AutoFix AdvisorCast

Michael Doherty [00:00:00]:
Hey, thanks for tuning in to another episode of the autofix Advisor Cast with your host, Michael Doherty. Hopefully everyone's doing well, everybody's feeling healthy, and I'd like to say spring is just around the corner, but it doesn't feel like it with merch being, you know, coming up next week. It's been, it's been cold all across the US but we'll get there, we'll get there. So hopefully everybody's got some, some spring plans, you know, get out, get out. Better weather. One thing I wanted to talk about today, it's been a hot topic that I've been hearing about from a lot of shops lately is third party warranties. So extended warranties, client extended warranties.

Michael Doherty [00:00:50]:
And I've been getting, I won't say conflicting information, but I've been hearing different things from different shops and policies and procedures and things of nature. But I think first and foremost, you know, I had mentioned a couple episodes back about coming from a standpoint, from a service advisor of, you know, on the offense versus the defense and being proactive versus reactive. So I think especially with new clients there that are coming to your shop for concerns, you know, check engine light, suspension, noise, drivability issues, things that aren't typically service or maintenance is when, you know, you're booking that service reservation with them on the phone or replying to an email that they sent in for a service request. And part of your conversation or email chain asking them about their service coming up or what they're going to need for their vehicle is asking them if they have an extended warranty and you know, right out of the gate establishing what your shop will and will not do with an extended warranty. And I've been caught off guard a lot in the past with extended warranties. You know, customer drops off a vehicle for a check engine light, we get their authorization for, you know, a level one testing. Say that and you know, technician looks at the vehicle, performs a diagnostic, sends the ticket back to service service, you know, adds parts, labor, et cetera, and then calls the client to say, hey, Mr. And Mrs.

Michael Doherty [00:02:20]:
Jones, here's what's going on with your vehicle and I've provided an estimate for you. And you know, the off guard part is that individual replies back and says, hey, you know, well, what about my extended warranty? And you're kind of like, what do you mean your extended warranty? Well, yeah, I have an extended warranty. Okay, well we didn't know that. Yeah, it's in my glove box. Just, just call them, just give them a buzz, you know, they'll take care of it. And having had that happen several times now, you're, you know, going through somebody's glove box, sometimes there's things in there that you really don't want to encounter. I've encountered firearms before that I'm not comfortable taking out of somebody's glove box and put my fingerprints on, to be honest. I've encountered just, just nasty stuff, you know, food wrappers, dirty diapers.

Michael Doherty [00:03:08]:
I mean, no one wants to put their hands in there. So again, after figuring that out, getting the information from the client, calling said extended warranty, they and going through that rigorous process only to come to find out they have figured out every loophole that exists. And guess what? It's not covered. Now you're calling the client back, letting them know that you did call the extended warranty. And by the way, that phone call in its entirety was probably about a half hour of your time as a service advisor, from being put on hold to explaining what's going on, them putting you on hold, and back and forth again, only to arrive at, hey, that's not covered. And now you've got to call the client back and explain to them that it's not covered. And that's not a great conversation either because, you know, they're under the impression that they purchased this extended warranty and that everything's covered. And usually they say, hey, I just have to pay my deductible.

Michael Doherty [00:04:09]:
So again, you know, coming from being proactive versus reactive and again, on the offense versus the defense, you know, when you're making that service reservation, finding out from that new client, especially if they have any type of extended warranty or third party warranty they plan on using at their visit and getting that information up front. What's the name of the extended warranty company? What's the policy number of that warranty warranty? What's the extended warranty's contact information? And a lot of the times the clients don't know this. You know, they have to call the place that they bought the car from to figure it out. They say, well, I thought you guys had that. I've had so many just conversations with people that just have no clue about their extended warranty. But more importantly, having the conversation with the client and being transparent about their extended warranty. And it's not something you've seen before. Everyone's different.

