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I do a lot of aftermarket work for the local dealerships and body shops. Most are 15 day net terms but others are getting stretched out pretty far. 10th of the following month, lost invoices, amount billed is less than estimate, no one is here to sign the checks. That PO was closed and you need a new number. The crazy excuses just keep on coming.

 

So my question is how do I break this cycle and encourage prompt payment? I do not want to discount a lower than normal Profit margin. And setting late fees may turn business away. Unfortunately it is a big part of my business.

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I deal with it some myself, Biggest thing is no Net terms anymore, you pay with a credit card or check when you pick the vehicle up, I don't care if it's a huge dealership or not. If you can't hire techs competetant enough to do everything in house and need me to do stuff, these are the terms.

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Agree, I have 1 customer who I let charge a balance and it's been an ongoing nightmare. Luckily his car broke down last week and he towed it to me. I explained to him that we could not do any work until his balanced was paid in full. It's probably gonna be 2 months before he has me paid off, but it's the last time I'll let someone charge a balance with me, including dealerships.

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I deal with it some myself, Biggest thing is no Net terms anymore, you pay with a credit card or check when you pick the vehicle up, I don't care if it's a huge dealership or not. If you can't hire techs competetant enough to do everything in house and need me to do stuff, these are the terms.

Ditto. Bring a check or credit card at time of pick up.

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  • 1 year later...

I stopped accepting personal checks about 1 1/2 years ago. Unless it's someone I feel comfortable taking a check from. After one really big delema, I learned that writing "bad checks" is almost a legal way of stealing. Most of the time it's not worth going to court over. Sad world we're living in.

Sent from my Chromebook 11 Model 3180 using Tapatalk

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  • Have you checked out Joe's Latest Blog?

    • By Joe Marconi in Joe's Blog
         4
      Typically, when productivity suffers, the shop owner or manager directs their attention to the technicians. Are they doing all they can do to maintain high billable hours? Are they as efficient as they can be?  Is there time being wasted throughout the technician’s day? 
      All these reasons factor into production problems, but before we point fingers at the technicians, let’s consider a few other factors.
      Are estimates being written properly? Are labor testing and inspections being billed out correctly? Are you charging enough for testing and inspecting, especially for highly specialized electrical, on-board computer issues, and other complex drivability work?  Is there a clear workflow process everyone follows that details every step from the write-up to vehicle delivery? Do you track comebacks, and is that affecting production?  Is the shop layout not conducive to high production? For example, is it unorganized, where shop tools, technical information, and equipment are not easily accessible to every technician?  Are you charging the correct labor rate and allowing for variables such as rust, vehicle age, and the fact that most labor guides are wrong? Also, is there effective communication between the tech and the service advisor to ensure that extra labor time is accounted for and billed to the customer? These are a few of the top reasons for low productivity problems. There are others, but the main point is to look at the entire operation. Productivity is a team effort.  Blaming the techs or other staff members does not get to the root cause in most cases.
      Maintaining adequate production levels is the responsibility of management to create the processes that will lead to high production while holding everyone accountable. 
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