How would You Like to Have 100% Service Absorption. Here is What I found.
I found this article:
Thank You,
John Miller
Auto Dealer Target
Rapid Fire Auto
MyTextClub
A car dealership attaining 100% service absorption is like a ball player batting .400 for the season. It rarely happens, but it's great when it does.
Improving service-absorption rates has become a hot issue as more and more dealerships turn to their back-end operations to offset reduced showroom activity amid faltering vehicle sales.
“Service absorption hasn't been talked about in a long time, but it's become a reenergized topic,” says veteran dealership trainer Steve Nickelsen of the Steve Nickelsen Group in Akron, OH. “Dealers are rethinking it.”
Service absorption is the percentage of a dealership's total operating costs that the service and parts departments cover through their gross profits.
For example, if running a dealership costs $250,000 a month and the back shop makes $250,000 a month, the service absorption rate is 100%.
Achieving that level is a feat that requires a laser-like focus on the service department — a focus that's often lacking from the many dealers who came up from the vehicle-sales side of the business.
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Upon contemplating this article, I reflected on the number one choke point for auto dealer service? It's Communication Breakdown!
My next question is: how to avoid communication breakdown. There are many ways to increase or streamline communication from service department to customer servicing the new or used car. The first step is to pick the method of communication. Immediately, a dealership is faced with a decision to phone, email, text, chat, facebook, or some other form of reaching out to connect with service clients before or after the service appointment. At MyTextClub, and Rapidfire Auto we have found that asking your customer how they would like to be contacted is a great place to start.
Once the contact type is set, the next big step is how to use that format to stay connected. Traditional rules for human interaction should apply here, and there are trainers who can help service professionals communicate more effectively no matter the experience level. Money spent on training is money well spent. It cost less to avoid problems than is does to fix them. That thought is the premise behind servicing vehicles as well, right? fix it before it breaks in order to reduce exposure?
Assess where your dealers service department is today. Get the tools and the training you should have, and service absorption will follow. The important thing here is not to wait. Waiting to correct a service marketing and communication problem will cost much more in the future than it costs now.Thank You,
John Miller
Auto Dealer Target
Rapid Fire Auto
MyTextClub
