Out of the Crisis.Org

[Louis Altazan]

Last month I posted a poll which asked,

With a 25% margin on both, how many sales would a business need in 2008, to equal the buying power of grossing $200K in 1998?

According to the Bureau of Labor Statistics (www.bls.com) $50,000.00 [25% of $200,000] in 1998 would purchase the same as $67,204 in 2008. This indicates it would take $268,817 in sales to have the same buying power. The effect may be somewhat less than many people imagined, but it is real loss none the less.

A business that is not growing in sales [and profit] is not remaining static. As prices rise, unless sales keep pace, a business is losing ground. Cost cutting is great and should be practiced. There also comes a time when sales must rise. Basically the business grows or in time, it dies. The point is, where will the growth come from? A small business owner just working more hours is NOT the answer.

Three of the primary scenarios for increasing sales are as follows:

1. Increase prices, not usually popular with clients.
2. Attract more clients, not always easy on a limited budget.
3. Sell more things to the clients the business already has.

The final is perhaps the most sensible yet least used tactic for many small businesses.

In a simple “what if” exercise, how many things can you think of that might accomplish this end?

_________________
Louis Altazan
Owner/Manager AGCO Automotive Corporation
Baton Rouge, LA

[Dave]

Just off the top of my head.

Offer more services, tool up so the shop can take care of more things that vehicles need.

When inspecting a vehicle let the customer know everything that is found. Too often shops fail to inform people of the real condition of their vehicle. This happens a lot to first time customers. Its like we are afraid we will run the person off if we tell them too much.

Track routine maintenance items and sell them when needed. Transmission services, oil changes, tire rotations and fuel filters are some things that fall into this category.

Remind customers of all the things their vehicle needs every time it is in.

If you know that a part typically fails at a certain mileage and a customers car is getting close to that mileage, let them know. Give them the choice of fixing a potential problem before it becomes a problem.

Set people up for the next repair. Let them know ahead of time so they can plan for it. Mr. Jones, per the factory recommendations your vehicle will be needing its timing belt changed in about 5000 miles. We also recommend replacing the water pump and tensioners at the same time.

Pre-schedule appointments, I have also heard it called exit scheduling. Schedule the customers next appointment as they are finishing up the current one.

Keep in inventory the commonly sold items. I find that wiper blades and air filters are easy to sell, but they have to be on hand. Most people do not want to come back in a couple days after waiting for a shop to order them.

_________________
David Wittmayer
Owner / Manager
Hansen Enterprises Fleet Repair, LLC
Camp Verde, AZ
www.hefrshop.com