Focus on the price; not the rate

  08 November 2010

Another week; another chance to take a pop at franchised workshop labour rates.

The Warranty Direct annual labour rate survey is easy meat for those magazines and newspapers (and even some trade papers) who appear convinced that franchised dealerships are deliberately setting out to ‘rip-off’ their customers.

There’s no point in trying to argue with the figures. We all know that £90 an hour is probably about average but that figure is hugely influenced by high rates in and around the M25; a more typical average of around £85 an hour seems realistic.

Equally, there’s no point in bleating about the low profit margins in the business as a whole. The customer at the service desk is not going to thank you for making him pay for the fancy showroom or the Italian floor tiles, even though he may appreciate the free coffee and the warm waiting area.

The ‘brand experience’ may work at the point of sale but it certainly less convincing in aftersales, especially since many premium brand customers rarely spend much time hanging around the workshop.

So, why don’t we just come clean and say: ‘sorry, that’s what it costs to get your car serviced and maintained by a team of experts, working with the latest equipment and in clean, hi-tech premises’.

I don’t hear my IT consultant or my boiler repair man having to justify his hourly charges – and they both work from home.

And why are we allowing the debate to focus on labour rates when the real issue is the service received and the actual end price of the job? Did you get a courtesy car? How many hours did it take for the independent to do the work? And what parts were used, at what price?

Am I the only one who thinks the franchised sector needs to seize the initiative here? We need an aggressive, positive response campaign based on the facts; otherwise this is an argument we’re going to lose every time.

Have a great week, both in and out of the showroom. If you have a story for us, or want to get something off your chest, email rupert@auto-retail.com

Rupert Saunders

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