The Real Value of the Oil Change: Leveraging Service into Profits

The Real Value of the Oil Change: Leveraging Service into Profits

by | Jul 19, 2023 | Auto Service, Best Practice, Process, Technicians

Introduction

As an auto service shop owner, you already understand the importance of providing consistent and efficient services to your customers. In our last blog post, we delved into a comprehensive five-step oil change process that can not only enhance productivity but also significantly increase sales. But let’s move past the actual process of changing the oil. Today, let’s focus on how to leverage your oil change services to elevate your shop’s average invoice collection, which often gets overlooked amid the hustle and bustle of daily operations.

Unraveling the True Worth of an Oil Change

The truth is, the value of an oil change service goes beyond the mere price you charge your customers. It’s about cultivating repeat business, upselling, and, most importantly, building long-term relationships with your clientele. A discounted oil change can act as the hook that brings the fish to the bait, paving the way for more lucrative services.

A Real-World Example

I vividly remember a personal encounter I had with a store owner during my tenure as the Regional Director of Stores for Big O. I was visiting a store in Grants Pass, Oregon, and the owner was seeking advice on how to boost his business. His store was in a prime location, with a huge sign out front and cars streaming past every hour. To me, the potential seemed vast and untapped. I asked him why he didn’t advertise a low-cost oil change option to attract more customers. His response took me by surprise. “Why would I do that?” he asked. “I work hard enough as it is.”

This shop owner was so engrossed in his day-to-day duties that he lost sight of the bigger picture. He was charging $60 for an oil change, but he had no idea what his average invoice looked like when customers came in for that service. After reviewing his work order history, we discovered that customers coming in for an oil change ended up spending an average of $514 per visit. This revelation was an eye-opener. The owner immediately added a $29.99 oil change special to the sign in front of his store.

Shifting Perspectives

This story serves as a stark reminder that we need to shift our perspective from the price we charge for an oil change to the total invoice value per customer visit. It’s about seeing the oil change service as a loss leader—a strategic move to get customers through the door. Once they’re in, the quality of your service and your team’s expertise can work to upsell additional, more profitable services.

Conclusion

Remember, the main objective here is to attract new customers and build long-lasting relationships with them. The discounted oil change is merely the incentive that pulls them into your store. Once they’re in, the five-step oil change process we discussed previously will help ensure an efficient service and customer satisfaction, paving the way for future sales and repeat business.

So, are you ready to rev up your business by focusing on the average oil change invoice collection rather than just the oil change price? It’s time to leverage your service into profits!

As Always, Good Selling!

Pat

What I Learned from Hiring 1,000’s of Technicians for Shops Across the Country

What I Learned from Hiring 1,000’s of Technicians for Shops Across the Country

by | Mar 11, 2020 | Auto Service, Best Practice, Technicians

Throughout my career operating Tire and Service Centers, one of my main responsibility was finding, training and developing new talent. I did this for years and hired thousands of technicians for different dealers at all different stages of business.

And I’m not saying it’s an easy thing to do – find and hire great technicians – but there were two things that almost every dealer was doing wrong that was making it way more difficult than it needed to be.

Learn from their mistakes, and start taking the right steps to find and hire the best technicians for your shop.

First, how you attract technicians must be done correctly.

You need to think about hiring technicians like you would attracting customers. You can’t just post an ad on a website these guys (and gals) aren’t spending any time on, and you can’t ask them to do something they can’t or won’t do – like send you their resume.

Nine times out of ten, the best technicians aren’t unemployed perusing job sites. Most of them aren’t even signed up for these sites. They’re employed and realizing that they aren’t happy where they are. The most qualified also won’t have updated (or any) resumes to send your way – so stop asking for them.

Instead, post an ad to Craigslist. It may sound old school, but this has worked, time and time again. Post the ad with your phone number and request the technician call or text you for details.

If you’re thinking about hiring like you would think about getting new customers – you realize you need to offer an incentive to bring new technicians in.

Just like you’ll give a new customer a low-priced oil change, offer a new technician a signing bonus. Structure the bonus with the first half paid out upon signing and the second half after 90 days. Also consider a Flat Rate incentive program.

Here is an example Ad:

Auto Technician – for busy shop – Full Benefits – Signing Bonus

I am looking for 4 qualified mechanics with at least 2-3 years of experience.

Please call/text me immediately @ 555-555-5555 or respond to this posting.

We are paying the following bonuses for qualified new hires:

$1000 A Tech

$750 B Tech

$500 C Tech

*Please call for details

Technicians with at least two years of documented working experience need to apply.

The second and most important step, make yourself available.

It sounds like a no-brainer, but I would repeatedly see dealers post job ads and then not answer incoming calls. Answer your phone. I’m not saying you need to be available 24/7…but, basically, be available 24/7.

Save yourself time and pre-screen candidates over the phone before scheduling a time to bring them in for an in-person interview. I find that most dealers are pretty good at interviewing, but as a refresher, be sure you’re focusing on:

  • Past experience & jobs
  • What level of technician they’d consider themselves (A, B, C)
  • How many ASEs they have
  • Work ethic

If you’re thinking about hiring like you would think about getting new customers – you realize you need to offer an incentive to bring new technicians in.

When to hire? I get this question a lot. There’s no cookie-cutter answer from a revenue perspective – this decision varies depending on the services you offer, the technicians you have, etc. But, what I can say with confidence is that if you’re turning customers away at the counter midday – if you’re saying no to business – then it’s definitely time to consider hiring another technician.

Do you have any other hiring tips for dealers? Share them in the comments.