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Jared Hamilton
From: Jared Hamilton
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Denim Simkins

Denim Simkins Director, Fixed Ops

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The Add On - Impact of Selling Accessories

42923aa3020fd22752cae84a17cb6f5f.jpg?t=1Looking for a little more gross? How about looking toward a $40B industry. A few of the latest reports show that the accessory industry is on the climb. Close to 9 out of 10 people

that purchase a vehicle will add an accessory within the next 90 days. Over sixty percent will spend over $1500 on average. This all seems good right? Everyone would like to have a little something that makes their vehicle look and feel the way they like it.

Coming from a store where we built a quarter of a million dollar display and outfitted trucks with $8,000 to $10,000 of lifts, wheels and tires all the way to another store where an all season protection package was a big ticket. In short accessories is a mindset. The stores that sell accessories typically have someone that loves them and works hard to offer what is hot in the industry.

Mostly this takes the GM saying this is the way we are going to do business and everyone has to be on the same page.

Most of our OEM’s have come to market with a decent list of add-ons and actually most of them have created a decent profit margin for parts and labor for the simple bolt on and drop in items. Floor mats continue to be the most common add on however in some regions tint has taken over this as the most common add on item.

 Here is a very likely scenario for a store that has decided to install tint and shield.  This not a high volume sales store and they very much fall in the mid-size dealer segment. They promoted one of their lot techs to install tint and shield. Trained him for 30 days and then set out to sell 100 tints and 25 shields. They had the approval from the GM to spiff the salesman and service writers. In their first month they sold 66 tints and 22 shields. Figuring they sell tint for $150 and have a cost of materials and labor of $55 they make $95 gross per tint. On shield they sell it for $450 and have a cost of $210 for labor and materials they make $240 in GP. In this particular month they created an additional $11500 in gross, not bad right. They soon found out they needed to hire and train another installer.

Keep in mind these results did not happen by chance. They had the dealership on board and spent nearly $1700 in spiffs but they gained $11500. When I asked how this worked out so well the reply from the service director was, “my GM was pushing the process and made sure everyone knew how much he liked the tint and shield business”. Well for a net of close to 10K I bet he liked it even more.

Jason Lancaster
Tint and clear bras are a great source of profitable accessory sales, especially on new (or "new to me") cars. That's a great, actionable tip. Some accessory sales that I've seen work well for dealers and independent accessory shops: - Exhaust systems. This is an extraordinarily popular add-on for most truck owners, and it's easy-peasy to install a cat-back system on a new truck (no grime or rust, bolts to factory hangers). A lube tech could easily handle this with a little training. Axle-back systems are popular on coupes as well. - Tonneau covers. Another popular truck add-on, install is easy for anyone (technician or otherwise). - Lighting upgrades, from adding fog lights to vehicles that don't have them to adding on after-market systems. LEDs are incredibly popular right now, and the mark-up is decent on the quality LED systems (which is all any dealer should offer...the cheap stuff is a CSI problem waiting to happen). Install ranges from easy to difficult, but the harder it is, the more likely the customer is to pay a dealer to do it. The "trick" to all of the above is to offer more than just the factory's accessory brand. You don't want to only offer the Ford Racing (or whatever) exhaust system, tonneau, etc. You also want to be able to offer Borla, Magnaflow, Flowmaster, Corsa, AND the factory's designated system. Be sure to sell them for the same price a customer can find them online...most pricing today is determined by a MAP policy, which means the markup is decent. The cool part about offering all of the above is that you don't have to carry any inventory - most distributors will be happy to drop ship the parts to your dealership. As you say, accessories are a $40billion dollar a year industry. Truck owners in particular spend a big chunk of these dollars on bed liners, exhausts, tonneaus, lift kits, wheels and tires, etc. There's absolutely no reason for dealers to sit on the sidelines in this business.

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