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Upselling guarantees to boost dealers' revenues

A good support network and training are the key to unlocking the substantial profits which can be made from upselling.

In the past dealerships have been accused of overlooking the benefits of items such as service plans which can guarantee the customer returns in the future.

Research by Castrol Professional shows the average dealer fails to convert about £220,000 legitimate upsell revenues per annum – work identified by the technician but not converted by service advisers.

Daksh Gupta, CEO of Marshall Motor Group, said a dealer principal or department manager should be incentivising staff to upsell because it focuses the mind.

He felt pay plans do drive behaviour and people will sell more if they are incentivised, but this means getting the right balance between what you pay people and what they sell.

Gupta added: “I don’t like one person selling one product. I like to see a combination and want them to be selling a whole load of everything instead of one thing.”

However, Gupta makes an exception with finance and insurance which are only sold by his business managers because they are such specialised areas.

An electronic system updated daily tracks sales of items such as finance and insurance and air conditioning servicing across Marshall’s 48 sites.

Gupta said this gives the group a benchmark as to each site’s progress and helps incentivise staff across the company.

He said: “This is essential in a group of our size. We have to find out who is doing a bad job and then improve by concentrating on those issues.”

Assumptive selling can also raise issues in a dealership.

The assumption that a customer will buy a product often leads to pressurised selling. It is frowned upon by many people.

Some prefer sales staff to introduce the item and then allow the customer to make up their own mind instead of being given the hard sell.

Gupta said: “I don’t like it because I don’t think it is customer based.

“It is more about profits and you could end up selling something the customer does not want.
“I don’t think assumptive selling does the customer any good.

“You may sell more, but I would rather sell the product’s features and benefits and let the customer make the decision.”

Chris Hayden, CEO and chairman of Ford Retail, said it is imperative to consistently measure performance.

The group has 67 sites and more than 3,000 staff which are listed on a central computer system used throughout the company.

Aftersales performance is measured via service health check forms to ensure people are recommending the customer comes back for items such as tyres or brake pads.

Hayden said this allows Ford Retail to monitor everyone’s performance effectively: “This is about making people better than they were yesterday.

“When you have sites all over the country it is important to measure your key performance indicators.”

Despite dealerships’ commitment to customer service the motor industry is extremely competitive and there is always the danger a customer can buy consumables such as batteries and tyres elsewhere.

To ensure this does not happen, Hayden said it is important to make sure they are a lifetime customer and your dealership is their first choice.

He said: “Our tyre sales have gone through the roof because we have focused on being competitive.

“We don’t just sell tyres, we can give professional advice and train people properly.

“We are car dealers and should be able to advise people on anything for their car.

"If you are buying a new car you must be made aware of what is available to you and is our duty to tell people of these things so the customer comes back.”

Hayden also believes some dealers have allowed various upsell opportunities to slip out their hands by not being competitive.

Dealers must demonstrate to customers they do not need to go anywhere else for their aftersales requirements.

For Ford Retail, upselling is all about a process of explaining the product to the customer and finding out what is good for them. That way, whatever they buy will be beneficial.

"The company believes that if staff adopt this attitude it will improve penetration.

With the right focus and training in sales techniques, service receptionists should be ready and able to promote additional services such as Smart repairs, oil top-ups, air-con services and tyre replacement.

By focusing on the additional benefits to the customer, and the convenience of booking the extra work while the car is already at the dealership, staff should enjoy reasonable conversion rates.

In the new and used car sales departments, alongside the opportunity to market F&I and accessories, one product which certainly adds profit and aids retention is the service plan.

Since the start of the decade Mini has shown UK motor retailers how service packages could be used to keep car buyers coming back to the franchised garage.

Uptake of its TLC package, which provided a fixed cost for five years servicing to Mini buyers, was phenominal, and led Mini to offer an extended TLC XL which could keep cars coming back to the network for eight years or maintenance.

More manufacturers now support service plans as an offering which outwardly provides value and ease of payment to cust-omers, yet benefits franchised dealers through customer retention.

Dealers can also work with independent service plan providers such as Emac or The Warranty Group.

Ian Simpson, sales and marketing director of The Warranty Group, said some dealerships have achieved 80% penetration of service plans.

He said a dealer could make £100,000 out of the product over three years.

Simpson said service plans do not always fit easily into the sales process. He recommends training someone specifically to upsell the product at the point of handover rather than the point of sale.

It could become part of the handover process, much as the car sales process should involve an introduction to the business manager for an F&I pitch.

But by leaving the service plan upsell to the handover point, it will not confuse the sales process and the customer has already had a “cooling off” period from buying the car.

Simpson said: “We are finding we need to adopt an individual within the dealership to become an expert.

"If you train all the sales people it becomes too diluted and, in most cases, the sales are poor.”

However, Emac thinks service plans are a natural upsell and recommends they should be sold at the point of sale and do not require a hard sell as people can be offered fixed servicing costs which are unaffected by inflation. 

Paint protection

Diamondbrite – made by Jewelultra – retails for £299, of which about £170 will be dealer profit.

The company’s national sales manager Neil Simmonds said the cost includes fabric protection treatment.

He said: “The benefits of the treatments to the customer are the paint protection means they never have to polish the vehicle for as long as they own it plus the fabric will repel spills and stains.

“Penetration varies but we encourage dealers to go for about 40% on new cars.

“On used it is not quite as good because people have the mindset the vehicle has been open to the elements.

“However, Durabrite will bring paint on a used car back so it is nearly as good as new.”

Jewelultra provides free training for valeters which takes about an hour and for sales staff two hours.

Simmonds said: “It should be offered to every single customer because of the benefits. If you are spending £10 -15,000 on a car you want to protect it.”

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