Offering Service and Maintenance Agreements: Some Thoughts

Brought to you by Frank McMillan, founder of Ensure Protect, developer of R.I.D.E.S, (Ride it Daily Extended Service), fellow rider, and 45-year vet of the service contract industry. Pictured third from the left in Downieville with the RODS, (Radical Old Dudes)

Whether your customers are avid road riders, mountain riders, casual city cruisers, gravel riders, or e-bikers it takes a lot of moving parts and constant ability to bring them into your stores. Once in you must qualify them and then, of course, make sure you have the inventory mix to get them into the right bicycle and accessories.   It’s a passion for most of you, and I think we would all agree, it doesn’t stop with the sale.

What happens next?  When the client leaves with the new bike. After the sale? What are you doing to make certain they come back to you (not your competitor) for services and maintenance?  What is the # 1 reason they stay with you? What separates you from each other, from the on-line purveyors, (who may even be your OEM’s), and the OEM’s with their own stores?

Impeccable and undeniably excellent customer service is a good answer. Excellent customer service starts with the initial phone call and does not end after the purchase. It is something that stands out along the way with every interaction, every time your client comes back in. Excellent customer service earns trust. Trust stands out when it comes to bicycle service and maintenance and leads the customer t

o leave it to you to take good care of them.

Excellent customer service guarantees that your customer will come back into your store instead of someone closer or less expensive. Building trust with your clients allows your sales staff to offer the best service contracts and maintenance available at the time of bike sale.

The NBDA is the exclusive partner of the R.I.D.E.S program. I consider it to be the best service contract with maintenance available. R.I.D.E.S is a nationally recognized compelling package designed to retain your customers.  Designed to make you additional revenue; all you need to do is get behind it.

Bicycle sales is a customer-focused business, and the point is that selling a service and maintenance plan can be considered an “add-on”, but if communicated and sold properly, can end up a godsend to your consumer when they have a mechanical or are in need of basic service down the line.

The key to making revenue with a service and maintenance contract partner is to make sure your staff knows how to sell the compelling sides of the program to your consumers. Then make sure the staff gets behind it with a sales spiff. Before you know it, you are selling service plans that not only help the customer and your bottom line but keeping the customers coming back to you.

Many of the NBDA’s retailers have been working with the R.I.D.E.S program and are finding great success. Take away the wonder of how it works, how do I make money and how do I train my staff.  I will help you each step of the way.

On the fence of offering a service and maintenance plan? Ask yourself these questions:

• Do you offer free maintenance?
  • Your answer may be yes. If so, what does it cover?  Do you make money to perform the maintenance, or are you covering it? If you are covering it, how do you account for this?  Are you following FASB standards and meeting your state regulatory requirements?  I.D.E.S enables you to offer your customers annual maintenance(s) and you get paid your rates to do the work.   The program meets all state regulations and is backed by an A-Rated insurance company.

• Is accidental damage while riding covered?
  • You may offer some sort of plan, but what happens when a customer bottoms out a shock, breaks a hanger, spokes, or brake levers? This often causes an uncomfortable customer experience or an expensive accommodation, assuming that you’re lucky enough to get them back in your shop.   With R.I.D.E.S, these issues become a profit center and a customer retention opportunity!  Mishaps while riding are covered.  They come back to you for the work.

• Does your program cover wear and tear for things like chains?
  • I see so many plans that cover labor only or do not cover wear and tear. While R.I.D.E.S doesn’t cover consumables and cosmetics like rubber, tape, and fabrics, the program does cover chains, bottom brackets, rotors, and motors.   It really covers what it should with nary an exception.  You get paid to take care of them, or as I like to say, R.I.D.E.S provides.

• Can your customer get service while they are out enjoying the rest of the country?
  • One of our favorite experiences at R.I.D.E.S is when a customer calls while they are on a vacation or at a triathlon and need service, but they are nowhere near your store. We love to get them back on the road or the dirt.  Our database of your fellow NBDA dealers assures that we have capable service providers just about anywhere from coast to coast and over just about any mountain range. I love the early morning calls especially.   RIDErs can’t wait!

• Does your program make you money or cost you money?
  • While you may have a bustling program, does it make you money on both the sales side and the service side of your business? Are you managing the risks right?  I.D.E.S generates about 50% GP and pays you your posted shop rates for service, not flat rates.  You charge the program what you would charge your customers.   How are you paying yourself now if you operate your own program, or what is the experience for reimbursement from the OEM or other program?

As an NBDA member R.I.D.E.S is an exclusive program where the $250.00 sign-up fee has been waived.  Upon signing the dealer and service agreements we will send you POP, (brochures, hangtags, and counter cards), train you, and help make the experience of selling and servicing hassle-free.

With supply in interesting times, it is critical to capture revenue at every point possible. If you have been on the fence, this is a MUST DO NOW moment.

Selling a service and maintenance plan might take some practice, but it can be done, and the more you try it the easier it’ll get. Just remember:

• Not everybody will say no, so mention it to every single customer.
• Bring it into the conversation early.
• Sell the benefits as you would any other product on your shop floor.

For more information on R.I.D.E.S, click here or call us at 866-474-4337.

Frank

The NBDA has been here since 1946, representing and empowering specialty bicycle dealers in the United States through education, communications, research, advocacy, member discount programs, and promotional opportunities. As shops are facing never-before-seen circumstances, these resources offer a lifeline. Together, we will weather this. We at the NBDA will not waver in our commitment to serving our members even during this challenging time—but we need your support.

Now is the time to become a member as we join together to make one another stronger. Whether you’re a retailer or an industry partner, your membership in the NBDA is one of the best investments you’ll make this year. 

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