Using an audit to meet new business challenges

Author: Bob Greenwood

Everyone is becoming very aware of the many challenges that lay ahead for the independent aftermarket and if that makes you nervous, let me assure you that challenges can turn into incredible opportunities when approached properly. 


For example, much is being made of the fact that our field of expertise – which used to be considered a “trade” – has really joined the ranks of serious professions. If nothing else, our contribution to a healthy national economy certainly gives us that status. But in addition, our facilities and business processes are increasingly professional, and we have a growing understanding of and reliance on emerging technologies. 


So, we’re no longer just “tradespeople,” but true professionals. And as professionals, we must meet higher expectations and new standards of excellence in order to impress today’s consumers. 


This change, from trade to profession, brings enormous benefits to our industry. Not only will our income levels rise to mirror other high-end sectors of the economy, but our improved image will attract younger generations in much greater numbers. When young workers see the exciting technology that they would get to work with on a daily basis and the unique opportunities they would be exposed to, they will be eager to get involved. That, in turn, will help move our sector forward. 


Exciting days are ahead, but detailed planning is still required to ensure we embrace the future. 


To get you started on this planning, consider the following list of challenges we all face. Think about how each one affects your business and then try to find a solution that allows your shop to meet the challenge and move forward with confidence. 


This is a “business opportunity audit” and it needs to become part of your long-range planning process. 


Increased competition and shrinking margins. The old model of relying on car count has given way to a new model of selling knowledge. Billed hours must become our primary focus. 


To achieve this, it must be recognised that building relationships and earning trust is vitally important. We need to educate our clients about the value of an annual comprehensive inspection. The goal is to have an accurate picture of the condition the vehicle, with particular emphasis on safety and reliability. You can then counsel your client on the timing of any required work, based on how they use the vehicle and how much they typically drive. Vehicle maintenance is key to getting the most out of that vehicle. 


Changing consumer demands. We need to better understand our target clients: who they are, why they buy, and what they really want. 


Analyze your database to figure out who your top clients are, and what type of work they’ve had done on their vehicles. Are they break-down-and-repair clients? Or are they preventive-maintenance clients? You have a solid relationship with all these people, so perhaps it’s time to have a conversation with them about why they come to your shop and what they’re looking for long term. These are the people who most likely will recommend you to their friends and family, so listen carefully, take notes and improve your service levels to meet their expectations. 


Communicating value. If yours is like most shops, some of your current and target clients are not aware of what makes your shop “uniquely” different. This should be where your advertising or marketing dollars are spent. Differentiate yourself from the dealerships and put it in writing. Make sure your clients experience that difference. 


Differentiation is a key value. If you make visit a positive experience, your clients will look forward to dealing with you. 


Charging properly. Many owners don’t charge as much as they should because they lack confidence in their service. Get your emotions in check! Do the math and establish the right labor rates based on the skill of your staff and the value you bring to your clients. Review your structure to make sure you have the right rates in place for maintenance, diagnostics, and reflash work. Once again, educating the client is critical. 


Your labor rate represents your shop’s competency. You’re in a knowledge-based business and the people you employ – from the technicians out back to the counter staff up front – bring tremendous value. Want to prove the point? Introduce your clients to the technician who will be working on their vehicles. A two-minute conversation will convey your confidence in your staff and give your clients greater assurance that their vehicles will be handled by a true professional. (You might want to have a small training session with your technicians first, to make sure they know how to handle themselves in front of the client, and why making a good impression is so important!) This strategy is a proven relationship-builder. 


Poor image and damaged trust. Our industry faces a lot of unflattering preconceived notions that we must overcome in order to create client confidence. 


Believe it or not, this is a great opportunity for us in the independent sector. We just need to slow down long enough to engage with each client in a constructive and positive way. Review all the facts you have on that client, proving that you understand their situation and their expectations for their vehicle. Manage each account according to facts, such as how they use their vehicle and how long they want to keep it. Remind them that your recommendations are based on safety, reliability, and efficiency. 


There are so many more challenges that we face as an industry. I’m sure you can think of more if you put your mind to it. Once you have a handle on the ones that most affect your business, you’re going to need a clear plan for how to get where you need to be. Now write it down. 


Creating a written business plan is one of the greatest exercises in a business opportunity audit because it involves the five building blocks for any successful, profitable endeavor. 


1. Vision. What will the business look like in two years? This covers everything from the facility to the staff and how workflow is managed to maximize the bottom line. How will it differ from today? 


2. Talent. Do you have the right people in place to need to fulfill that vision? Have you got the required depth of knowledge on your team today? If not, is training / education available and does your staff have the desire to learn? 


3. Faith. Does your staff believe in your vision? In other words, are they motivated because they like the direction the business is going? Do they want to be part of it? Never ask them to merely “buy into” the vision. It is much more important that they “believe” in it. 


4. Resources. Can you provide everything they’re going to need to achieve the vision? This involves everything from tools and equipment to software and supplies. Everything must be efficiently laid out to maximize productivity. 


5. Measurements. You’re going to need a document that helps you measure your success as you move the business forward. Figure out what you need to track and then monitor your progress very carefully. This document will either confirm that your journey is going in the right direction, or it will point out where attention must be paid to keep things on track. 


Your business opportunity audit should reveal many exciting possibilities. Approach it with a positive mind-set and get the whole team involved – especially those millennials who love to be part of the building process. It will confirm to you that you’re truly in control of your own business. 


Figure out where opportunities lay and you’ll be on your way to capturing them. 


2021 is the start of the future. Lay down a solid foundation of thought and planning now, and the next two to three years will be an incredible and exciting journey.

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