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Posted (edited)

Stop subsidising other industries and charge your administrative fees!

 

For example if you do towing and you have to write out a check to pay towing fees to other providers, charge an administrative fee.

 

Data entry, getting all details correctly and chasing down paper costs money. We charge a $25 to $35 fee depending how much time the clerk has to spend working on the case.

 

You should have a line on your billing system so your clerk automatically ads the admin fee when they process the payout to the other service provider.

Edited by HarrytheCarGeek
  • Like 1
Posted

We charge a standard mark up on towing or any other sublet work. The way I see it not to sound rude, but I don't do anything for free (of course we do free inspections and some diag time is free, but you get what i'm saying). If I have to put my money out there (sometimes 30-60 days with some company's) and wait for you to pay me back then I'm going to add a fee to this. If I'm not making a profit on it I don't see any reason in waisting my time messing with it.

Posted

We charge a standard mark up on towing or any other sublet work. The way I see it not to sound rude, but I don't do anything for free (of course we do free inspections and some diag time is free, but you get what i'm saying). If I have to put my money out there (sometimes 30-60 days with some company's) and wait for you to pay me back then I'm going to add a fee to this. If I'm not making a profit on it I don't see any reason in waisting my time messing with it.

 

Doing complementary work is not a problem, but it has to be understood that it is complementary and it does cost money as it draws from revenue generating time. I am 100% with you there.

Posted

UGH, I have a customer who bought an extended warranty that pays for 3 oil changes a year... Guess who gets to call and orchestrate that whole ordeal. Better believe that oil change is going up at least $15

Posted

We mark up local tows from $10 to $25. Longer tows we add $40 or more. I don't own a tow truck, but with my phone I call Tow #1, occasionally Tow #2, and seldomly Tow #3. As far as the Admin fee goes, I would rather work it into the repair order. That way "No questions asked." Usually. Arranging towing can be a pain sometimes, so I charge for it accordingly.

 

When I enter my weekly data into my sales grid, I look for a pleasing profit on sublet work. IE, I sent a truck dealership diesel tech on a service call last week. I was charged $619, so I charged $889, and have already been paid. If it makes sense to me, then it makes sense. It helps the bottom line.

Posted

We charge a nominal shop supplies fee. A percentage of labor that caps at $10.00. How many of you guys flash update controllers? We do a bunch. I usually charge a data fee per flash update, but I was wondering if it wouldn't be better to charge a small data fee to every repair ticket, akin to the shop supply fee. Thoughts?

Posted

We charge a flat fee of $15 shop supplies fee to every ticket that has a part on it. Now the nature of a Diesel Shop differes though. Our Average RO is $1,250 so I don't think we have ever been questioned about the shop supplies. On tickets under say $50 (very rare for us) I would wave the shop supplies. We also flash update controllers. Again it's just a flat fee of $100 to update a controller. I don't see the need in breaking it down to a data fee and a flash fee. Leaves room for customer to question why he's being charged X dollars for a data fee. When at the end of the day he doesn't mind paying the $100 it's just a matter of wording.

Posted

ADP is right on it, its all about the wording, or presentation. Less detail, to a point is less to argue about. I think all sublet needs to be marked up. It costs time and money to set up towing, or sublet work, then pay for it and wait for your money. Also I recommend the phrase "job supplies" over shop supplies. The customer is more willing to pay for stuff you use on his vehicle, shop supplies sounds like he may be sponsoring supplies for the shop. I also like to type in some itms used on the particular ticket, like dielectric grease, m.a.f. cleaner, convoluted tubing., etc. This meets with no arguements, or resistance.

Posted

We charge 5% of labor for shop supplies with no cap. I asked my guys today if they ever remember a customer complaint and they replied no. As far as sublet, we divide by .75 for a 25% GP. Sublet would include mobile reflashing, towing, wheel repairs, windshields, and machine shop labor.

  • 4 weeks later...
Posted

We call the same company for all our tows and pay them on time no matter what. In return they give me a discount. The cost to the customer is the same. It's a win/win/win for everyone.

 

In the end everything you do for your customers needs to be billed. Even charities take a cut.

  • 1 year later...
Posted
On 2/6/2017 at 4:27 AM, alfredauto said:

We call the same company for all our tows and pay them on time no matter what. In return they give me a discount. The cost to the customer is the same. It's a win/win/win for everyone.

In the end everything you do for your customers needs to be billed. Even charities take a cut.

This is a smart way to do business, negotiate a volume discount with vendor, charge customer the "normal retail" price, pocket the difference, or even give the customer a small discount and pocket most of the difference.

Vendors love volume, and it's worth it to them to give discounts to keep you coming back, not to mention they give premium service and other perks to larger accounts.

It's also very true about charities and non-profits. Their people still need to get paid just like anyone else, they just don't get the remove profits from the business at the end of the year.

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  • Have you checked out Joe's Latest Blog?

