COVID-19 gives auto dealerships time to refocus

DETROIT — While the COVID-19 pandemic has slowed business at auto dealerships nationwide, it also has given their service departments time to thoughtfully and intentionally lay groundwork for better long-term productivity, customer retention and financial results.

Some fixed ops departments used the downtime in late winter and early spring to improve service-lane processes or develop new "touchless" protocols. Others drilled deeper into existing technology to boost efficiency and revenue, reevaluated employment levels and made tough staffing decisions.

"COVID made us do a lot of things to become more efficient in many areas — things that we should've been doing anyway but never had time to because you get caught up in the day-to-day operations," David Blackburn, service director at Scott Clark Toyota and Scott Clark Nissan, said.

The two dealerships are among three owned by Scott Clark Auto Group in and around Charlotte, N.C.

Mr. Blackburn said the pandemic-related downtime in April and May gave him time to evaluate staffing levels. As a result, the fixed ops staff at the Toyota store was reduced from 112 people to 93 — a 17% decrease. Most of those let go were service advisers and lube techs. Smaller staff cuts were made at the other two dealerships.

In June, the Toyota service department generated $30,000 more in gross revenue than the same period last year, he said.

"We're a leaner staff, but we're also more efficient," Mr. Blackburn said.

The business slowdown also gave the two dealerships time to more fully convert to an Xtime CRM system that allows for everything from online scheduling and video walk-arounds to photos and videos for suggested maintenance items and online payment.

"Customers can see and authorize repairs on their smart phones and tablets without ever coming to the dealership," he says. "Everything is better for customers when they don't have to spend time in a waiting room."

At the 15 rooftops in Virginia operated by Carter Myers Automotive, the pandemic gave service departments time to delve deeper into the capabilities included in CDK Service, a DMS platform, said Liza Borches, dealer principal. The platform includes the ability to add pictures and videos to inspections and text them to customers.

"We were always so busy that we couldn't take time to train techs to use all the capabilities in that technology," she said. "So in a way, COVID gave us the opportunity to create a better 'normal' going forward [and] incorporate things that will make processes more seamless as business picks up."

Service departments that used downtime to refocus on fundamentals like meet-and-greet and walk-around processes will be better positioned for success, says Almog Veig, a director of training operations for David Lewis & Associates, an automotive consulting firm.

"When fewer customers were coming in, a lot of stores took time to invest in more training and really polish up some skills so they can hit the ground running when things fully open up again," he told Fixed Ops Journal.

Mr. Veig said service advisers "need to focus less on selling and more on the customer — asking open-ended questions that will help them understand how customers use their vehicles," he said. "It's just like a doctor asking questions to get information during an annual wellness exam. In the end, it's all about delivering value that's commensurate with customer expectations."

Lee Harkins, CEO of M5 Management Services, a fixed ops consulting firm, said that during slow times service staff should get out of their offices and retrain advisers on walk-around protocols.

"They need to practice, practice, practice," he said. "Technology is great, but it's just an enabler. You still have to provide the basics."

At Lovering Auto Group, the business downturn was an opportunity to take stock of all of its processes, CEO Vanessa Delegas said. The group owns three rooftops in New Hampshire.

During this review, it was discovered that customers who called with a service question weren't always transferred to the right person. The remedy was to no longer have the business development center handle service calls even though it was created in 2017 to do just that.

"You can't afford to waste people's time," Ms. Delegas said. "Customers want to talk to someone who can answer their questions. Now our service advisers are the first line of defense when service phone calls come in.

"How you use your phones to meet the expectations of customer service is huge."

The COVID-19 pandemic has had a lasting impact on fixed operations and in some cases has prompted long-term, beneficial changes.

"We have the opportunity to create a better 'normal' going forward," Ms. Borches says. "If things don't look like they did before, I don't know that it's a bad thing."