Don Reed is CEO of DealerPRO Training Solutions in Columbus, Ohio. For more information or to contact him, visit dealerprotraining.com, call 1-888-553-0100 or email dreed@dealerprotraining.com.My team here at DealerPRO has evaluated and analyzed more than a hundred RV service departments over the past 20 years. In doing so, we consistently find three processes that are ignored and/or misunderstood by the management team. So, in this article, we will try to explain the following:
- Why are they ignored?
- How can you correct it?
- What are the benefits of doing so?
Most Ignored Process No. 1: Presenting Maintenance Menus
The question I have for RV dealers and general managers is, do you use some form of a menu in your F&I department? Every dealership we’ve been in certainly does. Why do you use F&I menus? Here’s two good reasons: To provide every customer with a higher level of service, and to increase gross profit per camper sold.
That certainly makes sense to me as it probably does to you. Why should your service department be any different? We find that about 80% of service departments are not using a maintenance menu – why?
Managers don’t know how to build a proper menu. But the fact is, the worst possible menu will still increase service and parts sales if it is presented to every customer, just like in F&I. In other words, 100% of your service customers are given the opportunity to say “yes” to an additional product or service. Sound familiar?
- Service advisors haven’t been trained on how to give a proper feature/benefit presentation. Do you have untrained F&I producers who can’t give a proper presentation? I’m guessing not.
- Dealers are not committed to making menu presentations a priority and make it company policy for advisors to present to 100% of their customers.
Note: I’ve actually had dealers tell me, “I don’t want my advisors to oversell my customers.” However, I’ve never heard a dealer tell me they don’t want their F&I producers to increase the sale of F&I products/services. Why does one dealer average $800 PRU (per retail unit) in F&I, while another is averaging $1,600 PRU in the same market? The answer is consistent menu presentations. Why should service be any different?
Here’s a comparison of the key metrics that should be measured in both F&I and service:
F&I producers Service advisors
- Finance penetration Number of repair orders per day
- ESC penetration Sales per day
- Tire and wheel sales Number of menus sales per day
- Roadside assistance Sales per repair order
- Gross per retail unit Hours per repair order
Here’s some management processes for maximum results:
F&I Service
X 100% feature/benefit presentations X
X present every customer with options X
X track individual performance X
X measure results daily X
X continuous training X
Same processes–different training!
100% compliance requires dealer’s commitment!
Most Ignored Process No. 2: Multipoint Inspection Process (MPI)
Question: Do you perform an MPI on all used RVs? Why?
- To provide the customer with a higher quality RV
- To increase gross profit per RV sold
Why should service be any different?
Again, we find that about 80% of service departments are not performing a complete multipoint inspection for customers – why?
- Managers don’t hold technicians accountable for a proper inspection
- Advisors don’t know how to present the value of an MPI and then sell the results to the customer
- Dealers are not committed to making MPIs a priority
Question: What is the primary mission of every service department? Answer: To provide every customer with a safe and reliable RV. How do you do this?
- 100% menu presentations = reliability
- 100% multipoint inspections = safety and reliability
MPIs should not be optional for customers. MPIs should not be optional for recon.
MPI Key Processes
Recon Retail
X Service advisor explains MPI will be performed to ensure safety and reliability at no charge X
X Technician performs MPI and diagnoses primary item X
X Parts provides parts pricing estimate for primary item and MPI X
X Advisor presents results for approval to repair X
Daily Performance Tracking
- Technician MPI completion/closing ratio (90%/30%)
- Advisor MPI closing Ratio (40%)
- Audit MPI for accuracy daily
- Track opportunities by red-yellow-green
Sell Technicians on the Benefits
- Increases their productivity
- Ethical responsibility to the customer
- Provides a safe and reliable RV to the customer
Most Ignored Process No. 2: Train Lower Skill Level Technicians How to Inspect
Moving on to a key process that far too many managers and dealers pay little attention to, which absolutely amazes me, and that’s technician productivity. Do you measure sales performance for all salespeople? Do you measure sales performance for all F&I producers? The answer to both questions is likely yes.
Why?
- To hold everyone accountable for their performance
- To identify underachievers
- To provide additional training where needed
- To improve closing ratios
What percentage of dealerships track the performance of their sales team accurately? Answer: 100%. What percentage of dealerships track the performance of their service team accurately? Answer: 20%. Do you see an opportunity for change?
What are 80% of the dealers doing wrong?
- Failure to measure hours produced per technician daily
- Failure to track hourly technicians’ productivity daily
- Failure to follow published labor time guides
- Lack of urgency to achieve goals daily
- 1Lack of incentivized pay plans for hourly techs
- Lack of training for low skill level technicians
- Lack of attention by dealers, GMs, service directors
Remember this: If you can effectively train your advisors on menu presentations and complete proper MPIs, your technician productivity will automatically increase and you’re well on your way to a record year in service and parts sales. It works in the sales department, and it will work in your service department, too!
