Why Should We Settle for Discounted Pay From Warranty Companies?
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By Joe Marconi in Joe's Blog0 commentsThe Technician Shortage Is Our Fault, And It's Time We Own It
Nearly every day, I hear shop owners complain: "There's a technician shortage. We can't find qualified people. There's no one out there." If that's true, then who's to blame?
The industry? The schools? The government? I don't know how you feel, but who promised us an endless supply of qualified technicians?
Another common complaint is that young people do not want to work in the trades. Well, if that were true, then why are other trades such as HVAC, electrical, and plumbing growing? What are they doing that the automotive industry is not?
Here's the reality we need to face: We do have a problem, but we shouldn't look for someone or any entity to rescue us. Not the government. Not the trade schools. Not the recruiting companies. No one owes us a workforce. If we want great people in our industry, it's up to us. At some point, we need to own up to the truth: Building a pipeline of qualified technicians is our responsibility.
In this blog article, I will break down the key reasons we are in this situation today and what we, as an industry, can do to solve the technician shortage. Are you ready to look in the mirror?
Have We Pushed Technicians Away?
Let's take a look at flat-rate pay. True flat rate, which pays a technician only for the hours they produce, is a controversial pay plan that emphasizes high production levels and creates a competitive work environment that, if not properly controlled, can lead to increased mistakes and a decline in morale and team spirit. Additionally, the stress and physical demands placed on technicians as they age are not favorable to long-term employee retention. What do we do with technicians as they grow older into their fifties and begin to slow down?
I have heard all the arguments and pros and cons of flat-rate pay, and I am not going to judge any pay plan. Let the facts speak for themselves. True flat rate has changed in most areas around the country and has evolved into a pay plan that gives technicians some pay guarantee.
Many shop owners have learned that team morale, along with the opportunity to earn income, is important to technicians and to the company's long-term success. But let me ask you: how many technicians have left or been pushed out over the years because of the old flat-rate pay system?
Another issue is the workplace environment. I remember being grateful to be hired as a young technician at a local repair shop. While very thankful, the work environment was not ideal. The shop owner kept the bay doors open year-round (I am from New York) unless it rained or snowed. He felt that if the bay doors were closed, customers might think we were closed for business. We had no heat and no hot water. Many of the jobs were done outside, year-round, in all types of weather. The starting pay was minimum wage, with no benefits, sick days, or vacation pay.
Now, again, I need to point out that I was truly grateful for the opportunity this shop owner gave me. I learned a lot working there, and the experience was pivotal in my career. But looking back, I wonder how many people were discouraged by these working conditions?
While the physical demands of the repair workplace are daunting, perhaps even more critical is the culture. Too many of my generation shop owners preached the mindset of "my way or the highway." We were the business owners, after all. We started our companies, took all the risks, and provided jobs. Why shouldn't we be the ones to set the ground rules our way?
Many of us found over the years that the "my way or the highway" mentality was a sure way to isolate employees and make them more likely to look over the fence for greener grass. In other words, it led many technicians to seek employment elsewhere, where they felt they could be appreciated and recognized for their hard work. The issue, however, was that there wasn't much green grass around. Disappointment after disappointment, bouncing from repair to repair shop, eventually led to despair. So, I ask you: were workplace conditions a contributing factor in today's technician shortage?
Another factor that we are all well aware of is the complexity of the modern automobile. When I started, the work was mostly physical, and you were required to master essentially three vehicle models: General Motors, Ford, and Chrysler. Let's fast-forward to today. The evolution of automotive technology, along with the extensive training and tools required, has outpaced the typical technician's pay compensation, with no clear career path. Again, leading to frustration and insecurity about the future.
Here is the bottom line: people don't leave their job; they leave their experience. We must do a better job.
The News Isn't all Bad; Your Next Steps to Fix the Technician Shortage
To fix the technician shortage, it will take a combined effort from everyone in the automotive industry, particularly automotive shop owners. Shop owners are in the perfect position to make the greatest impact, not only on their businesses but also on the future automotive workforce.
First, shop owners must become better leaders and understand that their ultimate success is directly dependent on the people they assemble around them. Any shop owner who mistakenly believes they can build an empire solely on their abilities is destined for serious disappointment. Business owners who think like this will eventually plateau. Without the collective contributions from a team of qualified people, your business will stall; it will not continue to grow.
Create a workplace that attracts top talent: a clean, professional, well-equipped facility designed to support productivity, teamwork, and a career, not just a job. Build a great reputation in your community by getting involved locally. Become the auto repair shop that people take notice of as "the" place to work.
