Fixed Ops Friday w/ David Rogers, Bill Demaree | Daily Dealer Live

We're doing better as a result of social media presence.

If it doesn't do those three things, then it's on the chopping block.

It's in return on investment discussion.

Hey, everybody, welcome back to another episode of The Daily Dealer Live.

I'm your host, Sam Darkin.

Thank you for choosing to be here on this Friday, the 20th of February.

So, hey, everybody, dealers are losing service customers.

Surprised to hear that?

But we're posting record service revenue.

Let that thing sink in.

According to Cox Automotive, dealerships have lost roughly 10% to 12% of service visits to

independence since 2018.

And much of that decline is hidden by the increase in revenue related to increased repair costs,

increased parts costs, which have both hit records in the past year.

So what's happening?

Well, cars are aging.

Customers need more repairs, but the loyalty is slipping.

And here's the real question for operators today on this Monday or on this Friday, the 20th.

Are you growing or are you just riding the wave of increasing revenue?

Today on Fixed Ops Friday, we're talking about how elite operators are taking control of the

service drive again.

And we've got an audience poll for you as we come into our show today as we post across

all social media platforms.

What's your biggest service drive challenge today?

February, 2026 retention, staffing, pricing, pushback, throughput, advisor, accountability,

or another thing?

What is it?

Post it into the social media platforms all across CDG where we're streaming today.

We'll bring your comments into the show today.

All this and more coming up.

But first, let's dive into today's auto industry headlines.

First up today, we have breaking news, and I'm going to give you that breaking news.

Right now, the Supreme Court has struck down President Trump's sweeping global tariffs

imposed under the International Emergency Economic Powers Act,

ruling 6-3 that the Constitution clearly gives Congress,

not the executive branch, the power to levy taxes, including tariffs.

Justices Alito, Thomas, and Kavanaugh descended, arguing the tariffs were lawful

under existing precedent, reports the Associated Press.

The ruling wipes out the so-called reciprocal tariffs applied to a broad range of imports.

However, it doesn't touch duties imposed under other statutes,

including Section 232 tariffs on auto parts and metals, which remain in place.

The court also didn't address whether companies will receive refunds

for the more than $133 billion collected under the Emergency Powers Act.

Several businesses are already pursuing payments in lower courts,

which could further complicate the refund process.

Still, the decision could ease some pricing pressure for automakers and consumers.

Economists estimated the IEEPA tariffs were adding roughly $1,000 to $1,300 per household annually.

With those levies struck down, that burden could drop by about half according to Yale

Budget Lab estimates, though the broader trade picture remains far from unsettled.

We'll be following this and more in the coming days and weeks.

Next up today, Christian Munier, Nissan's chairman of North America,

said competition from Chinese brands ultimately strengthens the market

and benefits customers, reports Bloomberg.

Speaking in Sao Paulo, Munier noted that Nissan's responsibility is simple.

Deliver a better product, a better service, and a better experience.

If the company does that, he said it will remain competitive.

His comments come as Chinese EV makers deepen their presence across Latin America,

including Brazil and Mexico, two markets that are especially important to Nissan,

which holds roughly 18% share of passenger car sales in Mexico.

Meanwhile, Brazil and Mexico have raised tariffs to slow the surge of Chinese imports,

prompting some manufacturers to localize production.

Canada, however, has lowered tariffs as it looks to diversify trade relationships.

Next up in other news, dealership profits are still running at nearly double

pre-pandemic levels. Blue sky values have more than doubled,

and public groups are actively buying now.

AI is starting to factor into how stores are valued.

At a recent Hague Partners webinar following the 26th NATO show,

advisors said buyers are increasingly asking about technology during acquisitions,

viewing AI adoption as a signal of operational strength and scalability.

Alan Hague noted that dealers don't need to master AI overnight,

but starting early creates a compounding advantage.

Even small gains in efficiency can meaningfully lift margins in a business,

where a net profit typically sits around 2% to 2.5%.

AI tools are already being used to prioritize higher value leads,

streamline service scheduling, reduce labor strain, and improve online reputation scores,

all of which make earnings more predictable and operations easier to scale.

The takeaway is buy-sell activity stays active.

Integrated AI systems are becoming a part of the value conversation.

Dealers who build those capabilities now may not only improve current profitability,

but also position their stores as more attractive assets when it's time to sell.

As an editorial aside jumping from the news from the Ziggler Auto Group,

yesterday we gathered our GMs together and we had an AI best practice session.

We asked each store to bring an AI best practice.

We had the CEO of Impel in-house, Devon, who gave us a great kind of state of AI in automotive.

Absolutely astonishing how quickly AI is developing,

how quickly these tools to help us in our business are evolving,

and I am absolutely convinced after yesterday,

going through all of those presentations and seeing all of those different ideas,

that AI adoption and understanding is going to be a separator in the days ahead.

The other thing he said, Devon,

and it's interesting because we talk a lot about AI on the show.

We sometimes take hits on it.

Hey, stop talking about it.

Devon said, look at the stock market this past week, post Superbowl.

Look at companies' stock value like Salesforce and others.

They're challenged and the reason they're challenged,

open AI advertised at the Superbowl, Claude advertised at the Superbowl.

Claude actually showed an ad that demonstrated in a commercial on the Superbowl

how easy it is to develop an app and it has upended SaaS and valuations of large companies

as they proved AI can develop an app to solve a problem in a dealership, for example,

far easier than a room full of developers.

And that is astonishing speed to development, and that will change the course of app development

and tech implementation and automotive.

It'll be fascinating to see in the coming weeks and months,

and we'll continue to stay on top of that here at CDG.

Back in the news, keeping with the theme of AI,

a new report from Spine argues that today's dealership pressures aren't cyclical,

they're structural.

Margin compression, rising labor costs, 50k new car averages,

and 30k used car price tags are colliding with customers who expect instant responses.

About 76% of dealers say they plan to increase AI spending,

but the report warns that simply layering on more tools isn't enough, I agree.

Many stores are still running a patchwork of AI for pricing,

chat, and merchandising without tying it together operationally.

As another aside, that's old thinking, right?

We used to patch systems together, I agree.

