With new-vehicle prices higher than ever, research from Cox Automotive indicates more consumers will be focused on fixing, rather than replacing. Further, while the traditional commute may be a thing of the past, our research shows that 50% of Americans expect to drive more in 2022 than they did last year— avoiding public transportation; driving instead of flying; returning to a hybrid work situation. With the added miles, service visits are expected to increase as well. All-in-all, the service lanes should continue to be an important part of the franchised dealer business equation.
Diving into the numbers a bit more…according to Cox, the number of repair orders has taken a hit from COVID. Here’s a chart of the volume of repairs dealers have seen over time.
But, each repair order generates over $475 in revenue on average.
As people start venturing out more, repair orders will most likely increase. And at a higher sticker price for each repair, there’s the opportunity to bank more money from your service department.
Use This Data to Your Advantage
As service visits increase, you’ll want to maximize efficiency within the service department. For two good reasons:
Tightening up your procedures within your service departments means you are eliminating wasted time and effort, allowing you to do more with less.
But, doing more with less can open up safety gotchas. As the volume of visits increases, people are moving faster. Unless your safety procedures get built into employees’ “muscle memory,” there’s a massive opportunity for things to go wrong.
So, start looking at the processes and procedures within your service department. Are there bumpy handoffs? Are there areas that tend to cause accidents or almost accidents? Now’s the time to iron out any wrinkles – because, with a bunch of 12-year-old cars on the road, you’re going to be busy!
How KPA Helps Keep Your Service Team
Take advantage of investigations, audits, program reviews, and more. KPA’s health and safety consultants help dealers comply with OSHA, EPA, DOT, and state regulations. Our certified consultants bring best practice advice and actionable recommendations for your unique program.