more have more loyal customers and are consistently busy thanks to them and enjoy higher average repair orders and are more profitable.

“Because the client that wants service out of you wants a good product. Once they find you, they will keep coming back,” Bullard said. “That discount guy will come in, get the discount and — unless you severely impress them — they are not going to stay. They’re going to find the next discount.”

Kent Bullard, chief operating officer of the Institute for Automotive Business Excellence and fellow panellist agreed. He also noted that being busy doesn’t mean you’re a well-run business.

“This is where we see this mentality of ‘because I’m busy, I’m a successful shop.’ Busy does not mean success,” he said. “Busy means you’re busy or chaotic or stressed or [have a] high turnover rate for technicians. You can’t keep good talent.”

Just provide customers with exceptional service, Cecil advised. When you are charging more, you have to. You can’t ignore the small stuff.

“You can’t have a greasy, nasty bathroom where customers might go; you can’t have greasy fingerprints on the car; you can’t use cheap parts; you can’t have unhappy people at the counter that don’t smile at the customer and say. ‘Thank you for being here,’ and ‘How can I help you?’ and ‘What can I do for you?’”