Question: “I’m having trouble keeping my best service techs because they keep getting lured away with better pay. If I raise their salaries and therefore my prices, don’t I risk losing customers?”
No one likes to pay high prices.
The relationship between gas prices and boat usage this past summer was a perfect illustration of that. But what a consumer considers to be “high” depends on the perceived value of what they’re buying. If you can convince your customers that the service you offer is more valuable than that of your competitors and then deliver on it, you can charge higher prices.
“Try to focus on your dealership’s ability to provide quality services with professionally trained people,” suggests Paul Swedenberg, director of operations for B & E Marine, Inc., a dealership based in Michigan City, Ind. “This may be a more important factor in retaining your customers’ loyalty than the prices you charge.”
To offer superior service, you have to invest in your service techs, and that means offering competitive salaries and benefits. You also should ensure they are well educated in their field — and stay that way as technology evolves. Swedenberg recommends dealers communicate specific expectations to techs, who he calls “one of the most essential tools” of a dealership. This may mean setting a pay scale — or a rewards program — based on a combination of quality and efficiency, for example.
While important, “compensation is not necessarily the most important ingredient in keeping loyal employees,” says Bob Williams, president of Five Star Solutions, which is administering the Grow Boating Campaign’s Dealer Certification Initiative. He points out that “the most common reasons for turnover are always personal treatment, environment and working conditions.”
Don’t forget to show employees how important they are to the success of your business and reward them for their hard work and dedication with more than just a paycheck. Even small gestures, like allowing techs to use a boat for the weekend or including them in equipment purchasing decisions, go a long way, Williams adds.
Offering outstanding service requires more than keeping the best employees. Marine dealers often treat the service department like a necessary evil, missing out on what others have found to be a major source of revenue.
Those dealers whose service departments are cash cows invest in tools, equipment, employees and training; track technician efficiency and customer satisfaction; and then market the unique service experience they offer to current and potential customers.
Car dealers are a good model. They make much lower margins on cars than boat dealers do on boats, and yet they tend to be more profitable overall because of their ability to make money on their ancillary products and services.
“If the dealer is focused on the service department as a profit center and providing superior service, then he or she can charge more than other dealers in the market,” states Ed Boncek, Sea Ray director of dealer management systems. “If the management tools are not in place for a good service operation, then the dealer will not be able to compete.”
Editor’s note: Dealers, marina operators, suppliers, boat builders and other industry professionals are encouraged to Ask The Expert. Those interested in submitting a question should e-mail it to email@example.com, indicating whether they’d like to remain anonymous.