The Right Strategy

Oct. 19, 2022

Do car counts or ticket averages dictate your service mix?

Speedy Lube in Bozeman, Montana, has two quick lube bays. Owner Travis Miller is always looking for the right balance between quick and thorough service.

“I try to tell my customers when they ask to do it faster—I say, ‘My business isn’t here to be the fastest oil change. We want to make sure we’re checking fluids and making the vehicle safe as a full-service shop versus just a quick oil change,’” he says.

After all, Speedy Lube has a lot to offer. Customers can still get in and out for a quick oil change, but they also have at their disposal a menu of additional fluid exchanges, fuel system cleanings, and full mechanical work in a separate bay.

Over the years, tickets have increased for the shop. Car counts have remained steady.

“My car count numbers have not decreased,” Miller says. “We do pretty much as many cars as we can per day.”

Miller has found the right mix of service options for his shop. A variety of factors play into that decision—his personnel, his building, his clientele, and his market, among others.

It’s tough to find the right mix, and it can be tough to resist the urge to tinker with the formula. Amid lots of change in customer expectations and shop strategies, NOLN explores the philosophies behind the “right” service mix and how different operators view the challenge in their markets.

More than 2 Sides

The NOLN Operator Survey has shown drain intervals rising by around 1,000 miles over the past five years. The anecdotal evidence is always that customers are opting for longer periods between oil changes. Owners see newer cars coming out of dealership warranties that rely exclusively on synthetic oil, which often come with longer recommended intervals.

That disruption is one of the main drivers behind a shift in the traditional quick lube model. If customers are coming in less often for the oil change, then it might make sense to try and get more “bang” for each visit. In other words: add services for higher ticket averages.

From the 2022 NOLN Operator Survey

Drain Intervals (miles)

2017: 4,178

2018: 4,792

2019: 4,910

2020: 4,445

2021: 4,934

2022: 5,155

Looking broadly at quick maintenance, two polar models emerge. Operators can run stripped-down, car count machines that offer oil and filter exchanges and little else. Many of the big brands and independents still operate on this model, relying on the foundational tenets of drive-up service that can be done cheaply and fit into a lunch break.

There are newer operations looking to push that model. Costa Kapothanasis, operator of the Costa Oil 10 Minute Oil Change chain, built a franchise model on shops that are smaller (sometimes one bay), with a lower cost of operations to maintain a true quick model amid the rising cost of goods.

On the other hand, operators are starting to incorporate brake work, more complex flushes and exchanges, and tire sales and service.

This is, of course, no more evident than in Jiffy Lube’s Multicare approach, which publicly rolled out in 2018. The move to include brake, tire, spark plug, and other services marked a shift for one of the best-known quick maintenance brands. Steve Ledbetter, company president at the time, called the move “more of an extension” of the service model than a rebrand. By 2021, company President Edward Hymes told this magazine that “the majority” of stores have transitioned to the newer model. Newer shops are being purpose-built for Multicare

While the definitions of the quick lube are shifting, there’s no one model that’s going to work across all markets for all operators. Multi-shop operators likely know how expensive flushes might be popular in one market and fail in another.

“It’s a microcosm not only from state to state but from town to town,” says Shane Burton, a Jiffy Lube franchisee. “And even in this town that I'm in, our three shops have totally different clientele.”

There aren’t just two sides to this debate.

Making Changes

Burton has been a successful Jiffy Lube operator for years. He oversees a group of service centers in Twin Falls, Idaho, but has partnerships in other areas. He says that the growth in service offerings has been an ongoing debate among operators.

“When we first started, we did mainly lube, oil and filters,” Burton says. “And occasionally radiator flushes. Now we have 26 different services, and that’s hard in a way, because you don’t want to pressure your customers.”

When there’s more to offer, there’s more for technicians to discuss with customers. For a given mileage on a vehicle, it can be a mouthful just to list all of the options.

On the operations side, there can be significant challenges to rolling out new services. Equipment needs to be purchased, and staff need to get trained on it. When it comes to customer service, there’s a challenge of showing them a maintenance item that they didn’t think they needed a month ago.

Burton said he remembers when power steering flushes were introduced years ago. The service emerged as vehicle technology changed, but it was new to technicians and a challenge to sell to customers.

“You start trying to sell that to customers who have never heard of it,” Burton says. “In the back of your mind, you know that your employee doesn't believe it, either. So he’s never going to sell it. And that’s a fight that all of us have with the new trends.”

There’s a similar shift today with synthetic oil. A customer with a new car might wonder why their synthetic oil change is suddenly much more expensive than a year before when they were getting conventional oil changes. But for the shop that succeeds, there are ticket benefits. Operators shared some of the highest ticket averages in survey history in 2022.

Key KPIs from the 2022 NOLN Operator Survey

Car Count: 39

Ticket Average: $82.54

Bay Time: 23 minutes

Gross Sales: $1 million to $2 million

Gross Sales Breakdown: 

Payroll: 27%

Lease/Mortgage: 9%

Cost of Goods: 29%

Operations: 17%

Net Profit: 18%

Playing with Numbers

When Jiffy Lube first started testing new services in a move toward Multicare, Burton says that one of his first concerns was about speed. He saw this as the crucial advantage that quick maintenance has over auto repair and dealership shops.

