Why Your Service Advisor's Pay Plan DOESN'T Work

Jeremy, what do you say we go to questions now? And our buddy Don Rideau.

So good to see Don Rito.

How you doing, Don?

I'm doing good. I'm wondering. I've been here a while, Chris. When am I gonna get a raise?

You've been here two weeks, my friend. This is your third week. Remember what I was.

Remember, he can't go to sales.

Yeah. What I was thinking, Don, is you should start paying me for how many times your parole officer calls me.

That doesn't sound. That does not sound fair at all.

Speechless. What do you got to say to that?

What kind of raise do you think you should get?

I mean, I kind of retract it now.

If.

If this is the route, the way that this conversation is going.

I mean, what. What happens if you leave and you don't have employment? Don't you go back to jail?

Yes.

Yeah. So let's. Let's. Why don't we figure out how you can be of more use around here and then talk about a raise? So far, the only thing we have you doing is reading a question once a week.

Speaking of which, let's go to this week's questions.

Well, maybe. Maybe Jeremy needs help at his shop. Would you think that don't make a good advisor? He went to jail for selling maintenance that customers didn't need. So I don't know if you.

Where. Where is your shop?

Have you learned your lesson well?

Really quick? Where. Where is your shop located?

Hesperia, California.

That seems like a very long commute. Especially considering that I. I cannot drive a vehicle.

You know what I always say, Don?

What do you always say, Chris?

If you wouldn't sell it to your mom, don't sell it to a customer.

This is great advice that I wish I had learned long before I went to prison.

Yeah, I'm sure. Okay, go to the question.

Let's go to the question. This One comes from LinkedIn. Chris, I know you're a busy guy, but I need your advice. Recently I got a huge uplift in warranty parts marked up from 40 over cost to 75.4% to avoid blanket massive performance free pay raises for all. I need to change advisors pay plans from off pure gross to something else. Haven't changed in 5 years. Low turnover, happy employees, customer attention, etc. Hate to do it, but perhaps customer pay ELR times point, 10 times labor hours plus 10% customer pay, part sales plus a 10% CSI bonus. Any ideas that won't have to be redone later?

Yeah, make. Make the. Make the Pay plan as confusing as possible. That's always my strategy.

So do you know in some states, the. The states have passed laws that the manufacturers have to pay certain percentages? So it kind of has been a thing in Florida, but now other states have passed it. So you're getting an influx in gross profit on parts.

Oh, okay.

You gotta wonder, though, how long the manufacturers can sustain that without raising. You know, it's gonna go into the cost of the car because it. It affects their warranty per car. Right. Which is something they build into the cost of the car.

So Volkswagen went through this in the early 2000s with the mass airflows. So when they were doing a lot of warranties with the mass airflow, the part was about a $600 part. So then also they were doing so many. The. They changed the list price on the part to $32.

Right?

Yeah. BMW used to do that too. You would know a recall was coming when they lowered the price.

Exactly right. So they'll do this. Yeah.

So that's all part of it. So here's. Here's the thing in our. Obviously, you're not in our service manager university, because in there we give you a pay plan and we teach you how to make a pay plan. I think that your. Your ideas is a little bit off in that I pay advisors on parts and labor sales. I do not pay them on gross. Gross is confusing. I don't. I know that a bunch of you went to a 20 group and came back and said, let's pay advisors on gross. Advisors don't control gross. They. They don't hire techs. You confuse them. There's all kinds of issues that it causes. So I don't know, 50% of their pay would be on parts and labor sales. 30% of their pay would be on CSI, and then I would have an ELR bonus and a customer pay bonus is kind of how I would do it. So that's the basis. If you get in there and are on Demand, it's only $250 a month. You can train your advisors, your techs, everybody on pet the Dog, customer service training, and then service manager universities in there so you can learn pay plans, how to hire techs. You know, there's so much stuff in there, I wouldn't even know where to start to tell you.

Yeah. And I just throw this out there. Change is uncomfortable for anything. So if you're doing anything and you have to rework the pay plan, you know, do your best to think about it as an enhancement. How's it going to help them long term because obviously you don't want to upset your entire career.

Yeah. The spirit is good in the question that. I don't want to change it again.

Yes, absolutely.

I want to get this right.

So.

So, yeah, I think that paying them on sales is better and I agree. Get it right. So do the numbers backwards and forwards and make sure that, you know, you project it out, that sort of thing. But that's what I would do. Good question. Thanks for the question. We'll be sending you some swag, some service driver revolution swag.

Absolutely. What do you think of that question, Don?

I thought it was overly confusing.

I think Don's had a little tequila in his coffee this morning.

