By Joe Marconi
Not every shop pays flat rate; for many reasons. So, many techs are on hourly pay. There is nothing wrong with hourly pay, as long as you have an incentive program in place that promotes high production levels to avoid complacency. For hourly paid employees I strongly urge you to have a pay plan that rewards production levels on a sliding scale.
As a business coach, I have seen too many times shops with low production levels and high tech payroll due to overtime pay. Overtime pay must not be used to get the jobs done with no regard to labor production. Limit overtime and create a strategy that increases production and rewards techs with production bonuses. By the way, there are many ways to incentivize techs, it's not all about money.
Overtime without high levels of production will eat into profits and if not controlled, with kill your business.
If your shop is an hourly paid shop, what incentives do you have in place to maintain production levels?
By Elite Worldwide Inc.
Elite's AMI accredited Online High Impact Course, sponsored by Jasper Engines & Transmissions, starts October 16th!
This industry acclaimed online service advisor training course is delivered by 2019 Ratchet & Wrench All-Star Award winner Jen Monclus, and has been proven to generate both happier customers and higher sales.
Here are a few of the topics that will be covered:
- Selling multiple repairs & big ticket items
- Selling diagnostic testing & maintenance
- Building powerful relationships in 60 seconds
- Overcoming the most challenging sales objections
- Generating more repeat and referral business
- Presenting service recommendations in a way that makes customers want to buy
- Note: Course will come with a workbook, homework assignments and testing to ensure accountability and lasting results
It's only $179 to enroll, and seating is limited, so call 800-204-3548 or visit our Online High Impact page to secure your advisor's spot today!
USA Today article (Friday September 27, 2019 by Nathan Borney - USA Today) shows that “the average age of cars and light trucks on U.S. roads reached an all time high of 11.8 years in 2018.”
The article goes on to claim... “By 2023, there will be about 84 million vehicles on the road that are at least 16 years old, reflecting a 240% increase from 35 million in 2002, according to IHS.”
Are you getting your share?
There’s only 90 days left in 2019 and the market is changing. Sorry, it HAS changed. Are you ready? Do you have your plans laid out for marketing your shop in 2020?
Auto Service Marketing - Fix Your Car Count FAST!
Hope this helps!
"The Car Count FIxer"
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I soon will need to setup a system to accept online payment as well as mobile person to person payments.
I run a equipment repair and inspection business and will shortly be working with a auction company and there customers. I have up till now only accepted cash or checks.
I need a mobile solution that i can take credit card payments and online. Can someone help me figure out a solution? Im really just not sure what too look for.
Thank you for your time
The average age of light vehicles in operation in the U.S. has risen again as consumers continue to hold onto cars and light trucks longer.
Driven by technology and quality gains, the average age of light vehicles on U.S. roads is 11.8 years, based on a snapshot of vehicles in operation Jan. 1, an analysis by IHS Markit found. That's up from a light-vehicle population that was, on average,11.7 years old in 2018.
The number of registered light vehicles in operation in the U.S. hit a record of more than 278 million this year, an increase of more than 5.9 million, or 2.2 percent.
IHS Markit began tracking the age of vehicles in 2002, when the average age was 9.6 years.
"The average age of a vehicle has continued to grow ever since cars started coming out from Henry Ford's production line, if you will," said Mark Seng, director of the global automotive aftermarket practice at IHS Markit. "People are hanging onto them longer because they're lasting longer."
From 2002 to 2007, the average age of light vehicles in the U.S. increased 3.5 percent, he said, but from 2008 to 2013, the average age rose12.2 percent.
"We're kind of back to that same pace that we saw from 2002 to 2007," Seng said. "The average age of light vehicles in the U.S. accelerated so much because we were coming out of the Great Recession back in 2008 to 2009 and new light-vehicle sales fell like 40 percent over a two-year period. Even during the recovery years there were fewer vehicles being sold, so that just accelerated the average age of the fleets in the U.S."
For the first time, the analysis included a review of various regions around the country. The oldest light vehicles are in the West, at 12.4 years, an increase of 1.5 percent from a year earlier. The Northeast had the youngest light vehicles at 10.9 years, which increased 1.1 percent from a year earlier. Weather and road conditions, driving habits and household finances and affluence can have a major impact on the average age of vehicles in a state and region, IHS said.
