Fixed Ops Journal - December 2017 - 28

FIXED OPS JOURNAL

This year's SEMA show
offered an array of new
accessories that can
boost dealer profits.

AUTO
ADD-ONS
7 habits of highly successful dealerships for accessories sales



dkushma@crain.com

he accessories market is bigger
than ever, but dealerships still
aren't taking full advantage of it.
From fuzzy dice to satellite navigation, auto accessories are a $40 billion-a-year
business - generating more revenue, by
some accounts, than collision repair. Profit
margins on accessories sales routinely approach 50 percent.
Half of new-vehicle buyers say they plan to
customize their purchases, industry surveys
suggest. When they do - 6 million new vehicles are accessorized in the first two years of
ownership - customers typically spend between $300 and $800. Truck buyers spend
$1,500 on average.
Yet only about 5 percent of customers buy
add-on accessories from the dealership where
they purchased their vehicle, the dealer software provider Reynolds & Reynolds estimates.
As new-vehicle sales and profits stall after
years of growth, franchised dealerships in the
U.S. must look elsewhere to pick up the revenue slack. Dealerships and automakers have
ample opportunities to increase their share of
the accessories market, now dominated by aftermarket providers, and to build customer
loyalty in the process.

PAGE 28

DECEMBER 2017

"We've got to do a better job of selling" accessories, says Trevor Gile, managing partner
of Motorcars Honda in Cleveland Heights,
Ohio. "That'll be the next big movement to
capture every penny."
Gile says dealerships must "get the nut
cracked" of installing accessories more quickly and efficiently. He is revising his service department's processes to help accomplish that
goal, Gile told Fixed Ops Journal.

DAVID KUSHMA

"We've got to do a better
job of selling [accessories].
That'll be the next big
movement to capture every
penny."
TREVOR GILE, managing partner
of Motorcars Honda

Mark Seng, global aftermarket practice
leader at the data analysis firm IHS Markit,
says "dealerships are getting aggressive across
the board" about selling accessories, "and
OEMs are focusing on the aftermarket, too."
"The dealer is positioned better in the consumer's mind" than independent competitors
to provide sophisticated accessories such as
electronics, Seng said in an interview at last

month's Specialty Equipment Market Association show in Las Vegas. But he adds that it
now "takes a much greater level of expertise"
to sell accessories successfully.

Seven keys
To capture a greater share of the aftermarket, dealerships need to offer accessories to
customers as an integral part of the new-vehicle sales process, dealers, suppliers and industry consultants agree.
That means committing to adequate pay,
training, equipment and support for dealership employees, including those in fixed operations, to sell accessories, industry experts say.
Among their recommendations:
Get service and parts employees involved in promoting accessories,
both during the new-vehicle sales
process and when owners come in
for service. Enabling vehicle buyers to talk to
specialists who install accessories can provide
a reassuring source of expertise.
Dealerships often "drop the ball in creating
an introduction from sales to service" for
new-vehicle buyers, says Gina Allen, fixed operations director of the Santa Margarita Auto
Group, which operates Ford and Toyota dealerships in Rancho Santa Margarita, Calif. As a

see SUCCESS, Page 29

Table of Contents for the Digital Edition of Fixed Ops Journal - December 2017