Spine says the real divide now is between dealers using AI tactically,

those embedding it into their core operating model.

Fragmented systems also create data silos, break customer context,

and ultimately deliver diminishing returns.

Over the next five to six years, the report expects AI to evolve

from handling repeat tasks like follow-up and scheduling,

to orchestrating cross-functional workflows and eventually participating

in trade evaluations, incentive comparisons, and inventory discovery within guardrails.

Bottom line, the competitive edge won't come from having the most AI tools,

it will come from unifying the data, upskilling the workforce,

and making AI part of the dealership's operating backbone

before the digital skills gap widens further.

Props to Brian Benstock on a prior episode of Daily Deal Alive

for proving just that, bringing four companies together on one solution,

asking them to work together and integrate together.

And last up today, lease maturities are finally rebuilding after several uneven years,

with roughly 420,000 projected across major brands in 26,

and volume expected to peak between May and September.

That's creating one of the cleanest use car acquisition windows

dealers have seen in a while, but not all of those units are staying home.

A meaningful share will head straight to auction,

and when supply builds that quickly, pricing pressure won't stay contained to one rooftop

or one brand, it will ripple across competing brands.

The smarter move is starting retention outreach at 90 to 120 days.

Are you doing that?

Before maturity and deciding early which models are worth buying out versus letting go,

residual spreads are wide, some high volume returns like the Nissan Road Pathfinder,

Silverado and Sierra are holding mid to high 60% of MSRP.

Others, including certain crossovers and luxury models,

are coming back barely above 50 on a $30,000 original MSRP.

That gap can mean a $4,500 to $5,000 swing and retain value before recon and transport.

In other words, discipline selection matters more now than raw volume.

As dealers like Mike McVeigh at Dave Dodge, Chrysler Jeep,

are leaning into long runway engagement, contacting customers

months before lease end, working trim level math and owning the relationship personally.

His store reports that nearly 9 out of 10 customers,

well, they don't shop elsewhere at least turn in.

He owns that retention.

Well, that's a wrap on today's industry headlines.

Welcome, everybody.

It is Fixed Ops Friday.

We're super excited to be here on Fixed Ops Friday going to the comments in the field.

Thanks, Sean Hopper, for saying what's up, Sam.

What's up, Sean?

Kevin Stuckey, Fixed Ops Friday.

Let's go.

You're right.

Let's do it.

Sean Hopper says, what was the best, the top best practice in the group?

By the way, you know what is fascinating?

So we asked the GMs go to your teams and see who's using the most innovative AI.

And here it was the surprising thing for me is to see how many sales consultants,

marketing people, BDC and managers are using AI to learn, to overcome customer objections,

and to better their own personal brand.

Simple tools like chat, GPT, Gemini and others.

It is awesome to see how salespeople have become entrepreneurial and they're applying

those tools.

Others that we saw and Pell stood out, Busy Car, LotLinks and some others as tools that are AI

driven and elite.

But here's my other thought.

The other thing I learned is it's still early and there's a lag between where AI currently

is and how quickly it's evolving and adoption and automotive.

And ultimately, I think that's better for the customer.

So Kevin Stuckey, is it a separator?

It is a separator and game changer in all departments and all departments if it's embraced.

And Paul Salisman says AI by itself is not a do all end all because it requires proper

thinking and implementation, just like Ben Stock proved.

And Paul, I agree 100% for now until what will be the big game changer.

And I actually read a memo, we'll talk about it more on Monday's show,

when AI can start developing itself, growing itself and kind of going to that next level

on its own.

Going into CDG circles this morning as we jump into Fixed Up Friday, talking about AI, tech stack,

ton of conversations in CDG circles this morning, hundreds of comments from dealers all across,

vendors, vendor selection, ways of overcoming issues, still a ton of conversation on the news

we reported from Stellanus earlier this week about the limit on number of stores that can be

bought, vigorous debate on whether or not that will help or hurt Carvana and whether maybe

Carvana is set to engage in even a bigger, broader relationship with the Stellanus brand

rather than trying to separate them out.

So all right, let's turn to today's show.

First up today, Dave Rogers, Fixed Operations Director at the Piazza Group.

Dave, welcome to the show.

Hey, Sam.

Thanks for having me.

Appreciate being here.

Welcome back.

It's exciting to have you back.

So Dave, for those that don't know you, you've been on the show before,

just tell us a little bit about yourself and what you do out there at Piazza.

Been in the car business 43 years now, an old guy.

Worked for the Piazza Auto Group, a Fixed Ops Director for the 31 stores we have here

in New Jersey, Pennsylvania and Delaware.

And like most Fixed Ops guys, they do a little bit of anything they ask you to do.

So, you know, some IT and some AI stuff and whatever they ask us to do.

But typical Fixed Ops.

Yeah, you follow the breadcrumbs of problems and issues where you can

deliver value and whatnot, right?

So you have how many stores did you say that you work with?

We have 31.

31.

All right, you know what?

I'm going to allow the audience to take the first question.

Usually, I love that.

But Mustafa comes in with a great question for you, Dave.

Mustafa says, what's the career path that you lay out for porters and lot attendants?

I love that question because in automotive, we want to start people out on a career trajectory

early and we would love to have them stay with the group so we don't have to

reteach culture and process.

So how do you career path for those porters and lot attendants earlier on?

Well, obviously, it depends on the person.

I mean, I came into this business as an apprentice tech and walked in $5 an hour,

$300 toolbox from Sears.

So I appreciate that.

Anybody getting their foot in the door, which is there's a lot of entry level in porters,

valet, detailers.

If we have somebody that's maybe their summer vacation or in between school,

they're just looking for a summer job.

But yeah, my store is all of my departments, managers, general managers,

they'll grab somebody, they'll find out what they want to do for a living and what they

want to do when they grow up and we'll place them where we need to do.

I've taken these valets and porters and turned them into parts personnel,

turned them into PDI technicians.

Myself personally, I did valet cars and I was a greeter for a while to dealership.

So I'm a living example of what can happen if you get lucky and work hard.

All right, so you've had success in 2025.

We see a lot of dealers are focused on fixed ops.

