1. Pro-SolutionsPro-Results Six Simple Changes for a Record Year in Fixed Ops Don Reed CEO DealerPro Training Columbus, OH (614) 471-8300 dreed@dealerprotraining.com

2. Want Some Good News? “You have the perfect processes in place to get you exactly what you got last year!” - Zig Ziglar -

3. Definition: The Progressive Realization of a Worthy Goal Earl Nightingale “Successful people do what unsuccessful people won’t do!” COMFORT ZONE SUCCESS – A journey, not a destination

4. Shocking Facts About Service Writers 81% 81% of all customer pay labor comes from the phones. 86% 86% try to diagnose the customer’s concern on the phone. 81% 81% quote mechanical repair prices before they know what’s really wrong. 95% 95% quote higher prices than independent shops, allowing the customer to shop other places. 57% 57% do not ask the customer for an appointment. opposite. The aftermarket does just the opposite.

5. Service Traffic Drivers Are Declining Oil change and Fluid Intervals getting longer 2000 – 2007 3,000 to 5,000 miles @ 3 – 5 Months 2008 – 2010 5,000 to 7,500 miles @ 5 – 8 Months 2011 – 2015 7,500 to 10,000 miles @ 8 – 10 months (Oil Change Intervals Doubled) Number of Customer Service Visits Per year @ 2.6 & Declining Source: JD Powers Study 2013

6. Service Traffic Drivers Are Declining Fewer Recommended Maintenance Items 70% of Advisors do NOT present Maintenance Menus AAA Survey shows 62% of vehicles are driven in severe category while only 6% of motorists felt they were driving in severe conditions… Advisors must advise!

7. Service Traffic Drivers Are Declining Advisors Must Train Customers on Proper Maintenance Fewer Repairs as Dependability Improves 2007 Average # Repairs per year @ 2.16 2014 Average # Repairs per year @ 1.33 (A Decline of 40%)

8. Change #1 Benefits to Dealer: Appointment Coordinators will SELL the entire day Schedule Appointments 15 – minutes apart by Advisor Schedule 12-15 Appointments per Advisor NOT Use Appointment Coordinators NOT Service Advisors

9. Change #1 Benefits to Dealer: Plant the Seed for Maintenance Requirements and Recommendations Prepare a Pre-Write RO Customer Appointment Reminder Calls Contact All No-Shows Reduce number of Calls Put on Hold NOT Use Appointment Coordinators NOT Service Advisors

10. Benefits to Advisors: Prepare a Pre-Write RO More Time for Reception, Walk-around and Menu Presentations More Time for Customer Communication Throughout the Day More Time for Active Delivery and Setting Next Appointment More Time for Presenting Technician’s Service Requests NOT Use Appointment Coordinators NOT Service Advisors

11. Change #2 Hourly & Flat Rate Technicians – Pay Incentives on Hours Produced 1.Hourly Base Compensation: $12.00 per hour? 2.Performance Bonus: Added to the hourly base compensation. Based on the number of flat rate hours turned per week as follows: Compensate to Motivate

12. Hourly Technician Pay Plan

13. Flat Rate Technician Pay Plan 1.Hourly Base Compensation: $20.00 per hour? 2.Performance Bonus: Added to the hourly base compensation, retroactive back to hour 1. Based on the number of flat rate hours turned per week as follows:

14. Flat Rate Technician Pay Plan

15. Compensate to Motivate Advisor Compensation Based on Individual Sales or Gross Profit ADD: Total Comp as A % of Gross 10%

16. Compensate to Motivate Parts Counter Personnel Bonus based on P&S Gross Profit – All Repair Orders Bonus based on Shop Productivity Appointment Coordinators Based on Appointments Based on Menu Sales

17. Compensate to Motivate Department Managers Based on Departmental Variable Gross Profit Bonus for CSI – Productivity What’s the Position Worth? 60/40 Rule Prepare a Pro Forma

18. Change #3 Train Your Service Team for Growth What is the Primary Mission of a Service Department? “To insure every customer leaves your dealership driving a safe and reliable vehicle” How? 100% Maintenance Menu Presentations for Reliability 100% Vehicle Health Checks (MPI) for Safety 100% of Customers must be trained for Retention “When was the last time…..”

19. Train Your Service Team for Growth Who is your #1 Competitor for Service Sales? The Aftermarket Over 150,000 versus 17,000 80% versus 20% Continuous Decline!

20. Train Your Service Team for Growth How Do You Compete with the Aftermarket and WIN? Answer: Train your Service Team to do what THEY DO! 1.Avoid diagnosing over the phone 2.Do not quote prices for mechanical repairs over the phone 3.Offer a FREE multi-point inspection 4.Offer EVERY customer an appointment for a specific day and time (Always today or tomorrow) 80/20

21. Train Your Staff for Growth Walk-ins – Drop-offs and Waiters Never Say NO Can Do Versus Can’t Do Allow 20 percent of Schedule for Walk-ins and Upsells Must Have Capacity to Sell

22. Train Your Staff for Growth Website Interactive Online Maintenance Menus Current Service Specials Build Value in Your Dealership’s Services Online Appointment Scheduling

23. Change #4 NON Recruit NON Technical Advisors Green Peas Non-Automotive Customer Relations Skills No Experience Necessary No Bad Habits

24. NON Recruit NON-Technical Advisors Easier to Train Versus “Old Pro” Utilize a Personality Profile to identify Sales Skills “Administrative Assistants” versus Service Advisors “Do NOT Hire another Dealer’s Underachiever” 1.2 HPRO?

25. Change #5 Align Your Marketing Plan With Your Capacity For Growth Define Your Goals Evaluate Your Capacity Train Your Personnel Measure Performance Daily Track Marketing ROI

26. Evaluate Your Capacity for Growth Shop Productivity (Total Hours Billed Divided by Total Hours Worked - Benchmark @ 120%) Current Shop Productivity % ____ Goal for Shop Productivity % ____

27. Evaluate Your Capacity for Growth Number of Technicians Current Number _____ Need to Hire _____ Skill Level _____ Number of Service Bays ___ Number of Lifts _____ Need to Add _____

28. Measure Performance Daily Number of Incoming Calls Number of Appointments Service Advisor Daily Performance Tracking Performance Board for Advisors

29. Measure Performance Daily Technician Daily Performance Tracking Performance Board for Technicians Track Sales Results by VIN Number Marketing ROI Profit Pro Forma

30. Measure Performance Daily: Service Advisor Performance Average Number of ROs per Day, per Advisor Customer Pay and Warranty Customers at 12–15 Internal ROs – What’s Your Policy? Service Advisor Performance Metrics Margins: Labor at 75 Percent and Parts at 42–45 Percent Sales per RO Closing Ratio

31. Measure Performance Daily: Technicians Productivity Number of Hours Produced Versus Number of Hours Worked Number of Multi-Point Inspections Completed Number of Additional Service Requests Total Gross Profit Produced MTD Number of ROs – Customer Pay, Warranty, and Internal

32. Change #6 Establish Accountability Standards for all Employees “There is a Cancer that is prevalent in Service and Parts Operations” Lack of Accountability!

33. Establish Accountability Standards for ALL Employees Advisors vs. Salespeople Service Managers vs. Sales Managers Parts Manager vs. Used Car Manager Employee “BUY IN” Top Performer Versus Underachiever Don’t Know How or Don’t Want To Do they come to work? “You’re NOT Running a Democracy”

34. Questions?

35. Six Simple Changes for a Record Year in Fixed Ops Don Reed CEO DealerPro Training Columbus, OH (614) 471-8300 dreed@dealerprotraining.com