Auto Retail NetworkThree quick tips for addressing the industry’s £1.3bn aftersales black hole

PARTNER FEATURE:

Aftersales departments must start to face up to more challenging conditions in the months and years ahead.

In the lead up to the global pandemic, aftersales teams were kept busy by a largely buoyant new car market. In essence, a retailer’s new sales provided ready-made service work. Things have changed. We need to roll up our metaphorical sleeves.

I know that might sound glib, but as someone who started his career as a service technician and progressed into a succession of aftersale roles, my passion remains aftersales. My goal is to keep those ramps busy.

Over the last two years, 1.8 million vehicles between one and three years old have been lost to the franchise network. Our respected REALinsights Data Science team has forecast the knock-on impact is a shortfall of £1.3 billion in new car servicing revenue over the next four years.

Switching from problem to solution

Step one is recognising the issue – job done. So, it’s time to move to step two, addressing it. And it need not be rocket science.

Three actionable approaches:

1. Optimise today’s used cars and backfill sales from the last 18 months

Used car buyers are far less likely to use franchised dealers’ aftersales services. Price concerns and the absence of longer-term warranties feature large as the reasons why.

The opportunity here is to address issues head-on. Ensure sales teams are challenged to promote used car service plans and consider the lifetime value of including longer-term warranties or make up-selling them a core goal. Invest in some marketing to promote the cost and value of your aftersales. Finally, ensure aftersales is a core item on your post-sales customer contact strategies.

2. Optimise video health checks

As a business known for the quality of our eVHCs, we know that all too much identified amber and red work is never converted. We recognise that price, affordability and customer inertia can be issues. However, for many dealers, this is low hanging fruit that needs to be harvested.

3. Tyres, exhausts and batteries

At the end of the 20th century, I vividly recall an article highlighting that the UK fast-fit market was forecast to reach £2.32 billion by 2001. Essentially, the success of fast fits is a tale of motor retailers failing to meet customers’ needs. Can we reverse the trend? I know we have to try.

Again, this is about marketing, but at a shop floor level it is also about training, giving team members the skills and confidence to help customers to buy services they need.

To conclude, addressing the shortfall in aftersales that is coming is in our hands. Suppliers like REALtime communications can help, and I know we welcome such opportunities for our part.