MY Best Strategy To Running a Successful Shop

[Joe Marconi]

In the 4 decades as a shop owner, my number one way to have a smooth running shop is to surround yourself with the right people.

I am interested in hearing from other shop owners. What's your opinion on how to run a smooth running operation? 

[JimO]

 I have always tried to hire staff members that are knowledgeable for the work that we routinely do and share my same values and principles. General internal medical doctors send patients to specialists when their patients illness or symptom exceeds their knowledge base or experience level. The sign of a good doctor is that he/she sends you to a specialist when needed as opposed to trying to solve a problem without the proper background, training and or equipment. Can I possibly afford to hire a staff and set up a shop that could profitably repair any problem on any vehicle? The answer is that I could try but I could not accomplish this profitably. Recognize you shops ability and comfort level and NEVER allow your pride stand in the way of sending a job to the dealer. In general I think that too many shop owners feel that sending a customer to the dealer for a repair is the same as losing a customer. I know from experience that a trip to the dealer for an odd or complex repair increase our customers allegiance to us. Let the dealer keep the vehicle for ten days, charge the owner $2,000 for the repair only to have the owner return the vehicle multiple times because the problem is not fixed. Let that frustration and expense be associated with the dealer as opposed to me. Lastly, run a clean, well organized shop which maximizes productivity. 

[Hands On]

I always try to keep a tech on hand that can repair anything. When I do not have one I step into that role myself to deal with the difficult ones. I have a dealer around d the corner from me that sends cars to me. The key to staying profitable is explaining the diag fees up front and billing for your time accordingly. 

[Joe Marconi]

On 5/9/2021 at 1:22 PM, Hands On said:

I always try to keep a tech on hand that can repair anything. When I do not have one I step into that role myself to deal with the difficult ones. I have a dealer around d the corner from me that sends cars to me. The key to staying profitable is explaining the diag fees up front and billing for your time accordingly. 

I agree.  All too often diag testing fees are not adequate enough for the time, the training and the equipment needed in today's world. 

[newport5]

I agree with the right people, but also shop procedures. It's one thing to run a shop when it's slow; the owner or manager can "touch" everything. But when it gets busy and they can't get involved with everything in the shop, that's when procedures pay off.

That is, a happier staff and happier customers.

If something goes wrong often, create a procedure to lessen the stress.

[Hands On]

On 5/24/2021 at 2:42 PM, newport5 said:

I agree with the right people, but also shop procedures. It's one thing to run a shop when it's slow; the owner or manager can "touch" everything. But when it gets busy and they can't get involved with everything in the shop, that's when procedures pay off.

That is, a happier staff and happier customers.

If something goes wrong often, create a procedure to lessen the stress.

I would like to get procedures written for everything in my shop. It is something I really need to sit down and take the time to do.  I want to open a second location. Duplicating what made my first so successful is going to be crucial. If I am going to put my name on a second shop I want it to be held to the same standards as I hold my first.

[juanpablo4219]

On 5/28/2021 at 11:01 AM, Hands On said:

I would like to get procedures written for everything in my shop. It is something I really need to sit down and take the time to do.  I want to open a second location. Duplicating what made my first so successful is going to be crucial. If I am going to put my name on a second shop I want it to be held to the same standards as I hold my first.

Policies and procedures makes a big difference and how a business is successful or a failure. They should be aligned with the mission statement of the business

When we have written procedures, more than likely it's because something happened and was resolved. Policies and procedures reduced the amount of headaches for a shop manager or an owner.

...and Yes, the policies and procedures will confirm the success of the second location along with having the right people.

[rpllib]

The right people performing consistently has certainly been a key to my ability to have a life, while owning my business. Some of that, I have to attribute to a healthy dose of good fortune, throughout my career, but especially early on(first 10 years). It was securing a single A tech (started as a C tech) and a service advisor , both with the right attitudes and right work ethic, and keeping them for 25 years plus, that has made the biggest difference for me. Others have come and gone, but having a core team through it all, made an immeasurable difference for me. This is especially noticeable when I compare myself to other owners, who were never able to establish that long term "core team", that still work in their business's every day, and face difficult transition options to the next generation of ownership for their store.  

