Online merchants and big box stores have a lot of buying power and negotiate attractive margins in order to resell their parts and tires at discount prices. Many consumers then head to these types of retailers for savings.
The solution for a workshop is to adopt strategies to deal with this fierce competition.
Consolidating purchases with your top distributors pays off.
For the purchase of tires and parts, concentrating your purchases locally is a paying commitment. For the majority of large distributors, the average prices on a shopping cart are similar, however by grouping purchases we are working on a partnership component vs a supplier relationship. Everything becomes more interesting and more profitable:
- Simplified return management,
- Discount for placing orders online,
- Monthly volume discount,
- · Prompt payment discount.
In short, no consumer pays workshops for an advisor to spend hours finding cheaper parts. It is with the dollars of profits that a workshop pays the bills on a daily basis. It is therefore important to understand that 40% profit on a coin at $12 is more profitable than at $10. The advisor has a role to advise the customer and to assert the advantages of local distributors such as the national guarantee.
Explain the disadvantages of low cost purchases
Instead of discrediting cheap tires, it is suggested to list the advantages and disadvantages of each tire that can be installed on the vehicle and let the customer choose what they want. After all, a good advisor informs and guides the consumer in his selection.
The goal is to make the customer pay for significant added value.
Mechanical shops are not necessarily the cheapest, but they definitely offer more for the price by giving value to customers. When we change the tires, we carry out an inspection.
By trying to adjust to the industry giants, the latter will always find a way to display a lower price, thanks to their strong bargaining power. Customers who only have the lowest price in mind are not the ones who can ensure sufficient long-term profitability.
Service: a major advantage
The purchase of tires, for example, is a major investment for some and a mandatory purchase for others. Some consumers do not want to waste their time choosing and do not hesitate to buy the cheapest tires online or in supermarkets based only on online reviews.
To stand out from this competition, workshops have every interest in focusing on service, promoting their reputation and offering a storage service. Instead of adjusting prices according to industry giants, technical advisors must rely on service and, through a series of questions, encourage a visit to the workshop rather than giving a price over the phone. It is through simple and technical questions that we can see the arrival of the customer at the counter.
On the phone, we inquire about the type of vehicle and we ask technical questions about the load capacity, the speed rating to create a context of new information that will lead the customer to go to a branch to better understand his options. On site, an advisor inquires about the vehicle, the time the customer intends to keep, the mileage or driving habits. It will then be easier to suggest a tire and explain why it costs more than another. A customer who has moved to 90% more likely to buy than on the phone.