by Lisa Walsh

Recapture Revenue With Auto Fleet Parts and Service Operations

by | Dec 7, 2021 | Uncategorized

The pandemic hit the world of automotive dealership fixed operations particularly hard. Many automotive and truck Dealership Service Departments were forced to close or severely cut back staff and operating hours for a period in 2020 and early 2021 during the Covid outbreak. 

Savvy dealerships found a way to continue servicing customers during this period, offering vehicle pickup and delivery services; others expanded mobile repair capabilities or started mobile repair. These expanded parts and service business offerings helped many dealerships eke out profits when new and used vehicle sales were severely reduced.   

Fast forward and vehicle sales are returning along with record gross profits, despite tight inventory. In fact, many automakers have less than 14 days of inventory currently available, and the ongoing chip shortage means this situation is not expected to abate any time soon. For dealerships that focus on their fleet and commercial business, the vehicle shortages are even worse as manufacturers may elect to prioritize retail customers from a vehicle production standpoint. 

Filling in the Revenue Gaps

If fleet and commercial vehicle shortages continue, what can dealerships do to fill in the revenue and gross profit gaps in vehicle sales? What can they do to enhance and deliver world-class customer service for their local fleet and commercial customers? How can they achieve a win/win arrangement, allowing them to improve fleet and commercial customer satisfaction while also increasing their fixed operations revenues and profits? 

In our partnerships with some of the top OEMs and fleet and commercial dealerships, MarketSource has successfully assisted in delivering superior customer service with an emphasis on increased uptime. Results have been consistently positive. The dealerships are experiencing improved revenues for their fleet and commercial customers by keeping their vehicles and employees on the road. Considering that most businesses are very short staffed and often have more business than they can currently handle, maintaining up-time is critical. The dealerships are also enhancing their fleet and commercial customer satisfaction and loyalty, while expanding Parts and Service Department revenue and gross profits.   

What Fleet and Commercial Dealerships Should Do Right Now

Offer mobile service onsite during non-business hours. For example, let’s say a large landscaping business operates Monday through Saturday from 7:00 am to 6:00 pm. The dealership can provide onsite service to this client between 6:30 p.m and 10:00 pm. 

Provide basic maintenance, light-duty repairs, warranty, and recall services along with the usual vehicle diagnostic and inspection services. 

Utilize telematics technology and its business development center to deliver a proactive fleet maintenance management system that allows clients to monitor and assess vehicle diagnostics in real-time. 

Partner with fleets to receive their vehicle dashboards with current vehicle status. 

Conduct outbound appointment setting based on fleet dashboard information and fleet customers’ specific requirements. 

Deliver parts to the dealership technician when they are on site with the fleet and identify additional repairs that are necessary. 

Recruit and develop the professional acumen of mobile technicians, mobile hybrid technicians, and hybrid technician/service advisors to fill the rising need. 

Simplify billing by issuing single monthly invoices for all completed repairs. 

Launching a Mobile Fleet and Commercial Program

Obviously, launching a mobile fleet and commercial service program requires an investment of both time and money. However, the consensus among the many dealerships that MarketSource works with nationwide is that the investment is well worth it. 
 
Besides time and money, success depends upon committing to new processes, adjusting to new business hours, and promising sufficient technician compensation. It’s not an easy proposition, but it will be worthwhile. 

Why Consider a Mobile Fleet Service?

Mobile repair options expand dealership service capacity by having “bays on the road.” 

 

Most experts believe that mobile services for both fleet and retail customers will continue to expand. This means that successful early adopters will be uniquely positioned to capitalize on all the opportunities.

 

Done correctly, most mobile fleet repairs will result in the ability to complete service on multiple vehicles at one location, thus increasing technician productivity and service revenue.

 

The additional service sets the stage for fleet customers to take advantage of further benefits via maintenance plans and service contracts.

 

Once mobile services are implemented, dealerships can partner with technical schools to mentor and train apprentice technicians to help maintain the requisite quality and quantity of staff.

 

Due to extremely limited vehicle availability, fleet and commercial customers are more likely to retain vehicles longer, resulting in more repair needs.

 

New business relationships and partnerships fostered by a mobile repair service enable service departments to complete more complex repairs on all vehicles. 

A Competitive Edge for Local Dealerships

Research conducted by Deloitte in 2019 indicated that 64% of all fleet and commercial vehicles were owned/leased by fleets with just six to 99 vehicles, with most of those businesses having fewer than 40 vehicles. Fleets of this size tend to be local, usually relying on service at their local dealership. These smaller fleet businesses also do not generally have a dedicated resource for keeping track of vehicle maintenance and servicing needs. This presents a wide-open opportunity for dealerships to offer an important value-added service. 

Imagine a busy small business owner, not being aware that a “check engine” light is on in one of their vehicles. If they could easily access a dashboard and find this information in a timely manner, they could avert a serious problem, get it fixed, and reduce downtime. But in many cases, they may not find out until the vehicle fails to the point of requiring expensive repairs that could have been avoided. This is where the dealership could step in and be proactive. Imagine being able to monitor a dashboard and collect maintenance data in real time, contacting the fleet manager about the light, and offering to schedule a mobile visit or set an appointment at the dealership. 

Ongoing vehicle shortages have made it nearly impossible for dealerships to sustain predictable profits from variable operations. Therefore, it is definitely worth considering a sharper focus on potential profits and increased revenues obtainable from mobile fleet and commercial service opportunities. As most would agree, dealership fixed operations are the backbone of any dealership. Even when vehicle sales hit a bump, fixed operations can deliver consistently strong profits and customer retention, especially when dealers offer enhanced services.

Want to know more? MarketSource’s auto industry experts are ready to discuss your dealership’s dilemmas and how to solve them. Contact us today. 

 

 

Topic: Uncategorized

ABOUT THE AUTHOR

Lisa Walsh brings 35+ years of automotive experience to her role as Executive Director, Automotive Solutions at MarketSource, Inc. She has owned her own dealership, served as a dealership finance director and general manager, and was a business development manager at GM. In spearheading results for dealership fixed and variable operations as well as OEM accessory and fleet sales, her clients consistently achieve greater account growth, market share, customer retention, customer satisfaction and more.

At MarketSource, an Allegis Group company, we believe better sales begin with better relationships. Our proven alternative to traditional outsourced sales is led by a proprietary process that helps businesses thrive by fostering deeper connections between people and brands.