maintenance
MATTERS November 2012
Maintenance
Chronicles: Showcasing the Profit Potential in Vehicle Maintenance Services
• Maintenance & MPG • Implementing a Vehicle Inspection Form • Top Overlooked Maintenance Services
maintenance
November 2012
MATTERS
[ Maintenance Chronicles ]
Chronicling Two Weeks of Maintenance Services Profiling Two Shops’ Maintenance Workflow Alexandria, VA [page 2] Akron, OH [page 14] We’ve documented the maintenance service workflow at two independent repair shops to showcase the sales and profit potential in vehicle maintenance services, and provide useful advice to help you sell preventive maintenance to your customers.
[ Technician-Centric Inspection Form ]
Boosting Profitability in Automotive Maintenance Service [page 10] Capitalize on the vehicle maintenance profit potential in your service area by using this handy inspection form on each and every vehicle that enters your bays.
[ Preventive Maintenance Musts ]
5-Minute Maintenance Strategies [page 20] These maintenance strategies can take your vehicle inspection process to the next level, helping you sell more necessary repairs and services, while giving your customers a better analysis of the condition of their vehicle. Maintenance Matters November 2012, Volume 1, Number 1: Published by Babcox Media, Inc. 3550 Embassy Parkway, Akron, OH 44333 U.S.A. Phone (330) 670-1234, FAX (330) 670-0874. www.babcox.com. 䊚 2012 by Babcox Media, Inc. Publisher, Jim Merle, ext. 280; Editors, Mary DellaValle, ext. 221 and Andrew Markel, ext. 296
[ Maintenance Chronicle ]
By Mary DellaValle, editor, ImportCar magazine
East Coast Shop Makes Maintenance a Priority Proper Equipment, Vehicle Inspections and Customer Education Yield Unperformed Maintenance Dollars Taking the time to educate your customers on the value of preventive maintenance can pay big dividends for them as it relates to vehicle performance, safety and longevity. And, when they have more incentive to bring their vehicles to you on a regular basis, it boosts your shop’s profitability in automotive maintenance services. Maintenance really does matter. In this Maintenance Chronicle, we are featuring an eight-bay shop located in Alexandria, VA, that employs five techs and has been in operation for 19 years. We’ve documented the shop’s maintenance service workflow over a twoweek process, as a means to showcase the sales and profit potential in vehicle maintenance services. Preventive maintenance checks and thorough inspections by shop owners
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and technicians can drive the purchase and installation of filters, wiper blades, lighting, oil, shocks and struts, batteries, antifreeze, tires, belts and hose, and other related maintenance parts and equipment. This shop owner has a focused effort on informing customers about necessary preventive maintenance services when they’re at his shop. “All of our techs are instructed to recommend upcoming maintenance on every car that comes through our bays, and any service that is of immediate need while the car is in for other issues,” he explained.
[ Maintenance Chronicle ]
ten an ce Sa les at a Gla nc e * MSepain t. 10-22, 2012
Job s Per for me d
Oil Changes •••••••••••••••••••••••••54 Air Filters •••••••••••••••••••••••••••16 Fuel Filters •••••••••••••••••••••••••••2 Cabin Air Filter •••••••••••••••••••••••16 Coolant Flush and Fill•••••••••••••••••••6 Transmission Flush/Filter •••••••••••••••16 Wiper Blades •••••••••••••••••••••••••16 Ignition (Plugs/Wires) •••••••••••••••••17 Hoses •••••••••••••••••••••••••••••••3 Belts •••••••••••••••••••••••••••••••20 Lighting •••••••••••••••••••••••••••••19 Tires •••••••••••••••••••••••••••••••16 Batteries ••••••••••••••••••••••••••••14 Fuel Injector Cleaning ••••••••••••••••••3 Note: The car count for Week 1 was 62 and the car count for Week 2 was 58.
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[ Maintenance Chronicle ] “I know some techs are apprehensive about recommending additional work because of a customer’s reaction to an increase in expenditure,” the owner added. “My answer is that we will actually be doing a disservice to our customer if we failed to explain all options pertaining to maintenance. We can all have a clear conscience, as long as what we inform the customer is 100% accurate, and then they can decide what (maintenance) approach to take.”
