Thousands of pounds in aftersales revenue is being missed by franchised dealerships, according to data from autoVHC, the automotive aftersales solutions provider. Failure to complete vehicle health checks has resulted in dealers losing £11,295 each in potential additional income this summer.
The average UK dealer accepted 542 vehicles into their workshop in July and August – with a third of them released without undergoing a full health check. In July, the average invoice per completed health check stood at £64 and in August this was £63. Across the entire network of 4,900 franchised dealers, the total lost sales could potentially amount to as much as £55.3 million in just two months.
Service departments throwing away revenues
Chris Saunders, business unit director at autoVHC, said: “Missing out on such a significant amount of aftersales work poses a number of concerns for dealerships, not least in terms of staff performance.
“The volume of vehicles being presented to workshops is fairly consistent, so sales opportunities are there. Yet, as our data shows, by failing to complete a large proportion of vehicle health checks, service departments are simply throwing away revenue opportunities. This is despite the typical service department making up 50% of a dealership’s overall profits.
“Considering the expectation of a tough period for the car sales side of the automotive industry, neglecting aftersales activity in this way is very unwise. Trust also comes under the spotlight, with unsatisfactory VHC completion rates casting doubt over whether clear care and attention is being paid to customer vehicles during the servicing process.”
Don’t miss financial aftercare sales opportunities
New car sales fell for a sixth consecutive month in September, plunging 9.3% on last year, according to figures from the SMMT. Car dealers must look at ways to maximise their revenues, by ensuring vehicle health checks are carried out consistently, for example. Dealers can also explore new ways to market, through the provision of financial aftercare products for their customers.
Dealers should speak to every customer about how they plan to protect their investment when buying a new car. Offering extended warranty, GAP insurance and MOT test cover are just some of the options available to provide peace of mind and financial support should they need it. Download Car Care Plan’s Guide to Motoring Financial Aftercare to learn more about what products are available and their benefits for both dealers and their customers.