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Higher Car Counts & Quality Control

Joe Marconi
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KBenline Apprentice

KBenline

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Since our expansion last year, our car counts have increased significantly, possible too quickly. We shot out of the gate like a race horse but stumbled a bit on the turn. Nearly doubling our weekly car counts from 110-120 to over 200 at times can be challenging.

 

Although we had clearly defined processes and policy, nothing is like real-life. We pulled back on the reins and assessed the situation. We learned that we were understaffed in the shop and on the counter. We hired an additional service advisor and tech among other workflow changes.

 

It’s no secret that I am a proponent of healthy car counts; car counts equate to opportunity, opportunity equates to increased profits. My advice to anyone looking to increase car counts: create a systematic plan and implement the process in stages. Attempting to climb a ladder too fast might cause you to miss a rung and fall to the ground.

 

Joe,

 

That's great that you are doing so well. You don't seem to have been impacted by the economy too much. In San Diego (where its only cloudy and overcast when Joe Marconi visits) we all took a huge hit starting in 2008 but especially 2009. I went overboard with specials and advertising to get as many people in the door as I could during that time. Although we ended 2009 down 5% in sales, we were actually up 5% in car counts. This tells you that you average repair order went down, which often happens when car counts are too excessive to handle. There is a positive to high car count and a negative to high car count and it is important as a shop owner to identify this. I found when our car counts were high everyone was getting burned out and overworked. Profitability dropped and customer complaints can start to rise. You can go too fast too soon and destroy your business and reputation if you are not careful.

 

I also know that the effort in 2009 has paid dividends for 2010 as we are up 5% in sales and the profitablity is back. I scaled back on the coupons and advertising and the car count is now a little lower but the average ticket is higher and we are more profitable. The important thing is as a business owner, you need to understand this dynamic and not just from a "feeling" point of view. You should be tracking your daily sales, average repair order, car counts, and use accurate statistical data to make the proper management decisions.

 

So, here is what I've learned going "backwards", (I worked for an auto repair management company for over 5 years then left and bought my own shop. I call this going "backwards" because most auto repair management trainers no longer own shops. They sold them and now do training.)

 

1. Be careful about implementing all the programs, ideas, etc. that the management trainers teach. I implemented many ideas to increase car counts "oil change packages, lifetime oil changes, free oil changes, etc." While these can be good then can also be very destructive if not thought out. If you have a smaller facility you will turn it into a large volume low average repair/profitablity shop and burn everyone out. Many of those customers will not turn into anything because they after the freebie only. You have to kiss a lot of frogs with these programs to get a price and you can be "married" to the frogs if not careful. Again, do not make "emotional" decisions based on ideas from a seminar. Implement these things based on your statistics, management philosophy, business plan, and how they can fit with the ideas you recieved from a seminar.

 

2. Be even more careful about implementing employee management ideas from a seminar. Once you put an plan into place it is very difficult to undo it and will kill employee morale. I found through consulting with auto repair shops and dealing with their employees that the employees hated when the owner went away to a management seminar. This is mainly because the employees felt the owner took a "left turn" on them and became someone different and so the employees entire foundation of their employment is turned upside down. That could be a good thing in some cases but a disaster in most. Your employees choose to work with you in small business based on who you are more than anything. You wouldn't like it if your top employees took a "left turn" on you and the feeling is mutual. So, when before you implement employee management ideas, think through the process. I don't have enough time to tell you my ideas on how to implement these things successfully. I simply want to emphasize knowing your facts carefully before implementing.

 

Keith - Robert's Auto Service

KBenline Apprentice

KBenline

Posted
Posted

Keith,

First, let extend my sincere appreciation for your insight and sharing your thoughts with us. I want to emphasize to all ASO readers that Keith's background from the training side of business combined with actual shop ownership experience is a unique situation which we can all learn and benefit from.

 

I agree with your assessment. I warned many of my colleagues not to compromise on price in an effort to maintain car counts. As you have found out, an increase in car counts can decrease your overall profit. Busy does not always equate with profit. There needs to be a delicate balance between being accommodating and profitable. In addition, we must understand who are client base it and continue to market to these people. We have lived through possibly the toughest economic period in recent history. In the 30 years I have been in business, this appears to be the toughest.

 

I think the reason we were up in sales is due to our recent expansion and marketing programs. We did a lot of homework and due diligence finding our target audience and market heavy to this audience. I don't compromise on quality or want to be known as a discounter. And, so far it's working.

The issue with implementing ideas from a management training seminar is a touchy one. Many struggling shop owners, who happen to be great techs, are overwhelmed with new ideas and because of the problems they are having with their business, feel that they need to play catch-up. And, often ends up with a frustrated staff and disappointed results.

 

Keith, it was great hearing from you and please continue to participate in the forums. It's what ASO is all about; the free exchange and sharing of ideas and opinions.

Joe

 

Joe,

 

Thanks for the kind words. I will "come out of hiding" and be more proactive with this website. I really like this website and feel it is the best thing I have seen out there in terms of education and training for our industry. I will respond to more posts using my background of training and my past seven years of business ownership. I hope all is well out there.

 

Keith

KBenline Apprentice

KBenline

Posted
Posted

Keith, can you tell us a little about what lost leader programs you are using, if any. You warned about some of the oil change programs that may be destructive; are there any programs that are working for now?

 

Joe,

 

I don't have a quick answer on this one. I have a marketing program that ties everything in together. If you go to my website you will see my specials that I run. We don't have state safety inspections in california, only emissions testing. When I get a minute I will outline what I have been doing the past two years now that is working VERY well!

 

Keith

KBenline Apprentice

KBenline

Posted
Posted

Thanks Keith, did not mean to give you homework, but....

 

 

OK Joe,

 

I made a new post to start off. Go check it out. - Keith

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  • Have you checked out Joe's Latest Blog?

    • Joe Marconi
      The Technician Shortage Is Our Fault, And It's Time We Own It
      By Joe Marconi in Joe's Blog
         0 comments
      The 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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