I still remember Lee Harkins’ warning in September when I interviewed him for a segment on customer retention for our old Fixed Ops Journal Forum.
He didn’t say it in any hysterical way; Harkins, CEO of dealership training company M5 Management Services, is not one for histrionics. Instead, he calmly stated in his Alabama drawl that dealership service departments were about to get hit with a 2-by-4 between the eyes.
And it made sense. Dealerships rely on new vehicles under warranty to return for service for at least the typical three years of coverage. But with fewer vehicles being sold the past couple years because of chip shortages and kinks in the supply chain, that means fewer vehicles under warranty coming in for maintenance and repairs.
In today’s newsletter, read Ken Wysocky’s story with Harkins’ insights, learn why it’s important to work on customer retention now and hear from service managers and directors on how they’re trying to counteract the drop in warranty business.
“Service managers have to start closing their retention gaps. … Everyone has to really concentrate on getting those customers to keep coming back,” Harkins told Wysocky.
Customer retention is such a constant focus of service and parts departments that I’m sure those high-performing dealerships are already hard at work training staff and improving communication.
The key is to begin thinking long term and start acting now, Harkins says.
“Stores have to start thinking a few years down the road — start selling customers on the fact that their dealership is a good place to do business,” he says.
Sounds like a good way to avoid that 2-by-4.