This post was originally published on Wards Auto
Germain Toyota of Naples, FL, acquires up to 135 used vehicles out of its service lane each month. But its success in using the service lane as a source of used inventory isn’t due to high technology. It all comes down to a seemingly simple move: asking if a customer would like to sell their vehicle.
“We don’t use any of the tools that are out there to mine service drive customers,” Wendell Hardy, the Florida dealership’s general manager, tells WardsAuto. “We ask the customer, ‘If we can pay a little bit more for your vehicle than what the market says it’s worth, would you be interested in selling?’ We keep it simple.”
The dealership aims to acquire used vehicles from 3% or more of its average 4,400 service customer pay and warranty monthly repair orders. The dealership has 52 service bays.
The dealership staff sold 235 used vehicles in January. None were acquired at auction or from rental agencies. “100% is from trade-ins, street purchases or service drive acquisitions,” Hardy says.
It Starts With a Text
The night before a customer with a service appointment comes in, they receive a text from a Germain Toyota salesperson letting them know the dealership wants to make an above-market-value offer for their vehicle.They also ask, if the customer is at least interested in hearing what the dealership is willing to offer.
“We don’t try to sell them a car. We just offer to buy their vehicle,” Hardy says.
If the customer says no, “then we just don’t bother them,” he says. But “a lot of folks are curious.”
If the customer would like to at least know what their vehicle is worth, the salesperson meets them in the service lane the next day. The salesperson does a walkaround of the vehicle and explains how the vehicle will be valued.
There are different ways to determine value, but the dealership uses the Car Commerce AccuTrade appraisal tool. After scanning the vehicle’s VIN and doing a diagnostic scan, dealership staff “hit a button, and it shows the value of the car,” Hardy says.
Hardy says the dealership tries to make the appraisal offer to every service lane customer with an appointment. It doesn’t research how much equity a customer has in their vehicle.
“We don’t want to know,” Hardy says. “If we get into only approaching the folks that only have equity, we lose sight of the folks that just might not like their car.”
The dealership has 11 salespeople dedicated to mining used inventory out of the service lane and a manager who oversees them.
Consistency Is Key
Hardy says the key is keeping it simple – just asking if the dealership can buy the customer’s car. They don’t try to sell the customer a new car, though most do buy their next vehicle from Germain Toyota.
Every time a customer comes in for service, doing it consistently is crucial. “Consistency is our secret sauce,” Hardy says.
No pressure to sell the vehicle or to buy another is also important.
“It all boils down to the customer experience and the journey we take the customer on,” Hardy says. “It is a fine line. We don’t want them to feel harassed. If they are just there for service, we want to respect their time.”
Because the ask is made every time a customer comes in for service, when they are ready to sell Germain Toyota is top of mind, Hardy says.
It also helps with referrals. If a neighbor is considering selling a car, a service customer may say, “Have you reached out and talked with Germain Toyota? I mean, they buy cars.”
The service people assigned to acquire inventory out of the service lane don’t receive specific training but are seasoned enough to initiate the conversations.
On the technical side, the salesperson points out to the customer the things they consider during the appraisal, such as dents or worn tires.
The salespeople are told to pay at least the amount AccuTrade says a vehicle is worth if not more, he says. The entire team is free to do so if they think a vehicle is worth it, Hardy says.
Running the Play
Germain Toyota has become something of a destination for other dealers who want to determine how to secure used inventory. “We’ve had public companies fly in top brass to watch our team,” Hardy says.
Dealers from other parts of Florida have also come by to learn.
