The 12 Most Important Factors to Successfully Operate a Fast Lube

Nov. 1, 2017
A Tribute to and Advice From Industry Legend, Joe Haggard Editor’s Note: Joe Haggard was connected with the fast lube industry in some way for nearly 40 years. In his final column, he wanted to pass on to the next generation what he considered the 12 most important factors to successfully operate a fast lube. With his ever-present due humility, he noted most were not his original thoughts, but all were incorporated in some way and had successful results. In memory of Haggard, who passed away in July, we wanted to pass on this advice one final time. Our

A Tribute to and Advice From Industry Legend, Joe Haggard

Editor’s Note: Joe Haggard was connected with the fast lube industry in some way for nearly 40 years. In his final column, he wanted to pass on to the next generation what he considered the 12 most important factors to successfully operate a fast lube. With his ever-present due humility, he noted most were not his original thoughts, but all were incorporated in some way and had successful results.

In memory of Haggard, who passed away in July, we wanted to pass on this advice one final time. Our sincerest condolences are with his family and friends. He has left a lasting impact on this industry he helped to pioneer.

1. Communicate.

Attend conventions and visit with every operator you can. Most of the great ideas I’ve picked up over the years have come from asking other people two questions, “What was the best thing you ever did?” and “What mistakes do you recommend I avoid?”

If you attend the annual convention and ask 10 other attendees those two questions, you will leave with 10 of the best ideas and 10 pitfalls to avoid every year. The deductible costs for attending may be the best investment you ever make.

2. Keep the customer in the car for true drive-through convenience.

Having a waiting room for fast lube services undermines the basic concept of it all. The quick lube industry’s edge over other forms of competition providing lubrication services is because we do the job in minimal time for maximum convenience. With the customer in the car, confidence is generated because they are in a position to see and hear the competent and thorough service being performed.

Of course, a waiting area is necessary sometimes because of extreme weather conditions, length of an additional service or unforeseen delays. But as a normal process, keep ’em in the car.

3. Understand perception.

Understanding perception in a fast lube is critical because we want the customer to have confidence in what we do and recognize our competency and professionalism. The catch is, the customer has absolutely no direct sensory input to convey the message. They can’t see what is flowing through hoses. They have absolutely no direct way of judging the quality of the products you’re using or the competency of your team. They determine it all by perception.

Favorable perceptions must be created and not left to chance. The signage, dialogue, menus, demeanor, conversational skills, appearance, checklists and the attitude of the crew are all tools to convey the message of quality and competency. The sequenced service procedure from the time of arrival to departure should be thoroughly rehearsed and utilize a specific script designed to convey the message.

Will the customers judge the quality of your oil filter by whether or not your greeter shaved this morning? Will they judge your team’s level of competency based on the cleanliness of the restroom? Yes! That’s the way we think, and that’s why it is essential to understand perception for successful fast lube operations.

4. Good leaders become so by serving others.

As a fast lube owner or manager, have an attitude of service. Those who serve their employees by giving them the proper tools, training and work environment fare better than those who simply “boss.”

When a leader promotes and focuses on the role of the business as serving others your driveways will fill and bottom lines will prosper.

5. Showmanship.

The beauty of showmanship is it often costs you nothing. There is an old saying, “There is more profit in the sizzle than the steak.” It’s just as true for a fast lube as it is for a restaurant. Showmanship has to do with how the service is delivered.

Showmanship is the exaggeration of favorable perceptions. For example, expressions of courtesy and respect such as, “Sir,” “Thank you” and “Please” are expected in business relationships. Showmanship is exaggerating it. Train your crew to use the words “Sir,” “Ma’am,” “Thank you,” “Please” or the customer’s name. Challenge them to use the words more and more until a customer complains. (They never will.)

Savvy operators hire actors who have the right appearance and can play the role. They can teach them to change oil.

The fast lube business is a personal service business similar to restaurants and resorts. Auto repair shops sell oil changes. Fast lubes sell convenience, confidence and ego gratification. There is a significant difference in the delivery, and showmanship is the key. Exploit the differences, and your driveways will stay full.

6. Checklists

All high-tech professions employ checklists. The airline captain with 20,000 hours in the air still responds to the right seater’s challenge/response checklist. Checklists are an efficient means to tell the customer all the little things have been done along with the oil and filter change. All the things you have added to increase value can be solidified in the customer’s mind as they hear the checklist.

Opening and closing checklists can be effective means of ensuring everything is set and in place for the first customer at opening and that everything is properly secured at closing. With all the good things checklists can accomplish, it seems only common sense to incorporate them into the job sequence and your daily routine.