New Profit Center
doing three or four per day, one by each of your techs, and your numbers will increase exponentially. Since then, we’ve purchased transmission, brake fluid and coolant flushing equipment, and those services are also performed daily. The customer gets back a healthier vehicle and we get a much healthier bank account. Everybody wins.” Beyond thoroughly inspecting vehicles while they’re in the shop for service, the owner also promotes maintenance to his customers with computer-generated promotional letters that are sent out daily. He feels that phone calls are an intrusion, similar to the ones he gets from telemarketers at work, at home and even on his cell phone, and he says he doesn’t want to impose that on his customers. If this owner were able to raise the awareness of the value of preventive maintenance with even more emphasis on customer education, he feels his shop would benefit from an additional 10% increase in maintenance sales, above the 25-30% increase already mentioned. And, he indicated that the
The purchase of new equipment has been instrumental in the vehicle inspection process and in moving the preventive maintenance revenue needle at this shop. In fact, total vehicle maintenance sales have increased 25-30% since the owner initiated a vehicle maintenance program approximately three years ago with the purchase of a power steering flushing station for $1,500. The owner said that the power steering flush service is billed at $140. “Now, if you were to do only one per day x 25 work days,” he continued, “your additional gross revenue would r f o r me d e p n u be around $3,500 t en p a rts w d n a lo t of a per month x 12 f e o c i k v c r e e h in s months, which Th at ’s a . le . r a e y t t he tab l as n o t would translate to f e Council l l a rs l o d ar Care C : e rc $42,000 annually. Sou “Then imagine
Mo
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on i l l i B 2 $6 re t h a n
November 2012 | Maintenance Matters
[ Maintenance Chronicle ]
product categories that would benefit the most are those that involve fluid flushes, because that is one of the neglected services he most often sees — which prompted the purchase of the new flushing equipment three years ago, helping establish maintenance as a new profit center for his shop. Sometimes customers take the lead on maintenance and bring in their vehicle for a service inspection because they are going on a trip, selling the vehicle or trading it in. And, this shop benefitted from scheduling maintenance work with customers after these various inspection scenarios, yielding unperformed maintenance dollars in the process. This shop could also boost profitability in the maintenance category by providing customers with a report of upcoming preventive maintenance items, based on vehicle mileage, after they leave the shop following a repair or service. It might prompt customers to schedule future maintenance-related services, or serve as a reference
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Oil Changes & Filters With engine lubrication being a solid category for preventive maintenance, this shop performed 54 oil changes over the two-week period (from Monday through Saturday), for an average of 4.5 a day. The owner said that 25% of those jobs were prescheduled due to a coupon or mailer sent out to customers. And, 40% were performed when the vehicle was in for another service and the tech noticed that the vehicle was near or past the recommended oil change interval. And, with this shop’s techs taking the time to inspect the air filter at every oil change, the shop sold 16 air filters over the two-week timeframe. Fifty percent of the time, air filters in customers’ vehicles are beyond the mileage
Filters replaced in the t wo-week period: Cabin air
Counc
when the shop follows up with maintenance reminders. Using an on-line component — like the ability for customers to schedule appointments on the shop’s website — could also increase this shop’s maintenance workflow.
Fuel & Air
are : Car C Source
n
Oil filters
hic le s o e v f o % Up t o 16 e e d l igh t s sn t h e ro ad c l udi ng , in re p l a c e d , b r a k e ts h e ad l igh l ic e n s e d l igh t s a n . h ts p l a te l ig il
Oil filters 54 Fuel & Air filters 18 Cabin air filters 16
[ Maintenance Chronicle ] replacement recommendation. The shop performed only two fuel filter replacements during the two weeks, but both were replaced as a preventive maintenance item, based on vehicle mileage. This is another great example where an inspection by a tech uncovered necessary work and yielded
were to get involved in Car Care Month activities and by promoting wiper blade replacement as seasonal maintenance.
Cooling System Over the two-week timeframe, the shop performed six cooling systemrelated services or flushes, one-third of which were on vehicles that had surpassed the maintenance recommendation. An area of neglect among its customer base, this shop could boost cooling system sales with proactive marketing in this service area.
Batteries and Belts
maintenance dollars for the shop. Similarly, 16 cabin air filters were sold, even though techs don’t regularly check the vehicle’s cabin air filter during an oil change service. Such a practice could significantly boost this shop’s cabin air filter sales.
Wipers Sixteen sets of wipers were sold in the two-week period, as well as three rear wiper blades. Whether by customer request or tech inspection, this shop’s wiper sales could be elevated if the shop
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Fourteen batteries were replaced over the two-week period, as techs test the battery life of every vehicle that’s in the shop for repair. Similarly, 20 serpentine belts were replaced in the same timeframe, following an inspection by the shop’s techs who determined that these belts were near the end of their useful life. (See page 3 for other maintenance services performed by this shop.) Hopefully, by getting an inside look at this shop’s vehicle maintenance numbers, you’ll begin thinking about new ways to effectively promote preventive maintenance to your customers. In the process, you’ll boost your shop’s profitability, and extend the life of your customers’ vehicles. And, that’s something everyone can cheer about. MM
[ Vehicle Inspection ] By Andrew Markel, editor, Brake & Front End magazine
The Technician-Centric The form that works for you, not you working for the form. A prelimin ar y ve hicle inspec tion sh ould be th orough and ta ke ab ou t 10-15 minutes The trouble with most inspection forms is that they don’t work the way the technician works. Most forms are configured by the system and not how a logical and efficient inspection should proceed. During my days as a tech, I would oftentimes fill out the form after inspecting a vehicle, second-guessing myself if I really did check a certain system or component. A preliminary vehicle inspection should be thorough and take about 10-15 minutes, depending on your equipment and number of technicians carrying out the inspection. The form should be filled out, item-by-item, as you inspect the vehicle. The most important reason to use a form is that it can create consistency for the inspection process. It also helps technicians establish a routine that becomes automatic, so that fewer service opportunities are missed. MM
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Note: Feel free to photocopy this form for use in your shop.
