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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.
By Changing The Industry
Episode 141 - Embracing Change in the Automotive Repair Industry With Matt Ruffman
Matt’s Mailbag: Hiring Bonuses, Flat Rate Pay and Building a Network of Friends [E110] - Diagnosing the Aftermarket A to ZBy carmcapriotto
Join Matt Fanslow as he answers some questions from his listeners in his 'mailbag.' Matt discusses the hiring bonus dilemma, compensation and profit sharing, the power of training, the flat rate pay system, book recommendations and how to create a network of industry peers.
Have a question for Matt to answer? Email him at: [email protected]
Hiring Bonuses for New Techs (00:02:27) Discussion on the fairness and impact of hiring bonuses for new technicians and how it affects existing employees. Broken System of Compensation (00:04:58) Exploration of the different ways technicians are compensated and how it can lead to resentment and difficulties in hiring new technicians. Ethical Profit and Long-Term Benefits (00:07:31) Explanation of how Matt's shop rewards employees based on ethical profit and how hiring bonuses can benefit both the shop and existing employees in the long term. The Mismanagement of Compensation (00:09:59) Discussion about the mismanagement of compensation in the aftermarket automotive industry and the potential impact on employees. Concerns about Flat Rate Pay (00:13:33) Addressing concerns about transitioning to a flat rate pay system and the potential negative impact on technicians' income and job satisfaction. Recommended Books for Auto Repair (00:19:49) Discussion on the importance of reading books on auto repair Building a Network in the Automotive Industry (00:26:06) Advice on how to build a network of connections in the automotive industry, including attending trade shows and utilizing social media. The importance of networking (00:29:42) The value of building relationships and networking in the automotive industry.
Thanks to our Partner, NAPA Autotech napaautotech.com
Email Matt: [email protected]
Diagnosing the Aftermarket A - Z YouTube Channel HERE
Aftermarket Radio Network: https://aftermarketradionetwork.com/
Click to go to the Podcast on Remarkable Results Radio
By Joe Marconi
Recorded Live at ASTE 2023, Jim Cokonis kicks off the conversation with a mention of the late Anthony Williams and his innovative concept of "the Sage on the Stage" in training and education. This approach emphasizes the importance of learners discovering knowledge on their own, rather than being passive recipients of information. Jim also discusses his role as the Executive Director of the Auto Talent Co-Op led by John Gustafson in California, a non-profit organization aimed to solve the talent gap and technician shortage in the industry. Jim Cokonis, Executive Director, Auto Talent Co-Op
The stage on the stage (00:04:44) Discussion on the traditional teaching method of standing in front of a room and delivering content. Engaging learners at a deeper level (00:05:43) Exploration of different learning styles and the importance of engaging learners in activities for better understanding. Teach to learn (00:06:33) The concept of teaching as a way to deepen one's own understanding and become an expert in a specific area. Developing a learning environment in the shop (00:08:33) Discussion about tools and techniques to foster a learning environment in the shop. Constantly refining content in training (00:09:42) The commitment to continuously update and improve training content, including peer review and addressing technical accuracy. The importance of engaging learners (00:17:57) Discussion about the value of actively listening and taking notes while learning from a podcast. Anthony Williams' impact (00:18:28) Reflection on the influence of Anthony Williams and his passionate approach to education. The Auto Talent Co-Op and technician shortage (00:19:21) Exploration of the Auto Talent Co-Op and its mission to address the ongoing technician shortage in the automotive industry. The importance of mentorship (00:28:48) Discussion about the qualities and skills required to be a good mentor, and the need for mentorship training. The value of certifications (00:31:33) Exploring the significance of certifications in verifying technicians' abilities and the need for businesses to qualify to employ certified technicians. Assessing the worthiness of a business (00:33:29) Examining whether a business is doing all the right things to attract and retain talented individuals, and the importance of creating a sticky organizational culture. The importance of tracking expenses (00:35:03) Discussion about the significance of understanding cost increases over time and its impact on income. The value of follow-up and assessment in training (00:37:04) Emphasis on the need for continuous learning and evaluation after attending training events. The evolution of opinions and the importance of being open-minded (00:38:19) Exploration of the concept of evolving opinions and the need to remain open to reforming and reshaping one's perspective. 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: -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 -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
Click to go to the Podcast on Remarkable Results Radio
Recorded Live at ASTE 2023 Scott Brown discusses the evolving technology of Advanced Driver Assistance Systems (ADAS). He dives into the challenges and benefits of calibrating ADAS systems in vehicles, the future of level five automation and importance of technicians staying updated on technology advancements.
Scott Brown, Founder of Diagnostic Network. Scott's previous episodes HERE. Show Notes
Advanced Driver Assistance Systems (ADAS) by Steve Zack, Kurt Shadbolt and Scott Brown The evolution of ADAS technology (00:01:17) Scott Brown discusses his early exploration of ADAS technology and how it has become more focused over the years. Understanding computer vision in ADAS (00:02:12) Scott Brown explains how computer vision works in ADAS systems and the importance of training cars to recognize objects in their environment. Advancements in camera technology (00:04:25) Scott Brown discusses the advancements in camera technology, including the ability to remove radar sensors and rely solely on cameras for functions like cruise control and pedestrian detection. The Lane Assist Experience (00:08:03) Discussion about lane assist technology and the adjustment to driving without it. Tesla's Shift to Vision System (00:08:40) Explanation of Tesla's decision to no longer use radar sensors and instead rely on their vision system for ADAS. Static calibration challenges (00:16:38) Increasing use of cameras for dynamic calibration (00:17:32) Benefits of backup cameras (00:18:20) The importance of technology in automotive education (00:25:18) The need for updated curriculums in automotive schools and the role of technology in education. The potential career opportunities for students in automotive technology (00:27:29) The Tesla's Full Self Drive Experience (00:32:16)
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