Next, shop owners must become more financially knowledgeable. Knowing your numbers and what you need to achieve for a strong bottom-line profit is essential to paying technicians the money they need and deserve. Profit will also allow you to compete with other trade industries by providing a benefits package that has real take-home value and security.
When it comes to culture, this is where the rubber hits the road. People crave recognition, praise, and a sense of purpose. Despite what you hear, people are not just money-motivated. Once people feel secure in their financial situation, retaining and motivating technicians can only be achieved by connecting with them on an emotional level. You cannot show enough appreciation. Give out praise for a job well done as if your business depended on it, because it does.
As technicians age, we need to have a place for them. Expecting a 58-year-old to perform like a 35-year-old is unrealistic. We need to be more focused on career pathing. Provide training, skill development, and coaching to develop leaders and mentors within our older workforce. While their bodies may have slowed, the knowledge they have gained is priceless.
Our future is dependent on young people entering our industry. We need to give more young people opportunities. Every shop owner across the country should consider hiring an apprentice, then build an apprentice training plan and career path for them. If every shop did this, we could solve the technician shortage within five years. Get involved with the trade schools and high schools in your area. Look into the NAPA Apprenticeship Program. Don't sit on your hands with this one. Do it today.
Lastly, don't get left behind. Commit to ongoing training for all your employees. Keep up to date with tools and equipment tailored to your business model. Don't try to be all things to all people and all vehicles. Identify your core profile customer and the vehicles they drive, and become an expert on those vehicles and the services you offer.
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By Riccardo
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Episode 271 - Training New Techs & Building a Lasting Automotive Business With Charles Mitchell
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Hey everyone,
I'm building a tool that helps auto repair shops plan preventive maintenance automatically — it predicts when each customer should come back, sends reminders, and helps keep the shop busy year-round.
But before I go any further, I’d rather hear it from real shop owners:
How many hours or bays do you usually have sitting empty every month?
What percentage of your work is planned maintenance vs emergency jobs?
Do you use any system right now to remind customers about service? How well does it work?
What would make you not trust an AI system that claims to schedule customers automatically?
I’m not here to pitch vaporware — I want to understand how shops actually think about preventive work and downtime.
If a few of you are curious, I can share a short demo and would love your honest feedback.
Thanks for sharing your experience — it’s worth way more than any market research report.
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By Hands On
The emailed me a form to sign up to be a "service provider" The company Service Up will send me the client. They will bill the client and pay me after the repair. Look at some of the highlights from the terms:
All transactions completed through the Platform are subject to a transaction fee ranging from 1.99% to 10% of the gross amount of each repair, with a baseline marketplace fee of 3.99% unless otherwise specified in a fleet-specific addendum.
The marketplace fee applicable to a given repair is one of the following:
• 3.99% (baseline) of the gross amount of all repairs completed through the Platform for all other customers, including customers to whom ServiceUp has referred you.
• A rate specified in a fleet-specific addendum, which overrides the baseline, provided such rate falls within the 1.99%–10% range stated above.
In addition to the marketplace fee, the following optional fee may apply:
• QuickPay fee — an additional 3.50% of the gross amount of the repair if you elect to receive early payment (typically next business day). In the event a credit card is used by the customer for payment, the 3.50% QuickPay fee will be automatically applied.
So, the fee they charge is any where from 1.99% to 17% if they pay credit card and you want funds next day
Company reserves the right, in its sole discretion, to modify, increase, decrease, or otherwise change the transaction fees, early payment fees, or any other amounts payable under these Terms at any time.
But those fees could go up with no notice at all
The Company shall remit payment to you net of any applicable transaction fees as promptly as practicable after, and contingent upon, Company’s receipt of payment from the applicable fleet customer for the services rendered by you.
They will pay you for the work you did, as long as they are able to get paid.
You acknowledge and agree that the Company shall not be responsible for any delays or failure to pay that may be caused by a fleet customer.
And if the customer fails to pay them, too bad.
You further acknowledge and agree that (i) the Company may withhold funds in the event of any dispute between you and the Company pending the resolution of such dispute, (ii) you shall not collect any fees for services rendered hereunder directly from a fleet customer and shall receive payment for such services solely from the Company, (iii) in the event the Company determines that you have violated the foregoing subsection (ii), the Company shall have the right to charge a penalty of 10% of the gross value of the applicable services and may withhold that amount from future payments or debit your bank account to recover the penalty and any applicable fees for services.
AND if they customer fails to pay them and you go directly after the customer yourself, tack on another 10%
So basically, you fix our cars, and we maybe pay you after we take fees.
Has anyone used this platform? What do you think?
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