You heard my read at the very beginning, right?

We're losing some customers in fixed.

And that's kind of masked to independence.

And it's sort of masked by the increase of revenue, right?

So dollars are going up.

We feel pretty good about it.

When you walked into your 2026 planning, what did you discover that isn't working,

that you're looking to solve this year?

Well, I think we're losing some of the customers, the higher end, higher mileage.

The average mile is in the shops since 19.

I mean, if you look at the average miles of the cars we're servicing,

they've gone from the low 40s to almost 73, 74,000 miles in a lot of the stores.

So we're doing a good job keeping some of those customers.

Obviously a good percentage of them.

We wouldn't have high mileage of that way.

Again, that's the average.

So we know we have a bunch above and below.

Yeah, I just, I think the RO count's been dwindling a little bit.

But a lot of that's because sales volume's down.

I mean, you've been selling 30, 40, 50% of what we did in 19, right?

In some cases, some stores, you have less new cars coming in the door.

You have less chances to capture a brand new customer that bought a new car.

So we've been circling the wagons a little bit and going back to basics.

You know, some advisor training, making sure that we're doing things the right way from the very beginning.

So it's interesting, I actually was talking to our head of fixed ops in our group,

which we'll have on at some point, Bob Keel yesterday about one of our stores.

And that was his instant response.

He's like, well, look, variable, UIO units in operation are down.

What are you doing in your group to solve for the UIO decline?

How are you making up for that?

How are you bringing customers in that may not have existed

because traditionally they didn't buy a new car three years ago?

I mean, we've been using some outside marketing, you know, different companies to go after

cars in your UIO and in your backyard.

We don't turn anybody away.

I mean, there's some dealers out there still that are from the 1970s and 1980s,

and they won't service a car if it wasn't sold at their store.

We don't do that.

It doesn't matter to us.

We do some mobile service.

I have four vans on the road and in my Mercedes store.

So, you know, we're trying to pick away at it.

I don't think there's one carp launch answer for that question.

You just treat every customer the right way.

You take care of them from the beginning sales, you know, like other guests have been on here.

You know, retention is not a new thing, but it's a new buzzword, right?

We've been trying to do that for 30, 40 years.

But you got to be, you know, keeping every single customer.

You just can't lose anybody for stupid reasons.

So, yeah, so you talk about going back to the basics and that being your focus for this year.

What are you doing to go back to the basics?

Give us three things that you at the Piazza Group are doing to get back to basics in 2026.

Well, the initial thing we started doing in December was we actually made all of our

manager's stores, look at every technician in their store,

look at the hours that they turn for the entire year.

We go from December to November.

And let's get these, all the techs up to a standard of what I think and what we think is reasonable.

You work roughly 2000 hours a year.

We want every technician making at least 2000 hours or above.

And we have them put together game plans to make sure that we have, you know,

all the techs making the money they need to make, because we all know without the techs,

we're not going to be doing anything.

The second thing we started working on was selling skills.

You know, we see a lot of, let's just say, variation in closing percentages.

And, you know, you look at some of the tools out there and you have some advisors in the 20s,

you have some advisors in the 50s for closing.

So, you know, we have the managers and we had all the service managers in and took like the best

ideas, almost like you said, and took a couple of them there and said, hey, what are you doing?

Because they had success last year.

And, you know, they've talked about how they're getting involved right away.

If they see somebody that, you know, red tires are not going to buy.

They jump in, they grab the phone, they start talking to the customers.

You know, they make sure that we're mentioning road hazards, buy three, get one free, whatever it takes.

So early intervention and the TO process is what we've been doing.

David, how do you, what is the training process for service advisors?

This is something that's astonishing to be an automotive.

A service advisor is an absolute critical selling position.

Like it is critical.

In 2026, it's critical more than ever before.

And yet there's certain steps to the sale in front end sales.

There are steps to the sale in FNI.

They're not as equally broken out in fixed ops.

What's your system or process?

I know you're using Steve Shaw for a while, but anything different or interesting that you're doing there in training?

We're still using Steve.

We still use the, you know, the Piazza University, as we call it.

We started doing like a little 20 minute podcast to just try to get the message out and work back on the basics.

Oh, I like that.

Yeah, I kind of stole it from you guys and, you know.

Yeah. So wait, you're doing a podcast.

Do you, who pushes this out?

How do you do it?

Steve and I are doing it.

We just, we started, his brother does the software.

He just put it out like a little 20 minute fixed ops focus.

Try to train the new managers, the new advisors.

Is it publicly available or is it closed?

Yeah, it is.

It's not on Spotify and stuff.

Where can you go find it?

Tell our audience.

Spotify, YouTube, Apple.

It's called fixed ops focus.

Dave Rogers, Steve Shaw.

We co-host it.

And, you know, we're trying to stay simple.

Not trying to be flashy.

Not looking for, you know, we're not looking for anything big.

We stay starting, trying to, our audience is going to be new service managers, advisors that want to move up.

And, you know, we all know GM's.

Most of them, 90% of them come from sales.

So, you know, we put in a tip for the day for those,

those GM's that want to learn a little bit about fixed ops.

So we try to bring them into, into the fold and teach them a little bit about, you know, parts of service.

So, so are you able to see what number of your technicians, service advisors,

whoever are, are listening to the podcast?

Are you able to, not yet, not yet.

They're looking at it for me, but I'm getting feedback.

You know, if I, if I mention a store and I mentioned somebody that's not doing what I want them to do,

I'm getting the text message and say, okay, I got your hint.

I'll get, I'll get, you know, I'll start selling more alignments or whatever the case may be.

And so we're getting good feedback from it.

You know, there's a, there's a lot of, there's a lot of people out there that really want to learn something.

And I think you alluded to it.

There's not a lot of training out there that, that teaches them how to do things.

How are you solving for one of the big problems in fixed ops today when we think about training for advisors?

So if, if I ever go back into fixed ops and say, hey, let's provide you some training,

one of the biggest objections is we don't have time.

So I go back to CDK stat.

The average hold time in most service departments is 10 minutes.

So they're busy back there and they're busy selling.

They're busy overcoming problems.

