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LABOR GUIDES


xrac

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We struggle with labor times on a daily basis. We compare Mitchell and Alldata all the time. The other day we sold an oil pan on a Chrysler Mini Van. The service advisor used the Mitchell time, 1.4hr. When I saw that, I nearly screamed!

 

This is a real problem. The tech was also doing an exhaust (cat-back) on the same car and the labor time for that was 1.3hr.

 

There is no consistency with time. Maybe we are approaching it all wrong. I try to teach my staff to take into consideration the complexity of the job. For example: An hour of brain surgery is worth more than an hour of racking leaves, right?

 

What it comes down to is that you need to be competitive where you need to be, and charge a premium for those more hi-tech jobs. You need to use good judgment too. We give too much away as it is. It’s a delicate balancing act.

 

Agree? Thoughts?

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You know, not being a tech can be an advantage. I have two service advisors, the one who was a former tech has a tough time with billing labor hours. The other advisor, who was never a tech, bills more labor hours.

 

In the end a job is worth what a job is worth. Labor hours must exceed pay hours, or we will not be in business long. The book can hurt us in our wallet!

 

Do you track tech productivity?

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Yes, I track tech productivity and shop productivity. It's one of the key numbers I look at each week.

 

If your labor rate is $100.00 per hour and your shop productivity rate is at 60%, you actual labor rate per hour is only $60.00

 

My tech bonus plan is based on their productivity.

 

At $100.00 per hour, an increase of just one hour per day will increase your income by $500.00 per week for a 5 day work week.

 

Increasing productivity is the best way to increase sales dollars without increasing car counts or raising prices.

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  • 5 months later...

Newspaper Columnist Tackles Book Rate vs. Actual Time Complaint

 

Book Time...

 

XRAC, do you enjoy getting my blood pressure to a boil? I think that labor charge has to be a mistake. But, why are we always defending ourselves. This is a free market and still America (isn't it?). We are free to charge what we want and the consumer is free to shop where they want.

 

I repsonded to the article, here's what I wrote:

 

 

"I am a auto repair shop owner for nearly 30 years and I can tell you that the consumer is getting a fair deal with what we charge. First of all why a shop would accept the customer's parts is a problem to begin with. We never do that! You don't bring your eggs to the diner and tell them to cook them for you, do you?

 

What Elliot does not realize is all the coutless hours we spend on repairing cars that we do not bill the customer because we gave the customer a price and we are honest enough to stand behind our ethics.

 

Hey somone out there in media land...try writing something nice about us for a change. WE KEEP AMERICA ROLLING, DON'T FORGET THAT!"

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Sorry Joe! :rolleyes: It seems that all our industry receives is bad press. Most of the journalists don't have a clue about anything mechanical and it is popular with the media for them to pick on us. They sometimes make things which we think are good practice like machining brake rotors sound like a rip off. However, it does sounds like the shop told the guy they would charge book time and then they may have inflated it.

 

I agree with you. That particular price is a bit too high. I would want to hear the shop's reasoning for that price. Was it a computer matrix error, or maybe they bumped up the price because the owner supplied his own parts? Or maybe just a stupid mistake?

 

The other issue that bothers me is when people listen to a journalist, like he his some "expert", just because he wrote an article. People don't realize that a writer's opinion is often slanted. That's human nature. And, on top of that, the writer wants to excite the audience.

 

I need to say it again...Hey, media people.... write something nice about us, just once!

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The journalists that I have know are not people I am especially impressed with as a rule. The few times I have given interviews it has been amazing how much stuff is not reported correctly. Yet, these people with their biases, incompetences, and political leanings to a great deal determine public perception about our profession.

 

I certainly wouldn't encourage anyone to pursue journalism as a career. There is very little money to be made being a journalist unless one rises to the upper ends of the profession. My observation is that it is a profession that attracts idealistic people who are good with words but sometimes not much else. The newspaper journalists are certainly going to be a dying breed because a lot of newspapers are going to go out of business due to internet competition.

are we talking about journalist's or presidents?..............(sorry)........

