How can we compete without lowering our prices?
My shop is in a competitive market—lots of shops and lots of options for getting a car repaired. Price shopping seems to be the norm for customers. How can we compete without lowering our prices?
Maylan Newton, president of Education Seminars Institute
People have always shopped us, plain and simple. There’s always been a problem in that they don’t tend to see the value of what we do. They don’t see the investment in the equipment, education or training, or what goes into parts and labor prices.
They only see our prices.
Our job is to make them see that value: What are the benefits for that customer in doing business with us?
A simple fix is increasing warranties. Most shops do a 12-month, 12,000-mile warranty. Make yours 18 months and 18,000 miles, or 24 months and 24,000 miles. This is a benefit that’s as easy for a customer to see and understand as price is to them. They understand that type of value.
Beyond that, you have to go into consulting mode—not selling mode. You need to build that relationship and help them make a good decision.
The majority of customers, they don’t understand what you’re doing back in the shop, so make them understand that you’re here to help them. Ask them how they use their cars. What do they use it for? What kind of driving do they do? A soccer mom—who shuttles her kids back and forth to school, then to practices, then to meetings and games—uses her car much differently than the guy who drives his vehicle two miles and picks up public transportation to work.
You need to set up the repairs and the maintenance based on their priorities, and let them understand that you’re trying to repair the car for the least amount of money you can as to fit their budgets. You want to give them the message that it’s not their job to worry about their car; it’s your job.