7. Think about the little things.

Customers don’t return because you did a good job changing their oil and filter. The little things you do are the reasons customers become regulars. In all my years, I never received a single atta-boy letter complimenting us on how well we changed oil, but there were many that praised our setting tire pressures — including the spare — or bringing a cup of water to their dog or letting them know we found a nail in a tire.

You may call them the little things, but in the customer’s mind those little things are the big things.

8. Pay systems and staffing.

What gets rewarded gets done. Establish a compensation system such that everyone benefits from more business. If you simply pay by the hour, there is little motivation to attract more customers. A percentage of sales pay system can make everyone eager to see more cars in the driveway and more growth to create higher paying positions.

There are forms of compensation that may be more effective than money. The sense of belonging and being surrounded by others who care for you and your welfare is a basic human need surpassed only by air, water and food. Sharp uniforms not only imply a well-trained crew, but uniforms also enhance the feeling of belonging to a team. Group social functions or outings play a role. Listening to your crew’s suggestions, problems and recommendations — especially when their ideas are put into use — can do wonders for their sense of worth and contributing to the team’s efforts.

Staffing for a two-bay fast lube should be a neat, clean greeter — usually the manager located up front — who greets the customer, makes the sale and does such things as the under the hood and light checks. You don’t need a cashier. The greeter has ample time to work lines to both bays including collecting the money.

There should be an upper tech and a lower tech on each bay. In a pinch, or to provide a lunch break, it’s possible for a single lower tech to keep both lines flowing, but not advisable on a continuous basis.

That results in the need for six on the payroll — a manager, an assistant for the manager’s day off and four additional lube techs. That works out to being fully staffed full-time, six days a week and everyone working on five days for a 40-hour week. It may well be worth scheduling a nine-hour day with everyone receiving five hours overtime. This creates a powerful motivating force for attendance because if one is late or absent, the lucrative overtime pay is lost.

Employees need to have a reliable payroll amount. Their scheduled hours and income should be secure. If there are no cars in the driveway, it’s time for cleaning, restocking, landscape maintenance or training. Understaffing or sending people home during slow periods to cut payroll costs is the absolute worst way to increase profits. If there is no one to immediately greet every customer on arrival, you are understaffed. Hire more.

9. Building design and equipment

Choosing equipment and tools is a major decision for a newcomer to the business because once they’re installed, they’re difficult to change. I would make the following recommendations:
  • Have two small compressors rather than one big compressor. Air consumption is not very high, but it is essential. When one compressor is down for maintenance the second will keep you going.
  • The bulk waste oil tank can be located anywhere on the property. Have a shallow drain pan fabricated locally with a continuous drain hose into a 30-gallon pressure tank in the basement. When needed, apply air pressure in the top of the tank to push the oil out the bottom and piped to the top of the bulk tank wherever located. With this system the bulk tank can be located so the waste oil truck doesn’t block your driveways during pick-ups.
  • If constructing a new building, plan it in steps. Consider, “What services will I be performing?” and “What equipment and piping do I need?” Finally, “Where will I store stuff?” Then design the roof and walls to surround it. By planning the job, equipment and storage first, appropriate space will be allocated and much of the piping can be concealed.
  • Slope the floors with appropriate drainage. (It’s tough to scrub down a level floor.)
  • Don’t use underground tanks. They corrode through and create big problems; 550 gallon, vertical, aboveground tanks are sufficient and can be installed in a tank room alongside the building at ground level. A two-foot solid pour wall surrounding the tanks should keep the EPA happy, and the tank room is a good place to put the air compressors to minimize noise level at the entry point.
  • Have a vent system for the basement. Four-inch PVC pipe routed up through the walls to a “squirrel cage” fan mounted in the overhang, exhausting through the soffit works fine. Gas vapors travel down, so the vent outlets should be at the lowest level of the basement.
  • Have a vacuum pump with a holding tank piped to both the console and basement workstations. A vacuum is essential for evacuating differentials, gearboxes, transmissions and over-fills. The holding tank can be relatively small if mounted on top of the waste oil tank and plumbed to drain into it. Check the valves to make sure they’re the flapper type, so there is no resistance to flow.
  • Quarter-turn valves are recommended for use throughout because their on/off position can be determined visually and they require less maintenance.
  • Have every tool imaginable close at hand at every workstation. If a tool will save five seconds, it’s worth having. In the overall scheme of things, tools cost almost nothing and generally last forever. Keep them from growing legs by having a screw up/bonus fund. Set aside an amount and use it to pay for things like mistakes, comebacks or missing tools. If you have no such expenses, pass it to the crew every month as a bonus for doing good work.
  • Forget dispensing reels. A console dispensing system is the only logical way to handle all those nozzles. The hoses drape down into the basement and gravity returns them nicely. No moving parts, no seals, no springs and no maintenance, plus a much lower cost. If you don’t have a basement, wall-mounted consoles can be fabricated with the meters installed in the cabinetry and hoses draped inside and functioning similar to a gas pump hose. If space is a problem, realize that the meters can be mounted in the cabinetry and 3/8-inch hose with small control valves used for dispensing. The limiting factor for oil flow is the small orifice in the meter, and the meter doesn‘t have to be at the nozzle. Dispensing rates with 3/8-inch hose will be the same as using the 1/2-inch hose commonly used, but when space is a concern they are more flexible and take up less space.
  • It’s worth having a battery charger mounted at the console or readily available to jump start those cars with batteries that mysteriously die when you are ready to send them on their way.
  • Have attractive floors that are skid-resistant, durable and easy to scrub. There are numerous options. Just realize that very few people look up at your ceiling, but everybody sees your floors.
  • Have a generous roof overhang. It protects the walls and allows space for vent fans, lighting fixtures and surveillance equipment. Wall signage is protected and lasts much longer. Consider extending the overhang to cover the entry zone to provide shade for those waiting in line.
  • Have the biggest signage permitted, and keep it and your exterior lighting on past midnight. You will have better security, and those driving by will know you exist.
  • Most every city restricts the size and type of signage, but some exempt what is placed on the building’s walls. A typical wall with a generous overhang for lighting may give you an inexpensive billboard-sized sign.
  • Design storage space in the building so the customer only sees the displayed products or things needed for the job. Cleaning gear, landscaping tools, motorcycle helmets, mop buckets and such clutter should be stowed out of sight.
  • Think about motorhomes when considering door openings and driveways. Motorhomes are lucrative because many others aren’t equipped to service them.

