A Level Tech offered and accepted a $7 dollar/hr more and 10K sign on bonus

[BrianJeffrey]

I have a great that a new local import dealer is stealing away from me. He has been with me for almost 5 months. Great guy experienced, import certified, ASE Master. The new local dealer needs a certified tech like him, some sort of dealer requirements. I'm sure not the first to have this happen. Has anyone upped the labor rate to keep a tech like this and been successful? My thought is to raise the rate considerably. 10-12 per hour and also raise my warranty.

 

Anyone been in a similar situation?

 

Thanks in advance

[carolinahigear]

All of us know that good techs are hard to come by. If you like him and want him, then by no means let him leave. Just as we want our clients to be with us a lifetime, we should plan to keep our techs a lifetime, too!! Just as you set his pay rate, you are also in charge of invoicing his work at a premium price. I also have a tech that is very, very good, very dependable, agreeable, polite, personable and did I say he is very, very good at what he does??!! He is my highest paid tech, and I charge more for his work. I make sure that i charge enough hours at enough rate to pay him well and make a premium profit on his work. He has been with me for nine years.

[BrianJeffrey]

Thanks for the info! I have a hard time figuring out what that premium price should be and stay within "the going rate". My concern is pricing myself out of the market. Our town is about 45,000 people with lots of competition.

[mspecperformance]

What were you paying him and what is your labor rate?

[BrianJeffrey]

24 hourly the rate was at 73. I know its low.

[skm]

What other benefits did you offer him? Is it possible that he is getting some very good health and retirement benefits from the dealer as well? I know that where I work I have been there 26 years. I get 191.00 towards my health insurance which is over 600.00 a month, and I only get 10 paid days off a year and no retirement what so ever.. After 26 years I am probably a very bitter person about this but I won't work for a dealership so I guess I am stuck with what I have..

[BrianJeffrey]

120 toward tools/ ins month, pd holidays, simple IRA company match & week pd vacation after 1 year, company uniforms, pd training. Any unpaid time off needed. He enjoys working here with our team. Has a kid starting college this fall also...

[tyrguy]

I haven't hired a tech in 22 years. Currently at $34/ hr billed with a minimum of $938 per week. Insurance contribution $850 family/ $425 single / mo. 3 weeks paid vacation, uniforms, unpaid time off as needed. My first tech [also my first employee] just retired to a home business after 36+ years with me. Attempting to go forward with just 2 service techs and 2 tire techs.

Edited October 13, 2016 by tyrguy

[HarrytheCarGeek]

By my rule of thumb, that $7 would translate into a $21 per hour labor rate increase.

 

There is no free lunch in our business, you know that we are subject to the ebb and flows of the market demands. If you have not planned your marketing and seasonal flow well, having a valuable employee cleaning the shop could prove a very painful experience.

[mspecperformance]

I haven't hired a tech in 22 years. Currently at $34/ hr billed with a minimum of $938 per week. Insurance contribution $850 family/ $425 single / mo. 3 weeks paid vacation, uniforms, unpaid time off as needed. My first tech [also my first employee] just retired to a home business after 36+ years with me. Attempting to go forward with just 2 service techs and 2 tire techs.

 

What is 34 hr billed with minimum of $938 a week mean? Hourly rate of $34 and a minimum of $938 weekly pay even if hours arent met?

[mspecperformance]

24 hourly the rate was at 73. I know its low.

 

That is a low hourly rate. Your tech pay ideally should be 30% of your total labor sales max. That would equal to a $80/hourly. Then you need to factor in room for everything else built into his pay including benefits, insurance, comebacks, etc.

[tyrguy]

 

What is 34 hr billed with minimum of $938 a week mean? Hourly rate of $34 and a minimum of $938 weekly pay even if hours arent met?

I pay my techs $34/hr for every flat rate billed. If it's a slow time I pay them a minimum of 60% of that rate or $20.40 /hr worked. They work 44 hours a week so 40 hrs x $20.40 + 4 hrs x $30.60 = $938.40. They get whichever is higher. The hours at which it flips from hourly to flat rate is 27.6 hours. With three techs over the last few years, I was paying a lot of minimum weeks but now with only 2 techs, they rarely get paid hourly.

[BrianJeffrey]

Thanks for all your info. It is greatly appreciated. I spoke with my Tech that left he said he needed to at least give it try for that kind of money. Just a money thing he said. I told him if he didn't fit he was welcome back here.

 

mspecperformance, Do you have a formula or benchmark you use to calculate in the benefits, ins and comebacks. I have raised my rate FYI. We did a rate survey and found that we were not the lowest but were the average.

 

I do like the hourly rate and then the billed hour pay. I am working on something similar. I assume at the 27.6 hours is break-even for the Tech?

[tyrguy]

Thanks for all your info. It is greatly appreciated. I spoke with my Tech that left he said he needed to at least give it try for that kind of money. Just a money thing he said. I told him if he didn't fit he was welcome back here.

 

mspecperformance, Do you have a formula or benchmark you use to calculate in the benefits, ins and comebacks. I have raised my rate FYI. We did a rate survey and found that we were not the lowest but were the average.

 

I do like the hourly rate and then the billed hour pay. I am working on something similar. I assume at the 27.6 hours is break-even for the Tech?

The break even point depends on how many hours they work.