Increasing Profitability with Ancillary Sales in Hertz Finland
Tham, Susanna (2018)
Haaga-Helia ammattikorkeakoulu
2018
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-201804104424
https://urn.fi/URN:NBN:fi:amk-201804104424
Tiivistelmä
In 2012 Hertz Finland launched a new ancillary sales programme called the Wheel. The Wheel consists of 6 steps sales model, which is taught for the staff in Service Based Sales (SBS) training. The Wheel 6 step model concentrates on how to sell to a customer. It encourages the CSRs (Customer Service Representative) to ask certain questions and observe their clients carefully, to understand what might be their wants and needs. Based on these informations the CSR always offers each ancillary product and service for each client, but for different reasons.
In addition to the comprehensive training, Hertz also offers the CSRs a 10% bonus of each ancillary product/service they have sold. What can be considered as ancillary is very easy to monitor, because most of the customers do reserve a car beforehand. The overall ancillary sales are being monitored by each station manager on a daily basis.
The author considers that the Wheel programme is working because it targets each customer´s individual needs. So, even though each item is being offered to each customer, there is always a different reason for it. The staff has considered the programme to be a good way to earn more and therefore find the programme quite motivating.
From profitability point of view, the programme has generated more revenue with small expenses. As the bonus is linear to the ancillary revenue made with the programme, the expenses can never be more than the earnings. Therefore the only considerable cost of the programme is the training cost. However, after the launch of the programme the staff turnover has significantly declined. This saves the company money on staff expenses, because they don´t have to constantly train new staff. Knowledgeable staff is a valuable asset for the company, because they often have better tools for selling well and performing at work.
From CRM (Customer Relationship Management) point of view, the author would suggest creating a rental database for the company, which would lay out the client´s rental history in a smart and easily accessible way. This would enable the use of existing client information in the sales situation. The rental history, however, should never be used to prejudge customers, but rather to better understand them.
In addition to the comprehensive training, Hertz also offers the CSRs a 10% bonus of each ancillary product/service they have sold. What can be considered as ancillary is very easy to monitor, because most of the customers do reserve a car beforehand. The overall ancillary sales are being monitored by each station manager on a daily basis.
The author considers that the Wheel programme is working because it targets each customer´s individual needs. So, even though each item is being offered to each customer, there is always a different reason for it. The staff has considered the programme to be a good way to earn more and therefore find the programme quite motivating.
From profitability point of view, the programme has generated more revenue with small expenses. As the bonus is linear to the ancillary revenue made with the programme, the expenses can never be more than the earnings. Therefore the only considerable cost of the programme is the training cost. However, after the launch of the programme the staff turnover has significantly declined. This saves the company money on staff expenses, because they don´t have to constantly train new staff. Knowledgeable staff is a valuable asset for the company, because they often have better tools for selling well and performing at work.
From CRM (Customer Relationship Management) point of view, the author would suggest creating a rental database for the company, which would lay out the client´s rental history in a smart and easily accessible way. This would enable the use of existing client information in the sales situation. The rental history, however, should never be used to prejudge customers, but rather to better understand them.