Monthly Archives: June 2017

Top tips for maintaining sales and incomes for technicians

Although Brexit continues to hit the headlines, it is just one of many changes that are likely to have a significant impact on the automotive sector. Henry Bisson, Marketing Manager for Ring, explains some challenges to be tackled head-on if the future is to be bright for the automotive aftermarket.

Vehicle ownership has changed. There are more three-year contracts, meaning fewer people own the vehicles they drive, and the servicing is often within a package. This means less business for independent technicians and garages. In addition, with rolling contracts, motorists don’t even need to worry about MOTs, which has a further impact on the aftermarket. Dealerships have their own dedicated teams of technicians that they can rely on to make any repairs, and whilst it may make owning a car simpler for the driver, it causes no end of headaches for local garages that have spent years building up a loyal client base.

Then there is the possible legislation that will extend the MOTs on new vehicles from three to four years, again causing a knock-on effect for independents that rely on consistent trade from testing and repairs. With times changing and fewer people owning the vehicles that they drive, these are our tips for technicians that want to maintain sales and where possible increase their bottom line.

 

    1. The first thing that technicians need to do is consider how they are packaging their products. Many garages rely on a standard range of lighting as an example, but the opportunity to upsell comes from having performance bulbs that can add value to the driving experience for the customer, giving them brighter and whiter light on the roads.This isn’t just about sales, it is about safety, thinking about things differently and offering better performing products that last longer will improve sales.
    2. Providing people with some advice on what to look for before their MOT is a further opportunity to reinforce customer loyalty. Focusing on prevention rather than the cure, technicians can spend five minutes showing a customer a check list of what to look out for. Although the return won’t be immediate, giving people advice in relation to tyre care, LED lighting for licence plates and battery maintenance checks will give the customer an experience that they are more likely to remember. Better still, should the customer require any of these accessories they will know where to go to get them.
    3. Although vehicle ownership is an immediate concern to the aftermarket, connected cars are certainly an ongoing consideration for the future. Not only will connected cars have an impact on technicians but also on the talent and skills of the next generation of garage mechanics. Self-drive cars will mean less maintenance and fewer repairs and the internet of everything will result in connected cars. Whilst this is certainly an exciting evolution for the automotive industry, we also need to consider the real impact it will have. Garages will no longer will be able to rely on basic diagnostic tools to identify a fault in a vehicle. Connected cars will use the latest digital technologies to create the functionality that a driver will come to expect from the most innovative vehicles on the road. Technicians will still need to know how to change engines, batteries and tyres but fundamentally it is not outside of the realms of possibility that they will also require a digital degree to be competent when it comes to connectivity.

 

The aftermarket has long been considered a sector that sits within professional manual labour, however as times change we are going to need to rely on some of the most advanced engineers in the market to upskill and most importantly prepare the talent of tomorrow for a very different approach to the aftermarket. This also raises further questions in relation to the accessories that will be required. Although it is too soon to make any assumptions, there is likely to be a shift to technology and digital based items that will be required alongside bulbs, tyre and battery maintenance and this is something we all need to be prepared for.

Take control of your own destiny

As the headlines continue to be dominated with speculation about what plan will be put in place as a result of Brexit, the automotive industry is already feeling the impact of uncertainty. Ring explains how it is taking control of its own destiny.

Marketing Manager for Ring, Henry Bisson comments: “As an exporter of thousands of products every year, there was never any doubt that Brexit would have an impact on the business, we just didn’t know exactly what that would look like.

“The effect on currency exchange has already been felt by many with the dollar strengthening against the pound, meaning that the cost of goods has increased with no material price increase. Then there is the euro also gaining strength against the pound. This results in a double impact as we pay more but ultimately sell for less when euros are converted back to pounds.

“The obvious concern is that goods from the UK become consistently higher cost, encouraging customers to go elsewhere. Prices are already rising at the pump as people try to recover the gap caused by buying in dollars. This means logistics and distribution costs are rising, so eventually prices for aftermarket products will too.

“Conversely, in Europe, volume sales are rising as they benefit from the increase in the value of the euro against the pound. It can be argued that this does bridge the gap short-term but we have to consider the longer-term impact of Brexit.”

Working with distributors and retailers across Europe, Ring has remained close to contacts since the European referendum to monitor the changing reaction as Brexit talks begin.

Bisson continues: “Following the initial announcement, and the headlines that ‘vote out’ created, contacts have become cautious. They, like us, are waiting to find out exactly what happens now. In the short-term it’s business as usual but how long this continues is unpredictable.

Having such a strong network across Europe has given Ring a greater insight into the reaction of those it works with and has therefore also given the business a chance to step back and consider what its own response will be.

Bisson continues: “Predictions and speculation are exactly that. Until we get a roadmap that has the facts the industry will find it difficult to plan and that is why we have chosen to take control. We need to be ahead of the game and we intend to secure our business across Europe.

“We’ve worked hard to establish the Ring brand across Europe over the last 10-years and have a strategy in place to ensure that this will continue. Business across Europe has reported growth year-on-year as we offer an alternative to the traditional markets. In order for us to build on this success, and to reinforce our intentions and commitment to Europe, we will be investing in these markets.

“Far from waiting to see what happens, we are budgeting to invest in Europe and very much see the markets as an opportunity for further and future growth.”

In the wider automotive market, with more than 30 million cars on the roads in the UK, the industry is not going to disappear overnight. However, as an industry that relies heavily on export, predictions may signal the end for some foreign businesses that could simply feel it is too expensive to produce in the UK.

Bisson concludes: “We can only predict what foreign owners will do and use past experience to influence this. We are hopeful that production will not be moved from the UK, which would result in the loss of skills and jobs.

“That is why we are choosing to take a more pragmatic approach to Brexit. We can’t change it but we can plan for change and use this as an opportunity to strengthen the business in what will inevitably become an increasingly competitive and turbulent marketplace.”