Which Premium Oil To Offer?

[userfriendly]

Exactly. Those oil warranties are purely marketing jargon. There's virtually no way you can prove that the oil was truly at fault even if it really was, and anybody who thinks Amsoil or any other oil brand is in business to pay for peoples engine rebuilds on the whims of their customers is a fool

Petro-Canada paid out big $$$$ in the early 2000s when they rolled out their Duron 0W40 without proper field testing.

 

[JohnnyJohnson]

The one that on sale with a rebate. Because in the end they just aren't that different and very likely won't make 20 K in you engine life. But other maintenance issues may!

 

[SteveG4]

If I had a business where oil changes were a significant part of my it, I would offer a recognizable name brand (take your pick) and purchase oil in one of the larger packages.

Determine what larger volume packages work for your business, and ask distributors for best pricing. Have them compete for your business.

 

[johnD2]

Mobil or Castrol would be my pick. Both offer extended interval oils.

 

[tystaples]

"Up there" in Minneapolis are there brands which have been around longer?

I agree with the logic behind those behind Mobil1. Let's hope mentioning it's 'Mercedes oil' doesn't scare 'em away either.
Amsoil's prices will.

You must assure your customers that they're getting whichever real deal you're offering and you gotta rely on your managers / staff to sound convincing and truthful when they pitch.
You said you're leaving semi-synths behind. That means you likely started the product conversation with many customers, no?

That's a good question. National advertising is probably similar with Castrol and Mobil 1 leading the pack. I do think AMSOIL has a fair bit of recognition around here but it's probably positioned stronger as a specialty product. Personally, I've never used it.

Yes, the guys up front have done a good job communicating the benefits of full synthetic- the main one being we recommend 5-6k oil change intervals vs. 3k with the blended oil. Full synthetic costs less per mile so it's not really a hard sell.

Most customers don't listen anyway and go 10k+ miles and never check their oil levels. We do a lot of engine and heavy line work for these people.

 

[tystaples]

If I had a business where oil changes were a significant part of my it, I would offer a recognizable name brand (take your pick) and purchase oil in one of the larger packages.

Determine what larger volume packages work for your business, and ask distributors for best pricing. Have them compete for your business.

Thanks Steve and everyone else regarding the distributor comments.

We currently buy in bulk off the truck and the lower volume product we get in 55 gallon drums. I'm not yet sure what the packaging looks like from our current distributor for the premium oils. Previously we were with a different distributor and have a couple evaluated others. There are some barriers to switching as we're on contract for a couple more years as they bought and upgraded all our shop bulk tanks and distribution equipment.

 

[tystaples]

What are you going to do about different viscosities ? As soon as you have to start stocking 0W-20, 5W-20, 5W-30, 10W-30, and on and on, you lose a lot of buying power with your oil supplier. You just going to put 5W-30 in everyone's car ? I don't think that's an uncommon practice.

Currently our 0W-20 is also good for 5W-20. We also stock 5W-30 in bulk. 10W-30 is mostly obsolete. Euro oils we buy in drums or kegs. We don't see a lot of diesels. The bigger issue is the newer cars with the -16 oils. Probably 80% of our customers use 20 weight oils.

 

[tystaples]

I don’t know about in the Minneapolis area, but I have seen lube chain stores under the following oil brands: Valvoline, Pennzoil, and Quaker State. There may be others but these are some that I’ve seen and you don’t want to compete with their branding.

I think you should streamline this so that you’re not spending time trying to upsell customers from one synthetic to another. I would phase out the generic/no name synthetic and just carry ONE single brand of synthetic in multiple viscosities as needed. Mobil one is one of the more recognizable brands but then again, not everyone knows any kind of oil brand and many car owners have no knowledge of brands other than gasoline brands. If you just offer one brand of synthetic, you really streamline the process, no need for up selling, and your economy of scale for purchase discounts from just one distributor goes up so that even though you only have the one brand which is premium, you can either make more profit and or offer your customers better value. So, if you choose Mobil one for example, just offer Mobil one exclusively.

