Quantcast
Jump to content


Recommended Posts

Posted

Raising your labor rate and trying to increase your average ticket dollar amount in an effort to increase income may not be the way to financial stability. In fact, it might just make you fail! Before you send for the men in white coats and call me crazy, please have an open mind and read on.

 

Like many of you, I once shared the belief that a high labor rate, quality work, high-ticket averages and superior customer service was the business strategy to create a successful repair shop. I also believed that the customers should never control the flow of work in my bays by dictating to me when they need service and that I should carefully plan out the day. There was also a time when I would refuse a walk-in for an oil change because I had too much work in the bays. Well, I’m here today to tell you that for me, this strategy is dead. It died along with the carburetor, points and condenser. The quality of your work, tracking key performance numbers and providing great customer service still holds true, but in today’s business world, it’s not enough.

 

Look around at the world today. Has anything changed? You bet! We live in a fast past world where people balance work, family, fun, Church and other obligations. Both Mom and Dad have careers and are running from ballet to baseball. The media has been drumming into our head for the past thirty years that great service is getting what you want now and fast. Why do people today value their time so much? Because they have so little of it.

 

So, here’s the scenario. Its Tuesday 2:00pm and Mrs. Smith arrives at your shop unexpectedly with a check engine light on. You politely and professionally tell Mrs. Smith that you would be more than happy to take the car in on Thursday. Now, she’s starts processing in her mind what she needs to do on Thursday: She needs to leave work early to bring her daughter to the dentist at 1:00pm and needs to be back at the office by 3:00 for a meeting, then dinner at 5:30 and the P.T.A at 7:00. “No, Thursday won’t do”, she says. Respectfully, you answer, “How’s next week?”

 

At this point she gets frustrated and says she will let you know. You just may have lost a customer. You viewed her problem as a check engine light and how you would fit her car into YOUR calendar. She perceived her problem as another way to balance an already demanding schedule.

 

Now let’s talk about labor rates and average repair order dollars, and I will hopefully tie all this together. Concentrating on bigger tickets and labor rates as a way to overcome inadequate car counts and low profit will simply not work. I’m not saying you shouldn’t charge what you are worth. I don’t give anything away in my shop and charge accordingly. But, what I’m more concerned about in today’s market is opportunity. I concentrate on maintaining healthy car counts to give me the opportunity to sell more. Today’s cars are not like those built in the 70’s and 80’s. You don’t have the highly profitable repair work anymore and cars are more reliable. Take a look at what the automakers are taking away from us: Timing belts, plugs/wires, fuel filters, distributor caps, rotors, etc. Not to mention long life coolant, transmission fluid and extended oil change intervals.

 

This means you will need a healthy car count in order to give your shop the opportunity to sell profitable service work. This also means that you will need to be very proactive in managing your customer’s vehicle maintenance. You will need to be very innovative in your approach on maintenance and service, and diversify your services to fit a broader range of consumers.

 

Successful “Big-Box” stores understand the law of compounding and moving product. Even in these tough economic times, Home Depot would rather sell 1,000 cans of paint a week and make $6.00 on a can, then make $12.00 per can and only sell 300. Why? Having that many people coming through their doors buying paint increases sales in other areas, such as paint brushes, primer, rollers and drop clothes. Again, when you increase the number of customers, you increase the opportunity to sell more products. This is the law of compounding sales through opportunity.

 

Before you go lowering your prices, STOP. Most of us sell at a fair price already. What I’m suggesting is that when you increase car counts, you give yourself more opportunity to move product: such as air filters, cabin filter, batteries, wipers and other items. Plus, you are working on building a customer base that will more likely return in the future because your willingness to work around their schedule.

 

You may have loyal customers, but if you’re not perceived as convenient and not willing to accommodate them when they need you, you may not be capitalizing on your potential to fully satisfy a customer.

