Independent Shops Can't Beat This One Thing

Foreign.

I'm excited about the topic today. Should we get to it? Are you ready?

Yes.

Shop Showdown. Dealerships versus independence. Who has the advantage? So today we're going to do dealerships. And then in the next episode, you're going to have your rebuttal.

I have to wait a whole week for all this pent up?

I'm going to pound this into you today.

You're going to need some.

Obviously, independents have the advantage.

Obviously, independents have the advantage.

Obviously.

Don't you want to hear my list first?

Your list is probably like you're. I'm going to make a prediction. Half of the items on your list are funded by a very large corporation and a huge budget.

What's the conspiracy theory with that? I don't understand.

There's no conspiracy theory.

Funded by. Funded by what?

Well, you'll see. Read your list. What's number one?

What's number one on my list?

Yeah.

Okay, so now we are talking about the who has the advantage? Dealerships or independent shops. Who has the advantage? Right. So the first advantage that dealerships have is they can sell them a car.

They're lucky they get to sell them.

The car, but they can sell them a car.

They can and they do.

Yeah.

So it's the circle of life, right?

Yes.

So if a car needs more work than it's worth, they can just walk up to the sales department.

I'm thinking of a statistic that I've heard on the show numerous times of the retention that dealerships have after three years on the service drive. Yeah.

Home field advantage.

Yeah. Well, is that.

I call it home field advantage. Okay, so.

So dealers are really good at service retention after the car is out of warranty, right?

No. And most dealership services. And afterthought. But they have the advantage. I'm not saying they use the.

Oh, so they don't actually exploit it?

No.

Okay, Okay. I. I can understand they do not.

Exploit it, but they could if they wanted to.

Absolutely. They could. Could you imagine if dealerships put the time and effort into servicing the customers that they had rather than trying to sell. Sell new cars, what that retention would do? Like, I just imagine like all the money they put into marketing.

Not only could I imagine that I stay awake at night thinking about it.

And that the sales would happen organically if they took just.

Okay. Do you agree that that's an advantage? I'm not saying that they use the advantage, but it is an advantage.

I just have to clarify one thing. Is there a bet going on here that you're going to get me to your side of this fence.

Yes.

I have to concede on this one. It is an advantage.

Okay. Yeah, it's clear. Clearly an advantage. I don't. I don't think that's too much of a stretch. Right.

Okay.

Okay, the next one is perks. See, dealerships have more perks for the customers than Independence. Example, loaners.

Because the cars break down so much they need to put them in loaners.

Listen, loaners, okay? Shuttles.

Everybody has access to shuttle drivers, okay?

But the. The other one I have here is people for contingencies. So let's say in. In most independent shops, if there's three customers that need a shuttle at the same time.

In a dealership, you can pull a cashier, you can pull somebody from somewhere, but usually, I guarantee you.

You can find somebody from the parts department not doing anything. But that guy probably has a nose ring.

So you agree that there's somebody sitting around in parts that could be pulled, which creates more perks for the customer because they're sitting around.

Especially because that person is probably going to try to sell the marijuana on the way home.

What?

Yeah. You didn't know that? That's how parts profits rise is they funnel marijuana through the shuttle drivers on the way home.

If the customer says no, is that a lost sale?

Yeah, it would count against the closing ratio.

GoT.

Is legal in California. Just saying.

It's legal in a lot of states. I think Colorado, Washington, I don't know.

What? Okay, so I agree with your perks. Now, I walked into some dealerships and I look around and I'm like, who is paying for all this?

Did I say car wash?

No, but it's a good one.

Perk.

Car wash. Automatic or hand wash?

Actually, we had a dealership as a client that had a movie theater.

Yep, seen it before.

Really?

Movie theater?

How many independent shops have movie theaters?

Well, it depends. Does an iPad count as a movie theater?

Like a real movie theater?

Like lounge chairs, popcorn, all that?

Oh, yeah, popcorn. Cookies. Cookies. A lot of dealerships have cookies.

Well, some independents do too.

Coffee.

Okay.

