7 Advantages Of Adding PDR To Your In-house Reconditioning Operation

In the reconditioning business, you’re always looking for a way to add another profit center. Luckily for you, adding Paintless Dent Repair (PDR) as an in-house capability is a great way to increase profit with minimal effort. As someone who’s already performing automotive repairs in your service bays or collision center, adding PDR to your processes will actually be pretty easy. With PDR, you can reduce the time you spend on bodywork during the reconditioning process, but you can also save quite a bit of money as well.

Trained PDR technicians can “massage” out any dents or dings found on a vehicle’s body. PDR typically relies on no damage to the paint in order to be as efficient as possible. Even so, technicians can still perform PDR to reshape the dents, and provide paint touch-ups if need be.

Below are 7 advantages of adding PDR to your reconditioning process.

 

It (Mostly) Doesn’t Cost Anything In The Long Run

Outside a few initial specialized tool purchases and training, PDR basically pays for itself. Once you have the training and tools, you won’t be paying any incremental costs to perform PDR since none of the tools or parts will require frequent replacement.

 

It Has a High Potential To Net You Profit

With the right technician, a $100 or $200 job can be done in 10 – 30 minutes with PDR.

 

You Have The Opportunity To Provide Better Deals To Customers

Most of the average drivers out there today have no idea what PDR is. It’s been around for close to 60 years, and there are still shops that don’t have it as a part of their repair processes. So, if a customer comes in with dents that need fixing, imagine their response when you tell them you can repair them all in a fraction of the time and for a fraction of the price of conventional dent repair. You may already use an outsourced PDR technician, but if you find yourself waiting for them to show up to complete the repairs, that vehicle downtime is costing you even more than just their charges.

 

Creates An Avenue For New, Potential, Customers

If you already have a stream of customers for other repairs and maintenance, you can offer dent removal as an up-sell in the service drive. In most cases, the dent work can be done during other repairs or services, adding no additional wait time for the customer. In addition to your walk-ins, you have the potential to bring in work from auto auctions, used car dealerships, car rental agencies, car insurance agencies, detail shops, and body shops.

 

Minimal Effort To Adding It Into Your Shop

PDR isn’t a method that requires a drastic change in your business. As we said above, it only requires a few initial tool purchases. Outside of that, there’s a pretty minimal space required to do the work and can easily be done in the shop or on the road with what you currently have. It only takes a few minutes to do during your detailing or painting phases, and it’ll just take a minute for you to speak with the customer, bring up the dents, and offer to repair them without any impact to the overall repair time.

 

Relatively Low Start-Up Cost

PDR will basically pay for itself once you’ve trained your technician(s) and purchased the proper equipment. It can be self-taught, but professional training and tools can cost anywhere from $5,000 – $15,000 depending on the level of training, certifications, and the quality of the tools. However, after the initial investment, PDR has high profit potential and costs much less than other typical investments for business line extensions.

 

It’s Easy To Sell To Customers

No matter what, offering a dent repair option that costs a fraction of conventional dent repair to a customer is a pretty easy sell. Since it only takes a few minutes to repair, the lower costs are drastically made up by the sheer volume of PDR that can be done throughout each week. What takes many shops days to do, you could do in minutes. So, if you provide a quality option that saves customers money and is convenient for them, you’ll ultimately get more business down the road.

 

AutoMobile Technologies offers Software Solutions That Can Help You Manage Your PDR Process

AMT offers software designed to make your reconditioning business more efficient, provide you with better visibility, and give you peace of mind knowing that your back-office is always up-to-date.

ReconMonitor is a state of the art workflow automation software for auto recon, dealerships, and auto remarketing companies. ReconMonitor dealership software decreases reconditioning cycle time from acquisition to front line and increases your control and profitability.

ReconPro is the industry’s most versatile and powerful software solution purpose-built for auto recon professionals. With essential tools for performing PDR estimates, hail and insurance matrixes, parts management, paint code lookups, integrations with body shop crash systems and accounting systems, too. ReconPro manages the details of running your business so you can focus on growing your business.

Watch For These Used Vehicle Trends Through 2019

 > Sales mostly flat

 > New vehicle prices spur more Used vehicle shoppers

 > Increased Used inventory means larger depreciation

Much like the year before, 2019’s new and used vehicle market is moving apace. Sales have been decent enough – with no real jumps in profits. However, analysts still warn of the impact of higher vehicle prices on the auto industry in general, which may mean greater margins for used car dealers.

With many in the industry voicing their concerns, there are a few used vehicle trends you should plan for in 2019.

