November 2008 - Feature
Building an In-House PPM Program
No one questions the benefits of a pre-paid maintenance product, but what are the benefits of managing it in-house? F&I manager breaks down his store's PPM program, and discusses why employee discounts are a necessity.
By Jim Dirks
Making the Program Customer-Friendly
A laminated member card is given to customers who enroll in Killeen Powersports' pre-paid maintenance program, which offers one-, two-, and three-year plans.
Upon enrollment in the program our customers are given their copy of the enrollment form and a laminated member card. The card is the same size as a driver’s license and easily fits into customers’ wallets. When they bring their vehicle in for service, they simply show their pre-paid member card to the service advisor and their vehicle is immediately brought into the shop. The repair order is then charged against the program’s in-house account.
We even honor the benefit at other dealerships. If the customer is on vacation and his or her vehicle is due for service or the customer moves during their program period, we simply instruct him or her to visit a local franchise dealer and have that dealer call us. We then pay that service bill on the customer’s behalf using our in-house account.
Determining Pricing
The amount you charge for your pre-paid maintenance program is ultimately up to your store. How you determine what to charge is not something this article can intelligently broach. Demographics in each area of the country will play a part here. What’s fair in one area may be way too high or way too low in other areas.
I do want to strongly suggest that you discount the program for your employees. Ideally, you want all of your employees to have this program on their powersports vehicles. Why? So that the salespeople, the parts department staff, the F&I manager, the service advisors, service technicians, and even your administrative staff will all have the same answer if a customer happens to ask them about the program. “Yes sir/ma’am! I have it on my bike and I love it!”
I would even suggest making the program ridiculously inexpensive for your employees so they will all participate. The additional revenue from sales generated by employee referrals will make up for the lost revenue from the employee discounts.
Jim Dirks is the former business manager of Killeen Power Sports in Killeen, Texas.
Jim Dirks can be reached at jim.dirks@bobit.com.