Accounting, Profitability, & Payroll
A sale must bring profit, if it doesn’t It’s a loss. Accounting is a major part of any business. Are you in control of your accounting and profitability? Are you controlling your payroll to be profitable?
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Latest Posts
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By Joe Marconi · Posted
I want to clarify something. I stated in the above post that many shops are getting $135 to $150 per hour. I am not implying in any way that this is too high or unreasonable. In fact, as an industry we need to raise the average labor rate across the board in this nation. What I am saying is that you need to sit down and do the math. Find out what your labor rate should be by determining your overall cost of labor and your expenses; and then adding your desired net profit. Also, I recommend you have multi-tier rates. So, a C-level tech performing oil changes and general service is billed at your standard labor rate and an A-level Master Tech performing complex driveability and other onboard diagnostics is billed at a much higher labor rate. If you are not sure how to do this, you need to get help from a professional, such as a coach. -
I bet you have a bunch more heater repairs than I do... One thing I left out. My machine has a line flushing feature for use with hybrids. It burns 1.5 lbs of filter life (limited by Robinair to 150 lbs before filter change). I do use this feature when I hit a bad one AFTER I'm done with the job. I clear the lines immediately after I'm finished... One thing that's cool is when I get a a massively over oiled one and the trap has 8 oz of oil in it the oil bubbles like a coke for 2-3 hours and the 8oz drops to 6oz The oil has liquid refrigerant in it. This phenomenon is useful when you have to open a system. It will "out gas" for a couple of hours AFTER recovery. If you tightly plug the lines it will "pop" when you pull the plugs days later, sometimes it will blow the plugs off (bad). Often I will use a balloon on one side to allow for expansion. If your system is outgassing when you plug it and the plugs stay in the dryer does not get poisoned with ambient humidity and I will commonly re-use the dryer. If I can I leave the systems in vacuum overnight (machine hooked up but turned off) and re-pull in the AM. This vastly reduces the moisture in the system. -
@RickD Thanks for the very thorough information. I'm in Northern Minnesota. A/C repair isn't of quite as high demand here I'm sure. Probably just as often as repairing A/C problems, we need to recover to perform other work on the vehicles easier. -
By Joe Marconi · Posted
I am not accountant and I do not know the tax laws in every state, but it is important that you meet with your accountant way before the end of the year if you received and used an SBA or PPP Loan. Loans used to pay bills may not be used as a deduction on your tax return, and may result in increased taxes. Again, DO NOT TAKE MY ADVISE as an accountant. I plan on meeting my accountant in October to review all the tax implications for my 2020 Tax return. AND, the SBA may change rulings, so stay informed and seek professional guidance. -
By Joe Marconi · Posted
With so many uncertainties these days, there is one strategy that we can all do that will help to smooth out our overall sales and customer visits throughout the year. Make sure the experience is always amazing during the entire customer visit. And perform the car delivery that gives the customer a reason to return. Here's the key part before any customer leaves your shop: Make sure you discuss their next service appointment and any other future recommendation. Let them know that they will get a reminder by either post card, email or text. BUT, there is one more thing you can do to boost your customer retention, get permission from your customer to call them a week prior to their next appointment. Yes, give them a phone call. Try it, and give it time to work. Oh....won't work, you're thinking??? Well, here's list of businesses that do it: Dentists, doctors, nail salons, hair dressers, chimney cleaners, boiler service companies and Successful Auto Repair shops. -
I use a Yellow Jacket "trap" (38080) on every car I recover. I'm running a Robinair 34788 NI-H and have not had any trouble in 5 years. I recover from low side ONLY (less oil come out) and the trap has not missed a drop. The machine never recovers oil. I intentionally recover my own cars without the trap to test the machine once a year. Oil recovery works fine then. The machine needs a tiny amount of oil to keep the solenoid seals lubricated. I believe 90% of the vehicles I service have sealant in them. The little test kits are not worth the trouble IMO. I do not use them. They are not accurate enough for me and take too long to test. It is difficult to find straight refrigerant in the DIY auto stores. Almost everything has oil and sealant... I have NEVER seen the sealant fix a leak but I have seen the sealant take systems out. The usual culprit is a membrane that the American manufactures like to use as a debris screen. The tiny holes in the membrane get clogged with the sealant and you find ALL of the oil in the system on the feed side of this membrane. GM SUVs with rear AC are the worst culprits. The tiny screen is inside the liquid line at the bulkhead fitting in the rear. Most techs don't know it's there as it is not a normally changed part (and it should be). A Murray part # for the little screen is 39335. It looks like a 1/4 scale orifice tube screen. The liquid line front to back has enough volume for the entire oil charge. If you have a plugged one and you don't change it you will have a comeback within a year. Rear AC will be wimpy as well. GM condensers with a replaceable dryer cartridge (Cadillac SRX) also have a super tiny membrane inside the dryer that will clog. Symptoms are low pressures on both sides, piss poor cooling, and a viciously hot discharge line. There is a TSB regarding this. If you refuse to service your customers cars because they might have sealant you are destroying your relationship with those customers. We have to service the systems and educate the customer. Occasionally I hit a system that has been massively over oiled. The sealant is everywhere. I will commonly replace compressor, condenser, orifice/TXV, dryer/accumulator, and discharge line. I will over flush remaining lines and evaporator and offer NO warranty. I haven't had a comeback on ANY of those but I believe I have been lucky. Customers will seldom pay to have the entire system replaced and see the shop as an "over charger". They will not come back to you for the other things they need. My Robinair machine's manual states "any leak sealers found inside the machine voids all warranties"... I run a shop in Texas that specializes in AC repairs.
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By QuandAns42 · Posted
Good to know! We've looked at this one, but haven't pulled the trigger. How's customer service in their off hours, if you've needed it? That's been my concern with a West coast based service. -
By Joe Marconi · Posted
From as far back as I can remember, labor has always been an issue. As and industry, we have struggled to get paid properly for the work we do. And those shops that understand how critical labor is, are the shops that have done quite well. In today's auto repair shop world; Getting the right labor dollars is no longer a buzz topic or debate- Labor dollars will be the salvation of your business. Labor translates into profit, and will also allow you to build for the future and to attract the quality people we need in our industry. If you don't know what your labor should be, you need to find out. Don't call ABC Auto, down the street to ask him. The odds are he did not do the math. Plus his expenses are not the same as yours. Depending on what you pay your techs, your overhead, and knowing your numbers will determine your labor rate. I can tell you that there are shops that are paying techs a very good wage and those shops are getting $135 to $150 per hour, and more. That is not a typo. And there are shops that have multi-tier rates. So, for Diag and labor jobs that have no parts associated with the repair, their labor is much higher than their standard labor. It's fair, it's honest and it's time we all raise the bar. Please, do the math, get help and make sure your labor is right for your shop.
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