Oh, yeah, Almost every day.

Oh, yeah, he's. He's putting a little.

He was choking on something there a minute ago.

Don's got a little Irish in him.

Do we have another question, sir?

Yes, we do have another question. This one comes from Joshua. Hi, Chris. Love what you're doing. Just started watching your videos. I have worked at a BMW Mini dealership in the UK for, For the last five years. We're going international. Chris started off taking booking calls and currently a service advisor. Reading bits of your story. It sounds very familiar to mine. There are a few people in the department who do not like my style of advising. They feel I'm far too relaxed with customers for a premium brand and would like me to change my approach. Honestly, my approach gets results and I feel like it makes the customer experience easier and more personal for them as a whole. So my question for you is what's more important? Looking after the customer in a natural and personal way that comes easy for me or conforming to dealer standards, as this is what they've been doing for years. Thanks, Josh.

Wow, that's a. That's a good question. Josh in England, I'm excited to. To send you some swag. I want to see a picture of you and the service driver.

Absolutely.

Shirt and hat. Over in England.

I don't know, I feel like you could accomplish both.

One thing as an advisor is like, you gotta be coachable. Right. So I don't know the whole story here, but I'm guessing that what they're saying is maybe you're taking too long with each customer. And so I would say that there is probably a happy medium and you should listen to what they want and still achieve what you're good at, which is making friends and petting the dog. Right. So you could do both. So maybe just reframe how you Think about it and try to do both. Someday when you're a manager, this will be a subject that you'll have to address as a manager. And so try to see it not just from the perspective of an advisor, but try to understand what is it that they're trying to accomplish and how can I accomplish it? Not losing my gift or what I'm good at, which is connecting with customers and still represent them since they're giving you a paycheck and providing you that opportunity, you know, do both.

Right. I agree. And I. You don't want to be robotic. Right. So I understand that you want your natural personality and style to come out, so. Absolutely. But I think you've got to conform to the culture of the businesses, to what they're trying to.

Deliver to the clients there, and then bring your own personal style into it as well. But I like that you talk about being coachable and. Yeah. So you're a hybrid service advisor now.

Great.

Yeah. But think as a manager, too. Like, think as a leader now. Like, you know, what Would you try to understand the intention of why they're saying that in the spirit of it and don't take. You don't always have to take it so literal. You can get. You can achieve both.

Yeah. And I always ask specific behavioral questions. What specific specifically? Did you notice that I did that? You didn't like, you know, did I use a slang word? Did I, you know, touch somebody, you know, inappropriately? Like, I don't know, just stuff like that.

I don't know how. Why get accused of touching people inappropriately?

No, but you know what I'm talking about, right? Like, some people are hugging.

Tell me, so how do you touch them? That's inappropriate.

Like, if you give people hugs and they don't want hugs. Stuff like that.

Yeah. You can't do that anymore.

Holy moly. Getting myself in deep water there.

I don't touch anybody anymore. No matter. I'm not.

Especially with the coronavirus going around out there.

I'm not touching you, bro.

But you understand what I'm talking about with the behavior, correct?

Yeah.

Specifically, was it a word you used? Was it, you know, the way that you talk to somebody, your behavior is what they're getting at, and you can change behavior and make it better, so. Great question.

And I think most of the time that the cause of what you're probably getting is that you're taking too long.

Yes.

Right. You need to speed up so you can do both.

Well, fi. Manager. Absolutely. You know, if you're taking 15 to 20 minutes to get the initial write up done. We've got to move that. Move that along. Absolutely.

Yeah. And if I have. If I have 10 advisors in a drive and one guy takes 30 minutes to write up a customer, I can. I can survive. But if I got two advisors and one takes 30 minutes, you're going to choke out the shop. So you have to take into consideration how many advisors that. That sort of thing to you. But good question. Thanks.

Absolutely.

Thanks, Don. So we'll come up with a plan for you to get a raise, but there's got to be less laying around and drinking and. And more work. I think that you would be better at asking these questions if you went and worked in Jeremy's drive a little bit.

Yes, absolutely. But do keep in mind that three of my limbs are not functioning. So that does make mobility a little bit different.

You can't discriminate against that. Jeremy, you have to, like, provide.

Why would I? I heard a rumor that he's training for a marathon. Don Rito, is that correct? Are you going to run the LA marathon next year?

No. That is a cruel lie.

Who started that rumor?

Thanks, Don. We'll see you again next week.

See you next week. Although I may have to leave the state abruptly. You know how it is.

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 when we post new episodes. I'm Chris Collins and you can find me on Facebook and Instagram @chrisbulldogcollins. And I'll see you again on the next episode.