One of the most popular and proven ways of driving consistent revenue for automotive dealerships in Australia is having a service department. Setting up a service department at your car dealership can offer many advantages beyond just recurring cashflow, it builds long term relationships, and even referral business. That brings us to the question, how do you start a service department at your dealership?
EasyCars has put together the complete guide to starting a service department in 2024.
Let’s get into it!
Define Your Service Offerings
The first step to starting a service department at your car dealership is to understand what services you want to offer. The services that your service department will offer will have a big impact on the tools that you need, space, and most importantly investment needed.
Common car dealership service department services include:
- Routine maintenance (oil changes, tire rotations, etc.)
- Diagnostic services
- Mechanical repairs
- Warranty services
- Bodywork and paint services
- Parts and accessories sales
Create a Business Plan
Planning is so important when it comes to achieving success in any industry. Put together a detailed business plan that outlines what you want your service department to achieve, how you are going to achieve it and most importantly what impacts your service department will have whether it be positive or negative on your existing dealership business.
Your service department business plan should include:
- Market analysis
- Competitive analysis
- Budget
- Revenue projections
- Staffing
- Marketing strategy
Having a strong service department business plan will help you make strong, detailed business decisions and raise funds if needed.
Get the Required Licenses
Before you can operate your service department, you will need to get the required licenses and permits. Requirements may vary depending on your location and the types of services you offer. Common licenses and permits include business licenses, environmental permits, and safety certifications. It's crucial to stay compliant with local, state, and federal regulations to avoid fines and legal issues.
Invest in Equipment and Tools
When it comes to operating a service department, nothing is more important than tools. Be sure to purchase all the tooling and equipment needed for your staff to perform your service offerings.
Essential service department tools and equipment include:
- Vehicle lifts and hoists
- Diagnostic machines
- Air compressors
- Tire changers and balancers
- Engine analysers
- Brake lathes
- Welding equipment
- Hand tools and specialty tools
Hire Staff
To offer car repairs and services, your dealership will need to hire experienced mechanic staff. Use platforms like Seek and Indeed to find qualified mechanics that can perform the tasks required efficiently daily.
Create an Efficient Workflow
Having a strong workflow is the key to being successful in the Australian Auto Repair industry. Put together a workflow that your mechanics can use. Consider the following when designing your workflow:
- Service intake: Try to streamline the process of receiving customer bookings.
- Workstations: Create an open and accessible workstations that your mechanics can use between different customer repair jobs.
- Parts inventory: Implement a workshop management system like Workshop Mate to automate inventory management.
- Quality control: Put together a quality control process that your mechanics must use to ensure high standards on every job.
Create a Comfortable Waiting Area
You will need to create an area where customers can wait whilst their vehicles are being serviced or repaired. The area must be comfortable and welcoming. Consider offering amenities such as:
- Comfortable seating
- Free Wi-Fi
- Refreshments (coffee, water, snacks)
- Televisions or reading materials
- Children’s play area
Marketing
How are you going to get customers to your service department? Effective and proven marketing strategies that your service department can use to gain customers include:
- Local advertising: Consider taking out an advertisement in local newspapers, or radio stations.
- Online presence: Be sure to create a website that customers can use to learn and book in for a service or repair.
- Email marketing: Send email marketing pieces to your past car dealership customer base.
Consistent and targeted marketing efforts will drive traffic and customers to your service department.
Final Word,
Setting up a service department at your car dealership is a proven and successful way for increasing revenue and maximising growth. The steps presented in this piece are how you can set up a service department at your car dealership.
DISCLAIMER – The content within this blog does not constitute professional advice and is intended to be general in nature. Please consult with all relevant parties prior to making any decision.
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About EasyCars,
EasyCars by Jeal is an Australian, web-based, dealer management system that automates the buying and selling of motor vehicles. Using the latest technologies, EasyCars removes frustrations experienced at the dealership and opens your doors for greater growth.
EasyCars features include Simple Stock Management, Automated Advertising, Integrated Accounting, Government Compliance, Business Reporting, Facebook Automotive Inventory Ads, Reviews Management, Dealership Websites and more.
To learn more about EasyCars Dealer Management System or to arrange a no-obligation free demo, contact us today on 1300 473 744 or submit the form below.