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For car dealers 2024 is the Year of the Service Drive...

12/29/2023

Clocking in Competition: Dealerships Gear Up Against Quick Service Shops in the Battle for Auto Service Dominance

As we peer into the landscape of 2024, car dealerships are bracing for a shift in focus. The showroom, once the bastion of their revenue, is taking a backseat as attention and resources are (finally) redirected towards the service drive. Dealerships are awakening to the realization that the Service Department is the battleground for customer retention and the competition isn't solely against the dealership across town but against the burgeoning quick service shops sprouting up around every corner.

In this era of instant gratification where a 15-minute home mortgage is a reality, consumers' most valuable currency is time. Quick service shops like Valvoline Instant Oil Change and Jiffy Lube have astutely recognized this and capitalized on it, posing a substantial threat to traditional franchise auto dealerships. Valvoline Instant Oil Change shops, for instance, reported income from continuing operations of $75 million grew 505% in 2023! Additionally, Take 5 Oil Change is now the fifth fastest-growing service franchise by sales growth at 47.6% and the eighth fastest in terms of store count increase at 20.2%. These nimble service centers tout advantages that resonate profoundly with today's fast-paced consumer:

1. Convenience: With extended operating hours and a hassle-free system often allowing customers to pull in over a pit where a team gets right to work, quick service shops cater to customers' busy schedules far more flexibly than dealerships.

2. Speed: The lightning-fast execution of oil changes and tire rotations in 15-30 minutes starkly contrasts the potentially lengthy waiting times at dealerships.

3. Cost-Efficiency: There's a widespread perception that basic services are more economically viable at quick lube chains compared to dealerships.

However, amidst this onslaught, dealerships wield several critical advantages that should not be overlooked and be shared with customers:

1. Expertise: Dealership technicians boast higher levels of training and possess broader knowledge, enabling them to handle intricate repairs and maintenance tasks that quick lube chains might struggle with.

2. Warranty Work: The ability to manage warranty repairs is a distinctive edge held solely by dealerships, setting them apart from quick-service competitors.

3. Parts Availability: Immediate access to genuine manufacturer parts is a trump card for dealerships, ensuring quality and reliability that quick lube chains relying on aftermarket parts might struggle to match.

The challenge ahead for dealerships isn't merely about combatting competition; it's about recalibrating their strategies to prioritize the value of time and convenience without compromising on their core strengths of expertise and reliability. By assimilating the customer-centric approach of quick service shops while leveraging their technical prowess, dealerships can carve out a niche beyond basic services, securing their position as the go-to destination for all automotive needs. The battleground has shifted, but armed with their inherent advantages and a willingness to adapt to technologies built to increase customer communications, dealerships can reclaim lost ground and forge a path forward in the evolving automotive service landscape and truly make 2024 the Year of the Service Drive.

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