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Handling Expansion in a Service Department

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FOB1117_Case Study

McKie Ford Lincoln, located in Rapid City, S.D., has a region-wide reputation for providing stellar service. And, management at McKie has long viewed the service department as an invaluable element of the dealership.

That’s why, a few years back, a decision was reached: McKie would move out of its original facility—built in 1962—in favor of a brand new, state-of-the-art dealership. And, roughly 75 percent of the new layout would be dedicated to parts and service.

By the the time that new dealership opened in Rapid City, in November 2015, McKie had gone from being able to handle three vehicles in its service check-in area to as many as a dozen.

“Now, no appointment is needed, and customers can just roll through,” says John Baskerville, McKie’s parts and service director.

Of course, the relatively quick expansion of McKie’s service department presented challenges. The dealership didn’t just need to retain its old customers, it also needed to bring in enough new clients to justify expanding its service area by around 6,500 square feet.

It also needed to staff the expansion accordingly. Finding quality technicians is an industry-wide problem, and it was one McKie needed to solve fairly quickly. Baskerville’s service department would have to lean heavily on its in-house mentorship program.

 

The Problem

Baskerville, who has been in the industry since 1985, knew staffing would be an issue when McKie changed locations and expanded. Hiring in rural, western South Dakota can be tough, let alone hiring in the midst of the industry’s technician hiring crisis.

McKie’s service department ran smoothly for years. But, with a larger facility came the need for a more sizable staff. And it was tough to gauge exactly how many more lube techs or additional porters would be needed initially.

Baskerville knew this much, though: He would have to utilize his industry connections during the hiring process.

 

The Solution

Baskerville tapped into his extensive Rolodex and was able to lure technicians from far-flung locales like California, Arizona, and Colorado. But, in order to make such hires, he had to employ a recruiting strategy that differed from many of his industry peers.

Instead of insisting on high-level technicians, Baskerville chose a few green horns, right out of vocational schools, knowing that McKie’s mentorship program, in which senior technicians tutor young peers, could help groom new hires. And, he started ramping up his hiring in late 2014, nearly a year before the new dealership opened in Rapid City. The dealership’s shop floor became a bit cramped for a while, but any inconvenience was worth it.

Baskerville says McKie’s hiring process is akin to the way in which Major League Baseball teams groom prospects.

“I rely on my farm club to ensure my team can grow,” he says. “My main shop is my major league—those are certified master Ford technicians. My quick lane team is my farm club—that’s where we teach [young technicians], and we train them.

“In a roundabout way, what we’re doing is we’re growing our own technicians.”

These days, McKie’s inexperienced service floor employees do minor maintenance like oil changes, tire rotations, tire repairs, wiper blade work, light bulbs and alignments. In 2014-2015, Baskerville hired at least a half dozen more service department workers than what McKie’s old dealership had required.

“We started staffing up in our old facility,” Baskerville explains, “with the plan of, when we opened up this new facility, we hit the ground running. … I had more techs on my quick lane than what anybody thought I would need. But thank goodness we did, because the volume hit immediately.”

 

The Results

During the process of changing locations, McKie’s management marketed the move with billboards and email blasts to service customers. And, since then, the South Dakota dealership’s service department has enjoyed unprecedented success. The dealership increased its Ford market share by more than 12 percent compared to the beginning of the decade, up to 36 percent. Customer retention at the South Dakota dealership is five points higher than the national average, reaching 36.1 by late last summer.

And here’s McKie’s most stunning statistic: While the dealership did an average of roughly 250 oil changes per month at the old facility, it did 870 last August alone, thanks largely to its increased staff and more spacious service department layout.

“We didn’t know how much pent-up demand we had from customers that really wanted to service their vehicle at a Ford dealership,” Baskerville notes.

Now, more than ever, word of McKie’s efficient service department reaches well beyond Rapid City.

“Not only are we obtaining new customers, we’re probably doing a better job servicing our previous customers,” says Baskerville, whose employer recently posted back-to-back months of low 90s CSI scores. “We kind of built this thing with efficiency and speed in mind. We get you in and out.”

How to Brace for a Change of Locations

John Baskerville, a veteran parts and service director, helped oversee McKie Ford Lincoln’s recent move to a much larger dealership facility. He explains how McKie increased its market share and CSI after moving.

The first thing is making sure all employees are kept in the loop on the progress of the new facility, getting them to understand what we’re doing, why we’re doing it. That allows them to buy in.

Then, at the earliest convenience, start explaining it to customers—you know, where we’re going, the benefits of the new facility. Communication is key.

The other key is making sure you’re adequately staffed from Day 1. Ramp up your hiring ahead of time. Be prepared to hit the ground running, from the day you open.

 

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