How daily targets led Rybrook Warwick BMW to global aftersales success

[gallery id=10]

Most dealer groups and businesses aim to be world-class, but it’s rare to have achieving such an aim independently verified.

Not only did Rybrook Warwick BMW walk away with AM’s Excellence in Aftersales award again this year (see panel), it was also named as BMW’s best service department. The dealership, located near the high-income areas of Warwick and Leamington Spa, won the two-year title in 2013, beating every other BMW dealership worldwide.

	EXCELLENCE IN AFTERSALES
	AM Awards auditor BDO concluded: “Rybrook Warwick is an excellently run business that is both innovative in its approach and dedication to customer service. Its staff are motivated and well rewarded for their performance, which means they are loyal and focused on what they deliver on a day-to-day basis. “Given the historic performance of the business, it is clear that when staff are well managed and allowed to develop into all that they can be, then this is when really significant results can be achieved. “The challenge for this business is ‘what next?’ as both capacity and the results indicate that aftersales is now plateauing such that increased performance can only really be achieved by improved efficiency. “Can the business’s right-first-time approach keep pace?”
	♦ Read Rybrook Warwick BMW's AM Award citation

What accounts for this sort of success? To start with, the business has a focus on customer satisfaction and retention plus strong results for overhead absorption.

The aftersales department is led by aftersales manager Simon Birchall, who has worked his way up through every position in the department.

Rybrook Warwick BMW – bought in 2008 by Rybrook Group, which represents premium and luxury brands across the Midlands, North West and in Yorkshire – wants to make servicing as convenient as possible for the customer and as efficient as possible for the business. Profit is never put before customer satisfaction.

Birchall has created a culture and team around him that is friendly, focused and always thinking about the long term. This last quality is not something the industry is known for.

“Our game plan isn’t about one year, it’s about the next 10,” said Birchall. “We just keep retaining customers and expanding our database and getting them back through the door.

“It isn’t difficult to have a good year. The difficulty comes when you want to build on that year after year.

“You can only do that if you look after your customers. You can have that one good year, but does everyone come away happy? Customer retention has to be the focus.”

Rybrook Warwick has a policy that when a customer leaves, no matter what they have said to someone at the dealership, that staff member has to think about the way the customer may be feeling. It’s a very soft skills-focused approach and is something Birchall wants everyone in the aftersales department to think about in their customer interactions.

“A lot of customers won’t speak up, but they will when they fill in a customer satisfaction survey, or they never fill one in and you never see them again,” he said.

“We want customers to walk away feeling like they want to come back and to feel good enough to recommend us to friends.”

Birchall has worked for BMW since the day he left school, starting out as an apprentice technician and working his way through the business to technician in every department within aftersales. He moved into management roles, first as customer services manager and then aftersales manager.

“I was always being guided to become aftersales manager. You have to make yourself the natural choice for the next job up the ladder.”

Birchall has led the aftersales team for six years and laughs when asked whether he still likes to get stuck in with the cars and get his hands dirty.

“Cars are so complex now and it’s been so long since I’ve done that sort of thing. I focus on managing my people.”

Everyone in the department has autonomy over their own areas of influence and Birchall sees his role as being there to help support, guide and train.

He has four junior managers, but tries not to get too heavily involved in what they’re doing.

“I don’t dictate. I’d rather people find their way of doing things,” he said.

“Things have moved on dramatically from a technical point of view, but I have done all the roles in the service department, so I understand where everyone is coming from.”

[page-break]

Rybrook Warwick may have won an AM Award and BMW’s own award this year, but there have not been dramatic changes over the past 12 months. The awards came on the back of four years of sustained success. Building that success took a long time. Rybrook Warwick explored every avenue of potential business over the years and dissected it, changing personnel when necessary.

The aftersales department brought in a ‘no appointment necessary’ policy after Birchall realised that no other retailer outside the automotive industry would ask a customer to make an appointment.

“You have to book in for the dentist or the doctor’s. We moan about them all the time, so why are we making customers make an appointment?

“We can cope with however many customers we are faced with on a daily basis without a problem. We’re prepared for it. We have a lot of corporate customers around the area and if their service light comes on, they know they can just drop in and we’ll get it sorted.”

Rybrook brought in extra resources last year, with a person dedicated to following up with every customer within 48 hours of their visit, just to check everything is satisfactory.

Every comment a customer makes, anywhere within the business, is collected and sent out to everyone in the aftersales department. Transparency is very important to Birchall and he believes it helps people within the team manage their time more efficiently, but also drive growth.

 

‘Every day is a month-end’

“We don’t have a month-end in this organisation. Every day is a month-end. It’s been the secret of success, with everyone trying to get as much as they can out of the day, rather than panicking. We don’t have late nights.”

The aftersales department at the dealership has a particular figure to aim for every day, but so does each team member. All service advisers and technicians can see where they are in terms of their performance in real time. If they are behind the pace, they can give themselves time to catch up.

