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Ken Christie is the Chief Financial Officer of the Australian Bank division of National Australia Bank (a global top 25 Bank), his role is responsible for driving the financial performance and oversight of the Consumer, Business and Private Bank, Wealth division and Customer Experience and products division in Australia. In addition to this fulltime role, Ken is a passionate car owner and collector and has a 50% equity ownership in an Independent BMW & MINI workshop in Melbourne Australia “BM Performance Centre”. This ownership with Mark Higgins blends his passion for cars with that of building and growing a small business.

He has an Undergraduate Degree in Banking and Finance from Victoria University, an MBA from Melbourne University and is a Graduate of the Advanced Management Programme at Harvard Business School. His passions outside of work include snow skiing, car racing, and vehicle restoration and spending time with his family. As a side note, his passion for skiing has led him to pass his level 1 and 2 Canadian Ski Instructor exams.

Mark Higgins is the Co-Owner of BM Performance Centre and is an experience BMW Mastertech. His experiences have brought him to New Zealand, US, and the UK. He is already in the business for 8 months and has set the roles and responsibilities of the shop. He has worked before as a workshop manager and a BMW Diagnostic Technician.

 

Key Talking Points:
  • The shop opened 6 months ago in Williamstown, Victoria, AustraliaKen Cristie- CFO of Australian Bank but has a passion for his car collection
  • He wanted to create a BMW and Mini’s specialty shop.He races a BMW M3 
  • Mark Higgins- Partner in business from answering an ad. He has been around BMW’s his whole life.
  • Business plan:Exclusive BMW operation
  • Ken found his partner via an ad placement
  • They built a business case and as a CFO. Ken was very familiar and Mark thought it was  
  • Their labor rate is $175. The dealerships are $240 – $280. General shops in Australia is prox $130
  • Building a long-term sustainable business.
  • ChallengesA consistent flow of customers and earning their trust
  • MarketingKen and Mark often go to malls and put flyers on cars in parking lot to attract new customer attention
  • They are getting 5-star reviews on Facebook
  • Australia aftermarket:Techs go through 4-year apprenticeship- then qualify to start 50-55k salary (40k US Dollars) Often only learn to do oil service/brakes at dealerships 3
  • Tech shortage- veterans struggling with new technology, new techs losing interest.
  • They are looking for techs from the UK to come here on work visas.
  • Australia has low unemployment.
  • Australia imports their vehicles.
  • BMW is the second popular vehicle in their area. Mercedes, Toyota, VW, GM, and Ford are in the top.
  • OE information is slowly trickling out to the aftermarket.
  • Mark is getting help from friends in the dealership network to get information to repair vehicles.
  • Technicians must go through an apprenticeship like the UK.
  • Legacy technicians are getting disenchanted as the new technology is coming at them so fast.
  • Parts margins and parts pricing are a challenge. They are trying to maintain a 40% margin.Off the scale compared to the UK.
  • A new key in the UK is about $150. In Australia $700.
  • They are looking for partnerships from parts suppliers
  • BM performance experience is a program they run at the shop.They adopted STEM ideas they heard from the podcast at their shop.
  • For customers that want to understand how their cars are serviced and the electronics, diagnostics, sensors etc in vehicle
  • Customers can watch service being done live, no charge for a customer to experience the service that is differentiation in the market.
  • Customers are fascinated by the diagnostic process and how the car works.
  • They had a BMW car club in the shop in on an evening with about 30 people.
  • Immigration policyUndergrad degree (have a trade), under 30 years old, no children or dependents- open immigration
  • Skills-based assessment and points system 
  • Australian Aftermarket ShowSimilar to AAPEX
  • Held every 2 years
  • Key suppliers-  oil, part supplies
  • Technical sessions to attend
  • Australia has the same land mass as the US with 25 Million peopleWill grow to 41 Million by 2040
  • It takes 24 hours air flight from New York to Australia

 

Resources Mentioned:

  • Thanks to Ken Christie and Mark Higgins for their contribution to the aftermarket’s premier podcast.
  • DOWNLOAD: Spreadsheet ‘BM Performance Cash Flow Spreadsheet HERE.
  • BM Performance Centre Website HERE.
  • Link to the ‘BOOKS‘ page highlighting all books discussed in the podcast library HERE. Leaders are readers.
  • Leave me an honest review on iTunes. Your ratings and reviews really help and I read each one of them.

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Be socially involved and in touch with the show:

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This episode is brought to you by Federal-MogulEpisode-Logo-Sponsored-By-v1-300x93.pngMotorparts and Garage Gurus. With brands like Moog, Felpro, Wagner Brake, Champion, Sealed Power, FP Diesel and more, they’re the parts techs trust. For serious technical training and support – online, onsite and on-demand – Garage Gurus is everything you need to know. Find out more at fmmotorparts.com and fmgaragegurus.com

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  • Have you checked out Joe's Latest Blog?

         0 comments
      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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