Growth in the Midst of a Recession

Increase your shop’s profits with these strategies to thrive even in a challenging market.

As the United States faces economic uncertainty – and a high likelihood of recession – planning for the future can be daunting. Businesses are buckling down and tightening their checkbooks in an effort to control expenses to avoid or reduce the effects of a potential recession. But in the auto repair industry, there are unique opportunities that come with uncertainty in the market – and that’s more business opportunities. As people across the country reduce their spending, they are more likely to repair vehicles than to replace them, offering auto repair shops the opportunity to actually increase business. With the right strategies, you may find that it’s entirely possible for your shop to not only survive an economic recession – but thrive and grow.

What growth in a recession looks like

The concept of growth in a recession can look different for individual businesses. Some shop owners might consider maintaining consistent business to be a success. This is a conservative, but fully acceptable approach – keeping consistent business can keep your shop open when many others might close. Other shop owners, however, might be asking themselves, “How can I increase my bottom line during a recession?” This perspective may sound like a pipe dream, but it’s highly realistic if you know the best strategies to implement for your shop.

Expanding business when facing economic and unexpected challenges might seem impossible; however, the COVID-19 pandemic proved that great success in the auto repair industry can be achieved in uncertain times. Throughout the pandemic, people chose to repair and maintain their existing vehicles, rather than purchase new ones. This actually increased the need for repairs, and people were saying yes to maintenance they might have turned down before, simply because they realized the necessity of keeping their cars in good shape. As an added bonus, shops began to add a no-touch element, providing a great opportunity to enhance the customer experience.

While the pandemic was an uncertain time for everyone, it actually brought great advantages for auto repair as it allowed the shops that adapted to create a customer experience that customers continue to enjoy today. In preparing for the economic uncertainty in the coming year, the lessons learned through the pandemic have become highly valuable, and they can be narrowed down to two keys to success: understanding your customers and creating a consistent process.

Understanding your customer

No matter what state the economy is in, the driving force behind all business comes down to the customer – the people who keep you in business. Therefore, as you prepare for a potential economic challenge, you must pay particular attention to your customers’ needs – and any changes – to properly adapt your business to meet those needs.

Pay attention to what your customers appreciate about your shop or the extra services that make them come back to you for service rather than someone else. Think about why a customer agrees to the work you do. Customers don’t buy brakes because they want to, and they don’t get excited about a new water pump or alternator. However, they do understand that purchasing these car parts can get them a safe, reliable vehicle – an end goal that you can support.

As the shop owner, this means meeting the customer on their terms and showing them you understand their needs and wants. A key factor that applies to this is establishing trust. Customers want to understand the repairs they are agreeing to. You can offer them a greater understanding with tools like digital vehicle inspections (DVIs), photos and videos of the vehicle and text updates with clear communication of the repair process. When you prove that your business is one customers can trust to complete the repairs safely and effectively at a fair price, they are more likely to agree to the repairs, and then return for more business.

Establishing a consistent process

In addition to understanding your customer, you must also offer a consistent experience, so they know they will receive the same great service and repairs every time they walk into your shop. Consistency in your operations can make the difference between surviving and thriving during a recession.

One of the best ways shops can establish and maintain a consistent process is through the use of the right tools – particularly a cloud-based shop management system. This type of software gives you the opportunity to track your shop’s data. This allows you to remain aware of finances and business trends and make adjustments as needed, as well as automate processes, such as scheduling or maintaining a parts matrix. This increases the efficiency of your shop, so even without adding new bays or staff, you can take on more work because you’re managing each repair order effectively.

On top of that, you can improve your customer communications with the ability to communicate via text to share images from DVIs and get their work orders approved, all without requiring another in-person visit. A consistent process maintained through an effective shop management system makes it easier on everyone: you – for better data tracking and management of your shop behind the scenes – and your customers – for a more efficient, transparent customer experience.

Achieving growth in a challenging economy

Overall, growth in a recession is an attainable goal if you are in tune with both your shop and your customers. As you gear up for the year ahead, make sure you have a clear understanding of your customers and their needs, as well as how you can meet them. Additionally, take the time to standardize your processes to keep them consistent. Utilize the right tools to help automate what you can, increase efficiency, and track data to monitor your shop’s progress and adapt as needed. With these adjustments, you will put your shop in a position better prepared for growth and success, no matter how the economy is performing.