 

[page-break]

Birchall explained that the culture within the business has got to the point where the technicians can catch mistakes from the costing department. They’re ambitious and informed about what they should be getting for each job.

Aftersales departments at other dealerships often fly by the seat of their pants for three weeks and try to get a result towards the end of the month, said Birchall.

“I knew 10 years ago that I didn’t want to be part of a business that operates in that way. It’s selling the benefits of getting the most out of your day that will really make it work. There’s no panicking, everyone is heading towards a daily goal.”

Birchall believes the biggest sales tool Rybrook Warwick has is trust.

“I think this industry is guilty of dealing with the car and not the person. We were guilty of it ourselves about five or six years ago. The cars are a by-product now. We’re totally focused on the individual.

“If you can get that warm interaction very early on and build that trust, you don’t really have to try to sell. If a customer needs something doing and the relationship is there, the sale will come hand in hand with that.”

To help build that trust, Rybrook Warwick started using Citnow’s video technology to film service work. The dealership is making about eight videos a day on average.

Birchall explained that for some customers, the offer of filming it is enough, they don’t actually need a video to be emailed to them.

“They know by us offering to send them a video that we have nothing to hide,” he said.

“It’s definitely helped our red work conversion, but we were already very focused on not letting the car leave the premises if extra work needs doing.

“That’s not us holding a car to ransom, but it’s about us finding a solution to make our customer’s day.”

The business has 13 courtesy cars, but Birchall has the autonomy to take any demonstrator from the sales team if he needs it. There have been occasions when Birchall has used every salesman’s car.

[page-break]

“If the problem we need to solve is the customer getting to work, out of the 85 people we employ, there’s got to be some way we can get them to work. That’s the easy bit, surely. Fixing it is the hard bit.

“We do have to be a little bit careful if someone wants a test drive and we’ve used all the cars to get people to work. But the sales guys will offer them up gladly, they’re a great bunch.

“Likewise, when the sales team need help, the aftersales department is there for them. I don’t think many businesses would do that, but the cars are there for the customer and they know that, too, so there has never been a problem.

“That helps our upsell opportunity and red work. We have a very low ratio of re-booked cars, because ideally we only want them coming in to us once.”

Rybrook Warwick’s two master technicians will walk out with every customer and listen to the problem with the car and then assign the problem to a technician based on the complexity of the job. Every customer is given five minutes to make sure the problem is fixed to their satisfaction.

To make sure everything gets done on the day, Rybrook Warwick has parts delivered from BMW three times a day.

 

Beating the average on overhead absorption

The motor retail industry has been struggling to hit a 60% overhead absorption rate in recent months, with the benchmark still set at 80%. Before the recession, dealerships aimed for 100%.

BMW’s national overhead absorption average is 69%, which is much better than January’s UK average of 56.7%, according to the latest ASE dealer profitability figures.

Rybrook’s overhead absorption rate is 126% year-to-date. It’s an astonishing figure and it’s no wonder Birchall can demand cars from the sales team with that sort of performance.

“It’s massively dependent on location, premises and cost. We take advantage of every opportunity we get. It’s not just about selling labour, it’s about upselling too, but it’s really a focus of everyone knowing where they are daily and heading to that target.

[page-break]

“We’re not there trying to rinse everything from each customer, but we’re there trying to make sure we do everything properly. If your customer service is right, you will automatically correct your overhead absorption rate.”

The Warwick site puts customer satisfaction ahead of profit, because Birchall believes the two are so intrinsically linked – the profit will follow if customers are happy.

Staff are encouraged not to rely on computers to run the business.

“Don’t let a computer tell you what today is going to be like, you should know that yourself already,” said Birchall.

“I never want a ‘computer says no’ moment in this business.  Every customer should be greeted with open arms. The computer is there to report to you, but don’t let it run your business.”

 

How to base bonuses on customer service

The first job Birchall does in the morning is look at two statistics. What’s the customer service score and what’s the target for today?

Rybrook Warwick’s service adviser team plays a significant role in helping to hit its high overhead absorption figures.

The team members are experienced and customer service-focused. All CSI scores are broken down individually and can be attributed to each adviser.

Service advisers are bonused on customer service ratings. Every Friday, the customer services manager will look at every customer satisfaction survey which has been sent in and will put a name against it.

The three service advisers and customer service manager in the business are on 91%, 92% 95% and 96% satisfaction ratings from customers, based on a snapshot of 60 surveys each quarter. Rybrook Warwick has also just appointed another service adviser due to the growth the dealership is targeting this year.

Birchall took a chance and opened the latest customer satisfaction surveys to be sent in to the business (AM watched as the seal on the envelope was broken) and every single respondent had left comments about individuals in the business and rated every element to the highest level.

Rybrook Warwick recognises service advisers on the same level as the sales team, with equal opportunity to earn bonuses.

Birchall said: “A service adviser will see 20 times more customers in a week than a salesman.

[page-break]

“That’s 20 times the opportunity for the business, not just the aftersales department. It is vital that we include them in the same pay structures as the salesmen.”