Michael Doherty [00:05:07]:
Well, to a degree, once you start seeing more of them, but having the conversation with the client to let them know that a, we'll be happy to call your extended warranty company for you. However, whatever that they don't pick up, you will be responsible for. And again, most people say, clients say, well, I'm just going to have to pay my deductible. And we all know that is not the case. There is a discrepancy with parts through the extended warranty company. There's a discrepancy with how much labor they'll pay. So again, just being transparent upfront with the client, letting them know that it very likely could be more than just their deductible. And I have had the offset that, you know, the repair is less than the deductible.

Michael Doherty [00:05:50]:
You know, we did a smoke test one time, found that the client's gas tank cap was, you know, leaking for the check engine light, it was an emissions issue. And called the extended warranty company, they said, how much is it? They said, yeah, well that's under their deductible. So thanks for calling. But you know, not covered because it's under the deductible. So that was good news. Calling them back and let the client know that, you know, it's under the deductible and it was an out of pocket expense for them. But nonetheless, you know, I think it's important for you as a service advisor because you're going to be the one dealing with these extended warranty companies. 98% of the time is to have a meeting with your team, your shop, the owners, the managers, technicians, whatever, and find out what kind of policy you want to put in place to protect your time and protect the company.

Michael Doherty [00:06:41]:
And the reason I say that is again, most extended morty companies, it's parts and labor disputes, it's, well, they want to send parts to you and just have you put them in. It's kind of like watching an episode of Better Call Saul where, you know, he's kind of a sleaze bag lawyer. And I'm not saying, I'm not saying that extended warranty companies are sleaze bags. I'm not. But again, it's like watching Better Call Saul. He's not a great lawyer and he's finding every loophole he can to either say no or just make it as cheap as possible on his end. You know, it's never a win situation. So have a conversation, have a conversation with your shop and find out what you do and don't want to do as a company for extended warranty companies.

Michael Doherty [00:07:24]:
And reason I say that is again, just being Transparent with the client. You know, if the client says, hey, well, you know, they, they supply, you know, they want to supply parts, I'm sorry, Mr. Customer, that is not our policy. That's not in our business. Or it's, you know, it's not how our business is set up. We're a parts and labor provider. We supply parts and labor and we warranty them. Well, they just want to send you the part.

Michael Doherty [00:07:46]:
We won't do that. And here's why. So again, just being transparent up front. Also, what I have found is not, it's not a deterrent to not get someone to use them. Meaning like if someone says, hey, I have an extended warranty company I want you guys to call and all that. But again, it's a time suck. It really is. It's anywhere from 40 minutes to an hour sometimes between sending paperwork, parts, receipts, phone time, downtime.

Michael Doherty [00:08:13]:
If that extended warranty company wants to send an adjuster to look at the vehicle, it's extra downtime on the lift because usually they don't come the same day. Depending on where they are. The adjuster, then the adjuster does their assessment. They say they'll get back to you. One day goes by, two days goes by, you call again. So again, it's just, it's never a good thing. But reason I'm saying this is, it's okay as your business to say that you're instituting a surcharge for dealing with their extended warranty company. And I think it would be advisable to come up with different levels of doing that that's going to again, protect your time and protect your shop on the financial side.

Michael Doherty [00:08:57]:
But the company that I worked with at one point in time we were charging, I think it was $100, it was $100 surcharge to the client to facilitate and deal with their extended warranty company for the transaction. And some people were okay with that, and some people were not okay with that. But again, you have to protect your time and you have to protect your business and the company that you work for. So just some thoughts there. And don't get me wrong, we always want to help the client. We do, we want to help the client. But there's only so much we can do when things are outside of our control. And reason I say that is again, with a third party warranty is extended warranty companies.

Michael Doherty [00:09:33]:
And again, having that talk with your team and having those process and procedures put in place will save you time, money and headaches because everyone you work with is going to be different, but just kind of a standard across the range. Hey, Mr. And Mrs. Jones, we'll work with them, we'll give them a call. But just to let you know before we do that, we have a surcharge as a business to deal with them, and here's why. And you know, see how it goes. But again, you know, don't. You're not at the mercy of the extended warranty company.

