Paint Sealant Package

turbomangt said:
Well, I have been a critic for some time now on how car dealers over charge on paint seal packages, now I'm no better than them. I have seen the potential dollars in this market, so after 2 months of planning I put together my own program, and its working. I will have 2 dealers on the program in a month, here is how it will work. I will paint seal new cars for $100 used ones for $135. I provide all the flyers to hand out to customers, and conduct meetings to their salesmen keeping them up to speed with regard to the advantages of the program. One of the dealers going on the program will price it out retail as follows. He will kick back $100 to the salesman for selling it (money is motivation) He will take $300 for himself. That means he will charge around $499.00 to his customers. Several dealers near him are charging $799.00 already, so he will be cheaper. Now, this was my idea. I will warrenty the work for the life of the vehicle, offering transfer from one owner to the next. Here's the catch. In order to keep my warrenty in tack, owner must return the car to me every six months. (the dealer won't be involved after the initial sale) for re application. The price for reapplication will be $150. which is $350 less than what he spent the first time. A small price to pay every six months for keep his car looking perfect. I will have print in the disclaimer stating that road chips, scratches, swirl marks and other defects caused by outside factors are not covered, Just to cover my butt. Gary
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Are you providing a written copy of the warranty to the customer with purchase? What is covered and not covered by the warranty? I would suggest you contact legal representation before selling any more of these unless you have a independently audited bank account holding enough money to cover potential claims. I know several people involved in the warranted protective coatings business and this is a requirement by law for the protection of the warranty holder.



Now for my take on the warranty issue relating to paint sealants/fabric guard etc.... These products when applied properly can help maintain a customers vehicle if used on a continuing basis. However, hitting a customer with a massive upfront charge for a warranty they will more than likely never be able to use is immoral and deceptive. A friend of mine runs a Cadillac store and likes to laugh about the $1500 protection package they sell to customers and how much profit is built into the deal. These packages offer 99.99% of consumers absolutely no value. Don't believe me? I know the manufacturer of a national paint sealant that is sold across North America by a major automaker. Warranty claims are less than 2% of warranties sold. Not because there is no damage - people either sell or trade the car or just don't bother to ever make a claim. Of the claims that are filed, many are denied due to "fine print" eliminating virtually everything that can negatively affect paint.

If you want to offer your customers a great deal then why don't you just sell them a $125 full polish and paint sealant every six months instead and actually maintain the vehicle without the upfront gouging?

Let's call it for what it is - taking advantage of a customers desire to maintain their vehicle by selling them something that they need but at a hugely inflated price. Just flat out wrong in my humble opinion but that's just me.
 
jimamary said:
I've got my flame suit on...



This is a sleazy thread.

$499 for a sealant?

I know its done everyday, but that doesn't mean I have to do it...



Take good care of your customers, they'll take care of you.



Dealers suck. You know that...



Jim
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Couldn't agree more Jim.
 
Remember just because you get water beading does NOT mean you still have protection, just as the opposite is true, just because you have water sheeting also means you still might have protection. I have attended both Car-Brite, Ardex and S & S automotive advanced training seminars, and they are now making more sealants and waxes that "Sheet" water away while protecting. The arguement on one side says "beading" can cause water spots, sheeting does not. However most people monitor the protection they have with beading. I don't want to sway from the topic, which was designed to brain storm ideas that may help other pro's. One last comment, this was an extremely informative thread, helpful for me and I now know that I will NOT offer the warrenty due to liability reasons. For that in itself was worth the time and effort. Amen to all. Gary
 
Gary-true, beading is not a sole indication of protection, but a surface totally devoid of wax will not bead or sheet.



I offer a higher cost sealant package for my customers and tell them they can expect 5-6 months protection. It might be a good alternative for you (assuming you don't already offer one).
 
Thanks Scott, since I already focus on consumer education in my business (America Car Care Business, Jan issue Page 118 titled "Information Highway) I will key in on that aspect of the package, all you guys have been a great help. Gary
 
Someone mentioned the big chains paying the claims and not the independant dealers? This was not true with Ziebart when I was involved with them. I know I had to settle a few rust and paint claims out of my pockets. This on top of franchise fees, etc, etc Its not always the customer who gets gouged.
 
Ugh, I have to agree with jimamary and ShineShop, and "warrantied" sealant packages make my stomach churn....



I actually read one of these warranty disclaimers at one point, and the way it was worded was vague and general enough that it seemed to imply that no matter what happened the warranty would almost never have to go into effect.



Well, anyway, this WAS a bad idea IMHO.... ;)
 
turbomangt said:
Well, I have been a critic for some time now on how car dealers over charge on paint seal packages, now I'm no better than them.
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I would agree with that statement.....................



However, at least your not "shoving" $300 bucks in your pocket for doing "nothing" like the dealer is.
 
Well, I'm a "dealer"; an F&I guy, actually....



I'm not going to take offense, though, nor attack. I agree that it's a ripoff, and I talked my owner out of doing it at our store. This discussion isn't about dealers, though, and I'm not going to turn it into one Some dealers suck, some don't.



