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By Joe Marconi in Joe's Blog5 commentsI recently spoke with a friend of mine who owns a large general repair shop in the Midwest. His father founded the business in 1975. He was telling me that although he’s busy, he’s also very frustrated. When I probed him more about his frustrations, he said that it’s hard to find qualified technicians. My friend employs four technicians and is looking to hire two more. I then asked him, “How long does a technician last working for you.” He looked puzzled and replied, “I never really thought about that, but I can tell that except for one tech, most technicians don’t last working for me longer than a few years.”
Judging from personal experience as a shop owner and from what I know about the auto repair industry, I can tell you that other than a few exceptions, the turnover rate for technicians in our industry is too high. This makes me think, do we have a technician shortage or a retention problem? Have we done the best we can over the decades to provide great pay plans, benefits packages, great work environments, and the right culture to ensure that the techs we have stay with us?
Finding and hiring qualified automotive technicians is not a new phenomenon. This problem has been around for as long as I can remember. While we do need to attract people to our industry and provide the necessary training and mentorship, we also need to focus on retention. Having a revolving door and needing to hire techs every few years or so costs your company money. Big money! And that revolving door may be a sign of an even bigger issue: poor leadership, and poor employee management skills.
Here’s one more thing to consider, for the most part, technicians don’t leave one job to start a new career, they leave one shop as a technician to become a technician at another shop. The reasons why they leave can be debated, but there is one fact that we cannot deny, people don’t quit the company they work for, they usually leave because of the boss or manager they work for.
Put yourselves in the shoes of your employees. Do you have a workplace that communicates, “We appreciate you and want you to stay!”
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By Joe Marconi
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By carmcapriotto
Explore: Strategies for pricing diagnostics and labor based on vehicle type, customer segment, and job complexity. Discover: The importance of understanding financial metrics, collaborating with service advisors and technicians, and providing exceptional customer experiences to justify premium labor rates. Matt Lachowitzer, Matt’s Automotive Service Center, Fargo-Moorhead, North Dakota and Minnesota. Listen to Matt’s previous episodes HERE Tom Schearer, Schearer’s Sales and Service, Allentown, PA. Tom’s previous episodes HERE Brent Fleischman, Yocum Automotive, Republic, MO. AutoFix Auto Shop Coaching. Listen to Brent’s previous episodes HERE
Show Notes: The importance of labor rates (00:00:01) Discussion on the significance of intelligent labor rates for profitability and success in the automotive service industry. Differentiated labor rates for specific vehicles (00:03:02) Approach to having higher labor rates for certain foreign car makes and models, and the customer acceptance of these rates. Multiple labor rates for different customers (00:04:54) Explanation of having various labor rates for retail, wholesale, and aftermarket warranty customers, and the strategic approach to setting these rates. Diverse labor rates based on vehicle type (00:05:54) Insight into having subtle changes in labor rates for diesel, euro, older vehicles, and different skill sets, and the correlation of labor rates with menu pricing. Determining diagnostic labor rates (00:10:22) Discussion on the determination of diagnostic labor rates at the front counter, potential modification of approaches based on insights from other panel members, and the significance of communication within the team. The meeting to implement new labor rate levels (00:17:48) Implementing new labor rate levels with input from service advisors and technicians. Setting diagnostic labor rates based on testing levels (00:19:55) Technicians use a system with 16 different testing levels to determine diagnostic labor rates. Labor rates for maintenance items (00:22:16) Discussion on lower labor rates for maintenance items like oil changes, tire rotations, and transmission flushes. Competing on maintenance item prices (00:23:20) The panel discusses pricing maintenance items competitively based on market demand and customer perception. Client experience and pricing (00:29:38) The importance of providing a great customer experience and its impact on pricing and customer loyalty. Knowing your numbers for effective labor rates (00:33:18) Advice to shop owners to evaluate labor rates based on their business needs and to know their numbers for profitability. Pride in charging premium rates (00:34:20) The importance of being proud of charging premium rates for the talent, tools, and facilities provided.
