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By Joe Marconi in Joe's Blog0 commentsAuto 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.
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By carmcapriotto
"AutoTechIQ helps car and truck owners identify problems their vehicles are having. We provide proven auto repair work that has solved similar issues thousands of vehicle owners have faced. We also recommend auto repair shops in your area based on trust, customer education, and quality of work. These shops inspect your car using a courtesy Digital Vehicle Health Inspection and create a state of health report with symptom information and necessary fixes." Frank Scandura and Krista Erickson discuss how AutoTechIQ aims to bridge the gap between shops and customers by creating better relationships through technology and transparency. The goal is to empower customers with knowledge and build trust. Frank Scandura, Frank’s European Service, Las Vegas, NV. VP of Certified Shop Relations and Member of the Board of Directors, AutoTechIQ. Frank’s previous episodes HERE. Kirsta Erickson, VP of Client Services and Marketing, AutoTechIQ Show Notes
AutoTechIQ: https://www.autotechiq.com/ Transparency is the New Trust (00:01:02) Discussion on the importance of transparency in building trust with customers and how it relates to online reviews and consumer behavior. Using Data to Inform Customers (00:03:52) Explanation of how AutoTechIQ utilizes data from repair shops to provide customers with relevant information and help them make informed decisions about their automotive repairs. The Power and Carefulness of AI (00:08:55) Exploration of AI as a smart algorithm and a powerful search engine that requires careful questioning to avoid getting incorrect answers. Transparency and Expertise in Automotive Services (00:10:33) Explanation of how AutoTechIQ aims to connect customers with expert shops that provide transparency, digital inspections, and communicate in a language that customers understand. The disruptors (00:15:16) Discussion on the impact of disruptors in various industries and the need for new solutions. Vetting process for certified shops (00:16:30) Explaining the requirements and process for certifying shops, including reputation, online reviews, and digital inspections. Driving consumers to shops (00:17:54) The importance of bringing consumers to shops through technology and creating a bridge between customers and shops. The digital vehicle inspection revolution (00:23:06) Discussion on the importance of digital vehicle inspections and the need to educate shops and customers about its benefits. The percentage of shops doing digital vehicle inspections (00:23:33) Exploration of the industry-wide adoption of digital vehicle inspections and the varying definitions of what constitutes a digital inspection. Disrupting business directories with transparency (00:25:22) The potential impact of AutoTechIQ on business directories, focusing on transparency and high-quality service. Thanks to our Partner, NAPA Auto Care Learn more about NAPA Auto Care and the benefits of being part of the NAPA family by visiting https://www.napaonline.com/en/auto-care Connect with the Podcast: -Follow on Facebook: https://www.facebook.com/RemarkableResultsRadioPodcast/ -Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/ -Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/ -Follow on Twitter: 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
Click to go to the Podcast on Remarkable Results Radio
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By carmcapriotto
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
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By Joe Marconi
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By carmcapriotto
Pete McNeil discusses the changing needs of employees in the post-COVID workplace, particularly focusing on Gen Z employees. He talks about the importance of providing a positive customer experience and adapting to the preferences and attention span of Gen Z employees. He also discusses the challenges of hiring and retaining Gen Z employees, including the need for benefits, learning opportunities, and potential pay advantages.
Pete McNeil, McNeil’s Auto Care, Sandy and Riverton, UT. Pete’s previous episodes HERE
Show Notes:
The Legacy of Old Car Repair Tools (00:01:39) Discussion about displaying old car repair tools in the waiting room to showcase the evolution of automotive technology. The Importance of Customer Experience (00:07:21) Highlighting the exceptional service provided by a server at a restaurant and the need to recruit service advisors from industries with a focus on customer experience. Understanding Gen Z Employees (00:08:47) Exploring the characteristics and preferences of Gen Z employees, including their shorter attention span and the need for clear direction and guidance. Gen Z Challenges in the Workplace (00:09:18) Discussion on the challenges faced by Gen Z employees entering the workplace without prior working experience. Adapting to Gen Z Preferences (00:12:19) Exploring the changing expectations of Gen Z employees during job interviews, including flexible work schedules and work-life balance. Creating Hybrid Pay Programs (00:16:38) The need for customized pay programs to meet the diverse needs and preferences of employees, with examples of different pay structures. Valuing Diagnostic Technicians (00:19:31) The need to compensate diagnostic technicians accordingly. Specialization and Rewarding Expertise (00:21:31) Highlighting the importance of specialized technicians in areas like transmissions, electrical, and HVAC, and the need to reward their knowledge and time investment. The importance of involving families in social events (00:26:34) Discussion on the significance of including employees' families in non-work related special events. Creating a positive work culture through various events (00:27:29) Exploration of different events, such as boating trips and casino nights, that the company organizes to foster camaraderie and teamwork among employees. The communication preferences of Gen Z employees (00:29:40) Insights into the communication preferences of Gen Z employees, including their preference for face-to-face interactions and the low reliance on social media for communication. The changing needs of employees (00:35:23) Discussion about the need for a new way of connecting and learning with the new age employees. Adding on to the Riverton store (00:35:47) Updates on the expansion of McNeil's Auto Care in Riverton, Utah, including adding six bays and a warehouse. Appreciation for Carm Capriotto (00:36:17) Expressing gratitude for Carm Capriotto's contributions to the automotive industry and the podcast. Thanks to our Partner, Dorman Products.
Dorman gives people greater freedom to fix vehicles by constantly developing new repair solutions that put owners and technicians first. Take the Dorman Virtual Tour at www.DormanProducts.com/Tour
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
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