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We currently use Alldata for our labor guide. However, we also have access to Identifx which has Motor labor information. Lately we have discovered some large discrepencies between the labor times. For example the labor to do a head gasket on a 2001 Chrysler Sebring 3.0 in 6.9 in Alldata and 9.9 in Identifix (or something close to that). The later seems to be closest to the actual. I could site other similar examples. Does anyone know which is most accurate? Advice?

 

Not to be harsh, but read your thread title, Labor GUIDES. They are just that, no one anywhere tells you you must charge only that amount of time. You can adjust the time you charge as you see fit. If you adjust up and become uncompetitive you will cease to exist. If you stick to a time you know is too low often enough, you will cease to exist. I have and use Real Time Labor Guide and will often compare times. Depending on the situation, how busy I am and who the customer is, I will mark up to the higher time. I also have the benefit/curse of being a one man show so I write the RO's and do the work so I am keenly aware of how long it should take.

 

Live by the book, DIE BY THE BOOK.

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Not to be harsh, but read your thread title, Labor GUIDES. They are just that, no one anywhere tells you you must charge only that amount of time. You can adjust the time you charge as you see fit. If you adjust up and become uncompetitive you will cease to exist. If you stick to a time you know is too low often enough, you will cease to exist. I have and use Real Time Labor Guide and will often compare times. Depending on the situation, how busy I am and who the customer is, I will mark up to the higher time. I also have the benefit/curse of being a one man show so I write the RO's and do the work so I am keenly aware of how long it should take.

 

Live by the book, DIE BY THE BOOK.

 

It is true what you say. Labor guide is a guide, not the auto bible sent down from heaven. It is a delicate balance between being competitive and being profitable.

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We currently use Alldata for our labor guide. However, we also have access to Identifx which has Motor labor information. Lately we have discovered some large discrepencies between the labor times. For example the labor to do a head gasket on a 2001 Chrysler Sebring 3.0 is 6.9 in Alldata and 9.9 in Identifix (or something close to that). The later seems to be closest to the actual. I could site other similar examples. Does anyone know which is most accurate? Advice?

We use alldata as our labor guide also. I've noticed several repairs that seem to be out of line. We looked at both Mitchell and Alldata when we first opened and went with alldata. We will be looking at diferent labor guides in the future

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We use alldata as our labor guide also. I've noticed several repairs that seem to be out of line. We looked at both Mitchell and Alldata when we first opened and went with alldata. We will be looking at diferent labor guides in the future

 

I've used all sorts of labor guides in the past. Alldata, Mitchell, Motor...etc.. etc.. The one that I have been using for the past couple of years is from a company out of Florida. It's called "Real-time Labor Guide" it's a pretty simple setup but whats nice is that if you find something that isn't correct... you call them.. tell them... they'll listen ... they'll make the changes and also give you a credit towards your next up date.

 

The only time I have any hassle is with the extended warranty companies... they perfer Mitchell... I tell them,"Hey, do what ya want, the bottom line is I'm charging what I feel it's worth and if the company isn't paying for it... somebody will." (Mitchell's labor always seemed a little light to me.)

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I've used all sorts of labor guides in the past. Alldata, Mitchell, Motor...etc.. etc.. The one that I have been using for the past couple of years is from a company out of Florida. It's called "Real-time Labor Guide" it's a pretty simple setup but whats nice is that if you find something that isn't correct... you call them.. tell them... they'll listen ... they'll make the changes and also give you a credit towards your next up date.

 

The only time I have any hassle is with the extended warranty companies... they perfer Mitchell... I tell them,"Hey, do what ya want, the bottom line is I'm charging what I feel it's worth and if the company isn't paying for it... somebody will." (Mitchell's labor always seemed a little light to me.)

 

We take the same approach with extended warranty companies. We always inform the customer from the start that the warranty company may not pay the entire bill, and any additional charges must be paid by the customer before the car is released.

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