When I was young and running a group of retail stores, I had a mentor who used to tell me, “There are only two problems you can have in a tire store.
“One, you don’t have enough cars, or two, you’re not working the cars you have.”
It seemed an over-simplification at the time, but as I thought about it, he was right.
The reverse is also true: You’re doing well if you have enough cars and you are able to service them properly and according to need.
Well, we all know that’s not entirely true, but the pieces can come together better for both the customers and the business when there is a healthy traffic flow, and sales correlate with customer needs.
Converting your customers
Every successful store has a combination of new and repeat customers. A healthy business must have both, and you must manage both. If you have been in business for any length of time, then you have repeat customers; if you don’t, you better start looking for another job.
Today the new term for what my mentor was talking about is “conversion.” It’s a simple way to track traffic and productivity by dividing total sales by car count. It’s important to know how many cars are entering the shop and what the average sales amount is per car. The conversion rate usually measures a combination of walk-ins and call-ins that turn into work orders. As we know, customers don’t just call in or walk in and buy. Consumers have to be converted into customers. What kind of future customer they will be is determined predominantly by interaction and satisfaction with store personnel, their experience.
Sales per car helps determine profitability, and we all know there is a correlation between car counts and sales dollars, but the real key is in the mix ... the customer mix. The right mix of new and repeat business matters on many levels.
In most cases, when dealing with a repeat customer, it’s easier and faster to process a work order, and the sales process is generally shorter and smoother. If you have been building trust with your customer base, then it’s also possible that any number of these customer work orders will generate a higher conversion rate and higher sales per car.
It’s expensive to attract new customers; marketing and advertising costs are an expense, and the investment and requirement for good, intelligent marketing is time consuming.
If you are a store owner or store manager, you may not like what I’m about to say. Advertising has its place; digital, print, local support, PR, etc. Marketing has its place, as well. However, the real key to car counts and sales per car, the real responsibility for conversion is YOU. The owner, the manager, and the counter sales staff control car counts and sales per car. I’m more convinced than ever.
The manager is the key
This business is all about interaction and engagement. On many occasions in the past, I’ve over-advertised for under-performing stores only to be met with marginal success. I’ve transferred performing managers to under-performing locations with incredible success. Conversion is in the hands of the manager.
The manager controls the car count; the manager controls the sales per car; the manager controls the conversion rate; the manager controls the customer mix. This is the manager’s job.
The manager controls the attitude of the store. Again, there are only two ways to answer the phone — poorly or properly. The tone on the phone matters and everybody mimics the manager. When a customer walks in the store, whether new or repeat, the timing and the tone of the greeting are a mirror of the attitude and tone of the manager.
It’s been my experience that certain stores managers believe they are habitually in need of additional traffic. They have a tendency to blame the advertising, including the types of advertising, the types of offers, the design of the ads, the timing of the ads, etc.
I’ve found it impossible to market around or past a poor store manager. In other words, the success or failure lies at the store level. My point is, no store accidentally runs well. Customers, new or repeat, need to be managed, car count and per car sales need management and, of course, sales and mechanical staff need management.
You are the reason customers return. Make your place their place. Managers are the cause or the cure! Maybe there is only one problem you can have in a tire store.
Wayne Williams is president of ExSell Marketing Inc., a “counter intelligence” firm based in La Habra, Calif. He can be reached at [email protected].
To read more Counter Intelligence columns, click:
Beware of Routing Dullness: Invest $25 and a Little Time in You and Your Career
Leading Up the Hill or Off the Cliff: Make Your Employees See the Light or Feel the Heat
Expenses Creep, and Gross Profit Leaks: Watch the 'Extras' That Affect Operating Expenses