[ Vehicle Inspection ]
Inspection Form
Maintenance Matters
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[ Maintenance & MPG ]
By Andrew Markel, editor, Brake & Front End magazine
Fuel Price Fighter: Numbers That Will Open Your Customers’ Eyes to the Value of Maintenance With gas prices at historic highs, consumers are looking for ways to stretch a dollar. Maintaining a vehicle so it operates economically can help drivers get 10% better gas mileage. These are not drastic changes and do not involve tailgating semi-trailers on the freeway or installing magnets on the fuel lines. Rather, these are things that can be done at your shop — services that will pay dividends for you and your customers.
Tire Inflation,
4%
Inflating tires to the proper pressure for the vehicle can improve mileage by 4%. Even if the Tire Pressure Monitoring System (TPMS) light is off, a tire could be up to 24% under-inflated. Selling a customer a nitrogen tire inflation package can further improve his/her gas mileage by stabilizing the pressures over a wide range of temperatures.
Air Filter,
6-11% According to a Department of Energy study on modern vehicles, a dirty air filter can kill power and fuel economy by 6-11%. A dirty air filter can alter long- and shortterm fuel trims, causing the car to work harder and lose gas mileage in the process.
Engine Oil,
1-2%
As engine oil ages, it can impact mileage by 1-2%. This is due to the additive package of friction modifiers breaking down. The right oil also makes a difference. According to one oil manufacturer, if a vehicle requires 5w20, and 5w30 is installed instead, it will impact mileage by 2%.
Oxygen Sensor,
10-40%
Replacing a faulty oxygen sensor can improve mileage by as much as 40%. An oxygen sensor can become contaminated over time and lose the ability to sense changes in the fuel mixture. It all adds up and every percentage point counts as gas prices race to the $4 a gallon and beyond mark. MM
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[ Maintenance Chronicle ] By Andrew Markel, editor, Brake & Front End magazine
Repairs are the Key to Selling Maintenance Ohio shop proves diagnostics, repair and maintenance go hand-in-hand. For this edition, we examine an independent, three-bay shop in Akron, OH. The shop has three technicians, dedicated service writer and a shop owner who works in the bays and up front. The shop has been in business for more than 30 years and has a loyal clientele. In statistical terms, this shop is right
in-line with national averages for bays, technicians and years in business. It is well know for its diagnostic and driveability services, and handles both domestic and import vehicles. We’ve documented the shop’s maintenance service workflow over a two-week period, as a means to showcase the
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sales and profit potential in vehicle maintenance services. During this time, the shop performed 45 maintenancerelated services for 76 cars. Most of the service categories were consistent with Babcox Media’s Jobs Performed Survey. (See chart on adjacent page.)
The Community To estimate any shop’s profit potential, it’s important to look at the surrounding community. The average household income in Akron is $32,892. The income level of potential customers in an area can have a direct influence on the mix of maintenance and repair work a shop performs. It can also influence the age of the vehicle population. In no uncertain terms is this shop less successful or less profitable than a shop located in a higher-income community. The opportunities to maintain and repair vehicles are the same. Just like a shop in a high-income area, success requires a commitment to providing the highest-quality parts and service, and performing thorough vehicle
[ Maintenance Chronicle ]
M ain ten an ce Sa les at a Gla nc e Sep t. 4-19, 2012
Job s Per for me d
Oil Changes ••••••••••••••••••••••••••14 Filters [Air & Fuel] •••••••••••••••••••••7 Cabin Air Filter ••••••••••••••••••••••••0 Coolant Flush and Fill•••••••••••••••••••3 Transmission Flush/Filter •••••••••••••••3 Wiper Blades •••••••••••••••••••••••••1 Ignition (Plugs/Wires) ••••••••••••••••••5 Hoses •••••••••••••••••••••••••••••••2 Belts ••••••••••••••••••••••••••••••••2 Lighting •••••••••••••••••••••••••••••1 Tires ••••••••••••••••••••••••••••••••2 Batteries ••••••••••••••••••••••••••••4 Fuel Injector Cleaning ••••••••••••••••••1
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[ Maintenance Chronicle ]
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inspections. What can change is the ratio between maintenance and repair.
During the two-week period, the labor inventory was fully expended.