Some may call "good fortune", hard work and smart work, which fits in their somewhere, but that has little to do with having healthy key employees that wish to remain living in the area of my store, for their entire career.

For owners early in their career, I would suggest finding the right attitudes and grow together. Then start your transition planning a minimum of 10 years in advance of your intended transition time frame.  This will give you time to find the next gen team for your business, and grow together with them to a successful future for all.  

[bantar]

On 4/18/2021 at 1:48 PM, JimO said:

Recognize you shops ability and comfort level and NEVER allow your pride stand in the way of sending a job to the dealer. In general I think that too many shop owners feel that sending a customer to the dealer for a repair is the same as losing a customer. I know from experience that a trip to the dealer for an odd or complex repair increase our customers allegiance to us. Let the dealer keep the vehicle for ten days, charge the owner $2,000 for the repair only to have the owner return the vehicle multiple times because the problem is not fixed. Let that frustration and expense be associated with the dealer as opposed to me.

We certainly send people to the dealer for Warranty work, recalls and difficult jobs that need one-off specialty tools.   I've generally felt uneasy doing the latter, but I like how you framed this....  "Let that frustration and expense be associated with the dealer as opposed to me."   Thanks!

 

On 4/11/2021 at 4:53 PM, Joe Marconi said:

In the 4 decades as a shop owner, my number one way to have a smooth running shop is to surround yourself with the right people.

On 7/26/2021 at 5:43 AM, rpllib said:

The right people performing consistently has certainly been a key to my ability to have a life, while owning my business. Some of that, I have to attribute to a healthy dose of good fortune, throughout my career, but especially early on(first 10 years). It was securing a single A tech (started as a C tech) and a service advisor , both with the right attitudes and right work ethic, and keeping them for 25 years plus, that has made the biggest difference for me. Others have come and gone, but having a core team through it all, made an immeasurable difference for me. This is especially noticeable when I compare myself to other owners, who were never able to establish that long term "core team", that still work in their business's every day, and face difficult transition options to the next generation of ownership for their store. 

We're still a startup, wrapping up year 4 in a few more months.   As a manager, I've always believed that great people, hopefully people way smarter and more talented than me, are the key to success in any field.  I've been in shops with these such tenured folks and was trying to figure out what we should be doing to accomplish longevity.   I recently lost 2 apprentice techs to a huge pay raise elsewhere, but I didn't see value in keeping them for a few reasons.  They needed to earn their pay and studying new technologies, etc  instead of just wanting it all now.  However, my shop foremen is 3 years in and it was time to reward his hard work.   I bumped his pay by 40%.  His attitude and ethics are great, so I want him to stay for a long while more.  

I'm blessed to have found another L1 Master Tech, who worked 15 years at his last shop (which sold), and a new B/C tech (still deciding).     Since Techs are in short supply.  My advertising approach was to let the candidates know what's in it for them.   In the end, they need to like coming to work everyday and there are tons of miserable jobs out there competing for the same position.   We have a great team, good overall vibe, so we touted it.   The L1 tech starts on Monday.   

Well, big raises don't come for free.   To stay profitable, I bumped my labor rate by $20/hr yesterday.   As I learned here, labor rate is derived from operations costs, but only supported by reputation.   I don't expect this to matter much, now that we have built a good reputation.  I'm sure I'll lose a few folks, but that's ok.

There are a lot of things that I'm doing wrong (or could do better), but my focus on people is spot-on!  

This thread has been great!   Thanks to all who have contributed!

 

[Joe Marconi]

Labor rates are going up across many industries, not just automotive repair.  Most shop owners and managers realize that being profitable and being able to afford to pay employees decent salary is key to the long-term health of the business.  

In my opinion, we still need to move the needle up with regard to labor rates, but we are finally seeing a move in the right direction. 

With that said, a business is strongest and has the greatest potential when it's foundation is built with the right people, the right leadership and the right culture. 

Great comments everyone!