They're busy helping customers.

How do you free up a service advisor to train,

given the constraints and the challenges that are time based there in that part?

It's, it's one on one.

I mean, we, we unfortunately have to rely on the manager and the, and again,

the general manager to get, to get in there, hands on.

We're trying not to, we're making sure that we're not understaffed.

That's the biggest thing.

If you, if you have three advisors, 15 texts, phones going crazy, you're not going to train them.

You can't teach them to do anything.

And that's where it came up with kind of the idea of the podcast.

Give them 20 minutes.

They can listen to it on the way to work and, and you know, maybe help them a little bit that way.

I would love to hear the success that you have with that in tracking it and then being able to

like hold, like see what the impact is because I can tell you, I hear often, oh, hey, in service,

they don't listen to podcasts.

They're not going to be on a podcast.

I actually don't think that's true.

I think we've proved that that is not, not factual, but I'd be interested to hear, like,

once you're further down the road, what the actual quantified impact is, or are you able to

quantify it yet?

We will.

We just started in January.

So yeah, 17 episodes out.

Yeah.

I mean, listen, CDG is a, is a big inspiration.

I mean, I, you know, talking to some of the real experts out there, the Dave Speciax and,

and, you know, I'm with the, the run-offs or run-offs guys and, and, and NADA and, you know,

like I hear what they're doing internally, they're using podcasts constantly.

Yeah.

I don't have this support team and the technical team they do, but, you know, it's just,

it makes us think we're going down the right road and help out with that.

So yeah, that's great.

Well, hey, by the way, to that point, if you're a fixed ops director, if you're a service

rider, if you're a technician listening to this show, post it up in the comments, we'll

read it out and then actually come back next Friday for the, for another fixed ops Friday.

Because I think you're right.

Fixed ops is such a crucial department.

It's such an important area.

We would love to be to a place where every Friday everybody tunes in live.

So let me ask you this.

What's your service advisor accountability cadence?

So when you think about sell through, when you think about hours per RO, what,

what are the KPIs?

And then how do you hold accountable to that result in the advisor role?

You know, I'm not a big one to beat people over the head with the hours per row and stuff

like that.

I mean, I think brand by brand it varies.

You know, if I was a California dealer that I had a Porsche and BMW and I was in, you know,

Napa Valley or, you know, and with the high tech, you know, I could sit there and maybe

look at my effective labor rate, my hours per road, you know, fix that stuff.

We, you know, we got volume brand cars, Philadelphia, rural areas.

So we look at store by store and we look at, you know, if I have four advisors,

I want to see that they're close by each other, right?

We look at the advisor numbers and the KPIs that way.

I'm not going to compare a Hyundai guy store in, you know, in Westchester to a Mercedes Benz

store, you know, out, you know, whatever.

They're totally two different animals, right?

So we look at it.

We look at consistency within the store.

So I have a one person at 1.3 hours, one person at 1.7, 1.8.

Hey, we'll get them together and say, Hey, what are you doing different?

What's going on?

You know, same, same with effective labor rate.

I mean, you hear the experts out there telling everybody, you know, you need to be 10% of

your door rate.

Well, yeah, if you don't do maintenance in your store and you don't have a good customer

database and you have a customer base and bringing them back for oil changes.

Yeah, you could be at 90% of your door rate.

But to me, you're doing a terrible job if that's what your effective labor rate is,

right?

So you would say ELR and you would say hours per hour are deceiving KPIs.

And by the way, Tully would, Tully would agree with you.

What is your number one KPI or metric that you drive towards the Piazza Group and fixed

off?

So I'm looking at the advisors and I want to make sure that, you know, more than 60%

of the gross is generated by customer pay work.

I want to make sure that they're doing that.

And then we started really dialing in on the, on the surface metrics, you know,

what is the percentage of inspection?

What is the percentage of ASR?

And then obviously the closing ratio by line.

You know, we want to see what's going on.

I don't look at the app by hours.

I look at by line and, you know, we're trying to get as high, you know, 40, 45%.

That metric was a mystery for years.

We didn't know what closing ratios were.

You know, back in the old days, we used to guess 30% like sales.

How are you tracking that now?

We went through the tools through CDK service or, or, you know,

dealer logics or one of the, you know, one of the service tools.

It's a great tool.

I mean, you know, those, those metrics are vital to, you know,

making sure that people are doing what they're supposed to do.

Are all your stores on the same tool or are there different systems across your group?

Yeah.

Do you think one day they will be all on the same system?

Is there an advantage group your size to having everybody on the same thing?

So you can all row same direction or is it better to allow each store to make

their own decision based on OEM, geography and personal preference?

My ownership doesn't like to put all their eggs in one basket.

We have CDK and Reynolds and Reynolds.

They like the competition between them when it comes contract time.

We do the same thing with some of their service tools.

I do like having everybody, you know, on a similar tool because it makes reporting easier.

But I got to be honest with you, you learn something new.

Like if you're in dealer logics or you're in CDK or you're in X time,

you know, they all have their pluses and minuses.

And, you know, I like the competition that way too to see what kind of tools we have.

And it makes me sharper.

I don't want to get bored either just by looking at an email report.

You know, I like diving in and learning.

So yeah.

Well, and they seemed like genius geniuses.

If one of those systems goes out and you have still part of your group able to be up and running.

So no shade to CDK or anybody else.

So yeah.

Well, yeah, I don't and I'm not going to beat anybody.

But dealer logics really saved the stores that were on that one.

The CDK, they can still write repair orders.

It was like nothing happened in those stores.

It was great.

Yeah.

All right.

David Rogers, Fixed Operations Director of Piazza Auto Group.

Will you hang tight?

We're going to come back to you as part of the roundtable at the very end.

Yeah.

I'll be here.

Thanks for thanks for being here.

Thanks for sharing your perspectives on what it means in 2026 to get back to the basics,

including that focus on advisors and the focus on some of those core key metrics

and helping us service technicians win in 2026.

Thanks for being here.

We'll get back with you in just a moment.

Thanks, Sam.

All right.

So we're going to talk for just a second about Stream Companies.

This episode is brought to you by Stream Companies.

