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I price shopped this week


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I am putting this in Non-Automotive Discussion, but my price shopping experience relates to how customers feel and may relate to sometimes in purchasing vehicle maint. and repairs.

 

The Back Story:

 

I have been on vacation since June 8th in southeast Europe. I am leaving in two days to go back to the United States. I am here with my wife who is a huge animal lover. To make a long story short their a huge stray dog problem in Europe. Dozens of stray dogs in every village, town, and city you go into. The town we are staying in has a population of around 80,000 and is pretty densley populated. We seen one particular dog the first few days we were here. My wife commented on how ill he looked at that time. Fast forward two weeks later and we seen the same dog again, this time almost dead. He couldn't pick himself up off the sidewalk, was very low on energy and strength and appeared to be dehydrated. I picked him up and walked home with him. We fed and watered him, and took him to a vet to get medication and later shots when he was healthy enough. I couldn't find an appropriate home for him so I decided I am taking him home to the United States with me. I figured I would just bring him on our airplane, but found out later he was too big to fit into the largest cage that is acceptable on the airplane. So I had to go to plan B, fly him on a seperate cargo plane.

 

I started contacting cargo brokers in the area. As a private individual you cannot just book cargo yourself, it must go through a cargo company. The first company I found was located in Turkey. They were going to fly my dog out of Skopje Macedonia (2.5hrs driving from where I am), send him to Istanbul, and then to Washington D.C. That is the most common route for cargo in this area back to the U.S. The cargo agent assured me that the dog would be fed and watered on layovers. I waited a week for a quote from this company and when I got the quote I almost fell out of my chair, 4300 Euros which is nearly $4800 with exchange fees.

 

I called around to another company who could not complete the transaction because my dog would have to go into Bulgaria which is a EU member. The EU has some rabies blood test that needs done after vaccination but their is no lab in Macedonia to complete this test at the moment. So I called a Cargo company from the Skopje Macedonian airport. Once again the booked route was from Skopje, to Istanbul, to Washington D.C. The price estimated was 1100 euros. After a few days of talking options and the broker looking into customs requirements the price went to 1580 Euros. I selected this broker and went this route. I didn't get a chance to get into contact with anymore brokers due to time constraints (over a week being wasted by the broker in Turkey).

 

During this mission to get my dog back to the USA I felt like a customer calling around to auto repair shops trying to price a service. I also rediscovered as to why a customer may feel on the defense whenever talking to a company for a service. I found one price nearly 3 times the amount compared to the competitor. There was also a 40% increase in price from my estimated price to the actual price. I don't know the actual reasons for the price increase, if it was increased due to customs and airline fees, or if it was the broker sensing I was determined to get my dog to the USA and he wanted to profit off of my determination. I also remember why I got into this business, I was an avid DIYer and came from a family of DIYers that rarely sourced out work. I generally DIY projects, and with this one "project" I felt "weak" because I had to rely on somebody else to complete this task for me.

 

Lots of rambling, I don't know what of this pertains to a customer psychology when choosing a service, I thought I would just share my story.

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  • Have you checked out Joe's Latest Blog?

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      Auto shop owners are always looking for ways to improve production levels. They focus their attention on their technicians and require certain expectations of performance in billable labor hours. While technicians must know what is expected of them, they have a limited amount of control over production levels. When all factors are considered, the only thing a well-trained technician has control over is his or her actual efficiency.
      As a review, technician efficiency is the amount of labor time it takes a technician to complete a job compared to the labor time being billed to the customer. Productivity is the time the technician is billing labor hours compared to the time the technician is physically at the shop. The reality is that a technician can be very efficient, but not productive if the technician has a lot of downtime waiting for parts, waiting too long between jobs, or poor workflow systems.
      But let’s go deeper into what affects production in the typical auto repair shop. As a business coach, one of the biggest reasons for low shop production is not charging the correct labor time. Labor for extensive jobs is often not being billed accurately. Rust, seized bolts, and wrong published labor times are just a few reasons for lost labor dollars.
      Another common problem is not understanding how to bill for jobs that require extensive diagnostic testing, and complicated procedures to arrive at the root cause for an onboard computer problem, electrical issue, or drivability issue. These jobs usually take time to analyze, using sophisticated tools, and by the shop’s top technician. Typically, these jobs are billed at a standard menu labor charge, instead of at a higher labor rate. This results in less billed labor hours than the actual labor time spent. The amount of lost labor hours here can cripple a shop’s overall profit.
      Many shop owners do a great job at calculating their labor rate but may not understand what their true effective labor is, which is their labor sales divided by the total labor hours sold. In many cases, I have seen a shop that has a shop labor rate of over $150.00 per hour, but the actual effective labor rate is around $100. Not good.
      Lastly, technician production can suffer when the service advisors are too busy or not motivated to build relationships with customers, which results in a low sales closing ratio. And let’s not forget that to be productive, a shop needs to have the right systems, the right tools and equipment, an extensive information system, and of course, great leadership.
      The bottom line is this; many factors need to be considered when looking to increase production levels. While it does start with the technician, it doesn’t end there. Consider all the factors above when looking for ways to improve your shop’s labor production.
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