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  Management Feature

'What Would You Do?'

Posted 12/10/2009
By T.J. Reilly, AAM

Every shop owner runs into ‘situations.’
How they handle them is important.


Chris Lechman
Chris Lechman

Editor's note: Shop owners run into "situations" all the time - situations that leave themscratching their heads, trying to figure out how to resolve the issue fairly for everyone concerned. They want to make the right decision in solving a dilemma, but things are not always black and white. Sometimes there are gray areas. Following is a good example of such a dilemma. It comes from Chris Lechman, AAM, general manager of the Downing Street Garage in Denver, an ASA member shop. How would you handle it? What would you do?

The scenario:
"A customer dropped her vehicle off at the shop after-hours," says Lechman. "The next morning, we contacted the customer for a description of the problem. She said the vehicle 'died' while she was driving it. After talking to the customer and attempting to start the vehicle, we called her back. She authorized diagnostic testing on the electrical system to determine the health of the battery, alternator and starter. Our tests revealed the alternator had failed and the battery subsequently lost power.

"We called the customer, told her about our findings and quoted a price for a remanufactured alternator to be installed. She said the price was higher than she expected, but authorized our replacing the alternator and some additional repairs.

"The customer later picked up the vehicle and paid for the diagnostics and repairs.

"Her mother called the next day and said our price was much higher than the shop she normally uses near her house in California. She also said she felt that California prices should be higher than ours.

"We told her mother that we realize we are not the least expensive shop in town, but that we use quality parts and employ only ASE-certified technicians. I also mentioned state regulations regarding automotive repair procedures and reminded her the repairs and price were authorized before we performed the work.

"The customer's mother then called AAA to file a complaint. She told AAA she had checked 10 other shops in our metro area and found all of them had prices lower than ours. I explained that it is possible other shops sometimes use lower quality parts from different parts suppliers and I could not determine how much this might have affected the price.

"After AAA officials informed her that they didn't get involved in price-only issues, she mailed a letter to our shop asking for a refund of the difference in price."

ASA’s Code of Ethics
Code of EthicsBecause this feature has so much to do with ethics, we would like to remind readers that ASA has a Code of Ethics to which all members agree to adhere. To review it, click here. You can also order a Code of Ethics poster to display in your store for $10. Go to www.ASAstore.com and click on “References.”

Dilemma:
How do you handle a customer who complains about price after the repair has been authorized and completed and the vehicle has been picked up?

How Lechman handled the situation:
"After multiple conversations with the customer's mother," says Lechman, "we finally asked what she felt would be fair. She said she'd like for her daughter to receive a $100 refund to make up for the difference in our price and the average price of other shops they allegedly contacted. She also mentioned that additional repairs/maintenance would probably be needed on her daughter's vehicle and if we came to an agreement, her daughter would be more inclined to return. We didn't give her daughter any cash, but we did agree to provide her with an oil change and tire rotation/balance at no charge the next time she visited our shop for service or repair."

How Reilly would have handled it:
"We've all had customers complain about the prices we charge after the work has been done," says Reilly. "When I first started in business 23 years ago, I was absolutely the cheapest place in town. Even so, I had people complain about my prices. Today I am about average in my pricing, but still receive the exact same amount of complaints as when I was the cheapest.

"We all compare prices. How many times have we purchased something from a department store, only to find later that we could have gotten it cheaper at XYZ store? Don't we feel like we've been ripped off? How many of us returned that item to the department store and then bought it at XYZ store? I did this recently for an item that cost $85 because the other store was selling the exact same product for $29.

"The problem with price comparing with an automotive repair is that the quoted price over the phone is very seldom the same price due to many different factors. Many customers will call 10 shops for a price, and then tell you they called three other shops that had lower prices.

"To combat this problem we have started using www.RepairPal.com, which is an ASA member benefit provider. This service will give you a high/low and average repair cost for most automotive repairs. When a customer complains about our price, we print an estimate from www.RepairPal.com to show them that we are competitive in our pricing.

"We've all been taught to show the value: warranty, quality and level of workmanship. However, this approach rarely works when the customer is looking at a $100 difference in price.

"Because 80 percent or more of new customers come from customer referrals, I believe in investing in existing customers. After having the conversation with the customer's mother, I would have issued an in store credit for $100 with the understanding that in the future we will be happy to match prices before we do the repair. Matching prices before the work starts gives us the opportunity to not only verify the price, but also to match the same quality part being offered by our competitor."

Bob Cooper T.J. Reilly, AAM – the author of this feature – is the owner of Same Day Auto Service, an ASA member-business in Clackamas, Ore. His e-mail address is TJ@SameDayAutoService.com.

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