How much revenue is slipping through the cracks at your dealership?

Well, Stream Companies missed Opportunities Report analyzes your strategy

and highlights where you can drive more sales faster.

Request your free report today at streamcompanies.com.

We appreciate Streams Company for supporting today's content,

including that cool conversation we just had with the Piazza Auto Group

learning how they're getting back to the basics in 2026.

I love this concept that some of the volume is declining.

We're losing.

I don't like the idea of it or the reality of it.

It's declining.

We're losing some business to independence.

Vehicles are getting older and we're getting some defection.

But to those service departments that aren't watching,

they're not seeing the decline because revenues are up.

Revenues are up on labor rates, parts, cost of repair, warranty reimbursements,

all those things.

We look like rock stars on the increase,

but when you actually look at the number of lives coming through departments,

some of us are seeing a decline.

Some are seeing a decline.

And today is about figuring out how do we get that back?

How do we win?

So next up today, Bill Damari,

Corporate Director at Fixed Operations at Tom Wood Automotive.

Bill, welcome to the show.

Hey, thanks for having me.

I'm excited to be here.

Bill, did I just butcher your last name?

I apologize if I did.

You did, but that's OK.

All right, give it to me.

How do we say it?

It's Damari.

Damari, I'm sorry.

All right, you know what?

My last name, D-Apostrophe, ARC Dark, is French.

And I heard so many variations on that, Dark,

and much worse when I was in junior high school.

So sorry, I should not butch anything French.

So tell us about the Tom Wood group.

Tell us about yourself and what you do out there.

Yeah, so we have a great group.

We're based out of Indianapolis, Indiana.

We have stores in Indiana and Minnesota.

Those are two locations.

We have 13 rooftops in our group on the automotive side.

We're pretty diverse in the power, sports,

collision, mobile service, standalone, oil centers,

et cetera.

So all things fixed ops, that's what I focus on.

Wait, so you have standalone like a Jiffy Lube type deal?

Yeah, we opened at the Indianapolis International

Airport.

We own the sixth rental agency there.

And six used to service at a little oil center that's

on the property.

And I heard rumor it had become available.

And at the time I had a Spiffy franchise as well

that was running from the north side down to there.

So we took over the sublease of that facility.

So it's a five bay oil center put in a car wash.

So we're in the car wash business there as well.

And we service all the rental vehicles at the airport.

Wow.

What kind of volume do you look at?

So all oil changes for any rental car facility?

We started with oil changes.

And we got into washing the vehicles

as they're trying to hand wash them.

They can't keep up.

They got a VIP code.

They can run through our car wash system

and clean the vehicle.

And now we get into oil changes, tires.

We're also using it as a kind of a center where my Ford mobile

can go down and handle recalls and kind of stage up

in the parking lot and do some mobile service out

of our property there.

Wow.

What a great idea.

Do you offer any services to retail customers coming in

and out of the airport at all?

We do.

And we'll offer, if you want to drop your vehicle off

for service, we'll valet you.

So you don't have to pay for parking.

We'll valet you up to the center.

It's just right out the street and pick you up

and get you back down and pick your vehicle

when you fly back home.

That's fascinating.

Does it sit on one of the dealership

financials or does it have its own financial statements?

We stand alone.

Whose idea was that?

I mean, obviously it was tied to the rental operations

initially, but that's a unique operation.

Well, when we were in the Spiffy mobile side,

I needed space into that area.

So when it came available, it just made sense.

So we're so fortunate.

We have an owner like Jeff Wood that's very visionary.

He wants to do whatever we can do to get capitalized

on itself in this city and just get better.

So it was a pretty easy conversation to say,

I want to sublease this facility and get into the carware systems

and kind of subsidize our Spiffy franchise.

That's very cool.

Well, thanks for sharing that about us.

I think that separates you in the marketplace

and very unique.

I would be a hand raiser on the valet piece.

What a great way to drop off cars

as you're headed to a busy flight.

Bill, Dave just talked about discipline at scale.

A ton of rooftops.

They're getting back to the basics 2026.

You built the playbook.

You launched something called the Service Advisor Handbook in 2026.

Tell us a little bit about what is that

and what caused a need for that in February.

It's interesting because I've been in this business a long time

and when I was younger, I always wanted to publish a book.

And I did a long time ago on how to become a service advisor.

How does a guy like me that stumbled into the business

right out of our trade school as a technician helper

and quickly saw the service advisors?

How do I do that?

So I wrote this little book.

I used to publish it, send it out, mail it out.

And then it kind of got locked away in a briefcase for years.

And then when I came to the Tom Wood Group 15 years ago,

I took this role about 10 years ago and I said,

we need to do our own training.

We need a Tom Wood way.

We need a kind of a template of how we want to do business.

So if Jeff Wood walks in a store,

he should see the same results, the same process in every store.

So we started about 10 years ago and I'm going to be honest,

I couldn't get this thing across the finish line.

We would get so far and I don't like it.

It's not working.

The words don't work.

And then I had a fixed ops coach that was on my team.

I gave it to him.

I gave him all the training materials that I had.

And so let's put this thing together.

We almost got it done.

I'm like, no, it's too wordy.

It's just, I don't like it.

It's not good.

And then chat GBT came along.

Oh, I love that.

You had it co-author it.

I took everything we had and I dumped it in there and said,

tell me how the generation A's and how will they comprehend this handbook?

And what it spit out, it still kept a lot of what we put in there,

but it reorganized it in a way that made sense.

And immediately when I printed these 46 pages, I'm staring at it.

I'm like, that's it.

That is what I've been after.

So it took us a couple more months to kind of tweak things and get it isolated in to print it.

So what broken in the service department world across the country,

what broken does this service advisor handbook solve?

What answers does it provide?

It solves, what does a good job look like?

You know, earlier you were talking about getting back to the basics.

This will bullet point what those basics are.

And in the middle, it'll go into the full detail process of exactly what am I struggling with?

What does my CSI results say is happening?

I can go back to this handbook and read exactly how should I be greeting this guest?

Why am I getting complaints on this?

So it's very detailed, but it's also sections that aren't so detailed.

