Service Dept. Biggest Missed Profit Opportunities | SDR #255

Service and parts managers. Most missed profit centers. Chris Jones. That's what we're going to talk about today. Maybe there'll be something in the news.

And a little something a little.

The news is a little thin today. And then we tell a story about a meal, a baked potato, and a service director that should have thought different.

Right?

That's more like everybody else. And I think it's a challenge for everybody. So that and much, much more. Coming up on this edition of Service Drive Revolution.

We went to dinner the other night and something interesting. They always disappoints me in the sense that I don't think I ever thought this way, But I think 99% of parts and service managers think this way. So we had a boot camp, crate boot camp. And we took them out to dinner.

Nice dinner.

To.

Maybe the second best steak in la.

It's moving up the charts for sure. I, I have a couple that I would have put in front of it that wouldn't anymore.

Okay. So earlier in the week to meet, we got to tell them the whole story. And I'll try to, I'll try to keep this brief, but earlier in the week, we went to that same restaurant for something else. So you and I were there and.

They.

They presented the specials. The waiter came out and he said, let me tell you about the specials. And I don't know, he, he had a bunch of specials. So there's one thing on there that he said. We have a special caviar baked potato. And then he describes it, he says, we, we, we clean it out and then we deep fry the outside so the skin of the potato. Then we put in our famous something mashed potatoes, lobster mashed potatoes or something. Then we put horseradish and sour cream and salmon roe. And then in a big scoop of some crazy caviar.

That's what it was. Caviar. That's right.

And then he tells us the price.

Yeah, it was expensive for a potato.

110 bucks.

That's right.

And I was like, first of all, I don't really know if I like caviar. I've had caviar, but isn't it really salty? It is salty. It's not that it's not good. It's just not something that I like, crave. Like, I don't. When people say caviar, I'm not like, oh, yeah. Like, I don't know. And I've had really good, what people would classify as good caviar, really expensive.

I don't actually think I've Ever eaten caviar before?

The horseradish and the whole thing, it kind of like, I was intrigued, but the price, I was like, I'm out.

Yeah.

So then we had dinner. It was great. And the next morning at the gym, I was telling.

My trainer about that baked potato. Like, I was thinking about the baked potato, and he was like, oh, I would try that. And so I said, oh, well, instantly, we're going to dinner there tomorrow for the boot camp. Do you want to come? Do you want to come along? We'll order the potato and we'll split. It was my kind of idea. Right.

So he joins us.

Yeah.

For. For the boot camp. So these are dealers and managers that have been through the kind of the initiation part of our coaching. So they've done a strategy session, signed up for coaching. Now they're coming to a boot camp. They've done a little homework, and they're coming to boot camp to kind of learn in person the recipe.

Yeah. We like to say it's the Harvard education on how to run a service department.

You made me come in early before dinner to play records.

That's right.

The new thing we've been doing at the boot camp is showing off the sound system here in the library. And I. I would guess that that was a highlight for everybody because I know you think you've heard Pink Floyd and the Eagles and everything.

Not to hear it on this thing.

Be like hearing it for the first time. You don't. You don't understand that that exists until you experience it in the way that they described it and everybody describes it as. It's inexperienced.

Yeah. That reminds me. I was walking to work the other day. Were you really? Yeah. And I walked past this. This audio business, and it says, for sale, Macintosh amplifier, $1 volume, stuck on full. And I'm like, I can't turn that down.

I love those. Those kind of jokes you tell, because I have no idea where that's going.

There's so many places.

All I have to do is put in the. I was walking to work. Yeah, that's my favorite.

That's just for you.

Usually. I like it more when you. You know, when it's like a hooker or something. But that was great.

You know, we don't usually talk about those jokes on this show, but somehow.

Walking to work ends up going that way sometimes. So I come and I play them some records and we get in an Uber. My trainer met us there and we. We have dinner and. And the waiter didn't even present. I don't know if he even presented that.

Oh, he did, but a little bit differently. Not as. He didn't. It wasn't as romantic as the other guy that. That waiter the first night was. He was good. He made me want to eat it. And I don't really. I don't see a point, but I thought about it.

So my trainer and I split that potato. Well, actually, I think he most. He ate.

I was gonna say, you probably had two bites.

Yeah. It wasn't good. It wasn't great. There was not. That was a. He was like. It was okay, but he's like a guard. Like, the amount of food he ate. We were trying to figure it out, but I think he ate like 10,000 calories.

There was a point where we were just all watching him.

Yeah. He. He ordered a huge steak, which was called a something. A Kansas cut, but it basically was like a prime rib. It was a huge.

Yeah, it was a lot of meat. Wasn't he shaming us for how little our steaks?

So he had. He had Mac and cheese on his plate. He had the green spinach, cream spinach, the gnocchi. He had brussels Mac and cheese. Yeah, everything. He ate all of that. Ate half of a steak. And he calls the waiter over and he goes, can I get another basket of bread? And he killed a basket of bread by himself.

Yep.

Then he ordered dessert and ate the. That big. Like it was nuts. He had the meat sweats for sure.

Yeah. He and I were walking together after kids, and I saw it.

