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Shop Efficiency? Help!


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Hello everyone i have been going in this site for a while and this is the first time i start a topic.

 

So let me give you a little insight of what is happening at the shop. i have 3 techs, one service advisor (my self) one receptionist, and a shop foreman (my father). We average at 45-65 billed hours a week (5 days), at 65 billed hours we are going crazy like if we are bringing in 150 hours, at the end of the week i look at my hours and Im like WTF. i just ran around like crazy for this.. Im know we have a big efficiency problem but i don't see the issue. My question is how is everyone a tight ship? How long is it taking for people to get there parts? I know its different for every one but i looking for an average.

 

I hope i can figure this out..

 

Rick

Edited by uniautoser
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Rick,

Posting a topic is a great way to get help.

The best way to get clarity is to do an "audit" (as I call it). Doing
an audit will allow you to see where there are inefficiencies, either
in the bays or at the counter - or in both areas.

So, to do an audit by reviewing last week's tickets, please answer
the following questions:

How many tickets were billed out?

When you look at those repair orders, does the information and the jobs
that were sold on the estimates match the completed invoices?

What you're looking for first is...
Were there jobs that were sold that were not carried over and billed out?

Was the labor time calculated correctly on the estimates and the completed
invoices?

Also, is there a reason you believe the problem is related to parts delivery?
What is happening with parts deliveries that is causing you to think that
is a big issue? For example, if your tech is waiting on a part, what is he
doing while he's waiting for a part delivery?

And when you say you feel like you just ran around like crazy... what is
it specifically you are referring to?

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1. Learn to anticipate.

2. Learn to delegate.

3. Learn to say NO.

4. Learn to hold people accountable.

5. Learn that not everything is an emergency, and not everything needs to be done immediately.

6. Grow a thick skin, and don't fall for googly eyes.

7. Plan your work.

 

For example, you already should know the routine of your shop. If you are the one that opens, visualize your day, don't be negative, because if you begin with a negative attitude it will percolate into your work day.

 

Make a list of the top things you need to achieve that day. And those that have to be pending until later, e.g., 1. Order bulk oil. 2. Order Joe's Camry solenoid. 3. Complete Peter's radiator job by noon. 4. Send tow for Martinez' Nissan @3PM...

 

As customers come in, give yourself time to do the job right, throw in some precautionary words about when the job should be done by. "Mr. Jones, this job takes about 4 hours if everything goes well, but sometimes rust and other issues come up that may delay completing the work on time." Another one, is "We can get the parts in here in about an hour, but we cant be sure it's the right one until we have it here in our hands..."

 

Delegate and hold people accountable, i.e., "Mike, don't forget that Mr. Peter's car is due by noon". If you know that your employee makes excuses for everything and freezes when something comes up with the job, add instructions. "Mike, if you have any issues with that radiator, or need anything else to complete the job that you can't handle, tell John so he can order the parts or give you further instructions..."

 

If the shop is very busy and can't spare anyone at the moment and Ms hottie comes into the shop needing her car's tire pressure check, say no diplomatically. "Hello, Ms hottie, it's good to see you, at the moment everyone is tied up, but if you have 30 minutes to spare, I can check the air on your car's tires." If she insist to do it right now, say you cannot at the moment, but gladly will do so when someone is available. Trust your gut, don't be a push over. Unreasonable customers like to stay unreasonable.

 

Make sure you lead, don't waffle. If you know you can't, then don't. If you know you can, then do. If there are uncertain issues, then let the customer know.

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First I would ask, how are you billing out the jobs? Are you billing out the correct amount of time ? What labor guide are you using? Do you overlap your labor a lot?

I bill my jobs based on the Michell estimator. i also add 10% on top for cleaning, painting, gasket removing, broken bolt removal ext.. also i try not to overlap labor, like if estimator for spark plugs are 1.2 and wires is 1 i put 1.2 on spark plugs and wire.

 

 

Also, is there a reason you believe the problem is related to parts delivery?

What is happening with parts deliveries that is causing you to think that

is a big issue? For example, if your tech is waiting on a part, what is he

doing while he's waiting for a part delivery?

 

And when you say you feel like you just ran around like crazy... what is

it specifically you are referring to?

 

I am the only one doing the service writing and the shop is pretty big. It should be a 2 SW and 4-6 Tech Shop. but i cant even keep 3 tech doing 40 billed hours each so why add one-two more techs and one more SW. So i have noticed that after ordering the parts from local parts suppliers they have been

coming in late and we did not have a a parts tracking system in place. i don't have time to keep track of delivery time and parts arrivals. I'm constantly putting out fires front to back.. I'm also a master tech so as much as I'm tying to avoid getting involved with the back i get sucked in it . So i get backed up in the front. This past week i hired a kid (21) to keep track of the parts ordering and his is in charge of putting all the parts in place to for the repair orders. policy is that the parts must arrive within an hour or he must call and push the parts supplier to for the delivery. You just cant rely on the parts suppliers they forget consistently and i end up finding out 2-3 hours later. its just hurting my production.

