2020 will forever be remembered as the year of COVID-19. The pandemic caught everyone by surprise and had a major impact on the economy, which will have ramifications for years to come. During the summer, states began to open up and some businesses were able to resume business, but with the reopening came a spike in cases and many are preparing for a second wave.
Mike Chung, director, market intelligence at the Auto Care Association (ACA), has been studying trends in the auto repair industry in his Market Insights with Mike series. Recently, he took a look at what was happening in the auto repair industry and compared it to the number of COVID-19 cases. Based on the evidence, which was gathered from economic data and survey results collected by the ACA, along with statistics gathered from reputable media sources and statistic gathering companies, such as Statista, Chung predicts that the next few months will see a second wave that auto repair shop owners need to brace themselves for.
What are your predictions for the next few months?
What I’m concerned about is the spike in cases, particularly in the South and West—California, Arizona, Texas. The rise in cases is causing governors to double-down on implementing strict stay-at-home orders. If this happens, it will impact vehicle miles driven, which, as of the summer, had been on the rise. If travel goes down, this means less business for shop owners. Summer vacations could offset that, people will be driving more than flying, but I’m focused on day-to-day driving and the decline in that and the impact that will have on auto repair shops.
How can shop owners prepare for a second wave?
The coronavirus presented an opportunity for forward thinking and well-managed shop owners to stay afloat and thrive. It was and is an opportunity to differentiate. We’re more prepared this time around. There are many different aspects that go into planning, but here are a few:
Staff planning. Forecast how many people you think you’ll need. You may need to cut back on staffing or on hours. However, right now many shop owners are seeing some of their best sales days ever, so it’s important that you do have proper staffing. Many people are looking to get out of the house and want to make sure they’re maintaining their vehicles since they won’t be purchasing new ones. Because of this, make sure your staff feels comfortable coming in if restrictions are put back in place. Make sure there’s appropriate planning and processes in place to keep your customers and your staff safe.
Regardless of whether or not there’s a new wave, there is a “new normal” and the way you run your shop will need to change. Make sure your operations are in line with customer expectations—touchless service, for example. Or providing loaner vehicles because it may take longer than normal to get a part. These are all important things to consider. The adaptive shop owners are the ones that will stand out.
Financing is a big one. Shop owners should prepare now for new financial aid that may come. Get your application in as soon as possible. If you wait, the funding may dry up. Start preparing now by talking to your accountant and making sure you’re dotting your i’s and crossing your t’s.
Times like this will be revealing in terms of business diligence and accounting hygiene. If you don’t have your books and processes and documents in order, this is an incentive to get on top of that.
When it comes to employees, how do you make sure they feel safe coming into work?
Communication is key. Make sure you have the team that you need and that you’re staying in touch with them and getting a pulse for how they’re feeling. If a tech of yours has concerns—maybe not even for himself or herself but for his or her family—let the tech know what you have in place as far as processes to keep customers and staff safe.
What about marketing? If this continues, how should shops be reaching out to customers?
It’s a delicate message. One the one hand, you don’t want to sound salesy, but you do want to think about long term care for that vehicle. Communicate in a caring way that resonates with customers. Make sure to get messages out about maintaining vehicle health, like advising customers to start their car and drive it around the block even if they’re not driving regularly.
What lessons has this pandemic taught us that shop owners can take into the future?
Going forward, it’s crucial to keep an eye on the current situation. Keep an eye on trends in the auto industry—miles driven, vehicle sales—as well as other trends that you may not have been watching before such as illnesses and infrastructure. A year ago, how many people would have seen a pandemic being so impactful? Watch the trends—they could have impact on repair and service.