One of the managers, and here's the thing that always surprised me. One of the managers at dinner is at a very high performing group, super talented. Been doing it a long time. Was kind of talking through. I was asking him questions. He was talking through what he had learned that day and how he saw things and what he. What he was planning and where he wanted to go and what he wanted to do kind of from there. And some of it was about where he wanted to go personally.

Right.

Because we were talking about personal stuff, too. Super nice guy, super talented, you know, accomplished in the industry. Older now, kind of has this new perspective from the boot camp. Right. And kind of understands now, like, oh, the. The limits were me.

Yes. Right.

This is actually easier than I thought. Right. At no point does he think to. To align himself or point himself at the goal of being a general manager.

Right.

I said it to him. I said, you know, what you should do? Because we were talking about goals. I said, as talented as you are, you should.

Try to be a general manager.

He was also sitting right next to someone that had done it.

It blows me away.

Service managers and parts managers have to understand you are the future of this industry and you're the future general managers. Start thinking that way now.

Right?

Raise your, your level of ambition and what is possible. I will tell you, and I tell everybody this, that becomes a general manager, the sales department is way easier.

Yes. It's not as complicated and I would take.

It's unknown, you don't know it, but it's easier.

Right. And I would go even further back and say that message isn't just for service managers, it's for advisors, it's for techs. Heck, if you really want to get crazy, it's for valets and porters. Like literally that fix operations, parts managers, counter people. The GMs are coming from there.

We are going into an era that it is shifting and the future is fixed tops, parts and service. In the future, leaders of our industry are going to come from the back end.

That's exactly right.

And the people in sales, the sales managers are going to.

They'Re going to either come to service or they're going to go to other industries that are similar.

But it won't be the same.

Right.

What's in the. What's in the news?

Our news today actually has a lot to do with our topic. I like when all that stuff kind of comes together. But.

The first article talks about the revenue growth of the exterior car accessories market is to be influenced by growing end use adoption. Which is a fancy way of saying that exterior car accessories are becoming the cat's meow. They're projecting to be a multi, multi million, possibly billion dollar increase in the global market for exterior car accessories and just stuff that we haven't thought of. But just saying that you know that there's opportunity for dealerships in the aftermarket.

Wraps, taillights, reflectors and essentially just saying that.

There is a tremendous amount of opportunity that the whole.

Owners really want to do this and essentially that they spend as much money in year two as they do in year one on accessories. I thought that was pretty fascinating. But that's a, that's a growing opportunity for dealerships. And I wanted to test you on this to see if you know. Do you know how much the accessory business in the automotive industry is valued at?

Oh my gosh, the number is almost unbelievable.

Yeah. This is the first 24 months of ownerships. Ownership. How much people spend on accessories?

How much?

$20 billion.

Yeah.

A year.

Well, you can just, you know, you just look around on Your driving. How many cars have some sort of personalization?

Yeah. And then. And then how much of that do you think comes from the dealership world?

Very little.

Not much at all.

Yeah.

So that's. That's kind of what we're going to talk about today, right?

A little bit.

But yeah, I'm really excited about that conversation, man. The average buyer spending a thousand dollars, plus it's on accessories in the aftermarket. Over a thousand dollars per car. That's the news today. Oh, that's it. It is. I want to tell you a joke about a priest.

Okay.

What do you. What do you call a priest.

That becomes a lawyer?

What do you call a priest that becomes a lawyer?

What? Father in law.

That's funny.

Thanks.

Today's subject, Christian service and parts managers. Most missed profit centers.

If only we could guess what that is.

We have six of them.

Yeah. I can't wait to hear these and talk about them.

Number one. So these are profit centers above and beyond the normal.

Hey, this is how we do business, right?

Yeah.

The normal repair, maintenance.

Diagnosis.

Are these in any particular order?

No.

Okay.

Do you want a minute?

You want them?

No.

I think that the biggest thing would.

Be is that eat. Segmented. Do you want this segmented in a specific way? Because it's. It's early enough.

I just got picked on today for removing food out of my. Out of my salad with a. With quite a lot of intention and separation. It's pretty good.

So these are things that parts and service managers and I. I think these equally apply to parts, so in some.

Cases more when it comes to the dollar, the price tag.

So the first one, and this is something I do every time I get a vehicle, no matter what, is upgrade the audio system.

I like it. Now, what do most.

Service or parts managers in a dealership think about that?

We want to keep it OEM because it's an electrical nightmare if something goes wrong.

Meanwhile, what percentage of people are going down the road and having the speakers changed or whatever it is?

They're spending $1,000 a car. So many. I feel like I could say that $20 billion number again.

Yeah.

Okay, then the next one. And this has one, two, three, I don't know, three, four different things. Inside of this category is the category that I like to call personalization. An example of personalization would be a wrap. Yeah, Right. So some. Some sort of vinyl wrap on the car that changes the color or adds a logo, adds a company name on there. That could be like just on a door or a magnet, whatever it Is but some sort of exterior personalization right along with that. Lights.

Yeah. I think that that's probably the biggest area for customization because you can change everything or input everything on. This is something that I think that the manufacturers have started to get an idea about. I think your car might do this. I know that my BMW does too. When you open the door do you see the BMW logo or the logo on the ground? Yeah, I think that's what people like. Stuff like that where their lights are. Conversation piece.

