Fixed Ops Roundtable

This week's episode features guest Brian Pasch, founder of PCG Companies and the newly formed Automotive Standards Council. In this episode Brian shares his thoughts on the current state of the industry and the role that digital voice assistants can play in improving customer service and reducing operating costs.

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What we discuss in this episode:

Key takeaway points from the episode:

• The main drivers for the interest in digital voice assistants are the desire to reduce operating expenses and difficulties in finding labor.
• Google My Business is a popular way for consumers to find the phone number of dealerships, and phone call volume tends to peak at certain times of the day.
• Digital voice assistants can help dealerships handle phone calls during peak times and reduce the workload of employees by taking on repetitive tasks.
• Digital voice assistants (DVAs) can improve customer experience and increase bookings for dealerships.
• Some dealerships have seen an improvement of 30-50% in bookings after implementing DVAs.
• DVAs can be particularly effective in competitive markets and during off hours. 

One solution to these challenges is the use of digital voice assistants, which can take on repetitive or monotonous tasks and free up employees to focus on more valuable tasks. Brian also discusses his recent research report on the topic, including the importance of analyzing call volume by hour and the benefits of using Google My Business as a way for customers to find dealership phone numbers.

The company Proactive Dealer Solutions and its DVA product, Brooke.ai, were specifically mentioned as a solution for dealerships looking to implement a DVA. Digital voice assistants (DVAs) are increasingly becoming a popular solution for car dealerships looking to improve their customer service. These artificial intelligence-powered systems can handle repetitive tasks and provide quick responses to customer inquiries, freeing up staff to focus on more complex tasks.

Brooke.ai, has seen significant success with its DVA system, which has helped dealerships boost their appointment bookings by 30-50%. The system is particularly useful in metropolitan areas, where competition is fierce and customers may turn to a different dealership if they can't get through on the phone.

Proactive Dealer Solutions has also found that combining its DVA system with its own outsource call center allows dealerships to get the best of both worlds. The DVA can handle the easy tasks and free up staff to focus on higher value tasks, such as making outbound calls and reaching out to lapsed customers.

Dealerships have also found that DVAs can be particularly helpful during off-hours, when staff may not be available to answer the phone. This ensures that customers can still get the information they need, even if it's outside of normal business hours.

Overall, the use of DVAs in the automotive industry is a trend that looks set to continue, as dealerships look for ways to reduce costs and improve the customer experience. With the right system in place, DVAs can be a valuable asset for any dealership looking to take its customer service to the next level.

If you're a dealer or fixed ops director looking to improve your performance in the automotive industry, this is an episode you don't want to miss. Tune in for a thought-provoking conversation on how to level up your game in the automotive industry.

Listen to the episode featuring Brian Pasch for even more insights!

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Apple:

This episode features keynote speaker Eliana Raggio Director of Industry Relations at Digital Air Strike and Board Member in Women in Automotive. Eliana distinguishes allyship from mentorship and discusses the benefits of both for professional development. She also talks about the importance of finding a mentor and the benefits of being a mentor, including the satisfaction of helping others succeed and the opportunity to be a part of someone's legacy.

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What we discuss in this episode:

In the automotive industry, it is important to be an ally in the workplace in order to improve retention, boost productivity and profits, and create a positive company culture. One way to be an ally is to familiarize oneself with issues related to diversity and inclusion, and to advocate for equal opportunity and fair career growth for all employees. It is also important to challenge the status quo and extend opportunities to those who may be overlooked or underrepresented.

Having a sponsor in the workplace can also be beneficial, as it can lead to an average pay increase of 11.6%. A sponsor is someone who advocates for an employee and has a vested interest in their career growth. It is important to have both performance currency, which is gained by excelling at one's job, and relationship currency, which is gained through building connections and investing in others.

