The so-called ‘race to the bottom’ has dominated the auto repair industry for many years. It’s a destructive cycle, harming both auto repair businesses and their customers, that is stunting the potential our industry, writes Amanda Webb, CEO at FixMyCar.
Driver preferences are changing and provides the perfect catalyst for systematic change in our industry, but auto repair businesses must come together if we are to make it happen.
Why is change necessary in auto repair?
The ‘race to bottom’ in auto repair builds an intense pressure on businesses to lower prices to beat competitors and attract more customers. However, we’ve seen over the last decade that this is a losing game.
When prices are lowered and profit margins squeezed, quality is often compromised to keep costs down. This has led to a lingering perception amongst drivers that auto repair businesses are untrustworthy and unreliable, doing the bare minimum to their vehicles and costing drivers more down the line.
This reputation hurts our industry and has led to an endless cycle of drivers expecting cheap work and wanting cheap prices to match.
If you factor in the squeeze this puts on technician pay, threatening the viability of businesses, we see just how damaging this cycle is. The Institute of the Motor Industry (IMI) predicts a shortfall of 160,000 workers in the UK automotive sector by 2031 and is it really a surprise?
When highly-skilled technicians see little monetary reward for their work and long hours, there is little incentive to remain in the industry and even less to attract the new talent that is so desperately needed.
The good news is driver attitudes towards vehicle repair and maintenance are shifting. Our latest report, Making Tracks: The Auto Repair Report, found that only 29% of drivers consider low prices an important factor in their choice of garage. 31% favoured seeing good garage reviews, 47% valued clear, transparent work and pricing most and 57% said that finding a convenient, local garage was most important to them.
What we see here is a change in driver values that can and should influence how we operate. Drivers are no longer accepting low quality work for a cheap price, they’d rather pay more to trust that the work is done right and done well.
Rebuilding that trust with drivers must be our top priority, and now is the time to start. This will mean increasing prices while always communicating value and providing quality work and reliable advice.
Garage group, IN’n’OUT Autocentres, is a brilliant example in our industry of an auto repair business that is bucking the trend to great success. The reviews speak for themselves, with customers regularly praising the excellent quality of work and the friendly and helpful customer service, proving once again just how important these things are to customers.
They offer fixed pricing, eliminating surprise costs and boosting transparency, as well as payment options such as Buy Now Pay Later and Payment Assist which offers greater convenience for their customers.
Escaping the race to the bottom can seem like an almost impossible task for independent garages battling costs, competition and staffing shortages. Thankfully, it’s the small steps that collectively have a big impact. Here are a few small adjustments I recommend to garage owners:
Lean into customer desire for trust and transparency Car repairs are confusing to most who lack the technical knowledge, so it’s up to technicians to bridge that gap and communicate as much and as often as possible. Technology can help build trust, send photos and videos directly to customers during diagnostics showing them exactly what repairs are needed. This helps them to see the problem as a safety necessity rather than just a cost.
Avoid price wars with competitors You do not need to match the lower prices of competitors to win. Instead, focus on how you justify your higher prices through better quality parts, trustworthy partnerships, longer warranties and most importantly your superior service. Ask customers to leave reviews so future customers don’t just have to take your word for it too.
Add value to your customer experience Justify higher pricing by offering drivers convenience perks and packages that make their experience better. This could be a collection and drop-off service, a complimentary car cleaning or tyre check. These are things customers will need but might forget and the convenience you provide here will be much appreciated making higher costs seem like a great deal.
It is more important now than ever that we end the race to the bottom to future-proof our industry and secure a better path forward. But to see this succeed it needs a widespread change in how auto repair businesses operate. Small changes from a large number of businesses will have an impact that benefits us all, and now is the time to be bold.
Author: Amanda Webb, chief executive, FixMyCar