Car dealerships cost a lot of money to set up and run, and regardless of what many customers may think, profit margins can be incredibly small. Everyone knows equipment like ramps, air systems, diagnostic equipment and staff wages are expensive, but other things that eat away at those tight profit margins are perhaps less obvious. Let's be honest; how many of your customers will give any thought to the cost of transporting customers and drivers to and from your dealership? In fact, how many people in your business will give it much thought?
Picking up and dropping off service customers and their vehicles is part of what dealerships do, but far too many dealerships operate customer transport in a pretty inefficient way. Certain dealerships may well have some sort of formal system in place that at least puts some focus on managing the pick-ups and drop-offs of customers, vehicles and drivers, but far too many still use a system which is essentially sheets of paper on clipboards.
Often, these ad-hoc ways of operating can be inefficient and ineffective at best, and costly at worst. Also, if a dealership doesn't have a proper plan and solution in place for pick-ups and drop-offs it can have an adverse effect on customer experience and harm the reputation that a dealership is always working hard to build and maintain.
A Complex Blend
Depending on the size of the business, a customer transport system can range from incredibly simple and straightforward to staggeringly clumsy and complex. Although a very small service center with one or two bays and a small number of customers each day might think customer transport is easy, but even in those circumstances it can be complex at times.
The easiest situation for a service center is when the customer brings their vehicle in and either waits or goes to where they need to be next on their own. Beyond that, things start to get increasingly more complicated and require the dealer to think and plan ahead.
In the scenario where the customer brings their vehicle in for you, what if the job is going to be too lengthy for them to wait around and they need a lift somewhere? In this case, there are three main options for the business. The dealership can get a member of staff to give the customer a ride to where they need to be next, they can give the customer a loaner car, or they can use a shuttle or a taxi service such as Uber or Lyft.
Costs are inevitably associated with all three options. Before it comes to which is the most cost-effective way for the business to operate, what about the advanced planning needed so the whole thing happens professionally and efficiently from the customer's perspective? We've all been there when it goes wrong, haven't we? The service advisor thought that the person who took the original booking arranged the transport but they didn't, there's no vehicle available or no driver to give the customer a ride at that moment, or the taxi can't get someone there for half an hour or more.
All those problems and more are common if the dealership doesn't have a reliable system in place for handling customer transport, which is where the Hop-Drop shuttle & valet App can be invaluable.
Remember, up to now we've just been talking about the very smallest businesses and how arranging customer transport can be a real headache for them, but just think how much more of a problem it becomes with larger operations. Even dealerships that are big enough to operate multiple shuttle vehicles still use systems that are essentially sheets of paper on clipboards. Is that any way to stay on top of such an important element of customer service in the 21st century?
Customer Transportation Options
Let's look at the options car dealerships have for customer transportation in a little more detail and examine some of the direct and indirect costs involved.
In some ways, loaner cars for service customers are a convenient solution for all concerned. The customer comes into the dealership to drop off their own vehicle, they're given a loaner by the dealership, and they can go about their business as they like and come back when their car is ready.
Franchise dealerships representing major automakers will have to have at least a specified minimum number of current loaner cars available for service customers to use as part of their franchise agreement. Of course, this is a pretty expensive way of providing transport for service customers and, as anyone who's ever worked in a dealership will tell you, demand will always outstrip supply.
Even if this were the only option you offer for service customers, this fleet of vehicles needs careful managing to get the absolute maximum value from this costly resource. Everyone concerned needs to know where the vehicles are when they are booked out when they are due back in etc. The service department also needs to keep track of the mileage of each vehicle so they can be serviced and maintained to the very highest standard.
Unfortunately, due to the cost of running a loaner fleet and the high demand for loaners, almost every dealership will have to supplement their loaner fleet with alternative forms of customer transportation.
Even though a dealership may have to have at least a minimum number of loaner vehicles on the road at all times, it doesn't mean they always have to be given up for the exclusive use by customers. The dealership may use these and other vehicles they may have at their disposal to operate a shuttle service for customers.
The common way for most dealerships to help customers when their vehicle is due in for service is to give them a ride home or back to their workplace from the dealership when the vehicle is being worked on. Once the work is done, the shuttle can then be sent to pick up the customer to return to the dealership so they can collect their vehicle. The big benefit this can have is that a single driver in a single vehicle can be sent out to collect multiple customers in one trip, which obviously saves the dealership manpower and money. However, it requires serious planning to achieve this and still deliver a great customer experience, which is exactly where Hop-Drop shuttle & valet App comes to the rescue.
