Marketing works, we have seen and experienced this first hand after getting some training in the area. Most of us know this to be true even if people complain and whinge that it is a waste of money and does not work. The reason for this “it does not work” mindset is the lack of training that most small businesses and even some medium sized businesses have, yet this does not stop them from trying tactics to attract people into the workshop. In the auto industry the age old attempt to draw in new clients is the cheap service deal. NRMA Motor Serve, Midas and Ultratune stores have been known to hammer this tactic rather hard, along with many small private workshops too. Be warned, whenever you see the cheap service deal there is a catch. The age old saying “if it seems to good to be true it probably is”, defiantly applies here.
Before addressing what the catch is we should look at what exactly we are talking about. What is the cheap service?
A cheap service is the promotional $99 service or similar. Its a super cheap deal that is designed to entice you into the workshop based on the mega savings you’re going to make. The dealerships are using this same tactic with capped price servicing.
This tactic can only go one of two ways for you as the consumer and neither of them are good. Before addressing the one of two ways you need to know and understand the basic figures of a small workshop. Assuming rent in Sydney, wages and ordinary overheads of running a mechanical workshop with two qualified staff. Its estimated the minimum weekly turnover for that small business would be $5k per week to break even (obviously there are many variables on this but work with the numbers for the purpose of the argument) A bigger shop with more staff and these numbers rise.
Using our imaginary template of minimum $5k per week it works out at $1K per working day and thus $500 per technician on the tools as a minimum.That means that on a $99 service each tech is required to turn around five services in a day. This is of course the break even point and is achievable. However lets assume our imaginary business wants to make some actual profit. Lets say it requires 7 services per day per tech. resulting in the turn over for the week being 7 services at $99 = $693 per tech per day. Multiply that by two for the pair of techs $1386 per day. Then multiply that by 5 working days Shops turnover is $6930 in a week (this is a very realistic figure). In a normal eight hour working day its an average of one service very 1.14 hours. How in-depth do you believe the inspection is thats happening to your car when it has to be done in just over an hour?
Here comes one of two possibilities. 1. your service is rushed in and out in 1.14 hours. This is done 7 times within a day per technician. Thus the business makes profit and lives to fight another day. Many will argue this is enough time, I believe it’s not. If an inspection of every component of your car is happening; check all fluids, tyre pressures and go through the several hundred checks required in a service as well as carry out the oil change, 1.14 hours is not enough time. The result is massive turn around of quick services with poor inspections and things getting missed. Clients rave “I’ve only ever paid $99 for a service, they are so cheap, etc…” The down side is after a few years at $99 services your car is no longer reliable and has a plethora of faults that are not getting picked up on the in and out service mentality. Your car is now a ticking time bomb waiting to leave you broken down on the Spit Bridge or in the Harbour Tunnel. Trust me, nobody wants to be that person.
The second of the two possibilities is this.
The $99 service is bait to get you in. This option is marginally better but borderline unethical. The dealers use this same tactic with capped price servicing. To counter act the cheap service cost the inspection is done in-depth and if any component so much as looks a little strange the technicians quote it. Your $99 service suddenly became a $3.5K service because it needs one of everything replaced. In some cases, items that could have waited for the next service are not left until the next service as the company needs to counter the loss it made on the cheap service getting you in the door in the first place.
Both of these are the extreme opposites however the point I’m making is even though the cheap service may be enticing, there is no scenario where a cheap service benefits the vehicle owner. You either end up with an empty wallet or an unreliable car. Stick with the workshops charging reasonable prices to do a satisfactory job on your car. I advise you any shop that is charging you around the $200 mark for a service is a reasonable workshop.
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