If you are looking to drive up your profits, you need to ensure you have service advisors that have the right attitude, aptitude and ethics. They will need to have the natural talent to sell, they will need to be well trained, and they will need to have the proper support systems in place. And lastly, you will need to have the right compensation and incentive plan in place to help your advisors excel. Here are some tips you can use to drive up your sales, profits and customer satisfaction scores, all at the same time.
1. In drafting any pay program, the first question you should always ask yourself is what are you looking to accomplish? With service advisors, you should be looking for them to generate three things: sales, gross profits and happy customers. This is why at Elite we encourage our coaching clients to implement pay programs that only reward their advisors when all three objectives are met. For example, the advisor can earn a graduated commission on sales, but in order to be eligible for the added income, they will need to meet minimum requirements for gross profit and customer satisfaction scores. With a program like this in place, with each sale the advisor will work toward ensuring that it is profitable, and that the customer is pleased. Compensation programs for advisors that only address sales without considering gross profit and CSI requirements are set up to fail because the shop typically encounters much higher expenses, and lower CSI scores. Remember, the behavior we get is the behavior we reward.
2. If you have more than one advisor at your shop, you have a number of options for how you can compensate them. Many shop owners will put each advisor on their own commission program, but unfortunately, this leads to an unhealthy type of competitiveness, and there is no incentive in place for them to help one another. This is why we recommend a shared commission whenever there are multiple advisors, especially when they have to cover for one another. If you have a more experienced and more productive advisor working with a less experienced and less productive advisor, you can easily adjust by either giving the more productive advisor a larger percentage of the shared commission, or you can provide them with a base pay that is supplemented by the sales commissions they will earn. These pooled commissions incentivize the teamwork you need to grow a successful auto repair shop.