What I CAN offer is some insight into what goes through the customer's mind, and how the package gets used in the dealership.



The package will be used one of two ways; either as an aftersale for more profit, or as a throw-in to close a deal.



If it is a throw-in to close a deal, take the money and kiss the customer goodbye; you won't ever see him again. The dealer will write the cost off against the profit, the salesperson won't get commissioned, and the warranty document will be forgotten. The throw-in could have been a hat, or an oil change, but it happened to be the paint sealant.



If the product gets sold for profit, then it will be sold on payment: "Mr Smith, $500 comes to around $10/month, or only about a quarter a day. That's a small amount, considering that the gloss and luster is warranted for as long as you own the vehicle. And who has time to wax a car these days?"



1) Cut the warranty from lifetime to 5 years, or 6 years. "Lifetime" is just unrealistic, and customers recognize that and it will work against the sale. The F&I manager will simple change "for the life of the car" to "as long as you are making the payments" in his pitch.



2) Instead of required reapplications every 6 months, make the hook a free inspection at the first anniversary plus or minus 3 months, to keep the warranty in effect. If they skip it, you're off the hook warrantywise. If they keep it, you have the opportunity to sell your services. The customer will already have "banked" the first expenditure in his mind, so offer your services as if he was a fresh customer. After all, he is, for you. Reapplication of product, swirl removal, interior, pick up a couple paint chip repairs and maybe a windshield nick.



3) There are almost NO claims for paint sealant or rustproofing. The customers forget about the paint sealant usually until "next spring" (spring is when the car gets its yearly hand washing with the stiff brush and dirty towels), and they forget about the rustproofing until it's too late (when they see rust. They forgot about the yearly free inspections required to keep the warranty in force).



So: 5 or 6 years on the warranty, maybe 7. And one free inspection, on or around the anniversary date.



And don't worry about the dealer's price. Your customer is the dealer, not the end user. When the customer returns to you, THEN he becomes your customer. Any questions about the difference between his price and yours can be answered, "Yes, but that was the initial application. This is a re-application. Obviously it will be less."





Tom
 
As far as the "ripoff" aspect, that would be a fascinating topic for a different thread. You can't get $400 for it without someone believing that it's worth it; perceived value. Is Z worth it, on the cost of manufacturing? How about Souv? Zymol Estate Glazes?



Perceived value. A fascinating topic. For a different thread maybe, but also maybe applicable to this one. You guys decide.





Tom
 
Tom, you make some valid points on the positive side of offering the warrenty. I still fear the idea of someone with fading/ chips/ or even a scratch blaming it on the failing of the sealer. What provisions do you think should be listed if I were to consider going that route. Gary
 
You are specifically warranting against fading and loss of gloss. Warrant only what you can "control" and correct. You won't have any fading in that first year. You want to specifically exclude abuse, road hazards, acts of God, environmental fallout (specifically acid rain) and manufacturer's defects (clearcoat failure, peeling, crazing and such). What you're looking for out of this whole thing is that inspection at year one to build your client base. MOST OF THE PEOPLE WILL MISS THIS, like 99%. The other 1% are your responsibility to resell the benefits: "Yes, the warranty is for 5 years, and of course it will last. But the car will look much better if we address some issues. Do you see these swirls? Those are from washing it improperly. Those aren't covered by the warranty, because that's abuse, but I can get them out, and show you how to keep them from reappearing...."



I'll find a warranty document and fax it to you, if you'd like. But, it won't really matter. Most of the customers will miss the inspection, and most of the ones who make it will become your customers, and the ones left over probably won't have any issues anyhow.





Tom
 
Mosca said:
Well, I'm a "dealer"; an F&I guy, actually....



I'm not going to take offense, though, nor attack. I agree that it's a ripoff, and I talked my owner out of doing it at our store. This discussion isn't about dealers, though, and I'm not going to turn it into one Some dealers suck, some don't.



What I CAN offer is some insight into what goes through the customer's mind, and how the package gets used in the dealership.



The package will be used one of two ways; either as an aftersale for more profit, or as a throw-in to close a deal.



If it is a throw-in to close a deal, take the money and kiss the customer goodbye; you won't ever see him again. The dealer will write the cost off against the profit, the salesperson won't get commissioned, and the warranty document will be forgotten. The throw-in could have been a hat, or an oil change, but it happened to be the paint sealant.



If the product gets sold for profit, then it will be sold on payment: "Mr Smith, $500 comes to around $10/month, or only about a quarter a day. That's a small amount, considering that the gloss and luster is warranted for as long as you own the vehicle. And who has time to wax a car these days?"



1) Cut the warranty from lifetime to 5 years, or 6 years. "Lifetime" is just unrealistic, and customers recognize that and it will work against the sale. The F&I manager will simple change "for the life of the car" to "as long as you are making the payments" in his pitch.