“It’s tough for anybody to keep up the speed as a fully fledged mechanic shop,” he says. “We see that with car dealers who offer fast lube. And customers still come to us, because the car dealers can’t figure out that speed will kill you if you do not have it.”

Burton and his team watches bay times closely. It’s part of their customer experience philosophy. Adding new services can impact that experience if it’s overdone.

At Speedy Lube, customers have come to expect a more thorough approach. Miller has found that his clientele will sacrifice a bit of speed for that experience.

“Even if I didn't have the mechanic shop, I'd still like to provide the service where you’re checking everything and providing a more in-depth service than just the lube and filter,” he says.

The mechanic side of the business is an extension of that philosophy. The operators who do that the best know how quick maintenance and repair can work in harmony. In Miller’s case, around 75 percent of the mechanic work is found when customers come in for an oil change.

That’s not to say that speed is a non-factor for Miller, and he has needed to decide where to perform certain services that are more than basic quick maintenance but aren’t necessary to schedule out with a mechanic.

“We are performing flushes and stuff in our oil change bays but not in our third bay,” he says. “So that did extend our times a little bit, but not significant enough that we’d not do the mechanical work.”

From the 2022 NOLN Operator Survey

The Quickest Shops

According to the 2022 NOLN Industry Survey, shops that reported the quickest average bay times are more traditional quick lubes, deriving 89 percent of annual sales from quick maintenance.

The quickest shops have an average car count of 48, compared to the overall average of 39. Their tickets are around $7 lower than the overall average.

Alternatively, the shops with the highest tickets report bay times that are 8 minutes longer than the overall average.

Finding Your Mix

As you’ve read, Miller and Burton had slightly different outlooks on the proper service mix and how changes impact speed, customer experience, and tickets. 

Miller’s Speedy Lube has a more “one-stop shop” attitude with its full-service repair bay. Burton’s Jiffy Lube shops have adopted lots of new services over the years, but he hasn’t gone the full Multicare route and still relies on quick, basic maintenance.

What’s key here is that both operators are correct—for their markets and situations.

One big factor that Miller had in his favor when implementing a repair component was the layout of the building itself. It has two quick lube bays with easy access in and out. The third bay is off to the side and separated.

“This wasn’t built as a quick lube,” Miller says of the building. “It was a gas station and mechanic shop, and our mechanic’s bay was an old-school car wash.”

When it came time to invest in repair for that third bay, it could be done in a way that didn’t disrupt the flow of the quick maintenance operation. The third bay could be viewed as added value.

“We never really thought it would affect our car count, because we didn’t use that bay for oil changes,” Miller says. “There’s even a wall between the two, so it would be hard to do oil changes over there.”

Furthermore, Miller has suited his service to the needs of the customer base. His shop takes care of the city of Bozeman’s police and municipal fleets, as well as the county sheriff’s office and some construction outfits. He says those clients are happy that if the oil change techs find something wrong with a vehicle, that work can be performed at the same location.

“Fleet is big for me,” he says.

As mentioned earlier, Burton has sought a model that works as a multi-shop operator in different parts of town.

“Even in Twin [Falls], we have our own clientele at each shop,” he says. “And they’re totally different. We find that not only is it a micro-economy per neighborhood, but within a town.”

A quick lube model works for that situation. It can be deployed as an economical option in most areas. Regular maintenance is the best way to maintain an older vehicle, after all.

As for added services, Burton and other operators also have local competition to balance against. Burton’s shops adopted tire rotation services a while back, but they were charging for it. They have to compete against local tire shops that might do it for free. But Burton’s shops retain that advantage of timeliness.

“Most of those guys do free rotations with the set bought there,” Burton says of the local tire dealers. “So you’re competing against them and we’re charging. The only advantage to the customer is time and money. We can do it faster than they can do it, and they’re already here.”

That’s an added service strategy that’s responsive not only to the local market and client, but it also leverages the “quick” model of maintenance for just a bit more on the ticket.

What Works for You?

Whatever your service strategy, customer service is going to win the day. That’s the top factor to consider when tampering with the quick maintenance model. Do the additional bay times and sales pitches detract more than the added value of performing tire rotations, spark plug checks, or serpentine belt replacements?

“You’d better be there everyday and know your customers,” Burton says. “There was a time where we were running 100 cars out of one of our stores per day. We were Johnny on the spot—so fast. We’d still get complaints about bay times. If you don't know your customer, and you just start implementing stuff, you’re going to have problems.”

In Miller’s case, he has tried to utilize the full repair bay in order to keep the quick lube bays moving along at normal speed, as long as customers are able to come back for an appointment. So far, his clientele have supported the model.

“Anything that’s going to take too long, I just schedule an appointment for the mechanic side,” Miller says.

What’s important to remember is that all of the shops described—whether it’s Multicare, quick lube, or something in between—rely on the fundamentals of the quick maintenance model. That means no appointments, service that’s quicker than the dealership, and a price point that makes the work a worthy investment. 

Burton says that if you’ve got that much down, you’re well on your way.

“Go slow, do the basics . Lube and filter, and always fix the broken stuff—that’s wipers, rock chips, light bulbs,” he says. “Those are easy and offer great customer service.”