Mobile Service Eliminates the Shop Visit – at half the cost of Pickup & Delivery
Dealers introduced Pickup & Delivery (P&D) to defend retention. They introduced Mobile Service to grow the business.
On the surface, the two appear similar: both remove the customer’s trip to the dealership. Operationally and financially, they are fundamentally different models.
Pickup & Delivery relocates the shop visit.
Mobile Service eliminates it.
That distinction determines cost structure, throughput, and long-term profitability.
The Real Cost of Convenience
Consider a routine 30,000-mile service:
- Oil change
- Tire rotation
- Multi-point inspection
- Cabin air filter
Average customer-pay RO: $240
Flat-rate labor: 1.5 hours
A dealership offers two convenience options:
- Pickup & Delivery
- Mobile Service at the customer’s home or workplace
Let’s evaluate the economics — not the marketing.
Pickup & Delivery: Operationally Helpful, Economically Heavy
How It Actually Works
The vehicle still goes to the shop. You’ve simply added transportation around it.
There are two common operating models.
Model A — Two Drivers, Two Vehicles
Two employees retrieve and return the vehicle.
Typical logistics per RO:
- ~20 min drive each way
- ~10 min handoffs
- ~3 total labor hours
Labor cost
3 hrs × $18 = $54
Vehicle operating cost
~25–30 miles × $0.65 = ~$18–20
Total transportation cost per RO: $72–74
That equals roughly 30% of RO revenue consumed by logistics alone.
And the vehicle still occupies a service bay.
Model B — Porter + Rideshare
Porter retrieves vehicle via rideshare.
Labor
1.5 hrs × $18 = $27
Rideshare
$40–60
Vehicle cost
~$10
Total transportation cost: $77–97 per RO
Again — same shop capacity used. No additional production created.
What P&D Actually Does
Pickup & Delivery improves customer satisfaction.
But financially it behaves like this:
Every additional RO increases expense without increasing capacity.
You’re scaling logistics, not production.
Mobile Service: A Different Operating System
Now perform the same $240 RO at the customer’s location.
The repair still takes 1.5 hours — same technician labor as in-shop — so we isolate only the transportation component.
Mobile Transportation Cost
Assumptions:
- 20 min drive to job
- 20 min drive to next job
- 40 minutes total drive time
Technician rate: $35/hr
Drive labor
0.67 hrs × $35 ≈ $23
Van operating cost
15 miles × $0.75 ≈ $11
Total incremental transportation cost: ~$34 per RO
No service bay used.
Direct Cost Comparison
| Porter + Rideshare | Two Drivers | Mobile Service | |
|---|---|---|---|
| Drive-time Labor | $27 | $54 | ~$23 |
| Rideshare | $40–60 | $0 | $0 |
| Vehicle Cost | ~$10 | $18–20 | ~$11 |
| Total cost per RO | $77–97 | $72–74 | ~$34 |
The Financial Impact
Per RO savings
- vs rideshare: $43–63 (55–65% lower)
- vs two drivers: ~$40 (≈50% lower)
At 1,000 convenience ROs annually
| Model | Annual Cost |
|---|---|
| Porter + Rideshare | $77k–$97k |
| Two Drivers | $72k–$74k |
| Vehicle Cost | ~$34k |
Mobile saves $40k–$63k per year before considering capacity gains.
The Structural Difference Dealers Miss
Pickup & Delivery
- Adds cost to existing shop
- Consumes fixed bays
- Increases congestion
- Scales expense linearly with volume
Mobile Service
- Operates outside fixed capacity
- Adds production hours
- Generates incremental revenue
- Improves efficiency as routing improves
The Capacity Multiplier
One mobile van:
- 3 ROs/day
- $240 avg RO
- ≈ $720/day
- ≈ $180,000/year
Three vans:
~$540,000 annual revenue
No building expansion.
No additional bays.
No added congestion.
The Strategic Takeaway
Pickup & Delivery is a retention tool.
Mobile Service is a production platform.
P&D helps you keep customers. Mobile helps you grow service absorption.
P&D scales cost. Mobile scales revenue.
Bottom Line
Convenience alone does not create profitability.
The winning model is the one that changes the cost structure.
Pickup & Delivery makes service easier for the customer. Mobile Service makes service easier — and economically better — for the dealership.
It cuts transportation cost roughly in half, unlocks capacity beyond the shop’s walls, and converts convenience from an expense into a growth engine.
Evaluate Your Own Economics
If you’re deciding between expanding P&D or launching Mobile Service, the decision isn’t operational — it’s financial.
Dealers who understand this early gain a permanent fixed-ops advantage.
Posted in Services, Digital Servicing