Michael Doherty [00:10:03]:
You know, you've got to do what's right for your client. You've got, you know, so always, always, always do that. But again, just something to consider. But again, it's been a hot topic that I've been talking to a lot of shops about lately with extended warranty companies. I mean, I had the conversation and I'm on a zoom call and, you know, you mentioned that and you see the eye roll. You know, let me tell you about this one, let me tell you about that one. So I know there's some good ones out there too, but in my personal experience, a majority of the ones that I've dealt with have just not been worth the paper that they're written on. And, you know, it.

Michael Doherty [00:10:33]:
Sometimes it is what it is. But again, just something to consider. Number two, kind of excited about this one is, you know, we always talk about most shops. You know, we want more clients, we want more clients, we want more car count, we want more business, but we also want to do it the right way. Right? So I think one thing that'd be really cool to do is for your shop to do a quarterly. So every four times a year, do a quarterly vehicle clinic. Doesn't have to be something massive, but build excitement around it. You know, post on Facebook about it, tell existing customers, tell them to bring a friend.

Michael Doherty [00:11:11]:
Have it either after hours, have it on a weekend, typically a Saturday, you know, 10 to 1, 11 to 2, something like that. You know, get a food truck. It doubles, you know, as an open house. You know, it's engaging with existing customers, it's attracting new clients. And, you know, have some raffles, you know, do a giveaway for, you know, a service or two, maybe a bucket with some detailing supplies in it. Have some raffles, but, you know, again, post it on Facebook, get people to register, don't charge them to come to it. But you know, things you can do for that clinic that I think are gonna be really important. Number one, there's a lot of people that just still don't know about their vehicles and, you know, empowering them, getting them to feel more comfortable about their vehicle and Reason I say that is if you have this event, this quarterly clinic, you know, have a vehicle, you know, up in the air on the lift already, obviously, you know, make sure it's okay with your shop insurance company that you're going to have a bunch of people back there to have this event, you know, every quarter or, you know, whenever you do it.

Michael Doherty [00:12:14]:
But just run it by your insurance company. Make sure you're cleared to do that. Most shops are, but you never know. Don't want to get anybody in a pickle with that. So just first and foremost, again, talk with your shop insurance, Igo whoever you're dealing with and make sure that that's going to be okay to have some people back there and explain what you're doing, right? And have a car up in the air where people can point out, you know, hey, what's this? What's that? What's this kind of, you know, questions and answer session. Have a, have a vehicle up on an alignment rack. Have a vehicle getting an oil service. Have a vehicle in, you know, a dead bay, you know, with a chock of wood under the front tire or something, and, you know, doing a tire, you know, doing a flat tire or a spare tire replacement.

Michael Doherty [00:12:57]:
Have, you know, someone going over instrument cluster warnings and what do they mean and why is it important to not ignore them? You know, just all things that you can think of again to just empower people more with their vehicles. There's so many people still that come to your shop that just don't know about their vehicles but would probably like to be part of something. And people, you know, when you've got a cause, when you got something going on, you know, and if you did want to charge people, then, you know, do like five bucks ahead, ten bucks ahead, and all that money goes to a charity. You know, pick one or two charities and, you know, you know, do a Facebook post at the end of that event. Hey, we took this check for X we brought to this. You know, was it Blue Cross? You know, was it blood bank? Was it, you know, whatever charity, whatever cause you want to do it for. But yet again, people get behind a cause. So, you know, build that clinic around a cause.

Michael Doherty [00:13:44]:
Get, get people out, you know, get people coming out. And again, it'll engage existing clients and build new clients for you. But you know, things like, you know, accessible fluids, you know, telling people how to check those. I can't tell you the amount of times I've had people come in with coolant issues and, you know, we ask them if they have Added any coolant to their vehicle and the reservoir is just to the brim, filled with coolant, you know, and they said, oh, it was half empty. And you're like, yeah, it's supposed to be like that. So, you know, again, show people, showing people the levels, the lines on fluids that you can do oil these days, not so much. The dipstick isn't quite there on most cars, but if it is, great. But still, you know, you can still check the condition based service indicator with them, show them how to do stuff.

