Fixed Ops Journal - June 2018 - F36

FIXED OPS JOURNAL

PROFIT BUILDER
Adding Hunter tire stations enabled Tim Shipe's
service shops to offer free alignment checks.

RETURN ON
INVESTMENT

 Spending on new technology means soaring

sales for 3 dealerships' service departments
STEPHANIE HERNANDEZ McGAVIN

foj@autonews.com

im Shipe, fixed operations director of
three Hyundai dealerships in the
Houston area, isn't afraid to invest in the
latest technology, whether tire alignment stations or electronic multipoint inspections. He's seeing results, in the form of soaring
sales numbers, to validate that strategy.
"Technology has proven results is the easiest way to put it, without question," Shipe told
Fixed Ops Journal. "We would not be able to
maintain our profitability without it."
Shipe's dealerships - North Freeway Hyundai, Humble Hyundai and Baytown Hyundai
- are part of Potamkin Automotive Group. At
the beginning of 2016, Shipe added a total of
four Hunter Quick Check tire alignment stations to the service drives of the three stores.
Now that such checks take
just minutes, the dealerships offer customers a
complimentary
check
with every service visit.
Shipe says the stores
added the stations, which
cost $40,000 each, to provide better service to customers as well as bump up
Shipe: Tech aids
tire alignment sales. Incustomer trust
deed, such sales at the
three stores have increased from an average of
50 per month in early 2016 to about 300 today,
he notes. At Hyundai of North Freeway, which
has two of the Hunter stations, alignments
rose from 15 to 160 per month. The dealerships charge $109.95 for an alignment.

Getting into alignment
To perform a tire check, a service employee
secures a target to each wheel. A high-resolution camera uses the target to capture the
alignment measurements of each tire with
one forward roll. The system prints out results
for the customer that depict the vehicle's

PAGE 36

JUNE 2018

Bottom line

Here's how service sales at 3 Hyundai
dealerships in metro Houston
increased after they installed tire
alignment stations and an electronic
multipoint inspection program.
 Tire alignment sales rose from 50 a
month in 2016 to 300 today.
 Same-day service sales increased
25% since the dealerships switched
to the inspection program in January
2017.
 That program drove a 45% increase
in follow-up sales.
Source: North Freeway Hyundai, Humble Hyundai,
Baytown Hyundai

alignment needs.
After reviewing thousands of alignment
checks in the past couple of years, Shipe concludes that 60 percent of vehicles coming
through the dealerships' service drives need
tire alignments. But it's difficult for service departments to offer alignment checks without
the stations, he says, so necessary alignments
often aren't identified.
"Customers are in need of an alignment about
once a year, and it's hard for us to make that determination without the actual alignment
check machine," Shipe says. "Since we've had
the alignment machines installed, our customers are definitely going longer on a set of tires."

Better inspections
Shipe is also a big believer in electronic multipoint inspections, which he says build trust
among service customers and encourage follow-up visits.
In January 2017, he installed a system at the
three dealerships called Xtime Spectrum.
Xtime, a Cox Automotive subsidiary, had
launched it the previous year. Spectrum offers
tablet check-ins for service visits, appoint-

ment scheduling and reminders, and follow-up notifications that arise from electronic
multipoint inspections.
The inspections include photos that a service technician can show a customer in person
or by email or text message. The photos affirm
technicians' findings, Shipe says, while electronic reminders nudge customers back into
the dealership to get the recommended fixes.
Xtime says multipoint inspections are part
of 96 percent of all repair orders at the three
dealerships. Among those orders, the stores'
service departments recommend additional
service 73 percent of the time. The result is an
average bump of $276 per repair order, the
supplier estimates.
"It's not enough to invest in new technologies and hope it works out," says Jim Roche,
Xtime's senior vice president of marketing
and managed services. "We understand that
it's challenging to manage human and cultural changes, but we've seen strong management can make these changes happen with
great results."
Spectrum's features cost about $1,600 a
month for each dealership, Shipe says, but
they have paid off.
Shipe adds that he previously used a different multipoint inspection program, but it did
not integrate the scheduling and communication services that Spectrum offers. Since
switching to Spectrum, service sales have
surged.
Since 2017, same-day sales from multipoint
inspections at the dealerships have increased
25 percent, he says, and sales for which customers return for recommended work have
risen 45 percent. Last year, there was about
$405,000 in additional revenue for service
sales, Shipe says.
The inspection system "has definitely instilled trust and value to the customer," he
says. "They can now validate the items we are
recommending, and it has led to additional
sales." 

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