jhon l service coupon

Lots of Specials, Incentives, and Discounts But Nothing About Paying for It! Why?

Within variable operations, there are dozens of financing options available through F&I. The new and used vehicle sales department advertise and have financing options for every buyer from sub prime to 800+ credit scores. In fact, many advertisements use “pre-approval slogans” and attractive financing to generate leads that end with an automotive purchase.

But when we move to Fixed Operations, it all stops. Why? We evaluated hundreds of dealership websites, advertisements, and Service Dept. direct mail pieces. No where did we find any messages that really gave customers any finance options beyond good cold hard cash, and “We accept Visa M/C!”  Even when we moved to independent auto repair shops, all we could find was CarCareONE and that was traditional financing that included filling out a credit application and getting qualified. (or approved)

Obviously, automotive lenders are not interested in financing $675 for someone that doesn’t have a credit card or the credit card is tapped out. But $675 could mean getting to work or not for that particular customer. So would it be fair to say, whomever has a financial solution for this customer, is going to earn their business? You bet it does!

According to Forbes, 46% of Americans don’t have a $1,000 socked away for an emergency, like car repair.  In fact, 76% of Americans are living “pay check to pay check.” This is a huge market and Forbes estimate it’s potential to be around $8 Billion dollars.

After reading several great articles written by Fixed Operations expert Don Reed (whom we don’t know personally, never talked to, and receive nothing for endorsing) it is clear that dealer profits can go through the roof by improving:

  • One item repair orders (LOF)
  • Declined repairs
  • Hours Per RO (HPRO)
  • Parts inventory
  • Retail labor sales

Not sure if this would be defined as a “rhetorical question” but what the heck! Would a Service Adviser/Manager offering customers “No Credit Check, No Credit Required Financing,” improve all of these?  In fact, using Mr. Reeds figures, if a dealer improved by just .05 HPRO’s, that would increase gross profits by about $12,000 per month or $144,000 over the next year. That is a 1,082 percent improvement!

As a dealer or Fixed Operations manager, would you invest less than $200 a month to increase annual gross profits by at least $144,000? (Now That’s Rhetorical!)

You want to really talk profit? Establishing “No Credit Check Financing” is just the first prong. The second prong is even better. We are talking “No Credit Check Financing” added into the marketing and advertising. It is one thing to just offer it, its another to go out into the market and deliver it. With over 225 million cars and trucks on the road today, the average age is older than ever before in history. At 11.6 years, it is projected to hit 12 years old soon. That means millions of vehicles with over 100,000 miles. Its time to tap it!

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