Finding Your Service Advisors' Closing Ratio
Do you know your service advisors’ closing ratios? If you’re not sure of it, it’s a ratio that can be tracked easily and is necessary in order to grow a business, as well as the employees inside.
Jen Monclus, certified sales and leadership trainer with Elite, says that a lot of shops primarily track as a team, but are often unaware of what each service advisor’s closing ratio consists.
“The reason you want to track a closing ratio is because it’s going to be very beneficial to the shop as a whole,” Monclus says. “Just because you have that metric, you can actually uncover lots of things in the business. If a shop’s closing ratio is low, then we’ve got to figure out where are the holes.”
There’s no cookie-cutter way to decide what an ideal closing ratio is for a shop, but an average closing ratio can range from at least 50–80 percent of what service advisors pitch, Monclus says.
“Some of the best closing ratios I’ve seen from advisors are usually 80–85 percent," Monclus says. “In a perfect world, I’d love for shops to be able to track closing ratio per advisor and per technician, so we can see what that metric is and if there are any holes.”
Monclus shares how shops can begin tracking individual closing ratios in order to determine hidden issues with a service advisor, and how addressing those issues can lead to a better closing ratio for both the service advisor and the shop.
Track Each Employee Individually.
How do you know the success of your service advisor? It’s simple—track his or her closing ratio individually.
“If there’s multiple advisors, it’s really cool to track them individually if that number is indicative of their skills compares to the rest of the team,” Monclus says.
She offers shops the following equation to track closing ratio for service advisors:
Total sales in a week/total dollar value of discovered services = closing ratio
“What we mean by the total value of discovered services means, in a given week, we’ve got to look at all opportunity that the advisor has to sell—that’s more than what the technician gives them to sell,” Monclus says. “It also includes what the customer wants and their request, but it also includes if they’re a repeat customer, so the advisor is able to pull up deferred work from their last visit.”
Tracking advisors week to week should be a common practice, and she says it allows the advisors to see how their results change over time.
“I like that because you can track it week to week and it’s a really great way to watch the advisor grow as salespeople, versus if you’re just collecting the data as a shop,” Monclus says.
According to Monclus, the same can be said for technicians.
“If you’re looking at that metric of the opportunity each technician finds per vehicle, if one technician’s averaging $1,000, then let’s just say the other one’s averaging $600, well, then we’ve got to start figuring out why is one technician so much higher than the other,” she says.
Address the Internal Downfalls.
Once results are found, shop owners are able to take a step back and see the differences between service advisors’ closing ratios. By tracking closing ratios individually, shop owners can see where certain holes are making an impact at the business, Monclus says.
“The shop owner really needs to take the time to listen and to learn,” she says.
To drill down and find the issue, Monclus suggests reviewing repair orders, as well as phone call recordings, to uncover if the service advisor is building value in the sell or even needs more training talking to clients.
“We want to track [closing ratios individually] so we can understand big picture holes, if there are any,” Monclus says, “If you review lost sales, you’ll uncover where the major holes are and then can come up with a plan to fix those.”
For example, John and Justin Devin of California Smog Check & Repair in Chula Vista, Calif., wanted to improve their service advisor’s closing ratio and overcome common sales objections from the shop’s target customer base. By tracking the closing ratio, John says he was able to identify patterns and from there, the negative habits that accompanied those missed opportunities.
After addressing those issues early on, the shop’s closing ratio increased from 56 percent to 87 percent..
“We no longer have to spend large portions of our time slogging through a quagmire of misunderstandings and miscommunications. It is a day and night difference,” John says.
Ultimately, individual tracking can help pinpoint what needs to be done to bring more success to the service advisor and to the shop.
Establish a Set Meeting.
As an owner, it’s important to set aside time to monitor how an employee is doing, not only for the employee’s benefit, but also for business to maintain its success. Monclus says that when an owner consistently tracks results, then it can push the employee to work toward a specific goal.
“[Owners] should be monitoring their service advisors’ daily goals just as a touch point,” Monclus says. “In my perfect world, management is having conversations with their service advisors daily.
“They should be monitoring their service advisors’ daily goals just as a touch point.”
For example, Mike Keplinger of Mike’s Car Care Center in Huntington, Ind., enrolled his service advisor in service advisor training to learn how to create a consistent sales presentation, which increased her closing ratio to 75 percent.
When service advisors know that they are being regularly monitored, he says, it then may provide more of a boost to up sales or even show the service advisor that his or her success is important to the business.
“If you’re only having discussions with advisors on their monthly goals once per month, that month can feel like an eternity,” Monclus says. “In a perfect world, I would hope there’s daily communications about advisors’ goals at least weekly, and that way we’re on track and we’re more motivated,” Monclus says.
Once goals are set and advisors hit daily goals, enthusiasm can skyrocket and there might be a push to work even harder the next week.
“Any time anyone in life achieves a small goal, that confidence just builds,” Monclus says.