In my last column, I urged tire dealers to replace their price obsession with a store philosophy emphasizing value. This approach is healthier long term than trying to beat the lowball price artists at their own game. Plus, it attracts a better caliber of customer. I encourage readers to combat lowball prices by telling consumers the truth: There's a minimum cost required to do the job correctly and guarantee the work, including expenses such as installing only original-equipment-quality parts, hiring qualified technicians, keeping their knowledge up-to-date, paying them for the labor time needed to repair vehicles correctly, and outfitting them with modern service equipment.
Furthermore, dealers who ignore this basic expense (part of the normal cost of doing business) and try to compete on price alone will inevitably go broke.
Beat the lowball price schemers by continually highlighting the value of your work-and adding value to it.
Improve attitude first
Do not assume that consumers-or your own service personnel-know the difference between price and value. If your workers don't believe good value beats lowball prices, the chances of succeeding with a value-oriented store philosophy are slim.
Many workers are embarrassed when neighbors criticize their employer's prices. However, some shop owners I know are proud as peacocks when new customers acknowledge they have the most expensive labor rates in town! To them, having a steady, successful business with the highest local shop rates confirms the quality of the work they do and the level of value they provide.
Commanding the highest rates also attests to the store's level of professionalism. If the shop and its employees didn't look and act the part, motorists wouldn't continue paying premium dollars for its services. So all things being equal, earning top fees within a local market is a very positive reflection on and compliment to any shop's staff!
Competent owners I meet often ask me how the lowball price artists can break even with their cheap prices. Indeed, there's only so much anyone can lower his cost of doing business by buying parts shrewdly, hiring good technicians etc. No matter how you massage the numbers, you cannot cost-justify their $19.95 alignments and $39.95 brake jobs.
The lowball price schemers are operating the same way they did when I entered the business. First, they don't install anything close to OE-quality parts. That's why you see so many of their brake jobs with the rotors cut paper thin. Or, the disc pads they installed are squealing, pulsing, wearing prematurely or creating excessive brake dust.
Second, they shortcut procedures. They play the percentages by doing the absolute minimum work or fewest adjustments they have found usually get the customer's vehicle out the door. Alignment-wise, that's the origin of the saying, ``Set the toe and let it go!''
These shortcut specialists never do an undercar inspection, a complete four-wheel alignment or a thorough engine analysis unless they're forced to.
Third, instead of charging a reasonable fee for proper procedure, they charge extra for every possible detail. For example, balancing, valve stems-probably even the air that inflates the tire-all cost the customer extra.
Highlight, add value
Undoubtedly, the lowball price artists' lousy workmanship and questionable service policies will continue defining poor value and generating countless comebacks. Some of these disappointed consumers will end up at your store, searching for proper repairs. Politely exploit the situation by redefining value for the disappointed and the doubtful.
Most service prospects are women, so emphasizing benefits important to women has the net effect of highlighting or adding value to your store's services. Peace of mind is a top priority for most women. They need to know that the vehicle won't fail again, leaving them and the kids stranded somewhere or costing them more time off work.
Finally, try adding value by exceeding consumers' expectations. For example, note their cares and worries. Road-test with the owner on board and give him a ride to work. Use the phone or fax to keep a customer abreast of progress on tough jobs. Give realistic completion times so, if anything, the car is ready sooner than expected. Scrub the blue stuff off new whitewalls before being asked to do it.
Treat people the way you like to be treated.