 

Sales Will Mostly Be Flat

Plenty of organizations are predicting flat sales. Both NADA and other economists expect the new car sales to be lower than 2018’s 17.3 million. Beyond that, according to Automotive News’, David Muller, senior economist at Cox Automotive, Charlie Cox, said:

“We estimate the market to be around 39 million and a half on the used side in total.”

In 2018, used cars saw a slight increase in sales in comparison to the new market. However, this year, they don’t expect the sales to increase by any substantial measure – which would end the 5-year gain the used market had been experiencing.

 

Increased Vehicle Costs Will Turn Customers To The Used Car Market

As manufacturing prices continue to rise, so will new dealership prices, and therefore use vehicle prices. However, the key difference here is that used vehicles will ultimately be the cheapest option for consumers.

The chief economist at Cox Automotive, Jonathan Smoke said: “The fundamentals remain solid; used-vehicle demand is at a peak. Wholesales supply is now post-peak and starting a gradual decline. The used market is the answer to the affordability challenges in the new market.”

 

Lease Maturities Will Peak

In 2019 alone, Automotive News’, David Muller, says more than 300,00 vehicles will come off lease in 2019 in comparison to last year. According to Cox, maturities are expected to peak around 4.1 million units– which comes three years after new light-vehicle sales hit a record of 17.6 million.

Executive Vice President and Chief Economist at ADESA Analytical Services, Tom Kontos said: “So With a high percentage of purchases happening upstream, there were comparatively fewer vehicles working their way downstream into physical auctions.” Which assisted in keeping prices from falling fast.

 

There Will Be Larger Depreciation

Since there will be an increase in supply, there’s an expected increase in the rate of depreciation as well. According to President of Operations at Black Book, Anil Goyal, the rate of depreciation for 2018 was 12.4%. However, he said the rate will go up to 15% in 2019.

 

There Will Be An Increase Of SUVs In The Market

Companies, such as Ford, are going all in with trucks and SUVs. According to Tom Kontos, “Even if supply growth in total is fairly moderate, the growth in crossovers and SUVs is going to be fairly significant.”

 

Bottom line: Used vehicle sales will be close to last year’s peak levels, which is good news. Demand will remain steady, partly fueled by higher new car pricing. SUVs and Crossovers continue to dominate consumer interest, and vehicle inventories should generally match their needs.

How Reconditioning Software Reduces Your Time To Market

Recon management whiteboard

Yesterday’s recon management dashboard. Don’t rub it the wrong way!

With each year, more and more dealerships are adapting to the latest and greatest technology. They’re doing this to increase their inventory turn times, but to also anticipate the likelihood of selling outside of those time spans. There are a lot of things to consider as a used car dealership, but one thing for sure is that each day a vehicle is being reconditioned, you’re losing money.

So, let’s approach time to market with an example. Let’s say your turn time is 50 days, but it takes you a total of 9 days to recondition the vehicle from auction to the frontline. With that turn time alone, you’re already reducing the vehicle’s chance of getting sold by 18%. Beyond that, if you wait too long, you may have to send it back into auction or reduce the price significantly to make any profit from it. The longer you have a vehicle in inventory that isn’t driveable by a potential customer, the less likely it’ll get sold.

Because of an inefficient recon operation, problems with morale can develop between your different departments. The business relies on the sales force selling vehicles as soon as possible, but if the technicians in the service department are taking too long, there will inevitably be some friction. At the end of the day, time to market relies the most on the reconditioning process pushing out vehicles as fast as possible for the sales team.

If you create a standardized process for your back-office, service department, vendors, and front-end sales, your time to market will drastically reduce. One of the biggest bottlenecks for used car operations and the reconditioning process is communication. Reconditioning management software can bridge the gap between all of the departments– making it easier for information to be accessed, knowing who’s accountable for delays, and getting approvals as fast as possible. It can even reduce friction between departments, by enabling your Fixed Ops department to set Sales department expectations with reliable delivery times for each vehicle.

To make sure all of your vehicles are frontline-ready as soon as possible, reconditioning software is an absolute must in this market. It enforces a much more organized approach when it comes to back-office information, vehicle reconditioning, sales, and customer satisfaction, and all the relevant information is available at the touch of a button on your computer or mobile device.

AutoMobile Technologies Can Help

AMT offers software solutions designed to make your reconditioning business more efficient, provide you with better visibility, and give you peace of mind knowing that your back-office is always up-to-date and your reconditioned vehicles are delivered at speed.

ReconMonitor is a state of the art workflow automation software for dealerships, auctions, and auto remarketing companies. ReconMonitor dealership software decreases reconditioning cycle time and increases your control and profitability.

