Increase Profits, Reduce Liability, while Saving Time and Money

Management guru Peter Drucker said, "If it's worth doing, it's worth measuring."

That's why they keep score in sports, have grade point averages and test scores in school, and viewer ratings for television shows. People like to know if they are on track to achieve their goals.

Managing safety recalls is no exception. How does a dealer know how well they are doing if they don't have numbers as performance indicators? How does a dealer know what corrective actions to take if they are off track?

It's why AutoAp, Inc. provides the Safety Recall Liability ScoreSM (SRL ScoreSM) as part of our Safety Recall Insights (SRISM) business intelligence service. It helps our dealership clients monitor and manage their recall processes and progress. AutoAp's proprietary metric has several components based on the dealership's behaviors and how those behaviors impact overall safety recall liability. It's a little bit like a consumer credit score - positive behaviors yield a better score (For the SRL ScoreSM, lower is better… like golf!).

Once Dealers Know Their Score, We Also Show Them How to Improve
Automotive retailers can see the specific actions needed for their dealership to improve through AutoAp's Safety Recall Insights dashboard, which is accessible in both mobile and PC modes - so. High-level actions dealers can take are discussed in my book "Safety Recalls: Think You're Covered." The more a dealer follows these actions, the more their scores improve due to 'found' recalls that are typically missed without our services.

What's In It for Me?
We've seen significant reductions in dealers' SRL Scores over the period of just a few weeks. If you measure liability and then take action, you can easily improve this critical metric. As more recalls are found, the dealership reduces liability and improves revenue from safety recall repairs.

In addition, the SRI service provides other important market data including how the dealership stacks up against recall practices' industry averages, compares with other dealers in their state and competitive brands' stats to allow our clients to quickly benchmark their performance.

All this, while saving time and money!

Brad Preble from CARR Auto Group confirmed the value of AutoAp's business intelligence services:

"We receive a weekly summary of my team's performance and can access a snapshot and trends into my operations and obtain benchmarks against other dealers as well as actionable recommendations for our team members from either my desktop or mobile phone.

Entrepreneurs want to make the best decisions and know the resulting outcome ahead of time. Some make decisions are based on facts while others use gut feel to guide their company's course. Decisions based on excellent information tend to be better, since "managing by fact" consistently provides higher quality decisions than any other method. This is a game changer."

Although dealers could build a recall business intelligence system on their own, it's something that can be outsourced quickly. Dealerships can be up and operating in a couple of days with AutoAp.

Through our Safety Recall Insights service, dealers have industry best-practices with actionable recommendations - specific to your dealership's performance - at your fingertips to quickly and easily to make even better decisions that provide exceptional returns.

One of our clients, Antioch Auto Group, used AutoAp, Inc., so effectively they generated an 84-to-1 Return on Investment. Naturally, we want other dealers to replicate this performance in their safety recall management efforts.

If we could sum up Antioch's success in one sentence it would be this: If you make just a handful of small, but important decisions, you will reap big rewards. On the surface, implementing a safety recall management system might sound like a daunting task. In reality, we break it down into easily digestible parts. We've found that our “Power Users” - dealers who reduce their recalls between 80 to 100% -- start with four simple decisions. They:

1. Commit to an automated process.
2. Develop a written policy for how the organization will handle safety recall management,
3. Develop a simple process and procedures for their team.
4. Appoint one person in the organization to have responsibility for making it happen.

Automating the process is key. Manually checking VINs on a nightly basis is simply too time consuming and potentially error prone. Your people can be even more productive doing other things.

Accountability to the process is another important factor. It's important to have appropriate policies and procedures in place and to have one person in the organization with responsibility for overseeing recall management.

After that, they turn things over to AutoAp and we do the rest.

The features discussed below make your life easier and are part of AutoAp's services. Daily VIN verification and daily reporting provide immediate intelligence to our clients that identifies open safety recalls right away. The information you receive is accurate and timely because we use multiple sources to cross-reference vehicles and recalls.

Our Power Users also typically opt for post-sale alerting. We monitor VINs of recently sold vehicles to see if/when a safety recall is issued after that vehicle left the showroom. This post-sale follow up is often a key to getting customers back to the dealership via the recall repair. It's a great way to keep a customer relationship strong.

We also provide consumer disclosure statements for every vehicle you sell: You can print as many as you'd like as part of the fixed monthly service fee. Many dealerships are simply relying on in-brand updates from the manufacturer. The challenges with this approach are that many OEM updates are delayed and can be error prone, and do not usually cover in-brand used vehicles you've acquired. Our in-brand service is even more reliable and saves much more time than the manufacturers' systems.

For off-brand vehicles, AutoAp also is a must-have. Dealers get no line of site from their manufacturer for off-brand vehicles. AutoAp provides the most effective - and cost-effective - way to identify open recalls for any trade-ins that come in.

