Customer downtime costs

When taking an order from a customer there’s a lot of information you need to take in to get the order right. There are many essentials. Because of all the questions that may need to be asked, it’s easy to feel uncomfortable asking even more, especially when you can probably do without. The problem with that is you risk giving poor service to someone who needs it and/or too much service to those who don’t need it.

Can you give too much customer service?

No customer is ever going to complain about getting their order too soon. There could be an extreme example where an excessively large order like a container may be unwelcome before they're ready. But even if a customer asks to be billed only at the beginning of the next month, they probably don’t mind getting the order earlier rather than later. It’s a bad idea for the seller, but a good deal for the buyer.

The issue comes down to the reality that you can only deliver so many orders within a certain amount of time. If a customer doesn’t care if the order comes in the next three days, you’re giving up the opportunity to do a rush delivery, strengthening a customer relationship, for nothing. While some people will always say they need their order yesterday, the best accounts will be honest with you because they know that by making your job as easy as possible most of the time, you’re more likely to respond when they really do need a rush.

How to ask, and not to ask for key information

More often than not, when a vehicle is down until new parts are replaced, the customer will say so. But not always. This is the flip side to the fact that you need to ask the question, you may be unintentionally irritating a customer who needs to wait for you. What you probably don’t want to do, although you can, is simply ask “when do you need it?”. It’s a bad idea because it comes off as a sort of “do I need to go out of my way to deliver to you now, or can I put it off?”. A slightly off-center question not only comes off as more genuine but shows an understanding of what they’re going through.

A much better sort of question is “is this a stock order, or a job in your shop?”. If it’s a stock order you can delay delivery a bit. Not by a week but at least by half a day. If it is a job in the shop, you can safely assume they need the parts sooner rather than later, but it if stays vague you can verify further by asking if it’s a truck-down situation or not.

If it’s the sort of situation where a vehicle is loaded, the driver is waiting, the dispatcher needs updates and the customer is waiting for delivery, the person placing the order will more than likely take this opportunity to let you know. Because you make a habit of asking if it’s a stock order or an ongoing job you can now more easily give the extra service to the customer in need, and no one will be bothered by it.

With time you can let your customers know that the squeaky wheel gets the grease. Let them know that you not only don’t mind but appreciate when a customer lets you know when it is or is not a rush so everyone gets better service. With time this will distinguish you from your competition. It’s an attention to detail that most people will say is obvious, but it’s not because nearly no one does it. Also, the hard task of asking extra questions creates an environment where you can regularly strengthen your relationship by offering timely service.

What’s the value of added service?

The point of this article so far is to make sure you offer appropriate and timely service, when needed, to your customers. The value of this service can’t just be for your customer. Repeat customers are good, but you have to make your time and effort as worthwhile as possible. Most parts your customer buys are for more or less known prices, so there are limits to how far you can take this, but you do have to calculate it.

The same customer can and should be charged different prices for the same part in different circumstances. If you’re trying to attract new business, be it a new customer or selling more to an existing customer, this is where you’ll likely offer the lowest price. If your call on your customer and they tell you what they want, this will be a slightly higher price, but you still don’t want to price too high.

If, however, a customer shows up at your counter with, for example, a camshaft and says he needs it identified and he needs to buy one. Well now the counterperson needs to use their knowledge and experience to identify the part, and you need to have the part on hand to make the sale. There’s value to that service and you need to charge more accordingly. It may not mean the difference between a 30% and a 60% margin, but it should be at least a few points more. The same thing goes for in your garage when serving an external customer. The mechanic is diagnosing, replacing and verifying the part, and so no one blinks at the fact that you charge for the time, expertise and equipment needed. But the counterperson who identifies, serves and bills the part also has a value in this equation. This does merit a much higher profit margin.

Conclusion

No matter how you look at it, asking fewer questions is easier. No matter how you calculate it, charging more money is more profitable. That said, a part that costs you x dollars should not have a fixed value to it. Whether you’re going after the business or they’re asking you for help needs to be factored just as much as whether they need the order yesterday or tomorrow should be considered. If for no other reason that a little more margin on a parts order costs a whole lot less than a truck not driving across the country.