Keypoints from the Episode:

• Mentorship involves a more experienced person guiding and nurturing the professional development of another person
• Mentors offer one-on-one advice, guidance, coaching, and can serve as a sounding board and role model
• A study by the Harvard Business Journal found that 71% of CEOs with formal mentoring arrangements saw an improvement in company performance, 69% made better decisions, and 84% credited their mentors with helping them avoid costly mistakes and become more proficient in their roles faster
• Being a mentor has benefits including the satisfaction of helping others succeed, being a part of someone's legacy, and the opportunity to develop leadership skills
• Allyship requires ongoing effort and requires learning and growing along with the group or individual being supported
• Allyship can involve speaking up, using privilege to amplify marginalized voices, and actively working to dismantle systems of oppression
• It is important to recognize that allyship is not a title or identity, but a verb and a continuous process.   

In today's workforce, allyship and sponsorship are crucial to achieving diversity, equity, and inclusion in the automotive industry. Allyship is a concept that involves actively supporting and advocating for marginalized groups in order to promote diversity, equity, and inclusion. It is different from mentorship, which is a relationship between two people where one person helps guide the professional development of the other. Allyship involves an individual using their influence or authority to help another person advance in their career. An example of allyship is the story of William Mina Fleming, who was hired as an astronomer at the Harvard Observatory despite having no formal training and being a single mother working as a maid at the time. Her mentor, Professor Edward Charles Pickering, saw something special in her and advocated for her, leading to her successful career in astronomy. Sponsorship is also similar to allyship, as it involves an individual using their influence to open up opportunities for others. It is important to have both mentors and allies in order to succeed and advance in one's career. Eliana will delve into the importance of allyship, which involves actively supporting and advocating for marginalized groups.

Eliana Raggio al

In this Episode I had a conversation with Ed Roberts & Tony Owens. Ed Roberts, a Jacksonville native, began his time in the automotive world as an Apprentice. Since that time, his career has stretched to positions including Master Technician, Shop Foreman, Technical Service Engineer for Ford, Store Manager, Service Manager, Fixed Operations Director and is currently the Chief Operations Officer at Bozard Ford Lincoln in St. Augustine, Florida. Over his 30-year career he has spent some time with Toyota Dealerships and Ford Motor Company, with the majority of his career within Ford stores. Over the years, Ed has been recognized multiple times for his leadership, innovations, and achievements in Fixed Operations. Most recently he was named as one of thirty Automotive News Allstars for 2020.

Tony Owens has been in the automotive business his entire working life. highly trained, experienced, and effective in customer interaction and customer resolution, repair shop utilization, technician proficiency and efficiency, warranty administration, parts inventory management, team building and employee relations.

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What we discuss in this episode:

In this discussion, the speakers talk about the importance of culture in a dealership and how it impacts employee retention and attracting new hires. A strong culture leads to high levels of customer satisfaction and a sense of community within the team. The speakers emphasize the importance of character, chemistry, and competency when hiring new employees, and the value of a teachable attitude. They also discuss the importance of setting the tone for the team, including making time for others and having a positive attitude.

A few take away key points from the episode

1. The first sign discussed is that people stay at the dealership. A strong culture leads to high employee retention, as people feel appreciated and like they are part of the team.
2. The second sign is that there is a strong mentorship program in place. Ed and Tony have a mentorship together, and both believe in the importance of learning from others in the industry.
3. The third sign is that the dealership has a strong reputation, with customers traveling long distances to do business with them.
4. The fourth sign is that there is a focus on customer service, with a good culture leading to high levels of customer satisfaction.
5. Finally, the fifth sign is a sense of community within the dealership, with employees feeling like they are part of something bigger than themselves.

Overall, a strong culture is key to the success of a dealership and can be achieved through strategic planning, empowering employees, and focusing on the right values.

Listen to the episode featuring Ed Roberts & Tony Owens for even more insights!