 

 

 

1. Learn to anticipate.

2. Learn to delegate.

3. Learn to say NO.

4. Learn to hold people accountable.

5. Learn that not everything is an emergency, and not everything needs to be done immediately.

6. Grow a thick skin, and don't fall for googly eyes.

7. Plan your work.

 

Some times i think I'm such a nice guy, this might be one of the issues... so everything in this list i will need to implement ASAP

Edited by uniautoser
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I gotta be honest with you. Based off what your saying, you need to fire everyone and start over. Sounds harsh right? Well, your basically bankrupt from what your billing out now, I can't imagine how your able to pay your techs,staff, OR YOURSELF.

 

First thing you need to do is stop being a mechanic and work ON YOUR BUSINESS. Your not going to have a business pretty soon. Let's address the problems your sharing one by one.

 

3 techs and 65 hours is bs. Is that total hours billed or per tech?how are you paying your techs? Do you have great techs? The way my shop was ran before I took over was 3 techs, 1 porter, 2sw, 1 shop gopher.

 

When I took over and made changes, I got rid of 1 tech, 1gopher, paid the other 2 techs better and switched them to hourly at a higher rate. They can crank out hours if the work is there. They are great techs and I want them happy. I also do a bonus if the shop hits over its monthly nut (that nut includes in the 20% off of the gross that the owner wants in addition to what he his salary is. Everyone gets a big bonus if we hit that, including the SW's and gopher.

 

If your parts suppliers are having to be called to see where your parts are,time to get a new supplier. Are you ordering from a commercial retail place or Orylies/auto zoo? It sounds like Orielurs/auto zoo if you have to keep calling.

 

Are you keeping the fast moving parts in stock? Do you work on everything or specialize? Me personally, I only work on a few car lines that I'm tooled up for with factory scanners and service info, and can keep parts stocked for. I order a ton from world PAC but get deliveries every 45-50 mins.

 

You need to hire someone to replace you. If you need to be in the shop, the hire Someone to run the office. Or hire someone to run the floor and hire someone to work the office while you figure out the roadblocks, fix them and have set SOP for your staff to follow.

 

If you know your a nice guy and can't get your people to do what you want, that's fine. It's great that you know that about yourself. The owner was here. You earn respect, but if they aren't doing what you want, hire someone that will make them and not be emotional about it. It is your business and lifeline.

 

What's your ARO? Have you figured out your effective labor rate? Good techs don't cost you money, neither does hiring more staff if that's what's needed. Figure out what's slowing you down and charge more.

 

 

In your example above, if book is 1 for plugs and 1.2 for wires, you should be charging 2 hours minimum for both, not the higher of the 2. Offer amazing service and quality parts with a great warranty and your customers won't even notice that you charged 2 hours. It's a guide, not a bible.

 

I have it set up to bump up the labor on all my charged jobs. If book calls for 1 it bumps it up to 1.3 automatically. You gotta realize that you got to get paid for your office staff as well when they look up estimates,answer phones, ect, that cost money.

 

Just some thoughts, answer the questions and everyone will chime in. You sound like your working way too hard for way too small of a return (bankruptcy based off what you shared).

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  • 2 weeks later...

What do YOU want to do in YOUR shop? If it is work on cars - HIRE a Service Writer and go work on cars. In my shop I think this is the BEST WAY, but I still enjoy working on cars and not listening to the whinging at the front desk (I was back in the shop singing along with the music happy as could be for awhile last week!). On the other hand, if you like the front desk and feel you have better control up there (but I bet like me you roll too much labor together and give away too much billable work! Seriously, it DOES take longer to change plugs AND wires than just to change plugs...) then you need to add some accountability to someone in the shop and stop trying to be shop foreman AND service writer. That will just wear you out! I think hiring a Service Writer was one of the best things I ever did!

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  • Have you checked out Joe's Latest Blog?

         5 comments
      I recently spoke with a friend of mine who owns a large general repair shop in the Midwest. His father founded the business in 1975. He was telling me that although he’s busy, he’s also very frustrated. When I probed him more about his frustrations, he said that it’s hard to find qualified technicians. My friend employs four technicians and is looking to hire two more. I then asked him, “How long does a technician last working for you.” He looked puzzled and replied, “I never really thought about that, but I can tell that except for one tech, most technicians don’t last working for me longer than a few years.”
      Judging from personal experience as a shop owner and from what I know about the auto repair industry, I can tell you that other than a few exceptions, the turnover rate for technicians in our industry is too high. This makes me think, do we have a technician shortage or a retention problem? Have we done the best we can over the decades to provide great pay plans, benefits packages, great work environments, and the right culture to ensure that the techs we have stay with us?
      Finding and hiring qualified automotive technicians is not a new phenomenon. This problem has been around for as long as I can remember. While we do need to attract people to our industry and provide the necessary training and mentorship, we also need to focus on retention. Having a revolving door and needing to hire techs every few years or so costs your company money. Big money! And that revolving door may be a sign of an even bigger issue: poor leadership, and poor employee management skills.
      Here’s one more thing to consider, for the most part, technicians don’t leave one job to start a new career, they leave one shop as a technician to become a technician at another shop. The reasons why they leave can be debated, but there is one fact that we cannot deny, people don’t quit the company they work for, they usually leave because of the boss or manager they work for.
      Put yourselves in the shoes of your employees. Do you have a workplace that communicates, “We appreciate you and want you to stay!”
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