Thanks to our Partner, NAPA TRACS NAPA TRACS will move your shop into the SMS fast lane with onsite training and six days a week of support and local representation. Find NAPA TRACS on the Web at http://napatracs.com/ Connect with the Podcast -Follow on Facebook: https://www.facebook.com/RemarkableResultsRadioPodcast/ -Join Our Private Facebook Community: https://www.facebook.com/groups/1734687266778976 -Subscribe on YouTube: https://www.youtube.com/carmcapriotto -Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/ -Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/ -Follow on Twitter (X): https://twitter.com/RResultsBiz -Join our Insider List: https://remarkableresults.biz/insider -All books mentioned on our podcasts: https://remarkableresults.biz/books -Our Classroom page for personal or team learning: https://remarkableresults.biz/classroom -Buy Me a Coffee: https://www.buymeacoffee.com/carm -The Aftermarket Radio Network: https://aftermarketradionetwork.com -Special episode collections: https://remarkableresults.biz/collections
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By Joe Marconi
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By carmcapriotto
Ever wonder how automotive shops across the country set their labor rates? It's not just about matching the shop down the road. It's about achieving your profit goals. Tom Ham discusses the labor rate tracker tool, which can be found on the Automotive Management Network. The conversation includes the variability of labor rates among different types of automotive shops and across states and the influence of location and shop type on rates. Tom shares that the tracker has grown to 3,000 shops reporting their rates, providing a more comprehensive view of the market. The episode also covers the importance of having a labor rate that reflects a shop's quality and customer trust. Find out why the labor rate tracker is a valuable tool for both shop owners and industry coaches to gauge market rates and inform business strategies. Tom Ham, Automotive Management Network. Tom’s previous episodes HERE. Show Notes
Labor Rate Tracker The labor rate tracker tool (00:01:42) Discussion of the labor rate tracker tool, its development, and its purpose in the automotive industry. Setting labor rates based on profit goals (00:03:18) Importance of setting labor rates based on individual profit goals and the process of determining labor rates. Feedback from members of the Automotive Management Network (00:08:14) Positive feedback from members of the Automotive Management Network regarding the labor rate tracker tool. Different labor rates across various types of automotive shops (00:12:32) Discussion of the variation in labor rates across different types of automotive shops, such as RV shops, franchises, transmission shops, and more. Variations in labor rates across different states (00:15:50) Observations on the differences in labor rates across states, including the correlation between labor rates and political affiliations. Mobile Repair Rates (00:17:01) Discussion about the lower labor rates for mobile repair services and the impact of weather on their business. Membership and Data Privacy (00:19:40) Details about accessing the labor rate tracker tool, membership requirements, and the privacy of members' data. Profit Structure and Labor Rates (00:21:08) Consideration of the potential value in understanding a shop's profit structure based on their labor rate and the implications for success. Cost Factors and Labor Rates (00:23:29) Discussion about the impact of rising costs, including healthcare and insurance, on the setting of labor rates. Snowbirds and Florida (00:25:22) Conversation about the history of Florida's popularity as a winter destination and the influx of seasonal residents. Future Developments of Labor Rate Tracker (00:26:48) Discussion about the planned enhancements and future developments for the labor rate tracker tool. Thanks to our Partners, AAPEX and NAPA TRACS Set your sights on Las Vegas in 2024. Mark your calendar now … November 5th-7th, 2024. AAPEX - Now more than ever. And don’t miss the next free AAPEX webinar. Register now at http://AAPEXSHOW.COM/WEBINAR NAPA TRACS will move your shop into the SMS fast lane with onsite training and six days a week of support and local representation. Find NAPA TRACS on the Web at http://napatracs.com/ Connect with the Podcast: -Follow on Facebook: https://www.facebook.com/RemarkableResultsRadioPodcast/ -Subscribe on YouTube: https://www.youtube.com/carmcapriotto -Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/ -Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/ -Follow on Twitter: https://twitter.com/RResultsBiz -Visit the Website: https://remarkableresults.biz/ -Join our Insider List: https://remarkableresults.biz/insider -All books mentioned on our podcasts: https://remarkableresults.biz/books -Our Classroom page for personal or team learning: https://remarkableresults.biz/classroom -Buy Me a Coffee: https://www.buymeacoffee.com/carm -The Aftermarket Radio Network: https://aftermarketradionetwork.com -Special episode collections: https://remarkableresults.biz/collections
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By Joe Marconi
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