They're bullet point and sections, which we're filming,

starting in the next 60 days for Rocket.

It will be our training curriculum inside Rocket.

Very cool.

So service advisors can go to that.

That's a training curriculum on how to sell, on how to engage with customers.

Are you going to make that Rocket training available nationwide?

Or is it proprietary?

Talking to Rocket, they would like to make it part of their curriculum.

So we're discussing what that would look like.

I'm very happy, because I think if it makes the industry better,

when I was at NADA, a lot of people heard I had this handbook in my backpack

and I wasn't sharing it, but I was showing it.

And I have a list of people I promised I would send it to.

And I want to add me to the list.

We would use it.

Well, I think everybody needs it because we tend to hold our team accountable

for something they don't know that they're doing bad,

because we don't have the process in place to show them what a good job looks like.

Why do you think the service advisor world is so less defined than a salesperson

or a finance role?

So many, or even a BDC manager, why are there less training?

Why is there less resources?

Yeah, it's a great question.

And I've struggled with that my whole career.

I came through being a service advisor and I think we outsource.

And I think the problem is everybody has their own way,

and their own way is the best way.

And then if you've got...

Yeah, but I want to challenge that though,

because everybody had their own way in sales up front,

and everybody kind of consolidated that into a five step,

a variation on five step.

Why didn't that happen in the service department?

Because in service, we've been the kids at the little kids table at Thanksgiving.

I think you are right.

We've gotten invited to the Thanksgiving table now.

And we are seeing...

By the way, you don't want to be at the big kid table at Thanksgiving.

It's better to be at the kid table.

I agree with you.

I agree.

But I think we're serious now.

And I used to ask our general managers,

what is your closing ratio and your PBR coming out F and I?

And you all know exactly what that number is.

And then I would ask, then I would say,

what is your closing percent on every ASR that comes out of your shop

on brakes, tires, filters?

What's your closing percent?

And nobody knew.

And some of it, we didn't have the tools to really track it.

And what does a good job look like?

Our goal was to get to 40% ASR.

We do it.

Why?

Because we were able to put a process together,

train the process, coach it around our group,

and get our numbers up.

So having a documented process is the key to our success in service.

And it's been missing for years.

So talk to us about that then.

So you've got the manual.

You've got the training guide.

You're creating the videos.

What behaviors will you incentivize as part of pay plans?

We just talked a misleading metric according to Piazza is ELR.

It's some of these others.

Average hours per RO.

What are you targeting and driving towards?

What do you see as the key metrics that you're putting in pay plans in 2026?

26, 100% video MPIs on the technician.

Now, it is not just a video.

It is a well-documented.

I went to a breakout session at NADA, and true video was putting on a session.

I took a picture of their well-documented process.

I came home.

I threw it through chats.

It put me a checklist together.

We put a process together.

We locked into a store.

We had a shop meeting starting tomorrow.

100%.

We will follow this video every customer, every time, every day.

What are you at today?

100%.

Now, I'm testing it at our Nissan store.

We were 100%.

We have been for two weeks at this store.

I'll make day one.

These guys locked into it.

What I found was our advisors were falling short.

So I brought our fixed ops coach in and the customers were not viewing the video at a high enough percent,

which means they're getting the text, but they're not looking at the video.

So we're not telling them.

It's a communication problem with us.

So we retrained the advisors to say,

hey, guess what?

You're going to get a video.

And it's your technician video and your inspection on your vehicle.

And one of the things I learned at NADA was we don't just shoot a video.

It's purposeful.

It's intentional.

Filters are laid out.

Batteries hooked up.

We've staged everything.

And then we do the video.

And it's a minute and a half to two and a half minutes every time.

And I'm telling you, it's a game changer for us.

And we didn't have the tools to do it, but we signed deals at NADA and now we have them.

What do you anticipate will be the impact once fully functional at 100% percent?

A, first of all, is 100% even realistic?

And then what will be the economic impact of having that at 100% in your group?

The reason I say 100% is because if it has an MPI on it, it has to have a video.

My service providers will reject the repair order.

We will not continue with the ASR until the video is on there.

And the technicians, all of our technicians are on tiered bonus plans.

They lose their tiered bonus plan if they're not 100% in that video.

So it's worth a lot of money for them to get it right.

Now we're running contests.

I'm giving away lots of really amazing door prizes starting in March

of the best videos around the group, which will be judged around the group.

So we're going to really make, I have a lot of fun with it, right?

But the economic side of it, think about a customer that drives in.

I'm a UVI fan, I have 13 of them.

So you as a customer, very transparent, you are scanning your own vehicle when you come in.

And now I have a technician that's scanning everything else about your vehicle.

And you're going to receive all this.

There's no underlying stuff that's happening because of the deception and stuff with what

dealers are.

I'm full transparent and I'm going to put it in front.

And by that, I can look at a video and tell you, yes, I mean, I don't want to do the brakes.

I want to do the tires or whatever because there's no questions.

Somebody's not telling me.

I see it.

So UVI, that's fascinating.

I saw at NADA, I saw Viper by ACV takes photographs as well.

How long have you had the UVI tool in place?

We've been with UVI for three and a half years.

Okay.

What's the impact of UVI in service?

Like, what is the benefit?

Why do you continue to use it?

It's not an inexpensive tool.

It's not.

But if you put UVI in, all those wheels you've been accused of damaging, all the scratches,

the broken windshield, all the stuff that the customer walks and walks around in the back

and points in a dent so that wasn't there, the UVI just solved our policy problem across the group.

Do you tie UVI into use car trade appraisals?

We do.

We do acquisition UVI through Venn or Viotto that runs through our UVI system.

So we have buyers now on every service drive that is communicating with the guests on every car

it comes through.

All right.

So I want to transition a little bit, not completely off of fix, but the intersection

between fixed and used cars.

You know, you're guiding a process that's helping the store and the group acquire

used cars into the organization.

Yes.

What do you believe to be the role of a good fixed ops director in 2026 with used car acquisition?

How should you be and others be thinking about it?

You know, it's paramount for our success.

As we know, our accounts have fallen.

So it's up to us to continue feeding the system and getting some of the vehicles because

if the vehicle is in for service, it needs service repair.