2) Instead of required reapplications every 6 months, make the hook a free inspection at the first anniversary plus or minus 3 months, to keep the warranty in effect. If they skip it, you're off the hook warrantywise. If they keep it, you have the opportunity to sell your services. The customer will already have "banked" the first expenditure in his mind, so offer your services as if he was a fresh customer. After all, he is, for you. Reapplication of product, swirl removal, interior, pick up a couple paint chip repairs and maybe a windshield nick.



3) There are almost NO claims for paint sealant or rustproofing. The customers forget about the paint sealant usually until "next spring" (spring is when the car gets its yearly hand washing with the stiff brush and dirty towels), and they forget about the rustproofing until it's too late (when they see rust. They forgot about the yearly free inspections required to keep the warranty in force).



So: 5 or 6 years on the warranty, maybe 7. And one free inspection, on or around the anniversary date.



And don't worry about the dealer's price. Your customer is the dealer, not the end user. When the customer returns to you, THEN he becomes your customer. Any questions about the difference between his price and yours can be answered, "Yes, but that was the initial application. This is a re-application. Obviously it will be less."





Tom
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You hit the nail right on the head and your insight into how the transaction works at a dealership is spot on with most I have dealt with. These "warranties" are sold knowing full well that they will never ever be used and if someone tries there are a million and one BS reasons to void it (such as the annual one year inspection). If the dealer was serious about this warranty providing any value to the customer then why do NONE of them call the customer and have them come in to do the annual inspection? Simple - they want the warranty to be null and void to protect their and the warranty company's profit margins. What is even more sad is that 99.9% of these sealants are applied incorrectly and don't work the way they are supposed to anyway due to "cheaping out" and having a minimum wage employee bang them off in 20 min. This stuff makes me steam.

I used to do business with a dealer that sold these warranted paint sealant packages and found something curious. They applied the sealant with an air gun bu thinning it out so the product would go further. First of all this did not apply sufficient product to make the sealant functional. Secondly, they gave no time for the product to set up and removed it immediately. Thirdly, they rustproofed the car after the paint sealant was applied knowing full well that they would have to use a solvent based coating remover to remove the overpray which in turn would remove the paint sealant they had just applied (incorrectly). I made light of this to the service manager and the business manager and their response was "but we did apply it". A blatant rip off and this is very common with dealers.



Gary - I spoke with a good friend of mine in the industry and you could get yourself into serious trouble here if you don't do this right. Like I mentioned earlier, you need to have a untouchable bank account set up to administer the warranties for potential claims.
 
How would a dealer feel about the idea of using the sealant package as a deal closer only?



I offer the dealer the sealant for discounted rate of $75.00. Dealer offers this to buyer for $125.00. Dealer can choose to make $50.00 or give it away costing dealer $75.00.



I really can not see marketing this service for more than $125.00. At least in my area anyway.



Forget the warranty. Just market this as a 6 month paint sealant with the recommended maintenance or reapplication. The dealer will offer the maintenance program at same $125.00 rate. (If the dealer wants to sell them a waranty they can but it would be waranteed by the dealer.)



The dealer will obviously need to be educated on the chemistry of the product and it's benefits in order to sell it successfully.



With this plan nobody get's screwed.

- The detailer makes money.



- The dealer has an incentive to make money and close a deal.



- The customer pays the same low retail price every time, knowing they didn't get ripped off at the initial sale by paying a huge inflated price up front.



carzzz
 
This is what I do in our shop in terms of Paint Protection packages, the difference is we do it directly to the customer instead of through a dealer or middleman.



We charge a fraction of what Ziebart/Tuff Kote/Valuegard is charging, and it involves a full exterior detail. The package will include the one time paint detail, 6x a year reapplication of sealant (wash inclusive). Our warranty covers oem finishes only and if the surface isn't waxed after the treatment (very easy to catch since most people don't wax well and leaves residues around emblems and such) it covers fading, watermarking and oxidation.



The "nice" thing with our package is that they can claim the detail anytime within the 12 month period the package covers.



Meaning, if a client brings in a brand new black cars with swirls, then he/she can opt for the detail right away, but let's say they got a car with a pretty good paint surface, they can avail the detail a few months down the road when the surface has been swirled or whatever.



Found it easier to package things that way than to "force feed" them to an expensive protection package that has too much "ifs and buts" in the warranty. It also assures us that he comes back often for other services such as engine details, interior cleaning, leather cleaning, etc.
 
I'm going to stay away from the entire issue. I have 3 large dealers within two blocks, including Indiana's largest Chevy dealer. ValuGard wants me to do all this stuff, but I'm sooo reluctant... I guess it is an ethics issue.



Plus, as the weather gets better, I'm booked at least 10 days out. i don't need the hassle of record keeping, etc.



My view is just do a great job, smile, and hope they tell a friend!



Scotty, as expected, has really really nailed the essence of this issue.



Jim
 
Jim-glad to see you are booked up solid too. The cool and wet weather is hopefully far in the rear view mirror...but then again, this is Texas.



I agree with you on dealer work. They want you at their beck and call and I am sure you are in the same position as I am with loads of private owners who are very loyal. They always come first. Besides, if the sealant packages don't work out, your name may end up being associated with it.
 
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