Enjoying The Fixed Ops Roundtable Podcast? Please leave a rating and review 👇

Apple: https://podcasts.apple.com/us/podcast/fixed-ops-roundtable/id1608656237

Spotify: https://open.spotify.com/show/15HHYoyvCo1PSFwYn02UXY

Thanks, Ed Roberts & Tony Owens

Connect with Ted Ings and the Fixed Ops Roundtable:

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2. Ted Ings on LinkedIn
3. Center for Performance Improvement

Chris Chesney is the Vice President of training and organizational development at a company called Repairify. Chris Chesney is regarded as one of the most outstanding educators in the automotive industry. He has experience building and growing some of the most successful automotive training organizations in the automotive industry.

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What we discuss in this episode:

What is it about the newer vehicles' technology that makes them more challenging to repair? And how do service departments overcome that?

"Safety systems are something that snuck up into the industry. And I would challenge the industry to look at them as an opportunity to have a better conversation with their customers because the motorist doesn't understand what these systems are. Many of them are annoyed by them." Chris said.

"If you've ever driven a vehicle with a lane departure warning, that kinda warns you when you're getting outside the white lines. But if you have lane keep assist where it nudges you and tries to steer you back into the centre of the lane, and our customers are still doing that today. Yet this past month, we had the highest casualty rate in our industry over the last decade of vehicles on the road that caused injuries or casualties caused by a motor vehicle accident." With all these new technologies still in play today on the vehicles being sold. Why do we still see that? It's because the new car dealer, the salesperson that sold the vehicle, didn't onboard the motorist in a way that helped them understand the value of keeping those systems on and what it can do for them.

When we look at ADAS systems, there are many items that people don't recognize as advanced driver assist systems, including things like pretension seat belts, that in a collision when you apply the brakes or the system uses the brakes automatically, it pretensions that seatbelt cis it up against your body So when your mass moves forward, it tries to arrest that momentum and prevents injury. And that's super critical to recognize. But does the consumer know that? No, they don't.

Vehicles are more complex today than they were last year, and that's going to increase every year to the point in the next couple of years, every vehicle will have multiple systems on board that are either voluntarily installed because the manufacturers knew that NTSA, the National Highway Transportation and Safety Administration would require them to do that, like an automated emergency brake.

So the complexity is increasing. That impacts everything that happens in the dealer, in the collision centre. I don't care where you're approaching that vehicle from a service perspective; it influences your workflow and your technician's skill set and affects the standards in which you take the car in. As we take those vehicles in, we've got to process them differently. We also need to make sure we have the right parts available to service those vehicles.

When we're looking at especially workflow, it's that Pre-Repair scan that we've got to perform on every vehicle that comes into the collision centre because of the carriers. The insurance companies want to know what was going on with that vehicle before the collision cause they don't want to pay for it.

And the Collision Center needs to know so that they know how to approach this vehicle and what repairs and or calibrations need to be made to that vehicle before they return it to the motorist so it's operating exactly as the manufacturer designed it to work. And if it's not, the collision Center opens itself up to massive litigation and liability, High risk because it's not the dent in the fender or the quarter panel or the ADAS sensor that was damaged and needed to be replaced recalibrated that costs money. It's bodily injury that costs m

We celebrate a milestone: Our 100th episode! In this special episode, I gathered my friends Tully Williams, Ed Roberts, Shon Kingrey, and Michael Cirillo. We reflect on the highs and lows of our journey so far, including our recent placement in the top 40 of all business podcasts.

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What we discuss in this episode:

While headlines tend to focus on new-car sales, savvy dealers know that fixed operations are really what keep franchised dealerships afloat.

Inventory shortages, digital retailing and pricing transparency, and rapidly expanding electrification are just a few of the new developments that are set to disrupt the service and parts industry as much as they did the new car sector. Dealers should use this time to reevaluate their approaches, perhaps even starting from scratch with how they approach this crucial aspect of their business.

Although dealers have limited control over part shortages, the remaining problems are primed for a new strategy. In recent years, the profit margin for car dealerships has shifted from vehicle sales to fixed operations. Currently, 49% of a dealership's gross is generated through fixed operations. Most automobile lots have distinct sections for selling cars and maintaining the lots. Even though it is the norm for a dealership's fixed operations (parts, service, and body shop) to operate independently, this division can have a negative impact on a business's bottom line and efficiency.

