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Profit Does Not Equal Cash in the Bank – Hunt Demarest [RR 817]


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Recorded Live at the Transformers Summit with Aftermarket Radio Network host, Hunt Demarest, CPA at Paar Mellis and Associates and host of the Business by the Numbers Podcast. Hunt's firm specializes in automotive repair clients and he gives us an inside scoop on common new client questions and concerns as well as some behind the scenes about his podcast!

Hunt Demarest, CPA, Paar Mellis and AssociatesBusiness by the Numbers Podcast

 

Show Notes

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  • Finance and accounting with new clients- “I want to know more about my finances, but I don't understand them.”
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  • Clients have to see the value in their numbers themselves
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  • How do you want to make more money if you don't even know how much money you're making right now?
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  • You need to set up your financials in a way that makes sense to you.
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  • Profit is used to pay down debt. Profit is used for your distributions. Profit is used for you to buy inventory and equipment.
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  • Paar Melis gives you a report card at the end of the month. Focus on the red items and that's going to tell you everything that you need to know.
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  • Numbers don't lie, but they can be misleading
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  • Instead of charging credit card fees, instead, raise your labor rate, and raise your parts margin 3%. Now you're making that credit card fee on every person
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Connect with the Podcast:

 

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Check out today's partner:

 

 

Learn more about NAPA AutoCare and the benefits of being part of the NAPA family by visiting www.NAPAAutoCare.com

Click to go to the Podcast on Remarkable Results Radio

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  • Have you checked out Joe's Latest Blog?

         5 comments
      I 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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