The service adviser team have a basic salary, they are bonused on customer satisfaction, financial performance through labour and then there are seven different upsell avenues they can also earn bonuses from.

The bonus process is transparent for the team. Each service adviser can see how much they have earned from each upsell. The bonuses are not capped.

“They’re treated very much like a salesman. BMW is realising this too and it has started recognition programmes for service advisers now.”

One of the advisers has been nominated for BMW service adviser of the year. “He’s in the top five so far, so we’ll see if he can win it,” said Birchall.

Given Rybrook’s record, few would bet against him.

 

Creating an aftersales department and team

When the business was refitted in 2011, Birchall set out to create an aftersales department, not a separated service and parts department.

The booking team sits within six feet of the workshop manager, the bodyshop, parts, warranty, costing and service advisers all sit within talking distance of each other. If a customer ever has a question on aftersales and an employee doesn’t happen to know the answer themselves, they can swivel in their chairs and ask someone who will.

“Organising the department in this way has trebled the efficiency,” said Birchall.

How does Rybrook Warwick recruit the right people? It may sound simple, but it’s through word of mouth and recommendations from current employees.

“The people we already have here have a lot of experience,” said Birchall.

“To me, if someone has been recommended it already raises them in my expectations.

“There isn’t a magic formula. The people we have are enjoying what they’re doing here and they’d like to pass that on to their friends that want to be a part of this team as well.”

The recruitment process is basic, there’s no psychometric testing. “It’s about me feeling it and weighing that person up within an hour. You’ll know whether they’re right for the role or not,“ said Birchall.

“I always ask, ‘if I was to pick the phone up to your current employee what would he say about you?’ and if they offer up their number straight away with no hesitation, you instantly know they’re right.”

[page-break]

Fighting the Fast-fits

Battling the fast-fits is much easier if you’re focused on customer retention, believes Birchall.

But there are certain elements of a traditional franchised dealer that can really hold them back from winning customers that have migrated away.

Weekend opening times are a major problem and fast-fits can use their national marketing power to go much further than most dealer groups.

Birchall believes customers are choosing fast-fits for convenience on Saturday afternoons and Sundays.

Rybrook Warwick is looking at Saturday and Sunday opening for the service departments and although nothing has been confirmed, Birchall said: “All dealerships will have to be open on Saturdays and Sundays. Whether it’s BMW or not, all brands need to catch up with this.

“The industry is scared of change, but it will happen.”

Birchall wants to pioneer opening on the weekends and his idea is to turn the business into a fast-fit-style centre on those days.

“We will compete with the fast-fits head on,” he said. “We’re not going to be spending five hours trying to diagnose a problem, that will be saved for during the week, when we have the resources available.

“We can compete with Halfords and ATS on a Saturday and Sunday. They’re taking our business and it’s time for us to take it back. The people going in to those places aren’t having major repairs.

“It’s like walking into a John Lewis on a Sunday, asking to buy a washing machine and them saying no because they don’t sell washing machines on Sundays. You’d just walk out and buy that washing machine from somewhere else and that’s what people are doing for servicing.”

Rybrook Warwick isn’t far off operating 7am-7pm during the week, another area Birchall thinks the industry should move towards.

“It might not earn us more revenue, but the one thing we’ve got to get our head around in this game, is that it’s not necessarily about revenue, it’s about offering a service.

“Directors will look at extended opening hours on paper and say it doesn’t add up. It will pay because you know that customer will come back again and again for convenience. Over a five-year period it will be profitable, there’s no doubt about it. Unfortunately, as an industry, we’re still doing business on our terms, not the customer’s.”

[page-break]

Digital aftersales

Rybrook Warwick has a real-time service booking facility that works with the dealership’s ‘no appointment necessary’ policy.

Rybrook Warwick marketed the new facility extensively when it was launched in September 2013 and says its customers love the convenience of booking their car in for a service while sitting on their sofa.

The dealership’s service customers can choose from four options for online booking – diagnosis, service, MoT and service and MoT.

The number of MoTs per day is limited, but there is no cap on anything else. This may sound like a dangerous game in terms of scheduling, but Rybrook Warwick has put the resources in place to deal with it, such as the master technician pre-ordering all parts needed for the next day’s bookings.

“If someone has a tricky problem, they will just pick up the phone because they want to know costs,” said Birchall.

“Online service booking is change and, again, the industry doesn’t embrace it. It’s great, how can you not like it if customers are booking themselves in?”

 

A self-diagnosing future

BMW started fitting cars with its ConnectedDrive tele-servicing technology in March 2013. As of last month, all new BMWs have it installed. Each car comes with a SIM card as standard (like a smartphone). When a car has a fault, it automatically contacts the dealership.

Rybrook Warwick is already getting emails from BMWs it has sold. The BMW sends the dealership a diagnostic code, which it can link to its own system, ready to order parts for the problem.

Birchall said: “We can see everything that might be wrong with that car.”