Tariffs Are Still The Biggest Threat To New Car Dealerships In 2019

With the agreement between the United States, Mexico, and Canada (USMCA), some of the previous tariffs’ impact has been erased. However, according to NADA News, Section 232 of the Trade Expansion Act of 1962 will still have negative effects with tariffs on automobiles and vehicle parts. A report by the Center for Automotive Research (CAR) says vehicle prices will go up– trickling down from the manufacturers to new/used car dealerships, and then to the consumers.

Back in July 2018, CAR’s research concluded that the tariffs would lead to a considerable increase in vehicle prices. It also showed manufacturers and dealerships would see a decline in annual new-vehicle sales and industry jobs. In CAR’s latest report, they created a total of ten different scenarios using U.S trade policies, Section 232 autos, auto parts tariffs (steel/aluminum as well), the USMCA agreement, and Section 301 tariffs involving Chinese imports.

According to NADA News, if the USMCA agreement is launched in its current state, CAR anticipates that:

  • Up to 366,900 U.S (77,000 of which are franchised dealerships) will be lost.
  • The average price of U.S. light-duty vehicle prices will go up by up to $2,750.
  • New U.S. light-vehicle sales will see a decline of up to 1.3 million units per year.
  • Consumers will be forced into the used car market.
  • Vehicle repair and maintenance costs will drastically increase for consumers.

CAR estimates that Section 232’s tariffs on automobiles and vehicle parts will be responsible for roughly 90% of the total economic problems that result from collective trade policies. In its conclusion, the most recent CAR report notes, “While the trade restrictions adopted or under consideration are intended to assist U.S. workers, these policies are likely to be extremely disruptive to and negative for the U.S. economy.”

NADA CEO, Peter Welch, says: “This analysis confirms that broad Section 232 tariffs on autos and auto parts still present the biggest trade-policy threat to consumers and the U.S. economy. NADA understands and appreciates the Administration’s attempts to level the trade playing field and eliminate unfair trade practices, but expensive Section 232 auto tariffs are the wrong tool for the job because they will lead to dramatic price increases, depressed vehicle sales, and job losses.”

In July, Welch spoke before the Department of Commerce and requested the Administration abstain from applying the broad-based tariffs on automobiles and vehicle parts.

“We should continue to work together to address genuine trade concerns, but without hurting American consumers, and small businesses in the process.”

Auto Dealerships Will Be Just Fine In 2019

New & Pre-Owned Sales signAccording to NADA News, Senior Economist for NADA, Patrick Manzi, said trends are looking good for both new and used vehicles in 2019.

He continued on and said in a recent speech in San Francisco: “The current posture of the U.S. economy is strong. A tight labor market continues to put upward pressure on wages, which are rising. Consumer spending, a significant contributor to GDP, remains solid. It’s a positive sign that consumers are spending money.”

In 2019, NADA expects there to be roughly 16.8 million sales in light trucks and new cars– a 3% decrease from 2018’s fourth straight year of 17 million units.

However, Manzi warned that the rising interest rates for auto loans will impact the affordability of vehicles for consumers in the coming year. With rates and monthly payments expected to rise, he says younger consumers will shift to the used car market. “This is a great opportunity for dealers to get these customers into nearly new certified-pre-owned vehicles.”

With the used car market’s expected increase, software companies have developed software to make the reconditioning process as efficient as possible to maximize profits. Products like ReconMonitor can help you track each vendor or employee task and identify what order those tasks are being performed. This helps you execute auto remarketing at maximum speed, and ensure you have the stock available to meet consumer demands.

Why Your Dealership Should Prioritize Convenience And Transparency

Why Your Dealership Should Prioritize Convenience And TransparencyAccording to Dealership News, research from a Cox Automotive Service Industry Study showed dealerships are losing out on roughly $266 billion dollars a year in service revenue. Beyond that, the biggest contributing factor to it all is customer trust and inconvenience. Unfortunately, many dealerships aren’t doing enough for customers to feel completely comfortable with their purchasing process.

Released back in January, the study also showed that 70% of all customers who bought or leased a vehicle from a franchised dealership did not return for continued vehicle service. The reason behind this? Well, they’d rather take their chances with established body shops and independent repair shops. In fact, the study showed customer service satisfaction with dealerships was about on par with the small body shop you may see down the street.

With the average age of vehicles out on the road sitting at around 11.5 years old, it isn’t too surprising that dealership services see a reduction in visits as a car ages. However, on the plus side, dealerships still lead the way against third-party businesses for overall customer visits– but lag in customer service, convenience, and transparency.

