Keep Your Service Absorption Rate Healthy

August 12, 2019NuVinAir® Blog

With economic storm clouds looming, make sure your service absorption rate keeps you covered.

We’ve all heard about some industry-disruptive trends that are predicted to come our way, such as ride sharing, autonomous vehicles, and fractional car ownership.  Some have already arrived, such as electric cars and online sales techniques. While some of these can seem daunting, within every challenge lies an opportunity.

Keep Your Service Absorption Rate Healthy

Now more than any other time, it is important to have a healthy goal for your service absorption rate. For consumers who aren’t familiar with the term, service absorption is the percentage of after-sales gross profits after all the fixed expenses for the dealership are covered. Currently, NADA (National Automobile Dealers Association) says the rate for the first quarter of 2019 was 57 percent. A healthy service absorption rate will allow dealerships to ride out any impending storms over the long haul.    

What Steps are Needed to Improve Your Service Absorption Rate?

  1. Make data your friend. The more information you gather about your customer, the more you can connect with them. Use the insights you’ve gleaned to create a customer dialogue with every single person who has walked through your dealership door.
  2. Spend time in the service department and observe efficiency. Time is your commodity, which means if you increase the service efficiency, the department will handle a higher volume of service business. Watch the workflow, make sure the needed parts are on hand, and give your technicians the technology they need to do their work.
  3. Educate your staff about the value of cross-selling to customers, but never attempt an upsell just to make money. You need to think about your customer and know what their needs are, and how they would benefit from spending a little more money. For example, if they are coming in for an oil change or tire rotation, ask if they’d like to get a NuVinAir® treatment for their interior at the same time. By helping them see the value in eliminating the unhealthy air in their vehicle, the upsell will seem more natural. And, if your customer can sense you are putting their needs first, you’ll establish a deeper bond that will create a lasting relationship.

New to NuVinAir?

NuVinAir’s patented technology cleans a vehicle's air in minutes and gives you and your passengers that fresh, healthy feeling you just can't get anywhere else.

Ask your favorite dealership or detailer for NuVinAir today and experience first-hand a new kind of clean. For more about NuVinAir, visit nuvinair.com or call 1844-9-VinAir (984-6247)

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