In my job I travel and work with many dealerships, and when I say many, I mean a lot. So I get to see firsthand what really happens in dealerships, as opposed to what dealers think is happening.
My specialty is fixed ops, and lately, I’ve noticed an oversight at several dealerships that’s driving me crazy. For whatever reason, some service advisors are not getting customers’ signatures on repair orders (ROs) when the vehicle is dropped off.
This is a big no-no!
ROs are legal contracts between your dealership and your customers. If a customer verbally authorizes a $300 repair bill but doesn’t sign the RO, they could easily come back and say they never approved that amount. If they decide to dispute their bill, your dealership loses in a court of law.
Years ago, when I was a service director, a customer disputed a $3,000 repair bill. We actually had the customer’s signature, but as you know, the RO legally must include the words “customer states” or “customer requests.” On the RO in question, the service advisor had abbreviated the words into “Cust sts.” The judge said there was no reasonable way to know that “Cust sts” means “Customer states” and so, therefore we lost the claim. No kidding.
That’s how meticulous you have to be with paperwork. A missing signature is as glaring as a neon sign. Sorry, you lose!
When I ask service advisors why they fail to get customer signatures, I get more excuses than you’d hear at a group meeting of Procrastinators Anonymous. It was busy, the customer was in a hurry and took off, what’s the big deal, we have their credit card on file, they paid their bill, I get the warranty ones signed, etc.
Everyone repeat after me, “Excuses are lies we tell ourselves so that it doesn’t have to be our fault.”
ROs must be signed when the customer drops their vehicle off. It’s unacceptable to wait until the customer picks their vehicle up to have them sign off on the RO.
Letting this rule slide sometimes sends you down a slippery slope to lost profits.
If you don’t create a habit by doing it every time, there’s a good chance that one day you’ll forget to have it done on a high-dollar warranty RO and it will come back to bite you in the butt. Say the customer needs a new engine before the warranty is up, and the engine costs you $3,000.
Then, two months later the manufacturer does a warranty audit and discovers that the customer never signed the RO. Oops. You think they’re going to let that slide? Not a chance. They’re going to charge the entire claim back. This happens more than you might think.
The only acceptable signatures are as follows:
-Ink signature on a paper RO
-Electronic signature on a mobile tablet
-Early bird drop envelope with a signed pre-authorization form
There are no other acceptable methods for a RO to be signed.
If this oversight is happening in your dealership, you’re in legal jeopardy.
If you believe this would never happen in your dealership, think again. Go on, just for kicks, go through all of your ROs daily for a week to see if all of them are signed.
If you find that some of them aren’t signed, you’ve got a problem. Address it with the service advisors. Let them know you’ll be checking on a daily basis to ensure all ROs are signed. Be sure to follow through on your promise.
When you get to a point where you feel confident the customer signatures will always be there, you can stop checking daily. But I still recommend doing random spot checks. Don’t fool yourself into believing that you’ll never have to check any more. You should always check on occasion.
This is another reason why I recommend a mobile check-in and MPI process. With a mobile tablet, the last step of the check-in process is the customer signature. You can’t start the job without the signature, so it’s virtually guaranteed that your dealership will be protected.