Dealership News suggests a few simple fixes for this would be:

  • Providing customers a way to pay online.
  • Schedule appointments with customers via their mobile devices.
  • Picking up and delivering serviced vehicles to and from customer locations.
  • Provide simple repairs to their vehicles outside of the shop setting.
  • Providing customers with information, such as trade-in value, services, price ranges, estimates, and competitive ranges.
  • Give customers a way to monitor their vehicle’s service remotely.

Jim Roche, Vice President of Marketing and Managed Services with Xtime told Fixed Ops Journal: “Dealers have to figure out how to get your vehicle to the service, or the service to your vehicle.” Which is in line with the study that also suggests customers are willing to pay more or travel longer distances if the customer service is great.

 

AutoMobile Technologies

AMT offers software solutions designed to make your dealership more efficient, provide your customers with the information they need, offer you better visibility, and give you peace of mind knowing that your back-office is always up-to-date and you’re building a positive relationship with customers.

ReconMonitor is a state of the art workflow automation software for auto recon, dealerships, and auto marketing companies. ReconMonitor dealership software decreases reconditioning cycle time and increases your control and profitability.

How Finance & Insurance Helped Dealerships In 2018

How Finance & Insurance Helped Dealerships In 2018

It looks like Finance & Insurance were great for dealerships last year. In fact, prepaid maintenance programs (38.9%) and vehicle service contracts (43.9%) were their most profitable sellers.

According to Auto News, Protective Asset Protection created a paid survey in December to look at how well dealerships handled Finance & Insurance (F&I) over 2018.

More than 150 dealerships opted in, completed the survey, and reported their gross margins were unchanged from the previous year (35% of dealerships said the same thing). However, 32% of sellers reported their F&I revenue had increased by 10%. While another 30% reported increases between 5% and 10% in comparison to the previous year. Beyond that, 42% of dealerships reported that vehicle service contracts (VSC) and maintenance programs were their biggest hits.

As we move more and more into 2019, experts suggest VSCs will continue to grow in popularity as consumers shift towards purchasing used vehicles. According to NADA, used vehicle sales were 39 million in 2018. Whereas new vehicles sales were 17.3 million. However, the expectation is for new vehicle sales to drop down to 16.6 million. With this change, consumers will need VSCs and other maintenance programs for taking care of their trucks and SUVs.

Senior Vice President of Protective Asset Protection, Rick Kurtz, says: “We believe the demand for many F&I products will continue to grow in the upcoming years, especially as more consumers use pre-owned vehicles to combat the affordability of new automobiles. What’s more, the continued trend of off-lease volume will place additional focus on used vehicles, where VSCs and maintenance programs will significantly help to ensure consumers keep their automobiles on the road and running. Also, we all see dealer-owned warranty company applications, in particular, helping dealers offer top quality F&I products designed to satisfy the needs of their customers.”

With the increase in F&I business, now is the time to evaluate how your business handles service contracts, and what systems you have in place to manage the work. AMT can help. If you’re working with F&I contracts, ReconPro can help you initiate a claim, schedule a repair, and maintain all records associated with the Service Contract. Apply Service Contract terms directly into vehicle records to create correct invoicing and improve customer satisfaction.

Four Tips to Keep Customers Coming Back to Your Dealership

In 2019, dealerships have a lot of competition when it comes to returning buyers, servicing, and simple repairs. However, if you focus on the customer experience first, you’ll keep them coming back for years to come. Nowadays, it’s not just their time at your dealership that counts, but also their convenience when visiting your website or waiting for their vehicle to be serviced.

The auto industry is evolving every day, and the way your customers experience your business is changing, too. Below, we have four tips that will keep customers coming back to your dealership.

 

Prioritize A Simple, Effective, & Informative Online Experience

Obviously, smartphones are everywhere. We all know it, and because of this fact, the way customers experience your business begins with a Google search. Typically, they’ll see a list of businesses (on Google My Business)  in their area that match what they typed in. They’ll go through, read reviews, look at pictures you upload, and then they’ll go to your website.

Customer service begins at first touch– your website. If it’s easy to navigate, provides useful information, and puts simplifying the customer experience first, then you’re much more likely to gain their business– and keep it.

 

Be Transparent With Customers

First and foremost, this will gain your customer trust. People know when salesmen are just trying to close a deal. It’s also safe to say many dealerships believe front end sales are where all of their money is made. However, in today’s market, it’s not so simple.

If you treat a customer well and prioritize their comfort, they’ll be more likely to come back for business and refer you. Beyond that, when you set expectations,  provide exact costs, estimates, rebates, and work with them through every step of the process, you’ll develop a positive relationship.

