Have you checked out Joe's Latest Blog?
Auto shop owners are always looking for ways to improve production levels. They focus their attention on their technicians and require certain expectations of performance in billable labor hours. While technicians must know what is expected of them, they have a limited amount of control over production levels. When all factors are considered, the only thing a well-trained technician has control over is his or her actual efficiency.
As a review, technician efficiency is the amount of labor time it takes a technician to complete a job compared to the labor time being billed to the customer. Productivity is the time the technician is billing labor hours compared to the time the technician is physically at the shop. The reality is that a technician can be very efficient, but not productive if the technician has a lot of downtime waiting for parts, waiting too long between jobs, or poor workflow systems.
But let’s go deeper into what affects production in the typical auto repair shop. As a business coach, one of the biggest reasons for low shop production is not charging the correct labor time. Labor for extensive jobs is often not being billed accurately. Rust, seized bolts, and wrong published labor times are just a few reasons for lost labor dollars.
Another common problem is not understanding how to bill for jobs that require extensive diagnostic testing, and complicated procedures to arrive at the root cause for an onboard computer problem, electrical issue, or drivability issue. These jobs usually take time to analyze, using sophisticated tools, and by the shop’s top technician. Typically, these jobs are billed at a standard menu labor charge, instead of at a higher labor rate. This results in less billed labor hours than the actual labor time spent. The amount of lost labor hours here can cripple a shop’s overall profit.
Many shop owners do a great job at calculating their labor rate but may not understand what their true effective labor is, which is their labor sales divided by the total labor hours sold. In many cases, I have seen a shop that has a shop labor rate of over $150.00 per hour, but the actual effective labor rate is around $100. Not good.
Lastly, technician production can suffer when the service advisors are too busy or not motivated to build relationships with customers, which results in a low sales closing ratio. And let’s not forget that to be productive, a shop needs to have the right systems, the right tools and equipment, an extensive information system, and of course, great leadership.
The bottom line is this; many factors need to be considered when looking to increase production levels. While it does start with the technician, it doesn’t end there. Consider all the factors above when looking for ways to improve your shop’s labor production.
Vic Tarasik is eager to share his insights and personal experiences with fraud, a subject that's not always pleasant but is crucial to address. As Ronald Reagan famously said, "Trust but verify." Trust is vital in business relationships, but so is verification. Vic highlights the need for proper documentation, procedures, systems in place to prevent fraud, cash management and the potential for fraud in parts purchases. He advises shop owners not to assume they are immune to fraud. Vic Tarasik, CEO of Shop Owner Coach. Vic’s previous episodes HERE. Show Notes
The importance of trust and verification (00:01:49) Discussion on the importance of trust but verify in business relationships and the need for systems to keep people accountable. Personal experience with fraud in shop ownership (00:02:47) Vic shares his personal experience with fraud in his first four years of shop ownership and the consequences of not having verification systems in place. Managing cash and verifying deposits (00:06:14) The importance of managing cash, verifying bank deposits, and the responsibility of shop owners to ensure every dime and penny is accounted for. Fraud by an employee (00:09:34) Vic reveals how one of his employees committed fraud by zeroing out an invoice and pocketing the money, highlighting the need for trust and verification in business. Importance of consequences (00:16:34) Carm and Vic discuss the importance of having serious consequences, such as jail time or termination, for employees who commit fraud or theft in a company. The importance of trust and verification (00:17:46) Discussion on the need for employees to sign documents and the importance of trust and verification in business. The need for a restitution or fraud clause (00:18:31) Importance of having a restitution or fraud clause in the hiring package and the need to act on it if fraud occurs. The importance of purchase orders (00:26:36) The value of implementing a system that requires purchase orders for all sales transactions to ensure accountability. Returning unopened rolls of stamps (00:28:01) The story of a young employee who stole unopened rolls of stamps from the shop and how the lack of systems and accountability contributed to the situation. The importance of controlling losses (00:34:55) Discussion on how shop owners can control losses and the impact of not doing so. Taking action to prevent fraud (00:36:20) Encouragement to take proactive measures to prevent fraud and the importance of discussing the topic openly. Thanks to our Partners, AAPEX and NAPA TRACS Set your sights on Las Vegas in 2023. Mark your calendar now … October 31 - Nov 2, 2023, 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: -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
Click to go to the Podcast on Remarkable Results Radio
Hey everyone, First I must say thank you to those of you that have taken the time to help me work through many of my startup issues! I'm still quite a ways off, about 8 months, but the future looks bright!
