We've "scene" it all--The SceneExchange Blog

I'd like to buy my next used car at...Costco?!

When I think of Costco, I think of bulk packs of toilet paper and giant boxes of cereal. However, they are actually a giant referral source for new car sales (700,000/year)--and now they are adding used vehicles to the mix.

They plan to have their certified-vehicle program rolled out to all stores by the end of 1st quarter in 2010. They have tested the concept in Denver, Phoenix and San Diego. The price point for used vehicles is based on the lowest price advertised online by the dealer at the time the customer is looking for a vehicle--then Costco customers are offered a price below the lowest posted price. This is usually within $500 of the dealer's invoice.

I'd love to hear from any dealers who participate in this program--and what your experience has been like.

Thanks!

--Beth

Toyota's stockpiling--prudent or lack of confidence?

Toyota is warehousing key parts here in North America just in case their supply chain gets interrupted due to supplier failure.

This is an interesting disruption to their long-standing "just in time" philosophy, which has marked warehousing as a symbol of inefficiency.

So, is this the right thing to do or is it an overreaction?
On one hand, they work with over 250 suppliers that also work with the US Big Three. If one of the Big Three goes into bankruptcy the chain reaction might shut down Toyota. On the flip side, perhaps this should herald a new level of communication and commitment between the suppliers and Toyota. They have, in fact, sent people out to help suppliers work on cutting costs and improving performance.

What else do you think needs to be done? Is Toyota inadvertently sending a lack of confidence message in their suppliers? Opinions?

--Beth

Trade Show “ROI"...Is it worth it?

For my first post, I wanted to write about a topic I was discussing with a client recently--trade shows. I am not saying that I am an expert on them, but I have attended well over 100 shows over the past decade. I've been part of small CPCU vendor fairs all the way to the elaborate CES and RIMS expos.

  One current and consistent theme among all of them is that a $5.00 20 gallon waste paper bucket still cost about $20.00 a day, and a $25.00 chair is still around $50.00 to rent. With today’s economic struggles, it is difficult to justify many of these shows because of the obvious cost as well as current attendance.

There are many shows to review each year to try and decide which ones will be the most beneficial when you weigh cost versus business. Certain shows attendance is necessary only to keep current with current customer base and not to be outdone by your competitor. Other shows are more viable for gaining new leads and contacts in the hope it will all add up to more business. I have been in the insurance claim servicing side for over 20 years and there were years where firms I worked for would do close to 40+ shows a year...with an average cost well in excess of $10K. This does not include staffing for the show, flights/hotels/food and entertainment…add another 10K for that. 

In better economic times the number and cost of these shows was irrelevant as long as it produced quality leads and kept us current with our market share. Everything is dependent however on the amount of quality prospects that attend these shows. Today companies are sending fewer representatives to these trade shows or not even attending them at all. What does that mean for the vendors that are shelling out $10K Plus each and every time? It means they are taking a hard look at whether to attend at all.

Companies are turning to alternative and creative means to get their products and services recognized, often turning their backs on trade shows. Many of these are Internet-based and very inexpensive--and you are able to specifically reach your target audience. According to Trade Show Week (3/23/09) “Not only is attendance dropping at some of the country’s largest shows, but also the number of exhibiting companies is diminished--some for economic reasons, others because of new company strategies.”

With this said, I do not foresee the demise of trade shows, instead I think it's the beginning of a new corporate culture concerning these shows. Instead of just saying yes/no to participate in certain shows, more homework will need to be done on what shows truly bring the best results. Same old, same old doesn't cut it.

Trade shows will always have a place in the business world, but the shows themselves need to do their part to make it more affordable. The shows that change and react to the times will do very well.  Those that do not will continue to see declines in attendance. I personally would like to see a few chairs and a trash can be included with every exhibit space from now on…think of it as a trade show stimulus package!

--Joe

Podcast: HR Tips for Shops

This month's "Topics in Ten" podcast features Julie Watkin, senior VP of Human Resources with ABRA Auto Body & Glass.

She covers employee-relations tips, finding and keeping good people and searching for up and coming talent.

To listen, follow this link.

We hope you find Julie's information helpful.

--Beth

Pyschology and its good friend, marketing

New vehicle sales fell last month (37%-ouch!), but Hyundai's marketshare has doubled. How have they been able to generate sales when prospective car buyers are reluctant to make any moves right now?

There have been several attempts to get buyers into dealerships recently (GM's and Toyota's zero percent financing and GM's offer to lock in gas prices at $1.99). But, they haven't been working. People are afraid to make a large purchase such as a new vehicle.

Yet Hyundai has created a novel deal that is a direct psychological play. Here's what their deal is: if you buy a Hyundai and lose your job, you can return the car. Simple and direct. Since our economy is so uncertain right now, their idea taps into a prominent psychological component. By removing that fear from the equation, customers are drawn in. (and, obviously, buying)

What can you do in your business to create an offer that helps remove fear? Just a little something to think about.

--Beth

Strategies for beating the downturn--from all types of busineses

Here is just a sampling of what various businesses are doing to help themselves right now.

1. The Artist--Damien Hirst (he created a diamond encrusted skull that gained reams of publicity and sold for $150 million) is making pieces for $5.00 and selling them at two stores that he opened. In case you are wondering, the $5.00 object is a keychain. You can also get a poster of the $150 million dollar skull for only thirty bucks.