Or the people that have the row of lights going all the way around the bottom of the car.

The LEDs.

Yeah. Super cool. Really?

I think they need to do that.

Yeah.

Yeah. Well I mean people are buying it so it doesn't matter what we think. Really.

Yeah.

People buying it.

Someone is for sure.

That's probably a bridge too far for me. But I see it all the time.

Yeah. Especially you don't hate on the people that they do it. Right. They still want to make it their car.

Wheels, wheels and tires.

Yeah. It.

It goes the. The gamut. So on trucks it goes, you know sports cars. Cadillacs, they want the Vogue tires. BMWs like whatever it is. But when you look at cars on the road, there's a high percentage of them that have an upgraded or a powder coated something sort of wheel.

And I don't think the price is the big motivator. I literally think it's all about how does it look on the car.

So what I did with my wheels is I just had them powder coated.

Yeah.

So I took them to a guy and had him powder coated.

I think the wheels were why I bought the. One of the reasons I bought the car I did with the package I had on it. The wheels are so important.

Number three, Tint.

It surprises me how many dealerships don't do tint.

I think they don't understand how easy it can be.

Yeah. But people are leaving there and getting.

It such a great margin.

It's so easy to sell Tint in F and I.

Yes.

What about Clearbra?

Same thing.

Same thing.

What I think it's. They leave the profit. They outsource it or don't talk about it or don't mess with it. But it's the thing that once you learn the system you can do it.

Next one is lift kits.

Yeah. That's something I really enjoyed doing when I was in the Chrysler world. I love doing leveling kits and lift kits. Wheels, everything. Jeeps. Oh my gosh. Don't get me started on accessorizing and customizing Jeeps.

But there's a huge opportunity.

There's a lot of independence out there that just live off of lift kits. That's basically all they're doing.

Yeah.

When I, when I had my.

Jeep I went to a place and that's all they did was lift kits.

Yeah. And they were probably booked out.

Yeah. Number six is a category with.

You know, sub, subcategories inside. So I, I call number six hobbies. So what do you think? Guess what sort of things profit centers could there be paying attention to your customers hobbies and then in a sense encouraging them?

I know it's, I know one of them is the thing you really wanted to put in the Jeep and never did.

Gun wreck.

Yes.

Yeah, for sure. So the hobby there would be what?

Shooting? Hunting.

Hunting. What about bike racks?

Bike racks. Good.

Camping?

Yes.

Tow. Tow packages.

Oh my gosh. Yeah. Everything from the lighting that goes to the towing. Everything, Everything with towing. So great.

Camping, all of, all of that.

Boating.

So what's the thing that we know about people that do those sort of hobby type things? What, where, where is that attached to them mentally?

Really high on the emotional level.

Yeah. It's experiences as part of their identity. And so if you're the one providing.

That, then yeah, my dealer does all that stuff for me.

Yeah.

Wow.

No, it's, it's unbelievable how many people are meeting on the weekend and going, you know, off roading or camping or jet skiing or whatever it is. And most of the time that's a complete afterthought when it comes to.

Parts and service. They don't think about that at all.

Well, I think they think about the 1% or 2% where it could go wrong. I think they're limiting liability and staying in the, the safe, the safety net and not thinking about what they're passing up on.

So number one was audio, Number two, personalization, lights, wheels, wrapping, anything that lets somebody kind of express who, who they are. Number three, tint. Number four, clear bra, Number five lift kits and number six, hobby oriented modifications or accessories.

Think about if you're the go to as a dealership, what does that do for your retention?

Retention and trust and relationship. Everything. Like they just, they, they see you as one of them. Yeah, in a sense. Right.

And the one stop shop that's really where I think it's at is that they don't go anywhere for a, they don't go anywhere for anything else. That's retention.

You don't want them to get used to going somewhere else because the advisor over there Might be friendlier.

Right. And then before you know it, they're doing. They're replacing tires and doing brakes and everything.

Like the same guy that can put on a lift kit can replace brakes.

They're. They're not thinking about limiting the amount of stuff they can do. That's for sure. They're looking to add to the repertoire.

It's easy. It's great stuff. So think, think about that in the sense of, you know, what, what can we do to increase our retention and our profits all at the same time? And I, I was telling Christian, I think we should go to sema. I think we should do some sort of an event at SEMA where parts and service managers come. We walk together, we talk about different things. Because I remember the first time I went to sema, I was like, holy cow. This is a bigger thing.

It's a cult almost. Right.

It's huge.

I wonder if they'd let me do. Stand up there.

And you can meet so many incredible vendors and manufacturers that you, you know, you just instantly can start selling.

Yeah.

Things depending on everyone.

Happy there, too?

Oh, yeah.

Yeah. They're having a good time.

Great time. It's Vegas. Maybe we move there. What do you think?

I could do a lot with an extra house behind my house.

Me, too. Well, thanks, everybody. I. I hope that sparked some ideas. I'm sure it did. And thanks for tuning in. We'll see you next time on Service Job Revolution.

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