Anyway, its time for me to start writing employee handbooks and a shop operations manual. I have a few templates, but they are pretty general. I know a lot of the "my shop specific" items I want in these, but a lot of the cookie-cutter type tasks and items I'm sure I will forget trying to write the entire document from scratch.
Would any of you be willing to share these documents for your shop with me? I would very much appreciate you all's help!
The ERTC (Employee Retention Tax Credit) is something Hunt has talked about in the past (See Episode 10 and 33) but this week, he wants to discuss the current status of the IRS with regard to auditing and follow-up on businesses that have claimed this credit, such as:
IRS is upping their fines if you don't disclose all funds, even the legit ones. IRS amnesty programs: From a simple "Hey, I've got this account" to "I owe you, let's settle." The IRS usually has three years to ask for back taxes, but some exceptions exist. If you've taken the ERTC money, there's a two-year period where the IRS might have you on their radar. Bigger amounts = more attention. The ERTC program's end is in sight, with some parts set to phase out soon. Want more details? Click here: https://www.irs.gov/newsroom/to-protect-taxpayers-from-scams-irs-orders-immediate-stop-to-new-employee-retention-credit-processing-amid-surge-of-questionable-claims-concerns-from-tax-pros
Thanks to our partners, NAPA TRACS and Promotive
Did you know that NAPA TRACS has onsite training plus six days a week support?
It all starts when a local representative meets with you to learn about your business and how you run it. After all, it's your shop, so it's your choice.
Let us prove to you that Tracs is the single best shop management system in the business. Find NAPA TRACS on the Web at NAPATRACS.com
It’s time to hire a superstar for your business; what a grind you have in front of you. Great news, you don’t have to go it alone. Introducing Promotive, a full-service staffing solution for your shop. Promotive has over 40 years of recruiting and automotive experience. If you need qualified technicians and service advisors and want to offload the heavy lifting, visit www.gopromotive.com.
Paar Melis and Associates – Accountants Specializing in Automotive Repair
Visit us Online: www.paarmelis.com
Email Hunt: [email protected]
Get a copy of my Book: Download Here
Aftermarket Radio Network
Click to go to the Podcast on Remarkable Results Radio
Evolving from Employee to Owner to Coach: The Journey of Independent Auto Repair Shop Owners - Chris Cotton Weekly BlitzBy carmcapriotto
The Weekly Blitz is brought to you by our friends over at Shop Marketing Pros. If you want to take your shop to the next level, you need great marketing. Shop Marketing Pros does top-tier marketing for top-tier shops.
Click here to learn more about Top Tier Marketing by Shop Marketing Pros and schedule a demo:
Check out their podcast here:
If you would like to join their private facebook group go here:
In this episode of "The Weekly Blitz," Coach Chris Cotton discusses the transition from being involved in the day-to-day operations of an auto repair shop to becoming a coach and mentor for employees. They emphasize the importance of having a well-established framework of processes and procedures, investing in employee development, and creating a positive work culture. By focusing on coaching and accountability, shop owners can ensure sustainable business growth and leave a legacy of excellence. The episode concludes with a reminder to continue seeking knowledge and improvement.
The transition to coaching employees [00:02:09] Exploring the significance of transitioning from a hands-on owner to a coach, focusing on building a legacy, employee development, and accountability.
Enhancing the business culture [00:04:31] Reinforcing a culture of continuous learning and growth by celebrating achievements and fostering a positive and supportive environment.
Sustainable business growth [00:05:39] Building a self-sustaining model through coaching and accountability, ensuring consistency in the present and laying the foundation for future expansion and growth.
Connect with Chris:
#autofixautoshopcoaching #autofixbeautofixing #autoshopprofits #autoshopprofit #autoshopprofitsfirst #autoshopleadership #autoshopmanagement #autorepairshopcoaching #autorepairshopconsulting #autorepairshoptraining #autorepairshop #autorepair #autoops #onlinebooking #serviceadvisor #serviceadvisorefficiency #autorepairshopmarketing #theweeklyblitz
Click to go to the Podcast on Remarkable Results Radio
By Changing The Industry
Episode 129 - Can Good Technicians Be Matched With Great Shops? With Joelle Pollack & Amy Gerardi