Leveraging Your Service Lanes for Inventory Acquisition
Appointments to service cars are made every day. Sometimes, a service appointment is for a routine oil and filter change and fluid level check whereas other times it’s because the car needs a major repair.
The pandemic wreaked havoc on many industries, leading to a slow recovery of new car inventory and the availability of auto parts, which has caused many people to hold onto their older cars longer. Spikes in fuel prices also had an impact on how people reduced expenses — driving less and owning a more fuel-efficient vehicle has become the norm for many.
Since your customers are keeping their cars longer, they’re spending more time and money taking care of them, which actually works to your advantage when you use our Service Drive Acquisition feature.
Customers are driving differently
Driving habits have changed for several reasons. Less time on the road because of fewer long-distance drives, more remote or hybrid work arrangements, and rising fuel prices means many cars have significantly fewer miles on them than they typically would, but they still require maintenance. Auto Service World indicates that there will be a steady demand for auto shop services in the coming year. They also predict a downturn in aftermarket part sales due to high interest rates slowing customer spending.
People are keeping their cars longer
Car manufacturers are building better vehicles today, so auto owners have no problem hanging on to their rigs, which is tough on your acquisitions team and their inventory-building efforts. However, you can always find a handful of customers who want the latest technology, such as cars with driver assistance packages or other improved safety or entertainment features. These tech seekers and those with repairs they simply can’t afford are likely sipping a coffee in your service lounge right now.
Unless these customers venture onto the showroom floor or stroll your lot, browsing your inventory while waiting, you may not realize they’re among that special handful of your customers. It’s hard to match a car to its owner when they’re just sitting in the lounge having coffee — unless you sit down and spark a conversation. The Service Drive Acquisition feature helps take the guesswork out of who has that great car your acquisition team has been looking for.
What if you could know in advance which person is looking to either trade in their car or sell it outright? With the Service Drive Acquisition feature in your service department, you can.
Service lanes are busier and service revenue is up
Have you noticed an uptick of service customers in your waiting area or an unusual number of cars in the bays? At managers’ meetings, are the numbers from the “fixed” side of the dealership higher than normal? These signs mean people are taking better care of their cars and returning to your dealership for their needs. It also means you’ve established a good trust factor among your customers, which is perfect when your service team introduces the customer to the Service Drive Acquisition feature.
WardsAuto recently reported that there was a post-pandemic boost in parts and service revenue for the six largest, publicly traded new-vehicle groups in the U.S., and they anticipate continued growth throughout 2023.
It was also noted that service revenue for those six vehicle groups was up 10.5% in 2022 over the same time in 2021 and a 9.1% increase for the fourth quarter alone for a total of $3.4 billion in same-store parts and service revenue.
So, a lot of quality cars sit in service department queues, waiting for an oil change, annual tune-up, brake service, or other minor repairs. Our Service Drive Acquisition feature was created for this very reason and can help you add these cars to your inventory.
How the Kelley Blue Book Service Drive Acquisition feature works
Kelley Blue Book®, a trusted name in the auto industry since 1926, has developed a Service Drive Acquisition tool that helps dealerships find new used cars for their inventory by utilizing the service department to source their vehicles.
By using Service Drive Acquisition, you open the service lane as a valuable opportunity to find quality pre-owned cars and trucks. There are two straightforward ways for you to acquire the inventory you desire while giving your customer a trusted offer:
- Pre-appointment: Your sales or service team can give the customer an Instant Cash Offer before their appointment when they call to confirm the appointment.
- Appointment time: Your sales or service team can give the customer an Instant Cash Offer at the time of their appointment.
Either way, the customer receives an offer for their car from a trusted name like Kelley Blue Book, and you increase your inventory with a strong acquisition tool.
How can this help your dealership’s inventory acquisition?
Most customers are familiar with Kelley Blue Book because it figures prominently in trade-in values from insurance companies and financial institutions, and on sites like J.D. Power and Associates reporting that Kelley Blue Book is the most first-visited automotive site on the internet. J.D. Power and Associates is well known by consumers for their automotive awards and ratings.
Now, Kelley Blue Book’s Service Drive Acquisition feature can help your dealership acquire more quality used cars for your lot.
By using the Instant Cash Offer from the service lane with your Service Drive Acquisition feature, you have access to the vehicle’s records, including sales transactions and maintenance records, which helps when calculating the value of the vehicle for your acquisition team. This information isn’t readily available when you source your used car inventory from other places like auctions, classifieds, or online marketplaces.
Since the pandemic, used car prices have been unstable. Prices have defied the standard norm of depreciation by appreciating when the shortage of new cars was felt around the world. The shortage of circuit boards, computer chips, and other electronic parts have made used cars a hot commodity.
Car owners have become acutely aware of the price of cars because of the shortage, and they tend to spend more time online appraising the value of their vehicle before they even make a buying decision. It’s possible that the people in the service lane already have an idea of what their vehicle may be worth before they get your cash offer.
They probably used Kelley Blue Book to source their prices, so when a member of your acquisitions team presents an Instant Cash Offer, there’s a much better chance that customer will be receptive.
Other ways Kelley Blue Book can help your dealership
Kelley Blue Book® Trusted Advisor Program – Appraising cars is a balance between profit and loss, and the more tools you have to get those numbers right, the more the needle moves toward the profit side of the scale.
Our extensive study and analysis of the markets helps us narrow down values by region, offering trends within 134 regions and 51 of the largest markets in the United States.
In addition, you have access to the following:
- Fair Market Range: This report gives you the tools you need to make an accurate assessment with consideration for all the different types of equipment and options packages for the model you’re appraising.
- CPO Price Advisor: This gives you an analysis regarding the trade-in range and where the Instant Cash Offer would fall based on real market data, such as transaction data and listing prices.
- Private Party Advisor: This report gives you a range of values based on conditions that can help customers determine whether they want to trade their vehicle in or try to sell it themselves.
- Service Advisor: Partner with Kelley Blue Book to become your 24/7 Service Advisor. Customers go to KBB.com to research the maintenance needed on their vehicle, the latest recalls, and any other common services needed. From there, the Kelley Blue Book® Fair Repair Range gives them a reasonable estimate of service prices.
Whether your customer decides to sell their vehicle through the Service Drive Acquisition feature or to go ahead with their scheduled service, your dealership makes money either way.
Increasing inventory with Service Drive Acquisition: The bottom line
Since people sell their vehicles themselves for many reasons, it’s hard to source new inventory without spending a lot of time on the phone, sending bulk emails to current customers, or visiting auctions.
But that’s a waste of your acquisition team’s resources. For instance, there are multiple expenses attached to auction purchases, such as transportation expenses and time away from the dealership, so it makes sense to use your service lane as a way to put more quality used cars into your inventory while still keeping the service department busy. Our Service Drive Acquisition feature lets your acquisitions team do what they do best — acquire inventory.
For more information on how Kelley Blue Book keeps dealerships on the cutting edge, read our blog!