10. Package deals.

Package deals make it easier for the customer to say yes to add-on services. They are a win/win situation because more value can be offered while increasing the overall net profit for the job.

Give each package an emotion catching name. There is a reason cars are named Mustang, Barracuda, Corvette and Regal. It works for package deals, too. Try, “Off Road Sportsman” for a fluid change in every gearbox for a Jeep. Try, “VIP service” for luxury car owners. Maybe try a “Birthday Bash,” a package of everything you do marketed with a pre-paid ticket and bouquet of flowers for customers on their birthday.

11. Be the best, and charge an appropriate price.

An interesting revelation comes with massaging the numbers for a fast lube. Determine from your previous year’s tax return the bottom line net profit you made after all expenses. Divide that number by the total number of cars you serviced to determine your net profit per car. The point of all this is to now ask yourself, “How much would I have to increase the charge price to double my net profit?” My guess is that it will be a surprisingly small amount, an amount that will be hardly noticeable by the customer.

Attract customers with quality, not pricing. There will always be a market for Rolex watches and Lamborghini automobiles because of the perception of quality. Customers who seek quality over price tend to purchase more add-on services because they care more about their vehicle than those who are more concerned with pricing. Their vehicles are generally in better condition and easier to service. Once the best is found, they tend to become regular customers more so than bargain hunters because price just doesn’t matter as much. They respond more to showmanship and personal attention.

12. Training.

Being the best in town requires the most highly trained crew. Teach someone how to relate to others for the most favorable perceptions and how to appeal to the psychological instincts of the customer and how to sell service and you will reap the much higher profits of selling the sizzle.

Lube tech training should be a formalized course of at least 40 hours, with exams and a diploma. A new-hire should not be placed on the line until fully qualified for the position. No customer wants a trainee working on his or her car. Conduct the shop training on an unused bay or after hours using employee vehicles.

The worst way to train is to put a new-hire with another lube tech to show him the ropes and allowing him to do it on customer cars. Do your training in a classroom, an employee lounge, in the parking lot or your driveway at home — anywhere away from a paying customer’s car. It’s best if one employee — preferably the owner or manager — conducts all the training. That way everyone has a single source for all information and everyone is functioning with the same plan.

There should be a written operations manual used as a textbook so all training is oriented around the owner’s attitudes, goals and operating philosophy. In establishing a training schedule, I recommend 25 percent of the time be spent on how to perform the service, 25 percent on rehearsing the show and 50 percent on sales, showmanship and creating attitudes for providing exceptional customer service.

Those are the 12 most important factors I know. Promoting any single one isn’t an assurance of success. That’s the challenge and fun of owning a business. The more favorable things you employ, the better your odds of success.

My wish for all operators is that you are successful, provide needed services and contribute to the economy of your community, coach a fast lube team with great memories and attain personal fulfillment in accomplishing your goals while serving all those around you.