IHS Markit found that the number of older cars and light trucks is growing fast, with vehicles 16 years and older expected to grow 22 percent to 74 million from 2018 to 2023.
In contrast, there were less than 35 million vehicles 16 years or older on the road in 2002, according to the analysis.
Seng said the growing number of older vehicles on the road provides more repair opportunities for dealers and aftermarket parts providers that focus on automotive service repair beyond warranty coverage.
"There's many more older vehicles on the road than there was in 2002, which means there's going to be all different kinds of repairs -- oil changes, brake jobs and new wiper blades -- that's going to be done to that vehicle cycle," he said. "That's more revenue opportunities for aftermarket repair people."
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By Joe Marconi
We all have those customers that focus on price alone. And we all struggle with our persistent attempts at converting them into believers. Believers of the concept that, while we cannot totally dismiss price, it’s the value of the product or service the customer needs to consider when making a purchase. What’s funny about these customers is that each visit tends to start with a complaint about price, even before the car is looked at. We recently had a situation that started off on the wrong foot, with price being the issue; but ended up a win for us, and for the customer.
Charlie Challenge (not his real name) arrived at our shop and asked for an estimate on replacing the timing chain for his Nissan Altima. My service advisor responded with, “Mr. Challenge, that’s a big job. How do you know your car needs a timing chain?” Charlie replied back, “Another shop checked it out and they told me it does. Can you please give me a price?” My advisor continued with, “Well, before we do anything, we need to perform a few tests to make sure you really do need a timing chain.” Charlie emphatically replied back, “And how much is that going to cost? All you guys want is my money! I asked for one thing; a price on a timing chain and you just want to make more money on something I already know I need!”
It took a lot of composure, but my advisor calmly stated all the reasons why testing is the best way to go, emphasizing the fact that if we replace the chain and it’s not the problem, the money spent would be wasted. Charlie shook his head, threw the keys on the counter and authorized the testing.
I’ve known Charlie for a long time. He’s not a bad guy. But price is always the topic of discussion. He has told me in the past that I should take a look at what other shops charge, and be more competitive with my prices. I have told Charlie that I don’t, and never will, price my services by what other shops are charging. I have also told him to look beyond price and look at the value you get. Besides, all the quality shops that I know are pretty much the same when it comes to pricing.
During the write-up process, Charlie revealed to my service advisor that the check engine light had been on, and that’s why he took his car to the other shop. The other shop replaced a valve timing solenoid, but that didn’t fix the problem. He was then told that the next step was to replace the chain.
Later that morning, the car was dispatched to a technician. A multipoint inspection was performed, along with all the tests related to the check engine light; which was a timing error. After the MPI and the tests were completed, we found a few things wrong with Charlie’s car. His Altima needed an oil change service, a battery, rear brakes, an air filter, the cabin filter had a mouse nest in it and the car needed an intake timing control sensor, not a timing chain. This engine has two intake control solenoids. One was supposedly replaced by the other shop. So, did this car have two bad sensors? Or was the wrong sensor replaced by mistake?
When my service advisor called Charlie to tell him the good news, he was silent for a moment. He was shocked that the car didn’t need a timing chain. He authorized the solenoid replacement, the oil change and replacing the mouse-infested cabin filter. He declined the other work.
I purposely did the follow-up call with Charlie a few days later. He was happy to hear from me and told me that car hadn’t run this good in years. I had to needle him a bit, “So Charlie, are we really expensive? We saved you a ton of money by doing the tests first and not just replacing the chain.” He said, “Ok Joe, I get it, I really do this time.”
During our conversation, Charlie did confess that he didn’t go to another shop, but actually went to that all-knowing, all-powerful place on the internet known as Google. It was Charlie that replaced the solenoid, not realizing there were two, and not knowing how to properly test the system either.
When I asked Charlie why he didn’t let us replace the battery, air filter and the rear brakes, he replied, “Joe, come on, I can do that work myself, and besides, you guys are expensive.”
Sometimes you win the battle, but it’s hard to win the war with some customers.
This story was originally published by Joe Marconi in Ratchet+Wrench on October 1st, 2019
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