 

How do you increase traffic to your bays? Say “YES” as much as possible. Be more accommodating. Try to work around your customer’s schedule, not yours. Be more flexible. Your daily planner is not written in stone. Promote while-you-wait service, if at all possible. At my shop we welcome walk-ins and promote while-you-wait service. It has proven to be a gold mine of opportunity for us. I do understand that smaller 2 or 3 bay shops may not be able to handle a flood of waiting customers. For these shops you may need to rethink your business model to insure that your daily scheduled jobs are balanced properly in order to maximize opportunity. Remember; opportunity equals profit.


View full article

Posted

[Article written earlier than posted time, link at the bottom to original source]

 

Raising your labor rate and trying to increase your average ticket dollar amount in an effort to increase income may not be the way to financial stability. In fact, it might just make you fail! Before you send for the men in white coats and call me crazy, please have an open mind and read on.

 

Like many of you, I once shared the belief that a high labor rate, quality work, high-ticket averages and superior customer service was the business strategy to create a successful repair shop. I also believed that the customers should never control the flow of work in my bays by dictating to me when they need service and that I should carefully plan out the day. There was also a time when I would refuse a walk-in for an oil change because I had too much work in the bays. Well, I’m here today to tell you that for me, this strategy is dead. It died along with the carburetor, points and condenser. The quality of your work, tracking key performance numbers and providing great customer service still holds true, but in today’s business world, it’s not enough.

 

Look around at the world today. Has anything changed? You bet! We live in a fast past world where people balance work, family, fun, Church and other obligations. Both Mom and Dad have careers and are running from ballet to baseball. The media has been drumming into our head for the past thirty years that great service is getting what you want now and fast. Why do people today value their time so much? Because they have so little of it.

 

So, here’s the scenario. Its Tuesday 2:00pm and Mrs. Smith arrives at your shop unexpectedly with a check engine light on. You politely and professionally tell Mrs. Smith that you would be more than happy to take the car in on Thursday. Now, she’s starts processing in her mind what she needs to do on Thursday: She needs to leave work early to bring her daughter to the dentist at 1:00pm and needs to be back at the office by 3:00 for a meeting, then dinner at 5:30 and the P.T.A at 7:00. “No, Thursday won’t do”, she says. Respectfully, you answer, “How’s next week?”

 

At this point she gets frustrated and says she will let you know. You just may have lost a customer. You viewed her problem as a check engine light and how you would fit her car into YOUR calendar. She perceived her problem as another way to balance an already demanding schedule.

 

Now let’s talk about labor rates and average repair order dollars, and I will hopefully tie all this together. Concentrating on bigger tickets and labor rates as a way to overcome inadequate car counts and low profit will simply not work. I’m not saying you shouldn’t charge what you are worth. I don’t give anything away in my shop and charge accordingly. But, what I’m more concerned about in today’s market is opportunity. I concentrate on maintaining healthy car counts to give me the opportunity to sell more. Today’s cars are not like those built in the 70’s and 80’s. You don’t have the highly profitable repair work anymore and cars are more reliable. Take a look at what the automakers are taking away from us: Timing belts, plugs/wires, fuel filters, distributor caps, rotors, etc. Not to mention long life coolant, transmission fluid and extended oil change intervals.

 

This means you will need a healthy car count in order to give your shop the opportunity to sell profitable service work. This also means that you will need to be very proactive in managing your customer’s vehicle maintenance. You will need to be very innovative in your approach on maintenance and service, and diversify your services to fit a broader range of consumers.

 

Successful “Big-Box” stores understand the law of compounding and moving product. Even in these tough economic times, Home Depot would rather sell 1,000 cans of paint a week and make $6.00 on a can, then make $12.00 per can and only sell 300. Why? Having that many people coming through their doors buying paint increases sales in other areas, such as paint brushes, primer, rollers and drop clothes. Again, when you increase the number of customers, you increase the opportunity to sell more products. This is the law of compounding sales through opportunity.

 

Before you go lowering your prices, STOP. Most of us sell at a fair price already. What I’m suggesting is that when you increase car counts, you give yourself more opportunity to move product: such as air filters, cabin filter, batteries, wipers and other items. Plus, you are working on building a customer base that will more likely return in the future because your willingness to work around their schedule.