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      The Technician Shortage Is Our Fault, And It's Time We Own It
      Nearly every day, I hear shop owners complain: "There's a technician shortage. We can't find qualified people. There's no one out there." If that's true, then who's to blame?
      The industry? The schools? The government? I don't know how you feel, but who promised us an endless supply of qualified technicians?
      Another common complaint is that young people do not want to work in the trades. Well, if that were true, then why are other trades such as HVAC, electrical, and plumbing growing? What are they doing that the automotive industry is not? 
      Here's the reality we need to face: We do have a problem, but we shouldn't look for someone or any entity to rescue us. Not the government. Not the trade schools. Not the recruiting companies. No one owes us a workforce. If we want great people in our industry, it's up to us. At some point, we need to own up to the truth: Building a pipeline of qualified technicians is our responsibility.
      In this blog article, I will break down the key reasons we are in this situation today and what we, as an industry, can do to solve the technician shortage. Are you ready to look in the mirror?
      Have We Pushed Technicians Away?
      Let's take a look at flat-rate pay. True flat rate, which pays a technician only for the hours they produce, is a controversial pay plan that emphasizes high production levels and creates a competitive work environment that, if not properly controlled, can lead to increased mistakes and a decline in morale and team spirit. Additionally, the stress and physical demands placed on technicians as they age are not favorable to long-term employee retention. What do we do with technicians as they grow older into their fifties and begin to slow down? 
      I have heard all the arguments and pros and cons of flat-rate pay, and I am not going to judge any pay plan. Let the facts speak for themselves. True flat rate has changed in most areas around the country and has evolved into a pay plan that gives technicians some pay guarantee.
      Many shop owners have learned that team morale, along with the opportunity to earn income, is important to technicians and to the company's long-term success. But let me ask you: how many technicians have left or been pushed out over the years because of the old flat-rate pay system?
      Another issue is the workplace environment. I remember being grateful to be hired as a young technician at a local repair shop. While very thankful, the work environment was not ideal. The shop owner kept the bay doors open year-round (I am from New York) unless it rained or snowed. He felt that if the bay doors were closed, customers might think we were closed for business. We had no heat and no hot water. Many of the jobs were done outside, year-round,  in all types of weather. The starting pay was minimum wage, with no benefits, sick days, or vacation pay. 
      Now, again, I need to point out that I was truly grateful for the opportunity this shop owner gave me. I learned a lot working there, and the experience was pivotal in my career. But looking back, I wonder how many people were discouraged by these working conditions?
      While the physical demands of the repair workplace are daunting, perhaps even more critical is the culture. Too many of my generation shop owners preached the mindset of "my way or the highway." We were the business owners, after all. We started our companies, took all the risks, and provided jobs. Why shouldn't we be the ones to set the ground rules our way?   
      Many of us found over the years that the "my way or the highway" mentality was a sure way to isolate employees and make them more likely to look over the fence for greener grass. In other words, it led many technicians to seek employment elsewhere, where they felt they could be appreciated and recognized for their hard work. The issue, however, was that there wasn't much green grass around. Disappointment after disappointment, bouncing from repair to repair shop, eventually led to despair. So, I ask you: were workplace conditions a contributing factor in today's technician shortage?
      Another factor that we are all well aware of is the complexity of the modern automobile. When I started, the work was mostly physical, and you were required to master essentially three vehicle models: General Motors, Ford, and Chrysler. Let's fast-forward to today. The evolution of automotive technology, along with the extensive training and tools required, has outpaced the typical technician's pay compensation, with no clear career path. Again, leading to frustration and insecurity about the future.
      Here is the bottom line: people don't leave their job; they leave their experience. We must do a better job. 
      The News Isn't all Bad; Your Next Steps to Fix the Technician Shortage
      To fix the technician shortage, it will take a combined effort from everyone in the automotive industry, particularly automotive shop owners. Shop owners are in the perfect position to make the greatest impact, not only on their businesses but also on the future automotive workforce.
      First, shop owners must become better leaders and understand that their ultimate success is directly dependent on the people they assemble around them. Any shop owner who mistakenly believes they can build an empire solely on their abilities is destined for serious disappointment. Business owners who think like this will eventually plateau. Without the collective contributions from a team of qualified people, your business will stall; it will not continue to grow.
      Create a workplace that attracts top talent: a clean, professional, well-equipped facility designed to support productivity, teamwork, and a career, not just a job. Build a great reputation in your community by getting involved locally. Become the auto repair shop that people take notice of as "the" place to work.
      Next, shop owners must become more financially knowledgeable. Knowing your numbers and what you need to achieve for a strong bottom-line profit is essential to paying technicians the money they need and deserve. Profit will also allow you to compete with other trade industries by providing a benefits package that has real take-home value and security.
      When it comes to culture, this is where the rubber hits the road. People crave recognition, praise, and a sense of purpose. Despite what you hear, people are not just money-motivated. Once people feel secure in their financial situation, retaining and motivating technicians can only be achieved by connecting with them on an emotional level. You cannot show enough appreciation. Give out praise for a job well done as if your business depended on it, because it does.
      As technicians age, we need to have a place for them. Expecting a 58-year-old to perform like a 35-year-old is unrealistic. We need to be more focused on career pathing. Provide training, skill development, and coaching to develop leaders and mentors within our older workforce. While their bodies may have slowed, the knowledge they have gained is priceless. 
      Our future is dependent on young people entering our industry. We need to give more young people opportunities. Every shop owner across the country should consider hiring an apprentice, then build an apprentice training plan and career path for them. If every shop did this, we could solve the technician shortage within five years. Get involved with the trade schools and high schools in your area. Look into the NAPA Apprenticeship Program. Don't sit on your hands with this one. Do it today.
      Lastly, don't get left behind. Commit to ongoing training for all your employees. Keep up to date with tools and equipment tailored to your business model. Don't try to be all things to all people and all vehicles. Identify your core profile customer and the vehicles they drive, and become an expert on those vehicles and the services you offer.
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