I've seen a sushi bar at a dealership before.

The espresso machine I have here in the safe house. Any. Any independent shops have that?

We will soon. Coming to Freedom Auto repair.

Really?

In 2020. Quarter four.

Okay, so that's a tie.

I'm not giving you perks.

What?

That's a tie.

Please, please explain.

Because anything on that list. Okay, I don't care. I could beat your three people standing around if 15 customers needed a ride. At the same time. I could handle that.

We have Uber, we have Lyft, we have bicycles, we have scooters, we have tricycles, we have red wagons, we have my car, two of our loaner vehicles.

That's interesting, because number three I had on here is that independent shops think that customers want to ride tricycles.

Wait, are you serious? Let me see that red rider. Oh, my gosh.

So you're saying that customers want to ride tricycles and bicycles?

Absolutely. It's a new era of transportation. Do you agree?

So basically you're conceding.

No, it's a tie. I'm not giving you that one.

Not.

Not giving it on that one.

Next one I have is expertise. And this, this is a long list.

Expertise at fixing the same car over and over again.

Yeah. So you're. You're, you know, in an independent shop, one day you see an F150 pickup, and the next day you see a BMW 3 Series.

And so you don't have the special tools for the BMW. You don't. Sometimes you don't have all the diagnostic equipment. So in a dealership, you have the tools, you have factory training. You. You have bulletins and warrant. You know, you have access to.

Wait, are you telling me that the dealership has access to the bat phone? To the engineers that built the car?

Yeah, essentially. Yeah. So you're gonna have some sort of technical support.

That's so, so nice. Yeah, that's a pain for me right now. I mean, obviously, you guys know, being an independent shop owner, that sometimes I have the duty of fixing the hard cars. Yeah, I can. Okay, what else you have on that list?

You have a parts department. So the parts department's there.

Are you actually saying the parts department is an advance?

So hypothetically, in a dealership, if you have a lot. If you're a Ford dealer and you have a lot of F150s and they go through brakes a lot. You have those brakes and rotors that if the parts manager is doing his job, you're gonna have the stuff that is needed that you see trends of. They're gonna be right there in the back. You just walk back and somebody's gonna hand you that. They're gonna put it on a repair order and you're, You're.

It's a pretty big.

You don't have to go somewhere to get it or wait for it to be delivered. It's right there.

I will say that the part.

Special tools.

Okay.

Factory support. Right. Factory training. So they train the techs, the Techs are only working on specific cars.

Okay.

Even in some dealerships, like, we have clients that have, like, Ford dealerships, the technicians not only only work on Fords, but they will only do suspension.

Right.

Or they will only do transmissions or. Oh, I'm a drivability guy. And you're like, well, there haven't really been a lot of drivability concerns in the last five years. Well, that's what I do.

I'll wait.

Yeah, I'll wait.

So it's a Ford.

They specialize. Specialize. It's a huge advantage because that guy knows everything about drivability ever on a Ford in the history of drivability ever being an issue.

I really feel like you stacked this against me. Like, you had to go first with dealerships because expertise. I. I did. I have to concede.

I did not. I did not consider.

That going first would be an advantage. I actually thought going second would be an advantage. I would have happily gone last.

You're gonna bias the audience just because you're going first.

I think going last biases the audience, don't you, Christian? I always want to go last.

Our experience is that the person that goes last usually has the biggest impact.

But so, I mean, there is an end game to all this.

The facts are the facts. Like, you're gonna win on the facts or you're not going first? I don't think matters. Okay, so do we concede that one?

So you're two for three right now.

How many times have you had to call a dealership and ask them for a tool?

I don't do that.

What do you do when you don't have a special tool and you can't get the thing off the widget off the thing?

I go to my toolbox, and it's in there.

So you're saying all the special tools we buy from the factory that they force us to buy are useless?

Well, I'm saying a lot of times, you can engineer it yourself for, like, pennies on the dollar. Interesting. There's more than one way to get set. Cam timing technology is amazing.

My grandfather and I were.

I like it. I'm in your head.

Yeah, a little bit.