Michael Doherty [00:14:28]:
So again, just empowering people with their vehicles, you know, and have that clinic. It could be again, multi, you know, multifaceted. But again, getting build excitement around it, get people engaged, get them excited, you know, again, how to change a tire properly, have a station for that, you know, and get them, get them involved. I mean, make sure it's safe for them. But yeah, I mean, get them, you know, get them with a torque wrench, you know, torquing down the lug nuts. Get them opening up their roadside emergency kit that they've never opened before. You know, what's. Oh, there's a red triangle in there.

Michael Doherty [00:14:59]:
What's that for? You know, again, just kind of go over things, things that seem common sense to us because we're in the shop every day. But for people that really don't know much about their vehicles or don't have the time and yeah, I get it, most people, some people have AAA and they don't want to do that stuff. But I guarantee you, even some people that have AAA are going to come to your event and again, have it every quarter, you know, be consistent with it. I think it'd be great to do that with especially clients that have, you know, new drivers in their family, you know, teenagers that are just starting to drive, you know, girls, boys, whatever, and you know, showing them how to change a tire. You know, what happens if I have to pull over on the road? What am I supposed to do? You know, put your hazards on, make sure you pull over in a safe spot. Here's how you open up your roadside emergency kit, put the triangle out, et cetera, et cetera. You know, I've had people in the past say, you know, especially with, you know, coolant stuff, overheating, well, you know, the car's still driving, there was smoke coming out, but I kept driving it, you know, no, you don't want to do that. Here's why.

Michael Doherty [00:15:55]:
Again, turn the vehicle on accessory. Show them all the instrument cluster warnings. Here's what they mean. You'll break out the booklet. Again, just engage with them. And I think a lot of people would really kind of eat that up, you know, literally. Like it would, it would be cool. There's not all places that I think are doing that, but again, just some food for thought.

Michael Doherty [00:16:11]:
But you know, again, in service advisors, you know, you're a big part of that. You know, you're a big part of the building that excitement, you know, be there at that event. It's not just technicians and owners, I mean, service advisors, because you're the face of the business, they're connecting with you. You know, you're the, you're the ones, you're the go to. Right. So, you know, be there, be part of it. Absolutely. So again, just retouching, you know, client extended warranty companies.

Michael Doherty [00:16:34]:
Does your business want to deal with them? Do they not want to deal with them? And if, why? And you know, again, just talking with the client about them being transparent from the get go, asking those questions at the beginning of the appointment, do you have an extended warranty company? And if the answer is yes, again, find out more information about it. So at least you're aware of it versus being surprised or caught off guard about it. And again, have that meeting, have that conversation with your team come to a decision. Do we want to, do we want to do a surcharge for dealing with someone's extended warranty company every time we have to. There's nothing wrong with that. Again, you have to protect your time, you have to protect the business and you know, financially and, you know, avoid headaches. So it's definitely worth looking into. And again, car clinics, I really feel that that is going to be advantageous for your shop.

Michael Doherty [00:17:21]:
It's going to build community, it's going to build excitement. I do, I see a lot of people coming out for that event and just, you know, make it your own, but definitely do it. And Service Advisor Nation, thank you, truly. Thank you again for another episode allowing me to go over some things that I feel are important to emphasize and talk about every week. And I'd love to hear from you guys too. So please comment. Thank you so much for tuning in to another episode of the Autofix Advisor cast. Keep those bays full and keep doing your thing.

Michael Doherty [00:17:52]:
Be yourselves, be original and take care of one another. All right, until next time. See you guys. Hey, thanks for listening to the Autofix Advisor cast. If you're ready to take your shop to the next level, check out our sponsor, WorldPAC and the WorldPAC Training Institute. WTI. Big thanks to them. For their sponsorship.

Michael Doherty [00:18:13]:
Follow the podcast on social media for more insights and subscribe so you never miss an episode. Oh, and tell your friends we want to help the industry grow and help advisors love their jobs again. See you on the next Autofix advisorcast.