If this sounds similar, you'll be relieved to know that the problem of fixed operational dealerships may be easily solved, and the benefits of a more cooperative workplace can be realized immediately.

Here are just but a few take aways from the episode:

create a strategy

Engage in conversation with your target audience, choose the best course of action based on their needs, and launch an offensive.

Build a strong sense of community inside your dealership.

Occasionally, we find ourselves cooped up in an office with no idea what's going on outside. Your staff members must feel comfortable coming to you with both complaints and compliments. With proper coordination and open lines of communication, your team will be prepared to adapt and require open lines of communication, so how accessible are your teams? Do you keep in regular contact with your staff? And this is the crux of the problem.

The secondary auto industry is quickly adjusting to reality.No cars have arrived yet, and fixing this will not happen before 2023. Fixed operations and prioritizing customer satisfaction are the keys. Let's have a conversation about how we can improve your dealership. Consider what we can do now, in December, and throughout the year 2023.

As part of the switch to electric vehicles, retailers will have the chance to update their permanent infrastructure. Current service profits are healthy, and they have the potential to grow in the future if dealers adopt innovative practices to improve their services and inventory.

A total of 100 episodes I can count on one hand the number of times I've been trusted with someone's tale or given the opportunity to glean their insight. It has been my pleasure to contribute to the development of the lovely you a hundred times over.

Please enjoy this brief trip down memory lane as we revisit the teachings and healings of those who have helped us make positive, lasting changes in our lives. Kindly subscribe and tell your friends about the "Fixed Ops Roundtable" podcast as we celebrate our 100th episode!

Listen to the full episode for even more insights!

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Apple:

Dave Boyle is the President and Chief Executive Officer of TraXtion. David brings more than 25 years of experience in the automotive industry to his position as CEO of TraXtion. David is directly responsible for all elements of TraXtion's North American company in his role as president and chief executive officer. David has put in thousands of hours in dealerships across the United States and Canada over the course of his career and is a recognized authority on dealership fixed operations.

In this episode, Dave returns to the Fixed Ops Roundtable to elaborate on how dealers can recognize, tackle, address, and take on the tire business to increase profitability and loyalty and examine tire sales as a means to increase customer loyalty. Consequently, if you want to develop your business by increasing your active customer base, average transaction value, and frequency of purchases, tune in today!

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What we discuss in this episode:

RO counts all across the board are going to drop very soon, coming from the fact that we've had these unprecedented two events in the last 24 months between COVID and the supply chain issues. We've lost a lot of cars from the parking lot because we're not selling as many.

Our industry has grown by selling cars and then servicing the vehicles that we sell.We're not very good at going out and doing what the aftermarket does and going after cars that are not necessarily cars that we sold. Most of our service departments rely heavily, if not exclusively, on the cars that we sell,and if we're not selling them, this is an alarming thing that, quite frankly, I don't think we've ever seen before. And while this is challenging, the impact on service is going to be something we've never seen before.

Those cars that we haven't been selling are going to come back to bite us in the service department, and I think that service managers need to be prepared for this and learn to fix thisIn the face of all this doom and gloom.

Boyle claims that electric vehicles will cause a dramatic shift in how service departments are utilized by dealerships. No oil changes will be necessary for EVs, eliminating one of the most popular reasons for customers to return to the dealership. According to Boyle, the issue is not the potential loss of income from services like oil changes but rather the motivation for the consumer to visit the dealership in the first place. the fact that it's been going away for decades as we went from 3000 miles to 5,000 miles to 10,000 miles now to whenever the light comes on, and it's not revenue that we lose. There's something much bigger at play, and that's the fact that we've used the oil change forever as the trigger for the service visit every maintenance.