So we get the repair where the customer pays or used car pays.

It's the same price.

So why not get them in a new car if we can?

We lock that guest and especially with our group because we have lifetime power train.

We have subscription oil changes, all this stuff for the retention

to bring them back and continue to hold them within our group environment.

So if we can get more cars purchased off the drive, we're just going to continue feeding

our system and rebuilding the our accounts as they come through.

What do you say to one of your service managers?

It just goes through my head as you mentioned that.

What do you say to one of your service managers that says,

hey, don't put pressure on me like you.

Our owes are down.

Yes, but revenue is up.

Sales are up.

And really it's a sales problem.

They should have sold more vehicles.

I mean, they're responsible for that at the end of the day.

What do you say to them in February of 2026?

I say we've dropped the ball in the fixed upside because we had it so well.

I call it the COVID hangover.

We just accepted everything that came in and we lost how we handle our processes.

So we're getting back to the basics as well and just handling all these service advisor handbooks.

I have a service manager handbook.

I have a parts manager handbook in the works.

Everything is documented with KPIs all the way from service advisors all the way to the top.

So you mentioned that you've got a trainer.

He said you brought a trainer in.

That clicked in my mind.

Who is the trainer?

Where'd you find this person?

What are they training on?

And is it a role in the group or is it an external partner?

Well, it's in the group.

I have two.

I have a fixed ops trainer.

He was a 20-year Audi high-end service advisor that just is very process-oriented.

He's on my team.

Every Monday we have a level 10.

We operate on EOS.

We have a level 10 meeting.

And we identify service advisors that are struggling, whether it's from an ASR problem.

And then that's where he goes.

He will spend his time with the ones that are really struggling.

And then he will coach them along.

We bring the handbook and we just really focus one-on-one with them.

My second I have is an automotive technician instructor.

A higher amount of Lincoln Tech.

We have 20 high school students that come through our store, facilitated here.

It is a dual core credit.

We are now state certified as of December of 25.

They're receiving dual core credits.

Juniors and seniors and I have 20 of them.

And we have a waiting list for 50 more for next year to come through our program,

to start bringing in our own techs and raising our technician from within.

Props to you.

Props to you for that.

That is a great commitment to the department.

I love your commitment to that 100% video MPI.

Did you watch the CDG?

Did you watch our dealer competition where we had folks go against each other?

Cavender, Rob Cavender's group one.

We want to do that again next year or even sooner.

I'm astonished at the variation or the levels of different abilities as it comes to video.

Video works.

We know it.

It's something that if we know, why aren't we doing?

And then there are such a wide variant.

So I love that you're doing a similar competition.

When are you going to run the competition?

And will you share the results with us?

Maybe we can highlight that on the show.

I will.

So during NADA, as you know, you get a lot of these awards and stuff.

And we want a Sonos speaker and a Nintendo Switch 2, right?

So I'm allocating both of those winnings toward technician contests for video.

And that will go up in March.

Yeah.

So I'm excited for it.

All right.

Well, Bill, we appreciate you being on the show.

We're going to actually bring Dave back in for kind of a lightning round here at the end.

Both the conversations were so good.

So let's bring Dave back into the conversation.

And by the way, before we go full and Dave, welcome back.

Thanks for continuing to be here.

Sean Hopper jumped into the comments here.

He says, hey, ask Bill about the Jersey swap with Rocket.

You may have already covered that.

But tell us what Sean's talking about there.

Yeah.

So I'm on the advisory board for Rocket.

I love Rocket, by the way.

What a great training tool.

And so I was one of the first one to bring a Tom Wood shirt and present it to them at a conference.

And now I have a Rocket shirt that they want me to wear around, which I do.

I'll bring, I'll wear it.

So yeah, it is a Jersey side.

I think it's a great idea to swap.

Very good.

Just Jordan Cox also comes into the comments.

Good fixed ops leaders focus on selling 100% of today's time.

Great ones do it through next month.

Excellent fixed ops leaders like Bill build systems to sell time for years to come.

So I love that quote from a gladiator, right?

What we do now echoes in the future, right?

And you're proving that.

Tell us a little or talk to us a little bit about how you look at that in terms of a long term investment.

So then we'll go into our lightning round here.

You're doing things today.

They're a long term investment.

All right.

Question for both of you.

Whoever wants to take this.

If I gave you, so I fixed, I saw I'm COO 41 stores.

If I gave you a struggling service department today,

what are the first three moves as you walk into that struggling service department

in the next 30 days?

Who wants to take it first?

Can I take it?

This is what I do.

So let's do it.

Let's do it.

Find a struggling store.

I'm living in a Nissan store right now that was struggling.

The very first thing I do is I grab the first customer and I follow it

from A to Z all the way through the process.

Good call.

I will follow it through the systems.

I'll follow it with my eyes and just take mental notes of what happened.

I like that.

Anything to add, Dave?

My first thing is, is I'm in the shop talking to the technicians,

getting the dirt on what's going on.

And then I, what I like to do is I like to dispatch.

I like to get in the middle of it so I can see every repair order coming out of the desk

and every repair order that comes back from the shop.

So that's my first.

So why do you think some service directors in 2026 are less likely to be seen turning

ROs, following customers in the drive?

What's pulling people into the office more in 2026?

I think it's too much working.

They get stuck in their office.

Emails, phone calls, stuff that just makes no difference.

And if you're operating on an EOS platform, you understand,

delegate and elevate, and we're going to move stuff away from us

so I can get out of this business when I need to get out.

I have an 80-20 rule.

You cannot be in your office more than 20% of the day.

The other 80% you are out in the drive.

I want to see you in the shop.

I want to see you out and about.

And if I come in, I better not work for harder than you.

And I, I moved pretty fast.

All right, Dave.

What is the biggest misconception about fixed absorption?

I quoted it to my fixed ops director yesterday,

and he gave me an earful after I did it.

What's the biggest misconception about fixed absorption in 2020?

Well, I think the biggest thing about it is that,

you know, all your variable guys just learn how to spell it when times are rough.

That's the biggest thing.

No, no.

We want you to pay for everything.

