Don’t let Franchises steal your business

It’s time to go on the defensive, says Mike Owen

When times are hard the temptation to take on work that is outside your capabilities and muddle-through can be overwhelming. The simple fact is that customers deserve better.

Ability is close to the top of my list of must-haves for a garage. A simple analysis of job cards and invoices, together with shared anecdotes from technicians, quickly highlight shortfalls.

ability guaranteed

Technicians often tell stories of what went wrong, often in public places for all to hear, but now as never before, ability has to be guaranteed. Why? Because all of the effort over the last decades by you and your forebears, and those who fight on the political scene, as I have in the past, is on the verge of delivering success for independents. But there is still a great danger.

It would be a huge understatement to suggest that in 2013 someone will drop a rock into the pond that is called the motor trade. Years of skulduggery and manipulation behind the scenes will, I feel, result in something more akin to a full sized meteor-strike.

BER effects

The block exemption regulation 1400/2002, or BER as we have referred to it since its inception, will cease. The effects will be limited in the independent sector thanks to replacement service and repair BER, but this does not mean that all is rosy.

I may live to regret this prediction, but I believe that we are going to see a lot of franchised dealers de-frocked. I know that if I were in their shoes I would look to capitalise on my knowledge and investment to become a specialist for the marque that I currently represent.

Those of you who have looked over the parapet will have seen that franchises are already good at warranty jobs and servicing of younger vehicles, but having the skills to be a specialist and repair older vehicles is a different ballgame.

It doesn’t matter that dealers match independents on prices for service, we can trump their ace with the ability to repair and have to keep hold of our strong hand. Ability has to become the weapon of choice.

fixing things

I recently had the pleasure of watching James Dillon present to an audience on the subject of diagnostics. Attendance at one of his seminars should be compulsory for all independent garages.

I have told James that I consider him to be the Tom Peters of the motor industry, Peters being the much revered motivational presenter recognised for making difficult subjects easily understandable. It is the likes of Dillon, Peter Coombes and Frank Massey that give the independent garages the edge, an ability to fix things.

A colleague of mine in Germany tried to slave-start his wife’s Mercedes – the outcome was, a trip to the franchise workshop and a diagnosis that threatened the replacement of an ECU and brought a bill in excess of €1000. Even after being offered a discount as he had an ‘old car’.

His local specialist charged him €480 and a replacement component, not an ECU, that came in at just €18. No discount, just ability.

I took a few moments to cost model the two offerings and believe that the specialist actually had five-times the earning potential of the franchise. It’s why we’re in this industry, isn’t it? Earning a living from fixing cars?

If profit is the corner stone of our endeavour, then ability must be the foundation that underpins it. The problem is that currently we have a dearth of the stuff, something you must admit to if you look at it in all honesty. It’s Pareto’s law in action, 20 percent can actually do it, 80 percent just say they can.

customer experience

Because of this the customer experience is not consistent, and the danger is that we could see our existing and potential customers scuttle back to the franchises that are hunting for more work. If they do, they may never emerge again.

Not all are blessed with the innate understanding of Dillon and his colleagues, and that means training has to be the next best thing. There is a cost, but it’s an investment, so there is a need to generate a return and this is achieved through your labour rate, not your parts.

That means a proper labour rate, too, the sort that attendees at Tasc seminars work out rather than using the American SWAG method – the Scientific Wild-Assed Guess.

customer satisfaction

My time as a mechanic is now in the past, so now my ability is in hiring technicians with the skills, creating a good working- environment and delivering profits to my client companies through customer satisfaction.

Ability is also a counter to the argument for licensing. If we, the industry as a whole, cannot defuse the claims made against us then we will all be forced, and so we should be,
to live under the umbrella of regulation.

This post was written by:

- who has written 1175 posts on CAT Magazine.


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