Why Car Dealerships Need a Service Department

Posted Friday, Feb 14, 2025

“A stitch in time saves nine.” This timeless saying is a perfect way to describe why car dealership service departments are essential. Just like minor fixes today prevent more significant issues tomorrow, having a service department within your dealership helps avoid future problems while offering many benefits. From increasing revenue to building customer loyalty and enhancing your brand’s reputation, a service department is an invaluable asset to any dealership.

This blog will explore why car dealership service is necessary for your business. From dealership maintenance to offering car repair services, we’ll look at how a service department can benefit both your dealership and your customers. Let’s dive in!

1. A Steady Revenue Stream

Selling cars is essential, but a service department offers a steady income stream. While car sales can fluctuate, services like dealership maintenance and car repair services keep the revenue coming in regularly.

Customers return not just to buy cars but for routine maintenance like oil changes, tire rotations, and even major repairs. You also have opportunities to sell replacement parts, boosting profitability.

Having an in-house service department allows you to rely on a consistent flow of income, which adds stability to your dealership’s finances.

Growing Industry Opportunities

In late 2023, there were nearly 174,200 auto repair centers in the U.S., a 1.5% increase from the year before. With more cars on the road and getting older, demand for maintenance and repair services is growing, making it an excellent opportunity for dealerships to expand their service departments.

2. Customer Loyalty Through Maintenance Services

One thing is evident in the automotive industry: customers using your service department are more likely to return for their next car purchase. They trust you with both their vehicle purchase and its care.

When you provide reliable dealership maintenance and car repair services, you build trust with customers, encouraging them to return repeatedly. Loyal customers are more likely to recommend your dealership, leading to repeat business and valuable referrals.

Handling all their needs under one roof increases the chances of securing long-term business.

3. Improving Customer Experience

A positive customer experience goes beyond the first sale. Offering car repair services is key to creating a seamless customer journey. Car repairs can be stressful but knowing they can count on you for reliable service turns a stressful situation into a positive one.

By offering dealership maintenance and repairs, you help customers feel supported. They can trust your team to handle everything, from oil changes to more complex repairs. When customers feel valued and their issues are addressed promptly, they’re more likely to return and recommend your dealership to others.

4. Building Your Dealership’s Reputation

Reputation is everything in the car dealership world. Providing high-quality car dealership services builds a reputation for your dealership as a reliable business. Word-of-mouth referrals are powerful, and customers are more likely to recommend your dealership if they’ve had positive experiences buying and servicing cars.

Offering dependable dealership maintenance shows your commitment to customer satisfaction, which reflects positively on your dealership’s image. A solid reputation will help you attract new customers while retaining existing ones.

5. Control Over Service Quality and Timeliness

When you run your service department, you have control over the quality of the work and the timeliness of service. By managing your car dealership service, you ensure that everything is done to the highest standards, using the right parts and skilled technicians.

This control means you can meet customer expectations and complete repairs on time, which is a huge plus. Customers appreciate quick and efficient service and providing this ensures they’re more likely to return.

Additionally, when you control the service quality, you ensure customers don’t have to go elsewhere for repairs or face long wait times. You give them the reliable, convenient solution they need.

6. Boosting Profitability

One of the most significant advantages of having a car dealership service department is the potential for increased profitability. Service departments often have higher profit margins than car sales.

For example, customers who come in for an oil change might also need additional services, like tire rotations or brake checks. This offers your dealership opportunities to upsell services, increasing revenue per customer. Over time, this adds up, leading to greater profitability for your dealership.

Additionally, repeat customers for services mean you have a reliable and ongoing source of revenue, contributing to your dealership’s overall success.

7. Stay Competitive in the Market

In today’s competitive automotive market, offering car sales and repair services sets your dealership apart. Many dealerships focus solely on sales, but when you provide maintenance and repair services, you offer more value to your customers.

A comprehensive service department shows customers you care about their experience beyond the initial purchase. It builds customer loyalty and helps your dealership stand out from the competition.

8. Enhancing Vehicle Longevity and Customer Satisfaction

One of the often-overlooked benefits of having a service department is its positive impact on the longevity of the vehicles you sell. You ensure your customers’ cars stay in top condition for years by providing regular dealership maintenance and car repair services.

When customers experience fewer breakdowns and have longer-lasting vehicles, their satisfaction increases, and they feel confident in their purchase and the service they receive from your dealership. This satisfaction can lead to more repeat customers, positive reviews, and a more substantial reputation.

Moreover, offering services like regular maintenance schedules can help customers stay on top of necessary repairs, prevent costly future issues, and further solidify their trust in your dealership.

Conclusion: Take Your Dealership to the Next Level

Having a car dealership service department is not just about fixing cars—it’s about providing value to your customers, generating consistent revenue, and building a reputation as a reliable business. You’ll improve your customer experience, boost profitability, and increase customer loyalty by offering dealership maintenance and car repair services.

At Advanced Auto Sales, we specialize in helping dealerships grow by offering top-tier car dealership service and dealership maintenance solutions. With our expertise, we ensure your service department operates efficiently and provides unmatched value to your customers, helping you achieve long-term success.

Ready to elevate your dealership? Reach out to Advanced Auto Sales today and discover how we can support your growth with high-quality service solutions.