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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 Joe Marconi
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By carmcapriotto
Thank you to RepairPal for sponsoring The Auto Repair Marketing Podcast. Learn more about RepairPal at https://repairpal.com/shops
How To Get In Touch
Group - Auto Repair Marketing Mastermind
Website - shopmarketingpros.com
Facebook - facebook.com/shopmarketingpros
Get the Book - shopmarketingpros.com/book
Instagram - @shopmarketingpros
Questions/Ideas - [email protected]
Click to go to the Podcast on Remarkable Results Radio
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By Changing The Industry
Episode 140 - The Cost of Safety Negligence in the Auto-Industry With Brandon Dills
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By carmcapriotto
Thanks to our partner, RepairPal. Visit the Web HERE
How To Get In Touch
Group - Auto Repair Marketing Mastermind
Website - shopmarketingpros.com
Facebook - facebook.com/shopmarketingpros
Get the Book - shopmarketingpros.com/book
Instagram - @shopmarketingpros
Questions/Ideas - [email protected] & [email protected]
Click to go to the Podcast on Remarkable Results Radio
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By carmcapriotto
Brett Beachler shares the history of his business, the impact of closing on Saturdays, and the importance of creating a positive work environment. He also discusses the significance of customer trust and his future goals for his business. Brett Beachler, Beachler’s Vehicle Care & Repair, Peoria, IL. Listen to Brett’s previous episodes HERE Show Notes:
Closing Saturdays and its Impact (00:03:20) Brett discusses the significant impact of closing Saturdays on their business operations and the positive response from their customer database. Increased Revenue and Team Morale (00:04:37) Brett shares how their decision to close Saturdays resulted in a 20% increase in revenue and improved team morale. Distinguishing Factors of the Business (00:07:19) Brett explains the factors that make their business different, including providing honest advice, focusing on cost per mile, and attracting a more educated demographic of customers. The Light Atmosphere and Customer Experience (00:08:21) Discussion about the importance of creating a positive atmosphere and delivering exceptional customer experience. Forward Thinking and Setting Dental Style Appointments (00:10:24) Conversation about the benefits of proactive maintenance and the importance of scheduling appointments in advance. The importance of people skills (00:15:31) Discussion on the significance of understanding and managing the different personalities and needs of employees for successful business operations. Benefits of being part of a 20 group (00:17:07) Exploring the advantages of joining a 20 group for business owners, including the opportunity to learn from others and receive support. Updating Processes and SOPs (00:22:34) Discussion about the importance of managing processes and standard operating procedures (SOPs) properly, transitioning from paper to digital form, and using Microsoft server for storing SOPs. Refining Digital Vehicle Inspection (00:23:25) Focus on improving the efficiency and effectiveness of the digital vehicle inspection process and making it seamless for both customers and technicians. Equipment Upgrades and Expansion (00:23:59) The impact of daily training (00:29:45) Discussion on the importance of daily training for personal and professional growth, comparing it to sporadic training every few months. Views on smartphones and idle time (00:32:46) Discussion on the negative impact of excessive smartphone use and the importance of utilizing time effectively. 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:
-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
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