Again, we bring you reports of dealers who learned that matching car dealer quality can grow their business.
The customer that’s willing to pay for more than Internet pricing is going to expect an upscale shop, because stores in other industries are going upscale, and that’s what he’s come to see as the norm.
“It’s not that the customer isn’t willing to spend the money, it’s that the customer isn’t willing to spend the money at your store, if it hasn’t been updated in ten years,” says Larry Penn of Elettromedia.
Mitch Schaffer of Mobile Edge, Lehighton, PA, hadn’t updated his garage, although his showroom was first rate. At the last KnowledgeFest show in August, he went to a seminar on using the back installation bays to sell upfront. A light finally went off. He decided to spend $2,000 to update the garage, but actually spent $12,000 putting down epoxy on the floor, painting the walls, putting in new work benches, new cabinets and tool boxes. He bought some new tools, a laptop and an iPad running a special app to check in and out vehicles. That was in November and the renovation has already paid for itself because his average ticket is up by 20 percent.
Schaffer gives every customer a tour of the bays and shows how the car is wrapped with tape and protected. Customers now quibble less about price. “People would say this is going to cost $400 but the other store will do it for $350. But I can’t tell you the last time that happened. Now they are looking at it like we are going to pay a little more but we’re getting a lot more. It was the final piece of the puzzle. We always had a great showroom.”
Elettromedia’s Penn, is also a retailer. He opened a high end store called Mobile Solutions 5 years ago in Calgary, Canada, a place where snow is on the ground 6 months of the year. He was surprised to find strong demand for high end car audio. The shop tries to compete in service and quality with the local Lexus dealer and that is how he attracts a 30 to 50 year old clientele.
“At this retail store, we try to make it like a BMW dealer. We bring out vinyl samples and carpet samples and involve the wife in the sale. We offer them an espresso.” That’s what the local Lexus dealer does.
“If we, as an industry, don’t cater to those people in that way, then they don’t buy and we deal with a demographic that doesn’t have the disposable income. The 18 to 25 year old male demographic is gone. We can’t market to those guys and expect growth and success,” said Penn. He adds that the stores doing this type of merchandising are seeing big gains. His store is expanding from 4,000 square feet to 7,000 sq. feet.
Josh Landau, owner of JML Audio in St Louis, MO keeps pumping money into his shop because it keeps improving his sales. “The more you put in, the more you get back,” he says.
The pictures of his shop say more than we can here. He has two fabrication rooms one for fiberglass and one for metal. His front room displays are hand built. Each has a screen above running continuous photos of installations in that category. So if you come in for a remote start, you are going to see all sorts of installs of back up cameras, custom install radar detectors and more.
About a year ago, Landau started a car loaner program. He bought three used vehicles so his customers can drive to work after dropping off the car. He loaded them up with rear seat video, back up cameras, and other “toys” so he gets calls from customers after they leave the store, asking to add products they see in the loaner to their installation. It cost Landau $25K for the cars and about $8k a year in insurance.
But it really helps close the sale. “We’ve had a lot of clients where the only reason they didn’t finalize the sale was they were figuring out the ride out. It takes that out of the equation,” he said. It also differentiates JML from other dealers in town; and if a job takes a little longer, the customer just holds on to the loaner an extra day. So it keeps the quality of installation up.
JML recently added a dust collection system in the back so when he takes clients through the garage, the fabrication rooms are immaculate and the car’s being worked on are clean.
Landau has three labor rates including $129/hour for anything involving custom fabrication; $109/hour for installing products bought elsewhere or fixing a factory radio. For JML customers the rate is $79/hour and product is guaranteed for an extended period. “I don’t sell extended warranties,” he said because it implies that he’s selling something that might break soon. “We don’t nickel and dime our customers and they don’t nickel and dime us.”
Source: CEoutlook
I believe this series of articles should be helpful to most retailers. Bravo.
I noted however with some interest, the add at the top of the page for Audio Extreme “Cheapest Audio Video Package”. (Google Ad inadvertent coincidense?) A review of this retailer’s link included language about authorized lines, warranties and the best brands like Boston Acoustics. As I recall a key part of the article was updating the store. Updating the web site might be important too.
Ray Windsor
German Maestro
Hi Ray. Sorry about that. That’s an AdSense ad that CEoutlook doesn’t control.
Amy Gilroy