Covid-19 opportunity for independent garages
22 October 2020
Author: Simon Harris
Fleet Assist says leasing companies and their customers are more likely to use independent garages post-lockdown.
Fleets will be more familiar with SMR provided by independent dealers and fast fits as a result of the coronavirus lockdown earlier this year, according to Fleet Assist. The organisation, which has a network of almost 5,000 garages, comprising franchised dealers, independent garages and fast fits, said the impact of the lockdown led to changes in behaviour as independent garages were able to step into the void left by the many franchised dealers whose workshops were closed.
Vincent St Claire, managing director of Fleet Assist, said more than two thirds of franchised dealers were closed during the lockdown, but only around a third of independent dealers closed.
It meant many of the vehicles among Fleet Assist's customers, solely contract hire companies, underwent servicing at independent garages for the first time.
"Covid was an opportunity," said St Claire. "We saw the franchise network close about 70% while about 30% of independents closed. The opportunity was there for more customers to experience service at independent dealers and, coming out of Covid, it might change people's behaviour."
Fleet Assist works with 38 leasing companies representing almost 1.2 million vehicles (although some are on non-maintenance contracts), and while many company vehicle users were furloughed or switched to working from home, a number of them still needed servicing or maintenance work.
"We are agnostic on which part of the network our customers will use," added St Claire. "Each of our customers will have a specific work direction policy.
"During lockdown, we were working with customers to help modify their work direction policy to ensure they were able to meet their objectives."
St Claire said there was renewed interest in joining the Fleet Assist network during the lockdown period because although fleet business is usually lower margin than retail, many saw the appeal of regular work.
He said: "We turn away more people than we accept because they have to
go through quite a rigorous audit process for independent dealers, but I think it was a light-bulb moment for some people.
"Fleet business might not be as rich in terms of returns or fees, but it was consistent and there are probably more visits per year. Many garages refocused on fleet business.
"Cost control is important to our customers. You might ask why someone would query the cost of a sump plug, for example, because it might only be 75p, but if a fleet has got 100,000 of those, that's 100,000 oil changes, which adds up to a lot of money.
"So it's more about educating our network and making sure we have rates that are appropriate given the combined spending power, but we've also got to promote the right sort of behaviour."
St Claire added that he advised customers to carry out MOT tests as soon as possible, despite the government allowing a covid extension, to avoid a bottleneck in bookings later in the year.
"We're always looking at our capacity and network, including lead times and rejection rates, to ensure the network stays trim and manages work properly," he said.
Fleet Assist is also boosting its capacity to service electric and hybrid vehicles with qualified technicians as the popularity of those vehicles increases among fleet operators.
"The issue of repairing hybrid and electric vehicles is often a problem because it relies on technicians who are trained to work on those vehicles," he said.
"It's something that will increase, but it has been an opportunity for fast fits to train technicians and improve capability of accepting this type of work from fleet customers."
He also believes the opportunities presented by digital technology will accelerate change in the SMR sector.
Fleet Assist's Atlas business intelligence tool gathers a huge amount of data on where customers are spending money and why certain work is being carried out, said St Claire.
"Customers want more analytics and provide more information," he said. "Network management is more of a science now.
"We've seen a shift in the way customers are booking, accelerated by Covid-19, to an online regime. It has been a big challenge for call centres to ensure they are staffed adequately, and there's now more of an acceptance about capacity to carry out work and the time it takes to accommodate it."