Dealers that make these simple decisions to automate how they identify open safety recalls have lower recall liability, are generating more warranty reimbursement revenue and have better CSI scores. And, of course, you can achieve excellent ROI, like Antioch Auto Group.

When I bought my first vehicle in (1978), one of the most important steps in the process was talking to the service department. I wanted to be face-to-face with the person most responsible for keeping my vehicle up and running - and understand the cost of ownership. Getting their view on the vehicle's serviceability and overall durability made sense to me. It was a critical step in my decision-making process.

Today, more than 40 years later, it still makes sense. According to a recent article in Fixed Ops Journal, a lot of customers agree - nearly 50% of potential customers would like to visit the dealership service department during their shopping journey.

Yet, more than 60% of dealerships don't make the introduction. That's a huge missed opportunity, for two key reasons.

First, like me back in 1978, raising a customer's comfort level with the service department is a great way to help close the sale. In addition, 44 percent of a dealership's gross profit comes from the service department, according to NADA. It makes sense to introduce potential customers to the service side of the business to plant the seeds for future appointments.

But, there's an equally-compelling reason to make the introduction that most dealers are missing. Getting the customer to the service department also gives the dealer the perfect opportunity to check the prospect's trade-in vehicle to see if it has an open safety recall.

Why does this matter? For one thing, it's an easy revenue opportunity. If the customer is in-brand, you can repair their vehicle right there on the spot, generating additional service revenue for the dealership. If there's no remedy - or worse, Stop Sale recall - what better way to prove your trustworthiness than to offer a loaner vehicle! This is the chance to showcase that you care about people (prospect and customers, alike). The mere gesture of offering to check their vehicle for an open recall will create goodwill and lay the groundwork for a good relationship. If it's off-brand, what better way to show it's the person, not the car, that matters. You can simply tell them about it, or better… take it to a nearby dealer. This action will speak louder than words. And, they will be a bit more captive while shopping for a new vehicle on your lot.

Actually making the repair with no additional strings attached will take the relationship that much further. It sends a clear signal to the customer that the dealership cares about their well being. These customers will highly likely share positive word-of-mouth about your dealership, too.

Of course, there's a good chance all this will help close the deal on a sale, too. Either way, getting a prospect to the service department and checking for open recalls is a win for everyone involved.

Quick question…

Who owns the data for a vehicle your customer owns?

That question is currently under scrutiny in the Massachusetts courts. The Alliance of Automotive Manufacturers (AAM) challenged a legal ruling that OEM telematics data must be shared with customers and independent repair shops.

It makes sense that the owner of a vehicle owns its data as well. In addition, it's logical that said customer can take that vehicle anywhere to be repaired, so there's a good chance the AAM challenge may not succeed.

For franchised auto dealers, this could pose a significant threat to service business. Once a customer shares data with an independent repair shop, the likelihood of getting that customer back for service will diminish significantly, as Greg Ross of Motormindz stated in this article (https://www.dealermarketing.com/are-dealers-ready-for-telematics-right-to-repair).

That makes it more important than ever to get customers back in for service. And AutoAp has a tried and true method that will help drive revenue, limit liability and create stronger, lasting customer relationships.

We work with our clients to identify open recalls from their existing customers. Customers with open safety recalls provide the dealer with leads that can generate significant service business. We call it active Customer Recall Revenue (aCRR). Here's how it works:

When vehicles are sold, AutoAp's Dynamic Recall Management clients' VINs are 'swept' into a sold/customer vehicles database. Customers whose vehicles have been recalled are provided to dealers on a weekly basis.

Our dealer clients then provide these customer leads as new opportunities for their BDCs to bring back 'lost' customers. This serves up in-brand vehicles they've sold for which a recall has just been issued.

The dealer's customers love it, because they often don't know their vehicles have an open recall. The dealer loves it because they generate additional revenue, provide extra value to their customers, increase their CSI and also limit their liability. The average simple ROI - additional profits divided by the cost-of-service - is 25 to 1.

Perhaps the biggest advantage is getting to potential customers BEFORE they choose to work with an independent repair shop. Locking in customers to service business sooner is a key element in keeping customers for life. With 70% of customers never going back to the franchise dealer, it's difficult - at best - to bring them back in. The pending Telematics legislation could make the situation even worse for franchised dealers.

Any way to get customers into the service lane is a huge benefit. Active Customer Recall Revenue is a great step in the right direction.

In April, Ward's Dealer Business ran an article by AutoAp CEO Mark Paul stating that vehicle complexity would ultimately lead to increased vehicle safety recalls. The recent Bolt EV recall is yet another indication of this tenet.

To minimize liability (and maximize profitability, CSI and preparedness), Auto dealers should take vehicle safety recall management seriously by [1] automating safety recall verification and monitoring processes, [2] developing a written recall policy that everyone signs and [3] naming a point person for managing recalls.

Dealers need to take the bull by the horns, as the number of vehicles with open safety recalls continue due to increasing vehicle complexity. Read Automotive News' Bolt story,