2. The Tech Firm--Intel

How does a company go from the smart branding of "Intel Inside" to laying off thousands (announced a few weeks ago) to staking their future on massive R&D spending? By making a smart move that plays into its company story by banking on innovation to propel its fortunes.

They will be investing $7 billion in new manufacturing facilities to support their next-generation chips--code name Westmere. This will allow them to bring technology to market even sooner.

3. The College--The Sheffield College (in the UK)

This school has developed an "action plan" to help support those who have been laid off. It includes special 10 week trainings, a part-time training program that guarantees a job to all who complete the courses and the creation of a one stop advice shop. Sheffield is a vocational school--the largest in its city.

What can be gleaned from these examples?

1. The artist--seek to understand trends and price points.

2. The tech company--committing to a strong vision of your company's future pays big dividends. And investing in your company is a good idea too--especially if your competition is cutting back.

3. The College--Tailor your product to the needs of your customers.

What strategies will your company use in tough times?

--Beth

Lean Principles Applied to Front Office Operations

Although the concept of lean has been around for many years--it actually dates to the pre-20th century--lean manufacturing is a topic of considerable buzz in the collision repair industry today. I am certain you have heard about lean manufacturing and principles, and you may even already be in the process of adopting these principles into your own production processes.

The same lean principles that are applied to your production process can also be applied to your office operations. The definition of lean is to assist in the identification and elimination of waste. As waste is eliminated, quality improves and production time and cost are reduced. A true lean model can be worked into both your office and administration processes.

Here are a few ideas that can be applied using the concept of lean into your office operations.

Begin by fully documenting your Repair Order flow; this is the process that follows how a Repair Order (the physical file) moves through your business. Documenting this will identify potential waste and let you focus on true value gained from the efficient repair of a vehicle (while maximizing profit and customer satisfaction).

Number One: The front office “counter” or desk should be as neat and clutter free as possible. This is a first impression opportunity for your customers and should reflect a positive and clean operation.

• Everything has its place—Customer information sheets, completed jobs awaiting customer pickup, estimates for follow-up...everything should be in its own “bin” or a labeled file in a file drawer. Every piece of paper should have its place.
• Files follow flow—As identified in your documented work flow, files should be created that follow that flow and each R.O. should be contained in the proper “file” for processing. This allows for focused tasks to be performed throughout the workday.
• Clutter free tasks—You or your staff can only work on one task at time to be most efficient. Try this little test. Walk up to someone working at their desk; and if there is more than one file, paper, note or other item in front of them, ask the question “which one of these tasks are you working on?”—and which one is most important?
• Golden rule Email—only touch the email once. Either reply to the email immediately, delete it if not important, or “file” it into the appropriate electronic folder.
• Work on your folders one at a time based upon importance and flow (both manual folders and electronic)

These minor changes to your work flow and those of your employees will have a significant effect on your processes and allow you to identify work flow bottle necks that need to be addressed.

--Alan

Online Communities Article (web exclusive) for Claims Magazine

If you receive Claims Magazine's e-News, the top story is from none other than our own Chrisa Hickey. If you are into auto claims and online communities, this is the story for you (in fact, even if you just want to learn more about online communities, you'll come away better informed).

Let us know what you think of the article.

Follow this link to read it.

--Beth

Our CEO has an article published in Claims Advisor

Our CEO, Ian Cunningham, has an article that is appearing online in Claims Advisor. Here's the link.

The topic is Direct Repair Programs--Why Insurers Need Alternatives in Today’s Market.

He discusses the way web services can help insurers gain leverage, give customers greater control and keep shops happier. Since many auto insurers are seeking alternatives to direct repair programs because of their limitations and the threat of anti-DRP laws, the time is right to learn about the intriguing alternative that a Web-based repair service can offer.

We hope you find the article helpful and thought-provoking.

--Beth

What Makes A Great Manager?

The latest issue of Business Week contained their yearly article commenting on the best and worst managers. Almost everyone on either list has the title CEO after their name--however being an outstanding CEO is more about leading; and managing is more about, well, managing. So, here's some advice for the rest of us. Listen Before You Jump In Employees will bring you everything from concerns to ideas to day-to-day chatter on a regular basis. Be careful to be a patient listener (even if you already know the answer). It is important to listen--and let someone have their say--before continuing. Everyone wants to feel heard and listening goes a long way toward building respect.

Recognition Is More than Just A Yearly Review It is your job to recognize positive actions and efforts. Make sure you do it out loud. Many times, we will note good work to ourselves and not verbalize what we are thinking. Your employees are not motivated by money alone, make sure to recognize and acknowledge hard work and a job well done.

Spread Good Fortune Around Take your staff to lunch or provide another type of meaningful perk. What you do can vary by the individual.Here's a good article from HR World about motivation. It covers the top ten tips. Make Sure You and Your Staff Are on the Same Page Setting deliverable milestones with your staff helps ensure that they know exactly what you expect. This also makes reviewing performance simpler because you have firm criteria against which you can examine their work.

You Need to Point the Way Try using a roadmap to guide your employee during the year. This lays out a path your employee can follow to ensure their success. Backing this up with one-to-one meetings and a sit down approximately six months before a performance review provides a chance to talk about where an employee is at and how to they can work to get to where they want to go.

It's always important to maintain your big picture while managing the day-to-day events in your department. I hope this quick article gets you thinking.

--Beth