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Accepting payments, get burned every time...


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We said we would help a high school friend by accepting payments for a HG on their envoy. It was going to be 1200 and they would put 800 down. Turned out they needed an engine and out of 3100 they put 500 down... I asked the husband 4-5 times to thing of what he can pay and let me know and I also needed at least half down. The wife ended up just showing up with no money and no idea what I had told her husband... Like a sucker I have her the car.

 

The car recently stopped on her and she called me complaint that with her "new engine" it should never break down and wanted to know what i was going to do about it... Being an envoy and being that EVERY time I see the car it's fuel light is on. Can you say GM fuel pump? Anyway it's getting towed in tomorrow and I do not plan on letting it leave unless paid in full.

 

Thoughts?

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I refuse to take any kind of payments anymore. If you approved the work, you can come up with the money to pay for it. If we do the work, who do I say doesn't get paid since the work wasn't paid for when the vehicle left the shop? Been burned too may times because I am a "nice" guy.

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You know, this is an excellent topic I would like to see discussed.

 

KNOW YOUR CUSTOMER. This is phrase used by the banks, and if you are thinking about taking payments, it would behoove you to know your customer.

 

I have taken payments in the past, and have been burned, but in all honesty after careful review, my instinct had warned me I would get burned.

 

I also have taken payments from people than needed their cars for work, and they paid on time without a glitch.

 

As a rule of thumb, I had taken half the amount for the job and the rest in payments.

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This is a very slippery slope to go down. As a business owner, you want to try and help your customers and also not lose out on the job. The problem is not everyone is ethical and even though you are going out of your way to help this individual, they may not see it in this light. We have only put work on credit one time here at our shop and it did work out in the end but would not do it again if possible.

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  • Have you checked out Joe's Latest Blog?

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      Got your attention? Good. The truth is, there is no such thing as the perfect technician pay plan. There are countless ways to create any pay plan. I’ve heard all the claims and opinions, and to be honest, it’s getting a little frustrating. Claims that an hourly paid pay plan cannot motivate. That flat rate is the only way to truly get the most production from your technicians. And then there’s the hybrid performance-based pay plan that many claim is the best.
      At a recent industry event, a shop owner from the Midwest boasted about his flat-rate techs and insisted that this pay plan should be adopted by all shops across the country. When I informed him that in states like New York, you cannot pay flat-rate, he was shocked. “Then how do you motivate your techs” he asked me.
      I remember the day in 1986 when I hired the best technician who ever worked for me in my 41 years as an automotive shop owner. We’ll call him Hal. When Hal reviewed my pay plan for him, and the incentive bonus document, he stared at it for a minute, looked up, and said, “Joe, this looks good, but here’s what I want.” He then wrote on top of the document the weekly salary he wanted. It was a BIG number. He went on to say, “Joe, I need to take home a certain amount of money. I have a home, a wife, two kids, and my Harly Davidson. I will work hard and produce for you. I don’t need an incentive bonus to do my work.” And he did, for the next 30 years, until the day he retired.
      Everyone is entitled to their opinion. So, here’s mine. Money is a motivator, but not the only motivator, and not the best motivator either. We have all heard this scenario, “She quit ABC Auto Center, to get a job at XYZ Auto Repair, and she’s making less money now at XYZ!” We all know that people don’t leave companies, they leave the people they work for or work with.
      With all this said, I do believe that an incentive-based pay plan can work. However, I also believe that a technician must be paid a very good base wage that is commensurate with their ability, experience, and certifications. I also believe that in addition to money, there needs to be a great benefits package. But the icing on the cake in any pay plan is the culture, mission, and vision of the company, which takes strong leadership. And let’s not forget that motivation also comes from praise, recognition, respect, and when technicians know that their work matters.
      Rather than looking for that elusive perfect pay plan, sit down with your technician. Find out what motivates them. What their goals are. Why do they get out of bed in the morning? When you tie their goals with your goals, you will have one powerful pay plan.
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