 

You may have loyal customers, but if you’re not perceived as convenient and not willing to accommodate them when they need you, you may not be capitalizing on your potential to fully satisfy a customer.

 

How do you increase traffic to your bays? Say “YES” as much as possible. Be more accommodating. Try to work around your customer’s schedule, not yours. Be more flexible. Your daily planner is not written in stone. Promote while-you-wait service, if at all possible. At my shop we welcome walk-ins and promote while-you-wait service. It has proven to be a gold mine of opportunity for us. I do understand that smaller 2 or 3 bay shops may not be able to handle a flood of waiting customers. For these shops you may need to rethink your business model to insure that your daily scheduled jobs are balanced properly in order to maximize opportunity. Remember; opportunity equals profit.

 

Click here to view the article

Posted

Always listen and take a minute or so to see whats's up. Many people will leave the vehicle if you offer a courtesy ride. If customer is not able to leave the car at least walk with the customer to their car while handling them your card.Try to keep a drive on lift open at all times to "Take A Look". The Sevice advisor can further impress that the vehicle needs to stay longer. For those that cannot leave the car and cannot reschedule for the next morning, send them around the corner to the second automotive shop that you own. That way you cover those customers that will pay more for full service and those that are in and out. Always thank all customers for their business and referrals.

Have A Great Weekend.

  • Available Subscriptions

  • Have you checked out Joe's Latest Blog?

         0 comments
      It always amazes me when I hear about a technician who quits one repair shop to go work at another shop for less money. I know you have heard of this too, and you’ve probably asked yourself, “Can this be true? And Why?” The answer rests within the culture of the company. More specifically, the boss, manager, or a toxic work environment literally pushed the technician out the door.
      While money and benefits tend to attract people to a company, it won’t keep them there. When a technician begins to look over the fence for greener grass, that is usually a sign that something is wrong within the workplace. It also means that his or her heart is probably already gone. If the issue is not resolved, no amount of money will keep that technician for the long term. The heart is always the first to leave. The last thing that leaves is the technician’s toolbox.
      Shop owners: Focus more on employee retention than acquisition. This is not to say that you should not be constantly recruiting. You should. What it does means is that once you hire someone, your job isn’t over, that’s when it begins. Get to know your technicians. Build strong relationships. Have frequent one-on-ones. Engage in meaningful conversation. Find what truly motivates your technicians. You may be surprised that while money is a motivator, it’s usually not the prime motivator.
      One last thing; the cost of technician turnover can be financially devastating. It also affects shop morale. Do all you can to create a workplace where technicians feel they are respected, recognized, and know that their work contributes to the overall success of the company. This will lead to improved morale and team spirit. Remember, when you see a technician’s toolbox rolling out of the bay on its way to another shop, the heart was most likely gone long before that.
  • Similar Topics

