Respondents to the MTD 2020-2021 Tire Dealer Auto Service Survey reported that auto services accounted for 48% of their total sales.

Every few years, MTD will get the pulse of readers' car service business through our tire dealer car service survey. The feedback we receive is always instructive. 

Since many of you get a large portion of your income from car services, I think it will be interesting to share some of the results of our 2020-2021 edition of the study. 

First, in order to establish a benchmark, we require dealers to provide the percentage of sales generated by auto services in 2020. Respondents estimated that car services accounted for an average of 48% of their total sales. 

Then we asked: "In your estimated total profit for 2020, what percentage of your dealership's auto services?" Respondents said that auto services accounted for 47% of their total profits. 

We also want to know the number of locations and service stations owned by each respondent, as well as the number of technicians they employ at each branch. 

54% of people report that they have a location. 16% said they have two locations. On the other hand, 14% of respondents said they have more than 10 outlets. 

The average number of service intervals is seven. Looking at the outliers, 4% of respondents said they have a service bay, and 7% said they have more than 15 bays. The vast majority of respondents have fewer than 10 bays. 

We also found that the average number of technicians employed by each branch is 6 people. 20% of respondents stated that they hired three technicians at each branch. Only 1% reported that they employ more than 15 technicians at each branch. 

We also want to know how many technicians at the respondent’s dealership have obtained ASE certification. Approximately 35% of respondents stated that at least 50% of technical staff have been approved by ASE. 

Have you ever wondered how do you compare to your peers when it comes to how to pay for technicians? Nearly 50% of survey respondents (47% to be precise) tell us that they pay for technology by the hour. Twelve percent only pays commissions. 34% paid wages and commissions. 7% of respondents said that they only compensate their technical staff through salary. 

We also studied the services provided. Not surprisingly, nearly 100% of respondents said they provide tire pressure monitoring system services. Ninety-five percent performs installation and balancing. Ninety-two percent provide braking services. 

86% said they provide shock absorption and support work, as well as battery and electricity services. 85% of respondents are engaged in bearing and seal work, 83% are responsible for oil changes, and 82% provide chassis and suspension services. Seventy-nine percent provides alignment. (This figure caught my attention. I think more will provide alignment.) 

79% of respondents also replaced wipers. (I always use the term "windshield wiper blade", but it seems that more and more vehicles are also equipped with rear window wiper blades. I must keep this in mind.) 

The following is the rest of the "services provided" list: ignition and spark plugs (65%), electronic diagnosis (65%), engine repair/diagnosis (61%), cooling system (64%), air conditioning (59%), chemical Product/injector/cleaner (55%) and exhaust system (52%.) 

Given the intense heat experienced in many parts of the country last summer, I would not be surprised if more dealers add air conditioning services to their menus. 

Now is a big problem. What is the most profitable service provided by the dealers who answered our survey? This will be the alignment, with an average profit margin of 75%. The average profit rate of TPMS services is 65%. According to survey respondents, the average profit margin of air-conditioning services is 62%. 

Braking service and engine repair/diagnosis provide the same average profit margin (59%), and cooling system work generates an average 58% profit margin. According to the survey respondents’ report, the service with the lowest profit margin is oil/lubricant. 

At this point, you may ask, "What is the maximum average fare for each service?" This will be an impact and support work of $521. Air-conditioning service ranks “second”, with an average ticket price of US$458.75. The service that generates the smallest ticket? Wiper blade replacement-$27.44. 

Do any of the above figures support what you saw at your dealer? Are they very different? 

Due to the limited space in this column, I cannot provide all the figures from our most recent survey. If you want more, please feel free to leave me a message. If you would like to participate in our next study, please let me know. Our readers, nothing is more important than your feedback.

If you have any questions or comments, please send an email to mmanges@10missions.com

Mike Manges is the editor of Modern Tyre Dealer. He is a veteran with more than 20 years of experience in the tire industry. He has won the International Automobile Media Association Award three times and a gold award from the Association of Automobile Publishers and Editors. Mike travels around the world looking for stories that can help independent tire dealers drive their business. Before rejoining MTD in September 2019, he held corporate communications positions in two Fortune 500 companies and served as senior editor of MTD from 2000 to 2010.