Maintenance Sales
At The Cash Register
Nineteen percent of the vehicles that came into a bay received an oil change. These are full-priced oil changes with no promotion or coupons. This is an excellent number, but could be improved with some marketing. A promotion could increase car counts and the chance to perform more inspections to spot additional work. The shop sold four batteries. This is outstanding sales volume for a shop this size during the early fall season. Where this shop succeeds is in its ability to sell maintenance with existing repair orders. The owner has made considerable investments in coolant flush and fill machines to help with difficult-to-purge systems. It also has top-of the-line diagnostic tools to resolve rotating electrical and fuel problems. Items like coolant flushes, transmissions flushes and ignition service were sold on top of existing repair orders addressing running problems, representing 23% of the maintenance service volume. This is where the business model of the independent, full-service shop has an advantage over maintenance specialists like quick lubes.
According to the owner, the massive economic downturn in 2008 has changed how the customer pays the bill. Previously, customers paid with credit cards the majority of the time. Now, even customers with excellent credit ratings are unable to get credit cards and existing cards have had the limits decreased. This has resulted in a cash register filled with cash and checks, not credit card slips. The owner says it has made for a better customer who is more frugal and willing to invest in maintenance. The shop has been able to maintain revenue levels, and even grow, in spite of the downturn.
November 2012 | Maintenance Matters
Analysis Overall, this shop is average when compared to industry averages for number of bays, technicians and services sold. But, there is always room for improvement. Promotions and coupons could improve car counts and inspections would help spot more work. While this shop’s maintenance-to-repair ratio is weighted heavily on the repair side, it reflects the area and drivers. But, these repairs leverage a lot of maintenance items customers neglect. MM
[ Missed Maintenance ]
Top Overlooked Maintenance Services Do the Math. Do your car counts and services sold match the below numbers? There is an abundance of unperformed maintenance in the market and the opportunity for your shop to uncover that profit potential through vehicle inspections and customer education efforts. During car care clinics carried out by the Car Care Council in support of Car Care Month in 2011, it was discovered that 84% of vehicles needed service or parts, the highest percentage in five years.
24%
Coolant: of the vehicles had low, leaking or dirty coolant. As coolant ages, it loses its ability to prevent corrosion and lubricate the water pump.
19%
Air Filter: of vehicles needed new air filters. As a filter trap particulates, it becomes restricted and the engine has to work harder and use more fuel.
18%
Functional Fluids: had low, dirty or leaking power steering, transmis-
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sion and brake fluids. Testing these fluids can be performed with test strips or through a visual inspection.
16%
Bulbs: of vehicles had a bulb that was burnt out. Be sure to charge for labor when replacing bulbs.
14%
of the vehicles needWipers: ed new wiper blades and 3% needed rear blades. Make it a point to inspect the wipers for any cracking or separation from the frame.
10%
of vehicles at the MIL Lights: Car Care Council’s events had the check engine light on. When a vehicle is first driven into the bay, check that the Engine, ABS and TPMS lights come on and then go out.
17%
Battery: of the vehicles inspected needed the battery terminals cleaned and serviced. New electronic battery testers can perform a definitive health check of a battery and document the results for the customer. MM
[ 5-Minute Maintenance Strategies ]
Maintenance Selling Strategies Three Easy-to-Implement Practices Deliver Immediate Results Here are three maintenance service strategies you can implement to elevate your vehicle inspection process to the next level. These practices can help you sell more, while giving your customers a better analysis of the health check of their vehicle.
Scan Every Car Scan every vehicle that enters your shop for codes. Technicians do not need a fullfeature scanner; a simple scanner will do the trick. The scan should be quick, but do not clear the codes. Even if the light is not on, scan it for pending codes. Random misfire codes can indicate worn spark plugs. Catalyst efficiency codes can indicate worn oxygen sensors, damaged converters or a faulty fuel system. Also, fuel trims can indicate a restricted air filter or damaged mass airflow sensor. Obtaining the codes and scanned information are a starting point to sell the customer diagnostic time to resolve the problem.
Look Up the Recommended Services Most technicians assume their repair
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information service systems are only for diagnostics and looking up torque specifications. But, they also have information on service/maintenance intervals. This information can spot and help sell specialty services like transfer case fluid replacement, cabin air filters and other items unique to the vehicle. Another resource is the Car Care Council’s Car Care Guide that can be found at www.carcare.org. This manual is the ultimate guide for consumers who want their older vehicle to run economically and enhance its performance and longevity. The manual is glove-box sized and can be downloaded or ordered online. You can even order copies for your customers.
Alignment Checks Do you want to make more money with your alignment equipment? The answer is to use it. Offering free or low-cost alignment checks will sell more alignments and chassis parts. If you feel there is too much time tied up in taking measurements, it’s time to re-evaluate your equipment. MM