    • By carmcapriotto
      Thanks to our Partners, NAPA TRACS, and Today's Class The "Great Correction" refers to a shift in the industry after a period of relative ease, likely due to pandemic related factors. The key concerns include a decrease in online searches for auto repair, rising costs, increased competition from dealerships, labor shortages, rapid advancements in technology (EVs, ADAS, AI), and the need to explore new revenue opportunities like key services, ADAS calibration, tires, and truck repairs. These issues suggest that the strategies that worked in the past may no longer be effective. Ryan Daily, Business Coach, The Institute Wayne Marshall, Business Coach, The Institute Fred Hule II, Business Coach, The Institute Show Notes Watch Full Video Episode Introduction of Guests (00:00:00) Market Challenges (00:02:14) Customer Education Importance (00:04:01) Effective Communication (00:05:16) Listening to Customers (00:06:49) Value of Language in Services (00:08:34) Customer Trust and Attrition (00:09:21) New Car Sales Impact (00:10:20) Facility Appeal (00:12:26) Investing in Facilities (00:14:09) Profitability Challenges (00:15:17) Mindset Shift in Shop Owners (00:16:16) Value Proposition Discussion (00:17:21) Continuous Improvement in Service (00:18:03) Understanding Profit Targets (00:18:49) Shop Management Systems (00:19:51) Training Service Advisors (00:21:06). Proper Vehicle Inspections (00:22:01) Communication with Customers (00:28:15) Follow  Up Strategies (00:29:45) Educating Customers on Maintenance (00:32:15) Company Culture and Staff Engagement (00:34:02) Understanding Expectations (00:35:59) Customer Engagement (00:36:55) Cultural Impact (00:37:36) Continuous Education (00:39:30) Investment in Staff (00:40:36) Onboarding Process (00:42:33) Industry Transformation (00:44:38) Adapting to Change (00:46:31)
      Thanks to our Partner, NAPA TRACS 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/ Thanks to our Partner, Today's Class Optimize training with Today's Class: In just 5 minutes daily, boost knowledge retention and improve team performance. Find Today's Class on the web at https://www.todaysclass.com/ Connect with the Podcast: -The Aftermarket Radio Network: https://aftermarketradionetwork.com -Follow on Facebook: https://www.facebook.com/RemarkableResultsRadioPodcast/ -Join Our Private Facebook Community: https://www.facebook.com/groups/1734687266778976 -Join Our Virtual Toastmasters Club: https://remarkableresults.biz/toastmasters -Subscribe on YouTube: https://www.youtube.com/carmcapriotto -Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/ -Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/ -Follow on X: 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 -Special episode collections: https://remarkableresults.biz/collections The Aftermarket Radio Network: https://aftermarketradionetwork.com/ Remarkable Results Radio Podcast with Carm Capriotto: Advancing the Aftermarket by Facilitating Wisdom Through Story Telling and Open Discussion. https://remarkableresults.biz/ Diagnosing the Aftermarket A to Z with Matt Fanslow: From Diagnostics to Metallica and Mental Health, Matt Fanslow is Lifting the Hood on Life. https://mattfanslow.captivate.fm/ Business by the Numbers with Hunt Demarest: Understand the Numbers of Your Business with CPA Hunt Demarest. https://huntdemarest.captivate.fm/ The Auto Repair Marketing Podcast with Kim and Brian Walker: Marketing Experts Brian & Kim Walker Work with Shop Owners to Take it to the Next Level. https://autorepairmarketing.captivate.fm/ The Weekly Blitz with Chris Cotton: Weekly Inspiration with Business Coach Chris Cotton from AutoFix - Auto Shop Coaching. https://chriscotton.captivate.fm/ Speak Up! Effective Communication with Craig O'Neill: Develop Interpersonal and Professional Communication Skills when Speaking to Audiences of Any Size. https://craigoneill.captivate.fm/
      Click to go to the Podcast on Remarkable Results Radio
    • By marxautocenter
      Hello everyone,
       
       Currently we use RO Writer and Auto Vitals to manage our shop workflow. It works out very well overall, but I'm looking for a way to keep track of daily/weekly shop numbers in a clean and easy to read format. We found it difficult to get clear numbers in RO writer, and use the punch in/out feature in Auto Vitals for time keeping (which limits our reporting features in RO writer). I'm looking for other shop owners who use this combination to tell me they way they keep track of their daily/weekly numbers, such as technician hours worked/billed, comebacks, declined work, sold recommended (and develop a ratio from declined work/sold recommended).
       
      I'm working on a Google sheet now, but I'm looking for opinions on what you find easiest to read, while limiting entering too much information multiple times.
       
      Thank you for your comments in advance!
       
