Maximising revenue opportunities in a competitive market

Motorsport
Maximising revenue opportunities in a competitive market

Since establishing Bay Nissan in 1991 the Farmer Motor Group Limited has grown to become one of the most successful multiple franchise dealerships in the Bay of Plenty region, which is now known at the Farmer Autovillage Xtreme. We decided to pay a visit to Farmer Autovillage Xtreme and find out why this company has been so successful and how they have retained their market share in the face of a shrinking new car market. Farmer Autovillage Xtreme has just been awarded the 2008 Chrysler Jeep Dealer of the Year, and they have also been awarded the Nissan Dealer of the Year some nine times in the last 15 years. Group Managing Director Mike Farmer attributes the company’s success to always providing exceptional customer service and always giving the customer an opportunity to purchase something. Four years of planning and nine months of construction resulted in the impressive facility at 116 Hewletts Road in Mount Maunganui which Mike says was purposely designed to maximise employee productivity but also be an inviting place for customers to visit, even if it’s just for a coffee in the Engine Room Cafe. “Presentation and cleanliness of your premises is all important, your street frontage drives 35 to 40 percent of your business, so make sure that your front window is as inviting as possible,” says Mike. “You want people to come in and browse, so make sure your stock is presented well with easily read prices or if you provide a service, then have an easily read menu board of what’s on offer.” “If you have a courtesy vehicle, keep it clean and tidy, and when it’s not in use make sure it’s parked in the front of your premises where potential customers can see it. “The same rule applies to your reception/customer areas, they don’t need to be brand new but they do need to be spotlessly clean and tidy. If you have surplus office space and surplus computer gear, then why not set up an office space for people to be able to access the internet while they wait for their vehicle to be serviced or worked on. “We opened Bay Nissan during an economic recession in 1991 and we survived this time and prospered purely by providing exceptional customer service and this continues to be the driving force behind Farmer Motor Group.” “However we have always made sure that our overhead structure was able to cope with reductions in sales and gross profit.” Mike points out that there are many simple and not necessarily costly things that readers of Motor Equipment News who run any type of automotive business can do to improve their profitability but also their customer satisfaction. “Remember that profitability is a numbers game,” says Mike. “You only need to reduce expenses by one percent, increase gross by one percent and increase sales by one percent to enjoy a huge increase in net profit, that’s a fact.” The service reception area of Farmer Motor Group was set up like an airline lounge with one counter for each vehicle brand.

To improve efficiency for the customer even further the counter is manned by both the service advisor and part specialist. “This maximises the opportunity for customers to buy additional accessories for their vehicle with no delay and they can be fitted while the vehicle is being serviced. ‘Whatever you do, don’t be scared to ask the clients if they want to buy something, because no matter how big or small the item is, it’s all additional revenue.” The parts department at Farmer Autovillage was set up to make picking parts as quick and efficient as possible thanks to simple shelving with parts boxes as well as racking for larger items like tow bar assemblies. Inside the service area a plastic bin is allocated to each job, allowing the job card and parts required to be placed inside for the technician to find easily. Once the job is complete the technician will complete the job card while sitting inside the vehicle as it passes through the automatic car wash. “It might sound unusual for a technician to sit inside a vehicle while it’s been washed,” says Mike Farmer. “But it saves about five minutes per job, so multiply that by six vehicles and there’s half an hour of time saved which can be utilised more productively.” “The key points for automotive businesses to survive this economic recession are simple,” says Mike. “Stick to the basics, keep everything clean and presented well, make systems simple and stress free and above all make it fun for you and your staff.”

 


 

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