Creating a More Profitable Service DepartmentBy Sam Komeha
Maintaining a profitable service department is one of the best ways to make sure that your dealership turns a profit, even when people aren’t buying vehicles. However, the service department often gets overlooked and lost in the shuffle of daily operations. By doing a few easy things, you can ensure your service department gets the attention it needs to stay profitable.
Get Your Hands Dirty
You don’t have to have grease up to your elbows and a wrench in your hand to get involved in your service department. Managers have the tendency to only visit the service center when something goes wrong. This is understandable because the service end of dealerships is highly technical and service technicians can usually solve service problems on their own. However, the independent nature of the service department doesn’t mean that owners and managers should completely remove themselves from their day to day operations. By talking to service technicians, understanding the way the department works, and forming a rapport with the techs, you can create a better work environment while identifying areas of the service department that could use improvement.
Build a Social Media Presence
The internet and social media play a huge role in our daily society. On Google alone, over 3.5 billion searches are made every single day. If your dealership, and subsequently your service department, aren’t coming up in these searches, you are missing a huge portion of your potential market. The easiest and cheapest way to be found online is to have a strong social media presence. Social media platforms, like Facebook, Twitter, and Instagram, can be set up easily and cost next to nothing to operate. Dealerships that post to their social media pages each day have a much better chance of being discovered online, which will help to reach a larger pool of potential customers.
Never Stop Improving
Complacency is a dangerous thing when it comes to the automotive industry. Especially in businesses that have been under the same ownership for years, dealerships can start to lag in their daily operations. Just because something has been done one way for 50 years doesn’t mean it’s the right way to do it. Taking an unbiased look at how your dealership is running and consulting other people within the company can help to create newer and better ways of doing things.
Switch Up Your Suppliers
Loyalty is an admirable quality, but when it’s costing you money, it just isn’t worth it. It is important to look at all the prices of your parts and materials regularly. Making a spreadsheet that includes the supplies you need and their prices at each vendor may reveal that prices vary considerably between vendors and you may be paying much more than you should. If that’s the case, you can either switch your vendor or ask them if they can match competitor prices. Everything from shop towels to engine parts should be looked at for potential savings.
Invest in Innovative Products
New, innovative products can do a lot more for a dealership’s service center than many people realize. Updating old technology or replacing antiquated service center products can turn a small investment into a huge time and money saver. One of these innovative products is New Generation Service Tags, which replace the usual paper key and rearview mirror tags with reusable eco-friendly plastic service tags. Using these tags, and other innovative inventions, in your service department can increase sales, make your technician’s jobs easier, and save money.
Implementing some, or all, of these tips, can do more than just increase service department profitability. They can help to bring you more business, make your employees happier, save time, money, and so much more.