A fixed ops consultant should be able to design business processes that fit the nature of an organization. Moreover, these consultants should also be able to cost-effectively improve a company’s performance. Make sure to utilize technology like service pickup and delivery so that customers receive a timely maintenance reminder on their phones when they are due for services. It will help you to increase your customer retention.
Focus on Process
In a business, processes enable you to create efficiencies, improve profitability and achieve your goals. It is especially true for dealerships, where departments like new and used vehicle sales, service, finance, and the Internet team operate independently. Unfortunately, this often results in a disjointed approach that hinders the overall profit for the whole dealership. Dealerships should focus on establishing clear and understandable processes that guide their employees. The first step in this process is defining the end goal. Once this is found, the dealership can then develop a plan to get there. It should include all the steps, exceptions and rules that must be followed to ensure success. Once the plan is in place, the dealership should implement the processes and train their employees to use them. It can be done through daily meetings with the service manager, parts manager, service advisors and technicians. It helps to communicate expectations and keep the team on track.
Additionally, dealerships should look at ways to increase revenue in their service department. It could be through offering services like service pickup and delivery, which allows consumers to have their vehicles picked up and dropped off at their homes or office. Another way to generate revenue is through marketing, such as an auto repair shop advertising ideas and contacting loyal customers with check-in calls or personal maintenance reminders.
Invest in Technology
Fixed operations have traditionally been a high-margin portion of a dealer’s overall business and have helped connect the customer to the dealership throughout the car’s life. However, over the last two years, that trend has flipped. As the average age of vehicles on the road continues to climb, COVID-19 and subsequent plant shutdowns, chip shortages, and changing consumer behavior have impacted sales; service department profit has dipped considerably. While this can be challenging, it is also an opportunity to leverage new technology and innovation. Consumers today have access to more information than ever, and they expect convenience and transparency when servicing their vehicles. Car dealerships can benefit from utilizing digital tools such as a mobile application that allows customers to download service coupons, set up maintenance reminders, and order parts and accessories.
Investing in these tools can improve client engagement and increase revenue while helping to retain existing clients. Ideally, the investment should be tailored to each firm’s needs, and the program’s results should be measurable. It will ensure that the investment delivers the necessary benefits to the practice rather than just filling a void. In addition, firms should be aware of the opportunity cost of the investment and consider whether or not the new technology could have been used to generate a better return on an alternative investment, such as a fixed deposit earning 5% per annum.
Re-evaluate Your Staffing
In any business, operational challenges are inevitable. Some are minor and easy to fix, while others can be a major headache and even lead to financial losses if addressed slowly. One of the biggest issues that can negatively impact your dealership is staffing problems. Finding and keeping qualified workers may be challenging, affecting customer service and resulting in lost income. Fortunately, there are ways to identify staffing issues and take corrective action before they become too serious. The first step is to collect and analyze data. It will help you determine which employees are over- or under-utilized. For example, if you have certain employees that are overworked, it may be possible to adjust their schedule. However, finding a long-term solution is important if you have underutilized employees with specific skills.
In addition, if you have constantly overworked employees, it’s important to consider hiring more employees. A solution can help you manage your resources and ensure you have the right people to keep your dealership thriving.
Re-evaluate Your Inventory
For many companies, the value of inventory can decline below its original cost. When this happens, it is important to re-evaluate your list by writing it down to its net realizable value (NRV). It will prevent overstating the value of your inventory on company financial statements and help you make better production decisions in the future. QA common challenge that dealers face with fixed ops is having to stay open later on certain days to accommodate the schedules of busy customers. One way to solve this problem is by implementing service incentives that reward your most loyal customers, such as a check-in call, maintenance reminder and quarterly specials.