Many shop owners and managers believe that raising their car count is the path to success. More vehicles in and out, the more money is to be made. It can work this way, too, but I suggest that looking at and tweaking your service processes that you have in place today should be considered before adding more vehicles to your day. Because increasing the number of vehicles will also increase any inefficiencies that your shop has.
Realize that higher car count also raises the denominator in the equation for calculating Average Repair Order (ARO). More vehicles means more tickets divided into the dollars generated diluting the ARO.
With this in mind, you will better understand the approach I offer as a way to increase ARO. As a matter of fact, some of these ideas will naturally raise your car count through best practices, giving your shop the best of both sides of the ARO equation.
But before we dive into the core of this discussion, let’s look at one thing that seems to be lost when looking for higher car counts — the wear and tear on your people and equipment.
Taking a look at the technician, you may understand what I mean. With every vehicle, the tech has to get in and out of the car, kneel as they set up the lift, swinging the heavy arms into place. They stand for hours on the hard shop floor in all sorts of conditions from the heat of summer to the cold of winter. I am not over dramatizing this; the body wears out over time. More vehicles equals more wear.
Equipment-wise, the garage doors, lifts and other tools will only survive so many operating cycles and then they will fail. More vehicles, faster wear.
Every vehicle needs to go through the service process completing every major step of it from beginning to end. You might be surprised if you were to ever really sit down and look at how many steps a vehicle needs to go through from write up through to the customer paying the invoice. And at any time, the vehicles in the shop will be at different phases of the service process, adding to the complexity of the situation.
What is crazy is that the service process is inefficient and broken and many shops still use it every day. When you start increasing car count, the problems with the process get magnified, making it harder to raise the ARO. Therefore, I recommend looking at and fixing the process before going for more cars. Consider going digital.
The service process begins with the customer setting up an appointment. How much information is gathered when the customer calls in has a large effect on the process that follows. Many shops will just get the customer name, vehicle type and maybe information for what the customer need done. Sometimes not even that much.
This hurts the start of the process in at least three ways. First, the more info you get up front, the quicker the write up will be. Second, you have more time to upsell the customer either on the phone or when they are in front of you. Finally, if you gathered their information and they do not show up, you can call them up to get them in on another day.
Still using paper estimates, work orders, invoices or even paper inspections? Stop. Going to a digital format will eliminate all the time that is spent just working with and moving the paper. Eliminate the time spent interpreting, copying everything written from paper to computer. Type it once and have it everywhere. Use a digital system to dispatch and track all the work in the shop with a glance at a monitor. Forget clipboards and white boards.
Using a digital inspection will save you time over using paper inspections. As the technician does the inspection, they input their findings with a few taps of the finger or by using “speech to text.” Everything gets entered in a clear format and just once. Using some digital Inspections your technician will not only fill out the inspection, they can also start building the estimate at the same time choosing the right canned jobs that need to be done to fix the issues.
Pictures and video can show the inspection findings so that the customer not only understands but they also get educated on the “why” of their vehicle’s needs. No more trying to explain to a customer the issues found, let them see them with their own eyes.
Deliver that digital inspection with pictures and video right to your customers via a text message. Get rid of the roadblock that the telephone now has become. The average text is looked at in about a minute and a half. Less time than it takes for you to dial a call, wait for voicemail to pick up, leave a message and hope that they call you back so you can try to explain to them what they need and authorize it so you can get it done by day’s end.
We know that in many cases customers will not authorize everything you suggest that they get done, so you want to be sure to copy those other recommendations into the management system for future reference. But we also know that things might get too busy and that step might get forgotten. Not to worry, digital inspections will automatically place those recommendations in the management system as the tech identifies them during the inspection. Later having all these items listed on the digital invoice that the customer gets to prepare them for their future service needs.
Don’t just print a lube sticker that you hope the customer will see and return for their next visit. Why not at the same time you print the sticker you set the appointment for when the customer should return based on their daily driving mileage and oil type used. And a week before this appointment an automatic text message gets sent to the customer to remind them of the upcoming oil change and service. The customer can confirm that they are indeed coming in for the appointment allowing you to preorder parts you may not have in stock. Have the parts waiting for the vehicle, not the vehicle waiting for the parts.
Complete the service by sending the invoice via text to the customer for review and payment. The invoice will list all that you have done, show the recommendations for the next visit and even present the customer with coupons for the future needed work. Having the customer pay via text frees up the time so when they come to pick up the vehicle, you can now go over everything, even the work that they will need to get done on the next visit. You can offer to send the customer a text that they can tap on a link and all those future recommendations will go right into their smart phone calendar, further reminding and preparing them for their next visit to your shop.
What I am suggesting here is that you take your shop to a digital service process before you choose to raise car count. Fix and automate the service process so you are more efficiently handling every vehicle. You are automatically recording and keeping recommendations and setting follow up dates for them. Stop using the phone, communicate with your customers how they want to be communicated to. Text them and they will get back to you with authorizations faster.
Once you take your shop to a digital service process; your shop will run smoother and more efficiently. And with the automation that is now in place taking care of many of the best practices such as recording recommendations and sending automatic appointment reminders to customers via text, you will see your average repair order amount rise on its own.
When you reach this point, now you are ready to raise your car count. But the funny thing is, the digital service process probably has already done that for you by bringing your current customers back regularly with them buying more service raising your ARO.