Because you're like, oh, you know, I didn't.

Crazy. It was in my head.

Yeah. So my grandfather and I were.

This reminds you of your grandfather?

Another segue.

You didn't hear that 30 seconds ago?

I did. I tried to step on it, and he came right back. This reminds me, Jeremy. This reminds me of my grandfather, who is a fireman by the Way.

Special tools.

It's got to be loose. It's got to be a loose.

Geez.

But. But yeah, he told me that I was too wrapped up technology and I called him a hypocrite and unplugged his life support.

What's even better? You couldn't get it out without laughing.

Dang it.

Practice.

Okay, so I like it. I'm in your head because you're already kind of conceding. You're like, oh, he got to go first. Like you're giving all these signs, same.

Way that you're doing with the audience by going first.

See, it's.

It's all the power of. I think, I think Our audience is NLP and persuasion.

Our audience is 50. 50. I think so.

I don't know too. Like, when we're done with this list, I want you guys to put in the comments what you think we missed on the list or what your thoughts are. Right.

Great thought. Yes.

Okay, so the next one I have is it dealership, service departments or one.

Stop shops, unless you have to order parts.

How many tires have you done in the last month in your. In your shop?

I don't do tires.

Most of the independent shops we talked to don't do tires alignments. They don't have a body shop. So even if a dealership doesn't have a body shop, they will have a relationship with the body shop that they get kicked backs from for sending them the business. Right. So they're one stop shop, full circle.

This is a tie as well, because anything that the dealership can do like that independence can provide as well.

But let's just say you wanted to exercise your home field advantage. You wanted to be a one stop shop. It would be very inconvenient for a customer to go to your shop to get the widget replaced and then go here to get tires. And like, it is, it is an advantage. Do we not agree how well they execute on it.

Is a secondary.

Sorry. So we're just talking about is it an advantage, not how well they execute? So execution is completely different than.

Well in anything. Right. You talk about NFL teams. Some are good and some aren't.

Like, all right, I'll, I'll concede on this one with the footnote, the understanding that consumers are shifting and they do want more convenience wrapped up in their service experience.

What does that mean? They want to go to Costco to get their tires and they want to come to you.

Well, I mean, there is a certain segment of the market that wants to go to Costco. But at the same time, if we're servicing say 150 cars a month, that's 150 set of tires that are going to be sold at some point in time. How do I tap into that market if I want to provide it? So if, you know, and dealerships numbers are a lot larger, like they may work on 1500 cars a month. So it's a natural add on there. I think it's just, is it an advantage to have one stop under one roof? Absolutely.

Well, I think, and I don't, I don't know if you guys experience this in a day, day to day thing just in your personal life, but the one thing that people don't have is time.

Right.

And so a lot of times dealership, the tires will be more expensive, but a customer isn't going to spend another two hours, meet somebody they don't trust, go through the process. Maybe it's done right or not and they have to come back. If they have a relationship with the dealership and they trust them, they'll pay a little bit more for the tires just to save the time and have it done. And if the car's there for the morning or there for the day, why not just have it done while it's here? And so it is an advantage.

So I mean we all have the same 24 hours in a day. And I think it's in today's consumer time is greater than money. So if I can save you time, it's worth dollars. And those are companies that are becoming billion dollar companies overnight have found a way to save consumers time and that is translated into dollars. So you're absolutely right there. I can't tell you how many customers buy their tires somewhere else and they don't want to go back there for the rotation simply because it's inconvenient. Right. It's more convenient to have us do it.

If a customer needs a body shop, what do you do?

I have a Quality Auto body right.

Down the street that I plug for Quality Auto Body.

Richard does a great job.

Thank you so much for watching this clip of Service Drive Revolution. Now you can catch the full episode on YouTube, iTunes or Spotify or wherever you consume your podcast. If you have any questions, go ahead and post them in the comments below. Make sure you subscribe and hit the bell icon so you're notified for when we post new episodes. I'm Chris Collins and you can find me on Facebook and Instagram @chrisbulldog Collins and I'll see you again on the next episode.