Cash Flow Solutions

7 Ways for an Auto Repair Shop to Find Extra Cash When Times Are Slow

Two men holding a laptop while looking at a white truck in an auto repair shop

For most auto repair shops, the daily focus is on fixing cars, not generating aggressive marketing plans. If you have happy customers who rely on your services, you may already be inundated with repeat work and referrals. After all, offering quality work at a fair price is certainly a recipe for repeat business and referrals. However, the auto repair industry is notoriously volatile. When the economy weakens, even faithful customers will put off bringing in their vehicles for service. Because of this, it’s a smart idea for auto repair shop owners to prepare for normal ebbs and flows by developing strategies for generating more cash when it’s needed.

  1. Selling Customers’ Cars on Consignment Thanks to sites like eBay and Craigslist, selling a vehicle has become much easier in recent years. The days of slapping a “for sale” sign in the back window of a used car and hoping for the best are over. For auto repair shops, online car selling is a potential gold mine.

Many consumers who are shopping for used vehicles prefer to buy one from a reputable business such as a repair shop with a strong track record of being honest and thorough. Likewise, customers with aging cars can benefit from selling through a business with a recognized name. When a customer decides against repairing their vehicle, it’s always a smart idea to learn what they plan to do. While some may continue to shop for lesser-priced service, others may be considering trading in their car for something newer. By giving them a proposal to sell the car on their behalf, you can potentially make a percentage of the sale while offering an additional service to a loyal customer.

  1. Start a Subscription Plan Regular maintenance and occasional repairs are inevitable expenses that need to be factored into the total cost of vehicle ownership. A growing number of auto repair shops are now offering subscription plans for service and maintenance for their customers to keep these costs consistent throughout the year.

Subscription management solutions like Zuora can be used to create a scheduled plan that enables customers to pay a set amount each month for keeping their vehicle running smoothly yearlong. It’s a convenient way for customers to budget for repair service while also serving as a strategy for keeping a percentage of your income consistent.

  1. Offer a Seasonal Promotion There is a cyclical nature to many repairs. Customers want tune-ups before taking summer road trips and windshield wiper blades replaced before the rainy season sets in. Creating regular promotions around these seasonal repairs can generate new customers and more sales from existing customers.

Of course, it’s easy enough to try and upsell a customer on a seasonal promotion when they’re already in your shop for service. However, real measurable cash flow can be made when you reach out to existing customers via email blasts and to prospective customers via social media and direct mail. By running regular promotions, you will over time train customers to seek out the discounts, enabling you to begin to plan on regular upticks in sales that you can count on when they are offered.

  1. Seminars You might be surprised by how many of your customers don’t know how to do simple maintenance tasks like checking their car engine’s oil level or the air pressure in their tires. A value-added service that you can offer that can get customers in your shop and scheduling appointments is to offer an informational seminar where you share your expertise and knowledge.

Consider holding a one hour session where you teach specific skills and also allow time for your customers to ask questions. Thank them for attending by offering them a coupon for a future service, and you’ll probably book at least a couple of new service appointments by spending this hour of your time with them. Because of your outreach, they will also think of you the next time they need service.

  1. Form Strategic Alliances Auto repair shops are local businesses that rely on local customers. This means you share the same target market as many of the other business owners in your community. Partnering with non-competing businesses is a very effective way to leverage word-of-mouth marketing.

The key to this strategy is to find businesses that offer the same quality of work and customer service. When you are focused on providing a high level of service, you don’t want to take the risk of referring one of your customers to a business with a less than stellar reputation. However, when you do find businesses aligned with your goals, objectives and service level, it can be a big win-win for all involved.

  1. Ask for Reviews from Satisfied Customers Because so many customers have had bad experiences with auto repair shops, positive online reviews can be one of the best ways to generate more business. Like with traditional word-of-mouth marketing, online reviews help potential customers feel comfortable about taking their vehicle to your shop. The more reviews that are published, the more comfortable they will feel.

If you have happy customers who rave about your service when they drive out of your shop, encourage them to leave positive feedback on Yelp, Angie’s List and other review sites. There’s a secondary benefit to generating lots of positive reviews, too. They will help you move up in search engine rankings, making your business more visible to potential customers who are researching online for a new auto repair shop.

  1. Kabbage 😀  – While ongoing efforts will go a long way toward keeping business flowing throughout the year, there may be times when you need an influx of cash to expand operations, hire additional staff or bridge the financial gap during a slow period.

While some banks offer small business loans, the process is often long and cumbersome. A more streamlined solution is to obtain working capital when you need it through Kabbage. In minutes, you can apply for a Kabbage account where you can quality for a line from $2,000 up to $100,000. Without having to fill out paperwork, fax documents or wait in line at the bank, Kabbage is a very convenient solution for a busy auto repair shop that wants ongoing access to working capital.

With many options for marketing, promotions, making partnerships and accessing additional funds, keeping income consistent, even during slow times, is possible. Have you implemented a successful strategy for generating more customers and increasing sales in your auto repair shop? Share it with the Kabbage community in the comment section below.

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