Capitalizing On A Red-Hot Market
Repair shops have a golden opportunity to capitalize on the current automotive market.
With COVID-19 restrictions loosening and vehicle manufacturers struggling to keep up with the demand for new cars in the midst of a semiconductor shortage, used car prices have skyrocketed. In fact, they’ve increased 48.2 percent over the last year, according to a June 2021 report from the Manheim Used Vehicle Value Index.
That has led to consumers, who traditionally looked to the used car market once their older vehicle had issues, now hanging onto those vehicles and repairing them.
So while that puts repair shops in an advantageous position, shops should not just be waiting for those customers to come to them, said Brad Fink, vice president of leadership and franchise development at Christian Brothers Automotive. They need to be aggressive in seeking them out.
“At a 40,000-foot view, this is highly beneficial for not just Christian Brothers but the whole industry, regardless of the sign on the building,” Fink said. “But the successes we’ve had this year didn’t start in 2021, it started in 2020.”
Across all of Christian Brothers’ locations, Fink has seen record systemwide sales. Fink wouldn’t share specifics, but said pre-COVID numbers are being shattered by nearly all locations over the last several months.
He attributes that success in large part to the current market climate, but says it wouldn’t be experiencing record numbers without the creativity they developed during COVID.
“We got really creative in finding ways to continue to grow our customer base in a safe and healthy way. That has absolutely carried over, both with our mentality and our strategic (approach),” he said.
Practices like remote pickup and dropoff, texting and digital vehicle inspections were pivotal to surviving COVID. Now with shops as busy as ever, those are the keys to being as efficient as possible, Fink said. And finding more creative solutions should be prioritized by all shops.
That goes for marketing campaigns, advertising and outreach too. There are more active customers ready to invest in their vehicles than ever before. Sure, shops can expect an uptick in sales just from the market. But to truly capitalize, shops need to seek out those customers, Fink said.
Fink also credits an increased investment in his franchisee’s for the success. With a tenuous real estate market, the company has been intentional about giving its franchisees more support, especially starting off. The company increased its minimum amount of training from two weeks to eight weeks, including six weeks in the field. Six months before the store opens, training begins. Three months before the grand opening, store operators are required to quit their other job to take on the hiring and setup of the location full-time.
“It was an ‘aha’ moment that we weren’t practicing enough,” Fink said. “It puts everybody in a more comfortable position because they have a higher level of understanding.”
For shops that are already open, training should continue to be emphasized. A shop full of employees that aren’t properly trained will naturally begin to show its warts as its bays fill up.
The time is now for shops to capitalize on the market. Creativity and training will be pillars to any potential success, Fink said.