      Cheers!
    • By carmcapriotto
      Thank You To Our Partners The Institute, AutoFlow, AutoLeap, Shop Dog Marketing, In-Bound:
      In this episode, Craig is concise as he reflects on the timeless wisdom of Martin Luther King Jr. and how his principles of nonviolent conflict resolution remain highly relevant today. Inspired by recent readings of King’s works, specifically his iconic Letter from Birmingham Jail, Craig explores how these lessons can be applied to resolving conflicts in everyday life—even in situations as modern as addressing negative reviews.
      This thoughtful discussion acknowledges the historical context of King’s writings while highlighting their enduring value in promoting understanding, negotiation, and meaningful resolution.
      Watch Full Video Episode
      Key Points Discussed:
      Craig’s Appreciation for MLK’s Legacy: Acknowledging King’s brilliance as a leader, communicator, and writer, Craig emphasizes the enduring relevance of his concepts and principles. The Four Steps of a Nonviolent Campaign (as outlined in Letter from Birmingham Jail):
      Collection of Facts: Ensure injustices are present and verified. Negotiation: Open dialogue with a willingness to find common ground. Self-Purification: Prepare yourself to act constructively and maintain the ability to return to negotiation. Direct Action: Take deliberate action aimed at fostering a return to negotiation.
      The Word of the Day:
      Unfettered.
      Adj - Not controlled by anyone or anything.  Uninhibited
      Modern Applications:
      Craig draws parallels between these steps and common missteps in conflict resolution today, such as skipping fact-gathering and jumping straight to retaliation—like leaving a low review without understanding the full story. He discusses how these missed steps can lead to escalation rather than resolution.
      Takeaways for Listeners:
      People care about how much you know only after they know how much you care. Applying MLK’s principles to situations like resolving a customer complaint or an unjust review can model constructive engagement and encourage others to seek facts, negotiation, and resolution.
      This episode is a thoughtful tribute to King’s enduring legacy and a practical guide for applying his lessons to resolve conflicts with empathy and integrity.
      Links & Resources:
      Letter from Birmingham Jail by Martin Luther King Jr.
      Join Craig as he unpacks these timeless lessons and their power to transform the way we approach conflicts in our personal and professional lives.
      Thank You To Our Partners The Institute, AutoFlow, AutoLeap, Shop Dog Marketing, In-Bound:
      The Institute at WeAreTheInstitute.com.  "Stop stressing over your business, you deserve a good night's sleep. The Institute’s coaching helps you achieve success and financial peace.
      AutoFlow at AutoFlow.com. Your partner in technology, Autoflow consolidates your client interactions - before, during and after the visit to a single thread. Learn more at Autoflow.com
      AutoLeap at AutoLeap.com. Are you tired of juggling multiple tools to manage your auto repair shop? Say hello to the streamlined efficiency of AutoLeap, the #1 all-in-one Auto Repair Shop Management Software!
      Shop Dog Marketing at Shop Dog Marketing.com. "Want to see your auto repair shop thrive? Let Shop Dog Marketing be your guide. Our customer-first approach, combined with AI-driven creative content, ensures top rankings.
      In-Bound at CallInBound.com. Cover your communication needs and revolutionize your auto repair business with AI-driven call analytics from InBound.
      Contact Information
      Email Craig O'Neill: [email protected] Join Our Virtual Toastmasters Club: https://remarkableresults.biz/toastmasters
      The Aftermarket Radio Network: https://aftermarketradionetwork.com/
      Remarkable Results Radio Podcast with Carm Capriotto: Advancing the Aftermarket by Facilitating Wisdom Through Story Telling and Open Discussion. https://remarkableresults.biz/
      Diagnosing the Aftermarket A to Z with Matt Fanslow: From Diagnostics to Metallica and Mental Health, Matt Fanslow is Lifting the Hood on Life. https://mattfanslow.captivate.fm/
      Business by the Numbers with Hunt Demarest: Understand the Numbers of Your Business with CPA Hunt Demarest. https://huntdemarest.captivate.fm/
      The Auto Repair Marketing Podcast with Kim and Brian Walker: Marketing Experts Brian & Kim Walker Work with Shop Owners to Take it to the Next Level. https://autorepairmarketing.captivate.fm/
      The Weekly Blitz with Chris Cotton: Weekly Inspiration with Business Coach Chris Cotton from AutoFix - Auto Shop Coaching. https://chriscotton.captivate.fm/
      Click to go to the Podcast on Remarkable Results Radio
    • By Zenoo
      Hi my name is Zenas and I am 26 years old from Alberta, Canada. I started my own automotive repair shop in December 2023. After running it for 1 year I made a little bit of profit. I needed some advice on how I could increase it. Its a 3 bay shop with two 2 post hoists and one 4 post hoist with alignment. I am the only mechanic in the shop as I can't afford to hire anyone at this point. I am charging about $120 per hour for the labor and very minimal mark up on parts. The shop had no customer base when I got it so it took me sometime to build returning customers. If I try to increase the prices on parts the customers run away. Seems like they are calling around the city and going to the cheapest person. My monthly over head cost is about $7000. Whatever I make in a month goes back into next month's rent. Any advices on how to manage this properly from other shop owners?
    • By nptrb
      As we kick off 2025, it’s a great time for you, an auto repair shop owner, to focus on financial organization, especially with tax season just around the corner. 
      Proper record-keeping isn’t just about avoiding headaches with the IRS; it’s about gaining valuable insights into your business so you can continue to grow and thrive.
      In this blog post, we guide you through organizing your financial records for a smooth and efficient tax filing process so you can avoid the stress this season.
       