However, as you’ll probably guess, this transparency doesn’t end with the in-person meetings. The best dealerships have software in place that will calculate everything a customer needs to know, instantly, for their purchase– including all of the things (and more) that we listed above. Whether it’s for service, or simply offering information, you can send out automated text alerts for customers to stay updated, giving them another easy way to connect with you.

 

Keep In Touch With Customers

Whether it’s through emails, texts, or phone calls, it’s important to check in with customers every now and then. This isn’t to suggest you should pester them on a regular basis (don’t do that), but sending out promotions every now and then is never a bad idea. Beyond that, if you have a social media page, that can be a great way to stay in contact with customers and provide updates on anything you’re doing that they may be interested in.

 

Have A Management Software System In Place

We touched on it a little bit above, but it’s crucial to have a system in place that helps make the customer experience as easy and informative as possible. In 2019, the majority of the most successful dealerships have a software system in place that not only increases operational efficiency, but also can create custom forms, email templates for promotions, provide customers with text message updates on services, and inform them of pricing and estimates on the fly.

 

AutoMobile Technologies

AMT offers software solutions designed to make your dealership more efficient, provide your customers with the information they need, offer you better visibility, and give you peace of mind knowing that your back-office is always up-to-date and you’re building a positive relationship with customers.

ReconMonitor is a state of the art workflow automation software for auto recon, dealerships, and auto marketing companies. ReconMonitor dealership software decreases reconditioning cycle time and increases your control and profitability.

NADA Chairman Says Dealerships Need To Be Active “Now More Than Ever”

According to NADA News, the new NADA Chairman, Charlie Gilchrist, strongly recommended that franchise-owned dealerships need to be active in NADA “now more than ever.”

He continued on with his recent speech in San Francisco and said: “I want you to think of your association as your second identity. It’s always a part of you, and it’s always there. That’s a big deal, whether you’ve been working in this industry for decades or you’re just getting started.”

President of Gilchrest Automotive, Charlie Gilchrist, has franchises including Ram, Nissan, Ford, Volkswagen, Buick, GMC, Chevrolet, Jeep, Dodge, and Chrysler all in the DFW area of Texas. His obvious success quickly reminded everyone in the Moscone Center that being a franchise owner is the best way in the world to distribute vehicles. However, he also discussed some of the major challenges dealerships of all sizes are familiar with and will have to prepare for down the line.

“My challenge to each of you today is to get involved,” Gilchrist said. “You are not just ‘a member’ of NADA. You are NADA.” He then followed up with: “Profitability in our new-vehicle department is a serious issue. This means we have to be better, and more creative, at running the rest of the store. We must adapt to this reality to survive in this new world.”

Beyond that, according to NADA News, Gilchrist urged the entire auto industry to unite together to help tackle the issue of technician shortages in the retail sector by supporting the NADA Foundation Workforce Initiative.

With the shortage of technicians and the many challenges ahead for dealerships in 2019, software companies are working hard to help manage and automate the workflow of dealership operations. Among the leading products is ReconMonitor, a state of the art workflow automation software for auto recon, dealerships, and auto remarketing companies. ReconMonitor dealership software decreases reconditioning cycle time and increases your dealership’s operational control and profitability.

Retired NADA Chairman Says Dealerships Are Writing The Future

Wes Lutz – Former NADA Chair

Recently in a speech in San Francisco, now retired NADA Chairman, Wes Lutz, advocated for dealerships in America to fully embrace the changing times for dealerships. Advising them to truly listen to their customers and discussing what the future of the auto industry holds.

According to NADA News, Wes Lutz is the president of Extreme-Dodge-Chrysler-Ram in Jackson, Michigan. Lutz was the head of NADA and was there to see new-vehicle sales go beyond 17 million units. However, he also predicted that personal vehicle ownership would eventually end.

“As I traveled around the world in 2018, my biggest takeaway was this” So many people want to write our narrative. They say that dealerships are fighting the inevitable, that change is coming and we don’t like it,” he said during his speech. “The truth is that we love change. Change is not happening fast enough for us. Dealers aren’t fighting the future, we’re writing it.”

Lutz continued on: “People prize convenience above all else. People value freedom above all else. The ability to just get up and go without waiting for anyone is a luxury that people don’t want to give up – they can’t afford to. Which is why people have very little interest in giving up their keys, despite what Wall Street or Silicon Valley says.”

With customer convenience at the forefront of dealership focus, software companies have management software available to help make dealership operations, and the customer’s life as easy as possible. Products, like ReconMonitor, have fully customizable forms and triggers that can notify customers of their vehicle’s status, and alert vendors and employees when their work is coming up. No more phone calls required to keep everyone informed.