By Joe Marconi
There is a large repair shop in the mid Atlantic states (they want to remain anonymous) that just formed an alliance with a local new car dealer to service their used cars. I will change some of the details; a request from the shop owner. But, the story brings up a few interesting facts. And, the big news is: This shop is profiting from this relationship!
The shop owner was approached by the GM of the dealer to service some of the used cars they have been taken in on trade and want to sell. The dealer techs are not trained and not familiar with the different car lines, being a Chrysler-only dealership. Due to the shortage of cars these days, the dealer is taking in on trade, all makes and models and wants to sell the used cars. And we all know profitable used cars are.
The repair shop performs a multipoint, which they get paid for, and then they do many of the services and repairs, which includes tires, brakes, wheel alignments, oil changes, air and cabin filters, wipers and other simple services. Most of the cars are newer cars, and the work can be done by a GS tech.
I don't know the pricing, sorry. But, I am interested to see where this goes.
Imagine, a new car dealer asking an independent repair shop to service and repair their used car fleet???
By Joe Marconi
One of the lessons from COVID is for repair shops to have a strong cash reserve. Shop owners need to budget their money each week, and allocate money to different bank accounts, such as payroll, operating expenses, taxes, etc.
Another account I would recommend is to have a Cash Reserve account, where money is allocating each week, and not touched unless their is a emergency, such as an economic downturn and or if an economic emergency occurs in your area or with your company.
While no one could have predicted the affects from COVID 19, I think we can all agree that being cash strong is a viable strategy.
You should have anywhere from 3 to 6 months of covered expenses in a separate bank account. I know, I know....it's a lot of money. Start slow and build each week. Anything set aside is better than nothing.
Of course, to have a reserve means that you need to have the profit to put away. Right? Well, another reason to know your numbers, revisit your pricing and make sure your labor rate is enough to support your payroll, operating expenses and have enough left over to set aside money for the unexpected.
Trust me, you'll be glad you did.
John Eppstein, owner of John's Automotive Care, San Diego CA has been in business since 1998. The business is a complete general automotive repair and a smog test station. John’s Automotive Care has been relocated twice; the last move was in 2003. John has been in the automotive industry since 1985. He is the Immediate Past President of the B & G Clubs of East County where he's worked since 1996. He is also a member of a local NAPA BOG group. John's been a member of ASCCA's Chapter 24 for over 12 years during which time he has served as secretary, vice president and chair of the Meetings Committee. John's Automotive Care is also currently an ASC Educational Foundation Cars for Careers donation site for San Diego, CA. Listen to John's other episodes HERE
Dave Kusa is the owner of AutoTrend Diagnostics in Campbell, CA. Dave is very active in Chapter 42 and currently serves as a board member and chapter representative. He has also helped several new shops become ASCCA members. Dave advocates with local legislators on behalf of small businesses and their employees. He contributes to TeamTalk and is a huge resource for members. He was ASCCA’s past president. Look for Dave’s other episodes HERE.
Key Talking Points
Purpose - Raise funds and money to support and encourage technical education and training for the automotive industry through scholarships, endowments, career development and other industry inspired programs. Vehicle donations from customers that go to auction- “cars for careers” Example- transmission/engine repairs. You are able to donate a vehicle no matter where you are, it’s not limited to only California Low overhead- about 75% of the money coming in from the vehicle donation program gets put into funds. Volunteer-based foundation. You don’t need to be a shop owner to be included in the board of trustees (tax advisor, grant writer etc) Last year they awarded 28 scholarships to 16 deserving students for a total of $23,500. To date, this is the largest amount awarded in the history of the Foundation. Schools involved - community colleges across California such as Cuyamaca College, Skyline College, Rio Hondo College, San Diego Miramar College, Citrus College, Chabot College, UTI Vetting process – Scholarships are awarded to students who fill out applications at https://automotivescholarships.com/ all applicants that meet basic requirements are then scored by a panel of automotive professionals and winners are picked from the highest scoring applicants. Opportunities to create a scholarship- John has started a scholarship with his business. He will match whatever his employees put into it. There are also one time scholarships for smaller amounts.
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By ASOG Podcast
Brian Walker of Shop Market Pros explaining what makes them different at the TOOLS Conference 2021.