Automotive News Canada - June 2020 - v2 - F11

More automakers and dealerships are offering
service customers vehicle pickup and delivery
to lift business and operate in a safer manner.

 Increased customer satisfaction
 Higher retention rates
 Bigger profits from higher-dollar repair orders

 More technician labor hours sold
 Smoother and more consistent flow of

make pickup and delivery a pillar of dealer
service.
"Outside of the automotive space, people
are finding different ways to live their lives,
whether they are getting their groceries delivered or they're getting more meals delivered
to their homes," Elizabeth Dwyer, Ford Motor
Co. customer service division marketing manager, told Fixed Ops Journal.
"And to have these types of services available, whether it's to work or to home, is going
to be a differentiator to Ford as well as our
Ford dealers."
Pickup and delivery may not be a good fit for
fixed ops directors who don't want to add the
complexity and costs that come from increasing headcount, loaner cars, paying for software and higher insurance costs.
"It really comes down to knowing your customers. Understanding what the customer
will pay for eventually answers the larger
question around the economics of pickup and
delivery," Roche says.

work.
"It's a fabulous loyalty tool. I don't know any
Multiple options
customer who is not interested in conveBecause stores have diverse budgets, staffnience," says fixed ops consultant Jim Roche,
ing and customer demographics, there is no
most recently a vice president at Cox Automosingle template for pickup and delivery that
tive.
works for all dealers.
But providing that convenience
Some brands, such as Volvo, Lincomes at a cost. Ujj Nath, CEO of
coln and Mercedes-Benz, have develmyKaarma, says dealers pay between
oped custom software for dealers to
$1,000 and $1,500 per month to use
integrate into their websites.
his company's suite of pickup-andFixed ops directors at other stores
delivery software. On top of that,
can outsource the complete turnkey
dealers also pay for the cars in their
pickup-and-delivery operation.
loaner fleets, for drivers and insurPackages are available that provide
ance costs. Nath told Fixed Ops Jour- Nath: Costs for
just the software or just the drivers. Or,
nal the amount a dealer pays varies the convenience pickup and delivery can be kept inbased on the number of repair tickets
house using porters driving a loaner
the service department generates.
car to the customer and returning to the dealMyKaarma, based in Long Beach, Calif.,
ership in the customer's vehicle. Some dealersells a pickup-and-delivery package that enships also use flatbed trucks for high-end vehiables the store, the driver and the service cuscles or performance cars.
tomer to communicate; provides route trackSome stores charge a nominal fee for pickup
ing; and allows for videos of the customer's
and delivery while others don't - even if the
vehicle to be quickly created and uploaded to
service involves a low-profit job such as an oil
deter damage claims. Nath said the company
change.
does not sell a la carte portions of its package,
Some dealerships include a loaner car for
but some companies do.
no charge, but some stores offer an optional
loaner for a small fee.
Roche, author of several fixed ops books deConsider the costs
tailing ways stores can maximize profits and
Roche estimates that the software to solely
efficiency, says dealers considering offering
manage the pickup and delivery process rangpickup and delivery should start by mining
es from $500 to $1,000 per month. If drivers
their data.
are outsourced, he says, fixed ops directors
"First, you need to look at your market area
should budget between $40 and $50 per hour
and where your customers are," Roche says.
to pay them.
Many dealerships offer pickup and delivery
Still, he believes even after COVID-19 fades,
for customers within a 25-mile range of the
most stores that have offered the service to
store.
help them through the crisis will keep doing
Then, fixed ops directors should survey their
so. That's the plan at Ford, which is looking to

Things to consider
Consumers like the convenience of
having their vehicles picked up,
serviced and returned to their home
or office. And service departments
that do it right are being rewarded
with loyal customers and bigger
profits. But it may not be for every
dealership.
Customer survey: Fixed ops
consultant Jim Roche says the first
step should be to poll customers to
find out whether they want the
service. If they do, are they willing to
pay for it?
Solo or turnkey? Dealerships that do
it themselves need special software;
others hire services that coordinate
the entire operation.
Half and half: Packages are available
that provide the software, the drivers
or degrees of service in between.
In-house pickup options: A porter
drives a loaner vehicle to the
customer's home and then returns
the vehicle that is to be serviced. For
luxury or sports cars, a flatbed or tow
truck picks up the customer's vehicle
and takes it to the shop.
Fees: Some dealers charge for pickup
and delivery; others say the service
pays for itself in bigger repair orders.

customers to determine whether they would
use pickup and delivery and would be willing
to pay for the service and a loaner vehicle.
"If pickup and delivery works, then you've
got two options," Roche says. "You can use a
service like Redcap, which is a great service, or
you can hire your own drivers. I think the doit-yourself model with between two and five
drivers works best for smaller dealers. Beyond
that it becomes unwieldy and you'll have
problems managing it. You are not going to
keep track of it with a pen and paper. You have
to coordinate it."
Whatever pickup-and-delivery option its
dealers choose, Ford plans to be in it with
them for the long haul. The automaker says it
will continue to subsidize dealerships that
pick up and deliver vehicles. It's a service Ford
believes dealerships should continue to offer
after the pandemic ends.
"This is an opportunity to reach out to our
customers on their terms," says Monica Viola,
Ford's customer experience strategy manager,
"and allow for it to be a way to deliver a great
customer experience." 

JUNE 2020

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Automotive News Canada - June 2020 - v2

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