Every maintenance bundle is centered around an oil change. And we've used the oil change for as long as the trigger tells us to come in and get the rest of the maintenance work done. When

that goes away with VST in particular, what's going to be the trigger? What are we going to have the customer come back in for? It will not be for an oil change.So we need to think about how we can get around this and still be successful while having our customers return on a regular basis,and if we start to have fewer service visits over time, it's going to be devastating for the industry. So we need to give some thought to what is going to be the trigger. What are we planning on inviting people to?The industry has built an entire procedure around oil changes at preset intervals, which allows for a multipoint check and the discovery of additional work. When the service of oil changing no longer exists, what then? When there's no motivation for customers to make regular dealership visits, what will happen?

Thirdly, it’s the potential labor shorta

Cuyler Owens is the Chief Commercial Officer at DealerWare - Dealerware is modern fleet management for the modern retailer. The Delaware-connected car platform elevates the service experience for dealerships, dealer groups and OEMs. By automating cost recovery, improving efficiencies, and promoting the customer experience, Delaware allows automotive retailers to lower the cost and complexity associated with managing courtesy vehicles, retail rental, and subscription programs. Launched in 2016, Delaware today contains tens of thousands of cars for hundreds of dealerships in North America, including the top 10 public dealer groups, across 28 OEM brands.

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What we discuss in this episode:

In this show episode, Cuyler talks about The Cost of Every Vehicle Sold. In a time of shrinking margins, better-educated consumers and increased demand for transparency, dealerships need to maximize all their assets to survive and thrive.

One of the dealership's most visible assets – and often the most significant source of wasted budget and opportunity – is vehicle inventory. Choices made here can quickly create or break profitability.

Cuyler begins the episode by talking about the "Marshmallow experiment." - delayed and instant gratification. The experiment began by bringing each child into a private room, sitting them down in a chair, and placing a marshmallow on the table in front of them. At this point, the researcher offered a deal to the child. The researcher told the child that he would leave the room and that if the child did not eat the marshmallow while he was away, they would be rewarded with a second marshmallow. However, if the child decided to eat the first one before the researcher returned, they would not get a second marshmallow. So the choice was simple: one treat right now or two treats later.

He discusses how we can apply the marshmallow test approach taking advantage of the current situation in the auto market, considering that prices have never been higher on used Vehicles. The automotive industry has seen tremendous financial gains based on some pricing going away even at the OEM level because the demand is so high and the inventory's low.

What would happen if you decided not to sell those vehicles and if you built those into a larger, longer-term business strategy?

Dealers keeping a used or older inventory in their fleets are seeing some exciting benefits; additional monthly repair orders are generated for every vehicle you'll have. This means there are more appointments, and you're taking care of those customers, which is essential because you have RO revenue that's being generated. Still, it's also highly beneficial from a customer satisfaction perspective And retention rates.

This proves the point that there is an opportunity to look at the long-term value of that customer. By providing those fleets, you've got options to meet customers and take care of them at a time when maybe you could jump into a quick sale of that vehicle but instead decide to build the lifetime value of that customer.

The point is that having vehicles on the lot is critically essential to the long-term engagement with the customer, customer retention and the value you're delivering to that customer because we're not looking for a one-time engagement, as all of the money lies within this customer's life cycle and the customer's lifetime value.

Quoting, "A vehicle that's a high gross nine months from now, 12 months from now, is probably still going to be a high gross vehicle."

Profitability is certainly where we're headed. This is an excellent opportunity to look at the marshmallow test and understand the deferred gratification of taking care of your customers, making sure they have fleets available and te

Anthony Giagnacovo is the CEO of CallRevu, a call tracking and monitoring technology designed to provide car dealerships nationwide with a clearer perspective of their phone operations. Ultimately, this knowledge enables dealerships to interact with prospective clients and sell more vehicles.

In this show episode, Anthony discusses how a new sentiment metric is used to evaluate phone calls. By monitoring customer phone calls and teaching robots to recognize "how you say it," companies can better cater to their client's wants and needs. A customer experience is delivered alongside the usage of data to improve the customer's journey.

