The strategies outlined in this blog reflect real-world strategies I have learned and used in my 41 years as an auto shop owner. I also use these strategies when helping clients as a business development coach.
While running a successful auto repair shop today has many components, the list below contains the top 9 strategies I believe every auto shop owner should consider when looking for ways to improve their bottom-line profit.
Ten Ways to Improve Your Bottom Line:
- Hire the best people and have enough staff. You will have a much easier time achieving success when you’re surrounded by the right people.
- Calculate your correct labor rate and adjust that labor rate every quarter.
- Charge a higher labor rate for jobs that do not include any parts, such as electrical testing, check engine lights, onboard computer issues, and drivability problems. The missing part profit must be made up somewhere.
- Review and refine your checklists and procedures to improve overall efficiency.
- Make sure all your equipment is working correctly and that you have the equipment and tools needed for the vehicles you service and repair.
- Make sure your part margins allow for a respectable gross profit.
- Make sure your inventory is up to date, with up-to-date pricing, and you don’t have too much stock sitting on the shelf.
- Make sure you have a process to get the proper credit for part cores, returned parts, and defective parts.
- Invest in ongoing training for all employees.
BONUS TIP: Speak to your accountant and business coach about tax planning strategies. But do not wait until tax season. Tax planning should be done throughout the year.
I hope you found this information helpful.