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Joe’s Business Tips For Shop Owners

Tips from Joe Marconi, co-founder of AutoShopOwner. His tips are shared to help you in your day to day shop operations, sales, customer service, marketing, advertising, and more!


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    • Advancing the Aftermarket. Of late there has been a lot of dialogue around my circles about being paid for the value you give and bring to your customer. I recently saw a survey of shops whose sales averaged $750,000 yet their net operating profit was only 2%. That is only a $15,000 average net operating income before tax. This troubling stat begs the question: How do you continue to invest in the business and even provide a living wage for you and your team at that level of profit? 98.9% of shop owners that I asked about raising their labor rate told me that they were the one who was most affected by the change. (their hesitancy and the pressure is all unjust) Listen for free on Apple Podcasts, Google Podcasts, Spreaker, iHeart Radio, Spotify, Podchaser, and many more. Mobile Listening APP’s HERE Find every podcast episode HERE. Every episode is segmented by Series HERE. Key Word Search HERE. Be socially involved and in touch with the show: Facebook   Twitter   Linked In   Email Join the Ecosystem – Subscribe to the INSIDER NEWSLETTER HERE. Buy me a coffee   Click to go to the Podcast on Remarkable Results Radio
    • I am seeing more and more labor rates hitting the $180 mark and higher for the same reasons you state.  Good news.  Let's hope all the shops around the country act on this. We really need to collectively raise labor rates. 
    • Bryan Stasch, Vice President of Product and Content Development, ATI. Bryan Stasch began in the auto industry in 1984 as a technician before becoming general manager at a national franchise store and eventually sharing ownership of three successful auto repair shops. In 2000, he joined ATI as chief instructor and became deeply involved in developing and presenting all aspects of ATI’s coaching and training programs. In 2006, he became head of ATI’s member fulfillment department, overseeing all ATI coaches and related administrative staff. In 2019, he took on the role of VP of Product and Content Development, an area of expertise that he excels in. Key Talking Points Four words of death – “I don’t have time”. Don’t have time to focus on the things that create market value. Where does the sale price derive from- The profitability of the business, the owners take home money, times a multiplier of 2 or 3, is what automotive repair shops are selling for.  N.O.P. (Bottom line and owner’s salary (expensed) if not part of production) + Interest expense + Depreciation + Amortization + Toys + One Time Expenses + Discretionary N.O.P. = Owners Cash. (Average of last 3 years) Multiply times 2.5 (?) = Sale Price Get the shop ready for an exit (planned or unplanned)- considering hiring a coach during the process and transition. The coach is your insurance and holds the owner accountable. Build a model you can duplicate so someone other than the owner can run. Could your business survive 60 days without you? Train others so the business isn't dependent on the owner. Develop a second in command. Get systems and processes documented. What is goodwill? Once the sale price has been determined that number is broken down into assets and goodwill to determine who, and how much, is paying taxes. Sale price, minus assets, equal goodwill. What does walk away money look like- Selling Price (100%) Broker/attorney (10%) Debt (10%) Taxes (20%) =  Walk Away (60%) Owning property- using it as a retirement plan. Could sell the business and become the landlord for recurring retirement income. If you want to sell the property it should be two different transactions.  Get the owner ready- what’s next for them? What do they need for retirement? How many years are planned for retirement? Is your family ready? What are their expectations? Get shop ready for the market: Financially-Maximize Owner’s CASH (Clean P&L), Drive Sales, Gross Profits Dollars and NET Dollars, 3 Years’ worth of Financial Data to PROVE IT. Operationally- Crew and Culture, Process Book/Operations Manual, Software and Equipment Thanks to Bryan Stasch for his contribution to the aftermarket’s premier podcast. Link to the ‘BOOKS‘ page, highlighting all books discussed in the podcast library HERE. Leaders are readers. Listen for free on Apple Podcasts, Google Podcasts, Spreaker, iHeart Radio, Spotify, Podchaser, and many more. Mobile Listening APP's HERE Find every podcast episode HERE. Every episode is segmented by Series HERE. Key Word Search HERE. Be socially involved and in touch with the show: Facebook   Twitter  LinkedIn   Instagram  Youtube   Email   Join the Ecosystem - Subscribe to the INSIDER NEWSLETTER HERE. Buy me a coffee As a member of the NAPA family, AutoCare Center owners can take advantage of the NAPA National Health Program from the NAPA Insurance Center. This “NAPA only” program gives you and your employees access to national “large group” rates on medical insurance with premiums discounted up to 30 percent. These rates are based on the collective purchasing potential of 22,500 NAPA locations including both NAPA AUTO PARTS stores and NAPA AutoCare Centers. The NAPA Insurance Center can help you with a variety of other insurance benefits too. For more information about The NAPA National Health Benefits program as well as all of the insurance benefits available to your AutoCare Center and your employees, visit the NAPA Benefits Center, at www.napabenefitscenter.com or call the NAPA Benefits Center at 844-627-2123. https://aftermarketradionetwork.comClick to go to the Podcast on Remarkable Results Radio
    • In high cost SF Bay Area I am now $180/hour labor rate from $155 for a few years and the dealers are all at least $200/hour. My senior tech makes $40 an hour flat rate and he is worth it. My B tech is $30 and my two C techs are $24 and $22. I also keep my reputation high so people are choosing to come to my shop. 
    • Ha!  I am 66 and there too.  I will let everyone know soon my next chapter in my life.  After 41 years in business and 47 years in the auto industry, it's time to turn the page. 
    • I am trying to go from one location to zero locations. I will be 69 in December. Anyone want to buy a good business in Indiana. 
    • With so many baby boomer shop owners retiring, there is great opportunity for shop owners looking to add new locations. In addition, there are many shop owners that have not survived the COVID crises.    Is anyone looking to open new locations?  If so, it would be interesting to hear your strategy and the reasons why. Oh, if you are wondering If I am thinking about expanding. The answer is no.  I had three locations, down to one now, and I am close to announcing exciting news very soon. So Stay Tuned.  



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