Listen, I think that, you know, it's, it's, uh,

it's a necessary part of the business and something everybody should know.

It should be, it should be, you know,

talk during the good times and bad times.

But, you know, Sam, you know, before 2020, before COVID happened,

there wasn't many people in variable that knew how to spell absorption.

So it just needs to become an everyday term.

It needs to become what it is.

It's about over 100%.

Do you really?

My premium group, it was 125% last year on my premium stores.

So what do you say to a GM?

What do you say to a GM or a fixed obstrector that says,

Hey, you know what?

I don't like a fixed absorption because I can't control overall expense.

I don't control it.

So I'm not going to be held to it.

Too bad.

Suck it up, man.

That's part of the deal.

You know, and that's, and, you know, you have a lot of folks out there that

are telling you, you know, hours are the only thing, you know,

hours are a great indicator, but gross profit is what pays the bills.

And, and you need to be focused on growing that every single day.

And your expense structure.

So we started about four years ago heavily focused on fixed operations because we saw

this coming and we have a goal as a group.

Groupwide, we want to be at 100%.

We hit 98.9 once.

We finish a year at 90.3 as a group.

And what I did is I took the stores that are 120.

I need you at 122.

I'm going to leave you alone.

The stores that were at 69.

I'm coming and I will be there and we will get this up to

75 to 80.

So I took the bottom ones.

Had these guys keep pushing here and we met in the middle.

We finished just over 90 for the year.

We'll hit 100 this year.

I love it.

What separates, what separates 70% absorption stores from 100% plus?

What are the behaviors or the culture indicators?

And we'll start on this one with Bill between the 70 and 100.

It's usually a lack of a selling process or gross is down.

We're not selling 25% alignment.

We're not closing or I find the ASR closing percent low.

So our opportunity is in the sales.

Sometimes the volume is down and that's fine.

We have some smaller stores, but you can control your expense.

They say they want to hire more techs.

I look at gross per tech.

You really need more tech and we need our technicians to do more of what's in the shop.

Complete.

So once we close that gap a little bit, we can get them a little bit higher.

It didn't have to be a lot if it's a small, small store and a small,

like a little rural area.

Maybe we can get them 100, but we can get them at 75.

All right.

So thinking about advisor comp, we talked a lot about the advisor role, training,

accountability.

Should advisors be paid more base or more variable incentive?

We pay probably roughly 40%, 50% base just to keep the top end in line.

If you have big months and you have big gross months, I don't need the expenses to get out of

line, but we're looking generally to keep it at 10% or under of what they gross per year.

That's the benchmark we use.

And I've found that 40, 45% salary and then commissionable gross, CSI incentives,

and then spiffs like William said before, I think that's how we keep it in check.

All right.

Bill, what would you say?

I agree with that.

We do about the same.

I cut the percent of the gross down and I add you can get 1% at 25% alignment closed.

You can get 1% here, 1% here.

So we take 2% to 3% on very specific KPIs that we want them to hit.

Yeah.

I love that.

What a great concept.

So Dave, 100% at video MPI, what do you think about that?

Listen, that's the goal.

Or is it unrealistic?

It's, listen, that's the goal.

I think you have to have a goal.

Why would you shoot for anything less?

I mean, I think when I look at it, if they're at 90, 95%, I know they're doing a good job.

There's probably times where is, you know, okay, not to do a video, but, you know,

yeah, the goal.

What are those times, Dave?

Give us that time.

I mean, you know, car was in last week, had a part ordered for it.

And even then, I'd like to see the video done.

I think it's always there.

I'm curious, Bill, what do you, how do you respond to that?

Is that a legitimate response?

Do you take that?

It's a hundred percent.

And I say that because they could hit a chuck hole, they could have ran over a deer.

And the most important thing about a video is pointing out seven great things to one bad.

So even if you're doing a video two days later, your car still looks great.

The tires still look great.

However, I noticed you ran over something.

You just got a nail on the right side.

Tired.

I think you still got to pick it up.

Dave, your response?

Inconsistence.

No, I'm just, I think you're doing fine here.

He's right.

Utopia.

And I agree 100% with him, but I'm a realist and I know there's exceptions to every rule.

So, you know, I got some stores at 90, 95%, 98% and I'm thrilled with that.

You know what I mean?

But yeah, you know, I'm going to just tell them William says it's not acceptable.

We're just going to start beating that 100% in their heads.

By the way, can I just tell you something?

I'm going to clip these sound bites and I'm going to play them back to our own teams

because I love that standard of 100%.

I always tell people if you had a house inspector that would come by two times a year

and do a video inspection of your house and give you a report,

that would be worth its weight in gold.

Why not for a car in a time when cars are, for some,

the most expensive purchase they're going to ever make?

It's touching base and checking in on that expensive.

Even as they grow, as they age, we talked about defection to Jiffy Lube

and some of these other competitors.

They don't keep the records like we do.

That's value, fair?

Bill, any thoughts on that?

I am so committed to it.

We're about to shoot a commercial about transparency,

including the MPI videos that we're going to post,

how to contact me if you do not receive a video inspection on your car.

I love it.

All right.

And with that, to both of you, we appreciate you being here on Fixedops Friday.

Thank you so much for wrapping out today's episode with this roundtable.

Thank you both for being here.

A lot of fun.

Thanks for having me.

Appreciate it.

And to our Daily Deal Live audience, what a fun show.

Truly, as we see front end margins normalizing,

as we see used vehicle sales stabilizing,

our conversation today has proved, if you want predictable earnings in 2026,

Service Lane is that lever.

Excited for next week's episode.

And to our Daily Deal Live audience,

thanks for watching Daily Deal Live,

where you break down the biggest moves in the car business.

As they happen, don't forget, we're here live every Monday, Wednesday, Friday,

1 p.m. Eastern.

That means we'll be back this Monday.

So if this is your world, hit like, hit subscribe,

turn on those notifications so you never ever miss a beat.

And we'll see you next episode, everybody.

Thanks for being here.

Fixed Ops Friday w/ David Rogers, Bill Demaree | Daily Dealer Live

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aging cars

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retained value

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apprentice tech

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