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What we discuss in this episode:

Giagnacovo begins the conversation by sharing The importance of Customer Service in the Automotive industry and how he thinks service is becoming such an essential aspect of the auto business. An example statement is, "A satisfied service customer is a strong potential new customer to buy cars or come back and buy a new car in the future."

When it comes to running an automotive dealership, several statements of truth apply: one of them being each Call Has The Potential To Serve A Customer, Book An Appointment, Sell Parts, Upsell A Promotion And Enhance A Customer's Loyalty.

With a monthly rise in service calls, more than 42 per cent still need to be answered because they are either ignored or sent to voice mail. This reveals the need to track, manage, and document each call to guarantee the quality of service your clients expect. If you don't, your clients will quickly figure out that you aren't the only option in town. They'll start patronizing your rivals down the street, leaving you with lost sales and possibly negative Customer Satisfaction Index (CSI) ratings despite your advertising efforts.

This calls for the question, "what could be done to manage this influx of service calls?" The simple answer is integrating a communication intelligence platform that enables call management for the whole dealership, including sales, service, marketing, and online retail.

CallRevu knows that a typical dealership tracks more than 500 calls per month to the Service department. Keeping up with and managing this many calls can be a huge hassle. Inevitably, some calls will not make it through. For this reason, you should think about investing in a CI system that not only aids in the tracking, routing, and monitoring of calls but also makes use of cutting-edge artificial intelligence (AI) and automotive call experts to record the entire call experience for the customer, including a summary and transcription, and to recognize keywords and sentiments so that you are notified via mobile device within minutes of a call being received. Automobile dealers may determine which clients they are missing by utilizing contemporary analytics. These consumers, he claims, are significant since they are not entering the dealership.

Receiving automated mobile alerts will enable your team to act quickly and respond to your customers' inquiries, so they feel valued and appreciated.

Listen to the episode featuring Anthony Giagnacovo for even more insights!

Enjoying The Fixed Ops Roundtable Podcast? Please leave a rating and review 👇

Apple: https://podcasts.apple.com/us/podcast/fixed-ops-roundtable/id1608656237

Spotify: https://open.spotify.com/show/15HHYoyvCo1PSFwYn02UXY

Thanks, Anthony Giagnacovo

Connect with Ted Ings and the Fixed Ops Roundtable:

1. Reg

Steve Greenfield is the Founder and Chief Executive Officer of Automotive Ventures, a company that provides entrepreneurs, businesses, and investors in the automotive industry with industry-specific information, early-stage venture financing, strategic consultancy, and extensive contacts. Steve has more than 20 years of experience in the automotive technology space, and He is also the Author of the new book "The Future of Automotive Retail."

In this show episode, Steve discusses the changing agency paradigm and offers a sneak peek at some things that are changing our industry quickly.

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What we discuss in this episode:

In this new sales model, dealers take on the role of "agents" who represent the OEM, facilitating sales that are conducted directly between the OEM and the customer. With dealers acting as intermediaries, the dealership takes on the role of an "experience center" that provides value through in-person contacts, technology, sales consultation, test drives, and car handover.

Although adopting an agency model has obvious advantages for OEMs, it is crucial that OEMs also consider the risks involved, including those related to dealing with current dealers during the transition and operational risks for the OEM moving forward.

To reshape the relationship between the manufacturer and the dealer and give the manufacturer considerably more control over inventory, advertising, and the customer experience, Steve discusses how OEMs will embrace an agency model. Using Europe and Australia as extreme examples, where dealers are largely redefined into just being an agent where they are a point of distribution for the consumer to come in and pick up the car they've already ordered and still service the vehicles, there is currently a lot of anxiety regarding servicing because as we aggressively move toward electrification, those cars will be much more dependable. Therefore, these vehicles will be much more reliable and be in the shop less frequently, both from a service interval and a components aspect.