A valet service, where the dealership picks up and drops off the vehicle without the customer having to visit the dealership themselves, is more often what luxury dealers do, but it is starting to become more popular with some other dealers too.
It's amazing just how complicated and involved running even a relatively small valet service can be. A valet service could mean the dealership using one of its vehicles with two people to go to the customer so one of them can pick up the customer's vehicle and drive it in. When the work on the customer's vehicle is done, a member of staff will drive the vehicle back to the customer and another member of staff will drive a dealership car to pick up the driver and bring them back or take them to the next pick up location.
Even if we're talking about a small dealership, a robust system needs to be in place to make the most out of the valuable and important resource. The dealership needs to know where the vehicle and the drivers are, what appointments they have to meet, when they are due back, and when they are free to be booked for another customer. Start to scale that valet service up to multiple of pick-ups and drop-offs and it's easy to see how clipboards and worksheets really won’t cut it. This is where Hop-Drop shuttle & valet App starts to come into its own.
It's easy to see how much running a courtesy customer transportation service can cost, so running it in the most efficient way possible is a must. Of course, it's not just the financial cost of running it that matters; the way it runs reflects massively upon the dealership and it's a big part of the whole customer service experience that is so crucial for dealerships in these challenging times.
Uber & Other Taxi Services
Outsourcing customer transportation is another option. Although it may be attractive because it requires less participation by the dealership, it's not without its own issues. If the dealership bears the entire cost it can start to get very expensive very quickly, and they’re also putting their reputation and a big part of the customer service journey in the hands of who knows who? You could, of course, arrange the rides for the customer and leave them to pay Uber or whoever for the trip, but that's not going to look good for a dealership, is it?
Something like Uber can be an extremely useful tool as part of a flexible, integrated customer transportation service for a dealership, but once again, controlling and monitoring the system is paramount to its successful operation. The dealership might, for example, not have a spare vehicle or staff available to go to a customer's house to pick up and drive their vehicle in for a service, so sending one driver in an Uber might be a great solution. Of course, they also have to have plans in place for taking the vehicle back to the customer or for bringing the customer in.
When you start to consider all the variables and how things can change throughout the day or the working week, how on earth can you hope to stay on top of things in the way you should without some sort of digital solution? What if a driver calls in sick? What if a loaner fleet is overbooked? What if a taxi doesn’t turn up on time?
If the dealership knows at the glance of a screen where everyone is, where they are supposed to be, and how long it will take them to get where they’re going, they can be flexible and efficient and adapt to the unexpected.
Dealerships obviously have to keep a keen eye on costs, but it's hard to think of many businesses that are so reliant on delivering a great customer experience for ongoing success than a car dealership's service department. If a dealership can inconvenience a customer as little as possible when they need their vehicle worked on, there's every chance they will keep that customer coming back time and time again.
While it takes a lot of hard work, thought and investment in both people and equipment to make a customer happy, it takes a whole lot less to upset a customer and it's far too easy to deliver an experience that will lose them forever. When it comes to customer transportation however, a good dealership running an efficient pick-up and drop-off service can even be a profit opportunity and hidden driver of CSI score
Plenty of dealerships won’t want to even consider charging a customer for transportation. But if approached in the right way, there's no reason why they shouldn't. It will depend on the size of the dealership, and also whether it represents a high-end brand.
A high-end dealership probably wouldn’t want to put a charge on the invoice for customer or vehicle transportation service, but they can charge a higher hourly rate for servicing than a mass-market brand wouldn’t be able to charge so they can recoup the cost of providing transportation that way.
Dedicated service centers or dealerships representing mass-market brands perhaps have a better opportunity to offer customers an a-la-carte service, something like a budget airline that charges extra for things like an in-flight meal or an aisle seat. A dealership could charge a small amount for giving the customer a ride with their own shuttle vehicle or with a taxi service such as Uber, but they could charge more if the customer wants the use of a loaner or a valet service.
Many won’t want to charge the customer in such obvious terms, but charging on some sort of a-la-carte basis could provide the opportunity for the dealership to advertise servicing at an incredibly affordable and headline-grabbing rate.
Hop-Drop shuttle & valet platform makes it easy to create routes for the same day or the future and tag these rides with information that will be useful for the driver and also for reporting purposes. Hop-Drop also helps to navigate, locate, communicate, and manage by digitizing your in-house shuttle & valet operation, which means beneficial savings of one of your most vital commodities; time.
Check out Hop-Drop today and you'll soon see how it can help you deliver the kind of customer experience that sets you apart from competition at the same time as paying for itself in the first month of operation.