      Why Organization Matters 
      Disorganized financial records can lead to several problems: missed deductions, inaccurate tax filings, potential audits, and, worst of all, wasted time. 
      By implementing a clear and streamlined system, you can avoid these tax dangers and, in turn, have a clearer picture of your shop’s financial health.
       
      Key Financial Records to Maintain 
      Several crucial documents form the foundation of your financial records.
       
      Sales Invoices
      Sales invoices include the details of every transaction with your customers, including parts sold, services performed, and payment methods. 
      Each invoice should be numbered sequentially and include the customer’s information, date of service, and a detailed description of the work done.
       
      Purchase Invoices
      Purchase invoices include your expenses, including parts, supplies, equipment, and other business-related purchases. 
      It’s best practice to keep all invoices and receipts organized by vendor and date.
       
      Bank Statements 
      Bank statements provide a record of all transactions that pass through your business bank accounts, including deposits, withdrawals, and electronic transfers. 
      Remember to reconcile your bank statements regularly to ensure accuracy.
       
      Credit Card Statements 
      Credit card statements document all credit card transactions and should be kept organized and reconciled with all of your other internal records.
       
      Payroll Records
      Payroll records are crucial for tax compliance and include employee wages, salaries, taxes withheld, and other payroll-related information.
       
      Inventory Records 
      These are essential for calculating your Cost of Goods Sold (COGS). This includes tracking the purchase, sale, and remaining stock of parts and supplies.
       
      Fixed Asset Records 
      Fixed Asset Records document the purchase and depreciation of long-term assets such as equipment, vehicles, and building improvements.
       
      Organization Strategies
      We recommend several practical steps for organizing your financial records. These strategies should be implemented year-round so tax season is simplified every year!
       
      Separating your business and personal finances is crucial. Maintain separate bank accounts and credit cards for business and personal expenses to simplify tracking and prevent confusion during tax season.
      Accounting software like Quickbooks Online can automate many bookkeeping tasks, generate reports, and simplify tax preparation. Establish a consistent filing system, whether you prefer physical or digital files. 
      For physical files, use labeled folders organized by category (e.g., sales invoices, purchase invoices, bank statements). 
      For digital files, create folders on your computer or in a cloud storage service and use clear file names. Pro tip:  If you receive physical documents, scan them and save them digitally to create a backup and make it easier to search for specific documents. 
      Regularly reconciling your bank and credit card statements monthly can help identify any discrepancies and ensure accuracy. 
      Finally, the IRS generally requires you to keep business records for at least three years from the date you filed your original return. However, some records, such as those related to asset purchases, should be kept for longer.
       
      Benefits of Organized Records
      Organized financial records offer numerous benefits beyond tax preparation. By tracking your income and expenses, you can better manage your cash flow and identify potential cash shortages. Accurate financial information provides insights into your business’s profitability and helps you make informed decisions about pricing, inventory, and investments. In the event of an audit, well-organized records will make the process much smoother and less stressful.
       
      Implementing these strategies can streamline your financial record-keeping, simplify tax filing, and truly understand your repair shop’s financial health. 
      Remember, consistent effort throughout the year is key to maintaining organized records and reaping their many benefits.


  • Our Sponsors



×
×
  • Create New...