Quick Oil Change Business Model
When it comes to the quick oil change business you can find both good ones and bad ones, just like restaurants. Although this article may focus on the negatives of this business model I know for a fact that there are reputable quick oil change centers out there that provide a valuable and important service for their loyal customers.
The reason I decided to write this article about the subject is a recent visit that my sister had with her Chevrolet Malibu to one of these locations. A few years ago I moved across the country and I am now about 2000 miles away from my sister and other family members.
Since the family is on their own as far as automotive maintenance each member has taken a different approach to needed car repairs. My sister has tried both the dealership service and the aftermarket quick service locations. She called me from the waiting area of a quick oil change business.
She stated that her Malibu had just turned about 22,000 miles and she was there for a regular oil change. The service adviser informed her that the mechanic recommended a few additional services. And that is what leads me to write this story today.
The list of recommended services was pretty impressive with the low mileage of the vehicle. I could let things like wiper blades and air filters slide as it can be a matter of opinion if these items are required. But they recommended a coolant flush and a transmission service on a vehicle with extended life fluids in both of those locations.
Problems with the quick lube business
In the early 90s I took a job as a manager of a quick lube franchise (no longer in existence) that opened up in my area. At that time I got an inside look at how this business works. It was pretty scary stuff and was not right for me so it didn’t last more than about six months.
One of the first problems is that at a competitive price of around $20-$25 there is a very small profit margin. In order to make this business model feasible the quick oil change center must up sell services that are more profitable if they want to stay in business.
The idea is to only up sell services that are recommended or required. Unfortunately sometimes the individual repair center may not take the time to verify what is required and necessary. As an example a transmission service is not recommended on my sister’s vehicle until 100,000 miles. And the cooling system is also not serviced until 100,000 miles.
It will be the job of the consumer to check into what is recommended to them and to verify that it is at least recommended by the vehicle manufacturer as well. Your owner’s manual does a great job of explaining what is due on your vehicle at particular mileage intervals.
The quick oil change business
Another problem that is built into the quick oil change business again refers back to the small profit margin for its main service. With such small profit margins you can’t afford to hire certified experienced automotive mechanics. If you clear four dollars from a half-hour service and your mechanic makes $20 an hour you lose $8 every half-hour.
Therefore many of these locations will hire and train oil change technicians that may not have a lot of experience. The problem with this is when they start recommending services. If the service adviser say’s that the mechanic is providing the recommendations, you might want to check on just how much experience he has as well as verifying that the repairs are recommended by your car manufacturer.
The franchise that I was the manager of for a short time sent me to a company training session that was designed to keep me focused on the up-selling process. This is when I realized that this was not right for me because of the generic approach that at the time was company policy.
In a closing thought I really couldn’t hold anything against the owner who had no automotive experience and was a good person. He was promised a viable franchise business model that was really just starting to take off in the early 90s. Although I may have a jaded view on the quick oil change business this doesn’t mean you shouldn’t get your oil changed there. What it means is you should verify recommended services as well as checking on the credentials of the people recommending those services.
I wrote an article about an item that is commonly recommended during an oil change service and you might really need, this is air filter maintenance. For more of the latest posts to this blog this next link takes you back to the homepage from this article about the quick oil change business.