He discusses the standard risk assessment, which he refers to as "the automotive ventures retail risk assessment," to determine the likelihood of any given event. Then, what will be the impact's size if it does occur? So that we won't become overburdened by all of these other concerns. And instead, only concentrate on those that are more likely to have a significant influence.

Dealers need to be ready for the possibility that most of the recall work may be completed, except for instances where hardware changes to the vehicle are required. By eliminating the need to bring automobiles in for warranty or recall repair, you will need to be able to deploy a software update and alter the characteristics. They will, therefore, proactively depend on the consultancy company.

Since these cars will have fewer or longer service intervals, there will be many changes to the dealer service base. They won't spend as much time in the shop, and there will be less demand for components from owners, mechanics, and those working on these vehicles. On the other hand, you will require highly skilled technician skills. You'll need sophisticated tools. Because I believe independent shops won't have the technical expertise or the tools needed to work on these cars, I think the countervailing effect for us will be a higher billable rate when we are working on these cars and a significantly lower defection rate at the end of the warranty period. The vehicles are likely seen less frequently in terms of frequency, but the average repair cost could be higher. Additionally, franchise dealers may enjoy substantially higher levels of customer loyalty, which has a strong deterrent effect.

Listen to the episode featuring Steve Greenfield for even

Jim Roche is the founder and the executive chairman of WarrCloud - a cloud computing technology platform that automates warranty processing for automotive dealers.

In this show episode, Jim and I talk about the future of warranty processing and how it's a big part of the dealer's business.

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What we discuss in this episode:

Warranty processing has been neglected despite the digital transformations occurring across the auto retail experience. It's likely that you are currently being marketed or have already incorporated a variety of solutions that are all intended to simplify your marketing and business processes so you can accomplish more and close more sales. Additionally, there is a good chance that none of these solutions address warranty processing, which is the most underutilized and antiquated aspect of a dealership's operations.

Jim starts the episode by talking about how to turbocharge your service growth with the objective being profitable growth. With the press recently talking about how some OEMs appear to be positioned to sell vehicles directly or through websites, the hypothesis is that going forward; dealers might become more service centers and delivery centers than the traditional dealer model of today. This brings the question of what the role will be going forward for selling vehicles, leading us to serve as the new profit driver. Excellent service will be the dealership's new profit driver from now on.

So what's driving your service department growth is the warranty, and what's driving that growth and warranty? We're just at the beginning of how much technology is being inserted into the vehicles, and it is that increasing amount of technology and this increasing complexity in vehicles that are the primary driver of this increasing warranty.

Jim explains that warranty processing is one of the few remaining areas of the dealer That have not been streamlined by technology. Automation typically reduces costs by over 50%, but maybe more importantly, technology brings a scalable solution now and into the future. This solves your turnover and employee retention problem. It also future proofs your warranty processing as we go into the future, which is critical because we're going to see warranties continue to go up and become a bigger and bigger part of your business which, when appropriately priced, converts fixed expenses into variable costs, which is more advantageous when your costs adjust to how well your business is doing.

The key to long-term profit is automation. Ideally, how this automation will work is repair orders would be extracted from your DMS system, would take into account all of the needs of the various elements of warranty processing, what the OEM needs to see, what the dealer needs to have to happen, and what the capabilities of your DMS. It would provide that automation, which would only get human beings involved when necessary. That's where you can leverage technology to bring efficiencies, drive down costs, and protect yourself in the future, which concludes that Vehicle sales going forward will be unreliable. There will be fewer sales, and they'll have a declining margin. Service will be the driver of dealer profitability, and warranty is the new growth engine of service.

Listen to the episode featuring Jim Roche for even more insights!

Enjoying The Fixed Ops Roundtable Podcast? Please leave a rating and review 👇

Apple: https://podcasts.apple.com/us/podcast/fixed-ops-roundtable/id1608656237

Spotify: https://open.spotify.com/show/15HHYoyvCo1PSFwYn02UXY