Some customers are price sensitive though and don't value a premium product. We buy 0W-20 Dexos for $11.20/gallon in bulk. I haven't priced the branded oils yet but I doubt we'll touch anything close to that with Mobil 1.

 

[tystaples]

I think generally people will recommend Mobil1. Plain and simple for most cars.
Problem might happen with European cars, particularly BMW.

If you see BMW’s in your garage, you will have to offer other oils. Mobil1 with the switch to current base stocks dropped all BMW approvals due to oxidation requirements of updated BMW approvals in 2018. Therefore, Castrol, Pennzoil and Valvoline in that case would be good choice to have just in case.

My wife's 2022 Jag recommends Castrol and so did her 2017 FWIW

 

[tystaples]

So far no sign of the OP. I'm just curious what the distributor would charge vs what Walmart charges on the shelf. I wonder if the distributor was more than Walmart, if you could just order all the oil you needed directly from Walmart.

Sorry, I didn't get notifications that I was getting so many replies!

 

[tystaples]

Thanks all for your feedback! I appreciate your insights.

 

[tystaples]

Also, a lot of the feedback was regarding our distributor. We have a lot of leverage and get very good pricing and service. We buy all our fluids, chemicals, filters, and most shop supplies from them. As much as possible I try to consolidate our spend to a handful of good supplier partners to leverage our spending to get the best service, maximize rebates, help with warranties, etc... We have one for tires, one for parts, and one for bulk fluids and filters. ~80% of our spend goes to these few. Probably nobody here cares much about the inside baseball of this business but if you do I'm happy to share info. You'd probably be surprised how small our discounts are for parts and tires vs. retail, for example.

 

[buster]

Mobil 1, Amsoil.

 

[Scuder]

Since you're tied into a lube contract, you don't really have the option to change without writing a big check. When it's over, you'll own the lube equipment, correct? At that point a distributor switch could be considered.
I believe the right oil is any brand with a widely recognized name from a distributor who well fulfills your requirements and is priced at a point that doesn't cause your customer to recoil.

 

[bullwinkle]

Also, a lot of the feedback was regarding our distributor. We have a lot of leverage and get very good pricing and service. We buy all our fluids, chemicals, filters, and most shop supplies from them. As much as possible I try to consolidate our spend to a handful of good supplier partners to leverage our spending to get the best service, maximize rebates, help with warranties, etc... We have one for tires, one for parts, and one for bulk fluids and filters. ~80% of our spend goes to these few. Probably nobody here cares much about the inside baseball of this business but if you do I'm happy to share info. You'd probably be surprised how small our discounts are for parts and tires vs. retail, for example.

I believe it-my independent mechanic has a pretty big Shell convenience store attached to his service garages, but his cost on Formula Shell motor oil quarts is routinely MUCH HIGHER than Menard's and others. He was big on Kendall, but when the prices snowballed recently he dropped them. Pretty sure he only has 55 gallon drums of motor oil, oil changes aren't his main business, but he spends a LOT of money at Federated AP (KOI) and NAPA, their drivers are almost always there when I am. I need to ask him what his discount on East Penn/NAPA batteries from NAPA are, probably could beat Sam's Club & others.

 

[Wolf359]

I believe it-my independent mechanic has a pretty big Shell convenience store attached to his service garages, but his cost on Formula Shell motor oil quarts is routinely MUCH HIGHER than Menard's and others. He was big on Kendall, but when the prices snowballed recently he dropped them. Pretty sure he only has 55 gallon drums of motor oil, oil changes aren't his main business, but he spends a LOT of money at Federated AP (KOI) and NAPA, their drivers are almost always there when I am. I need to ask him what his discount on East Penn/NAPA batteries from NAPA are, probably could beat Sam's Club & others.

You used to be able to just find your local Shell distributor and buy directly from them. The link below used to work, not working for me right now. My local one would sell directly to the public, it was just a cash sale. I used to get Shell ATF 134/FE directly from the distributor, much cheaper than either a Mercedes dealer or even buying online. You had to buy a case though.

https://www.shell.us/business-customers/lubricants-for-business/lubricants-distributor-locator.html