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By Joe Marconi in Joe's Blog0 commentsAuto shop owners are always looking for ways to improve production levels. They focus their attention on their technicians and require certain expectations of performance in billable labor hours. While technicians must know what is expected of them, they have a limited amount of control over production levels. When all factors are considered, the only thing a well-trained technician has control over is his or her actual efficiency.
As a review, technician efficiency is the amount of labor time it takes a technician to complete a job compared to the labor time being billed to the customer. Productivity is the time the technician is billing labor hours compared to the time the technician is physically at the shop. The reality is that a technician can be very efficient, but not productive if the technician has a lot of downtime waiting for parts, waiting too long between jobs, or poor workflow systems.
But let’s go deeper into what affects production in the typical auto repair shop. As a business coach, one of the biggest reasons for low shop production is not charging the correct labor time. Labor for extensive jobs is often not being billed accurately. Rust, seized bolts, and wrong published labor times are just a few reasons for lost labor dollars.
Another common problem is not understanding how to bill for jobs that require extensive diagnostic testing, and complicated procedures to arrive at the root cause for an onboard computer problem, electrical issue, or drivability issue. These jobs usually take time to analyze, using sophisticated tools, and by the shop’s top technician. Typically, these jobs are billed at a standard menu labor charge, instead of at a higher labor rate. This results in less billed labor hours than the actual labor time spent. The amount of lost labor hours here can cripple a shop’s overall profit.
Many shop owners do a great job at calculating their labor rate but may not understand what their true effective labor is, which is their labor sales divided by the total labor hours sold. In many cases, I have seen a shop that has a shop labor rate of over $150.00 per hour, but the actual effective labor rate is around $100. Not good.
Lastly, technician production can suffer when the service advisors are too busy or not motivated to build relationships with customers, which results in a low sales closing ratio. And let’s not forget that to be productive, a shop needs to have the right systems, the right tools and equipment, an extensive information system, and of course, great leadership.
The bottom line is this; many factors need to be considered when looking to increase production levels. While it does start with the technician, it doesn’t end there. Consider all the factors above when looking for ways to improve your shop’s labor production.
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By carmcapriotto
We've got a fantastic panel of guests, including Jimmy Lee and Kent Bullard from The Institute, and Brian and Kim Walker from Shop Marketing Pros to discuss ASTE, the Automotive Service and Technology Expo in Durham, North Carolina. Kim and Brian Walker, Shop Marketing Pros, Auto Repair Marketing Podcast Kent Bullard, COO, The Institute. Listen to Kent’s other episodes HERE. Jimmy Lea, The Institute. Listen to Jimmy’s previous episodes HERE Show Notes
https://asteshow.com The Go Kart Event (00:05:26) Discussion about sponsoring the Go Kart event at the Automotive Service and Technology Expo (ASTE), and the excitement surrounding it. Prizes and Activities (00:06:38) Details about the prizes and activities at the event, including fastest lap and time, golf simulator, axe throwing, and more. Management Training and Effective Communication (00:10:11) Mention of various management training sessions, including effective communication, hybrid diagnostics, and marketing strategies for different personalities in the industry. Phone Skills Training (00:16:51) Discussion on the importance of having good phone skills before investing in marketing. Handoff from Marketing to Sales (00:17:32) Exploration of the issue of service advisors not properly handling phone calls and potential solutions. Training Programs for Staff (00:21:36) Importance of developing training programs for technicians and service advisors to ensure their growth and retention in the business. The importance of investing in training (00:24:37) Investing in training and taking care of your team is crucial for success in the industry. Networking and building relationships at events (00:26:06) The value of networking and making connections at events like ASTE cannot be underestimated. The significance of sharpening your skills (00:27:12) Attending training events is like sharpening your tools to become a better technician, shop owner, service advisor, or manager.
Thanks to our Partner, Technician Find If you are tired of struggling to find skilled automotive technicians for your independent auto repair shop, say goodbye to the endless search and let Technician Find be your solution. We are a 'Single Stop To Staff Your Shop.' http://www.technicianfind.com Connect with the Podcast: -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 -The Aftermarket Radio Network: https://aftermarketradionetwork.com -Special episode collections: https://remarkableresults.biz/collections
Click to go to the Podcast on Remarkable Results Radio
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By carmcapriotto
In this episode, Reggie Stewart covers a range of topics from dispatching and business operations to shop renovations. Reggie recently undertook renovations at his shop in Kokomo, Indiana, he modernized the colors and feel of the shop to give it an upscale vibe, with the help of an interior designer. He also discusses the importance of building a positive culture and is currently working on creating job descriptions and manifestos for each position to better define expectations and attract the right people. Reggie Stewart, Reggie’s Motor Works, and Noble Auto Service in Noblesville, IN, Euro Specialist. Reggie’s previous episodes HERE
Aftermarket Weekly 109 with Reggie Stewart Is Your Company Culture Holding You Back? with Chris Lawson [RR 864] The importance of dispatching in a shop (00:04:21) Reggie discusses the importance of having a dedicated dispatcher in a shop and the potential impact on efficiency and economics. Business operations and booking appointments (00:06:25) Reggie talks about the current state of his business, being comfortably busy and booked out a few days, and the decision to add staff members. They also discuss appointment scheduling and managing waiters. The need for a dedicated dispatcher (00:08:43) Reggie discusses the need for a dedicated dispatcher in his shop and the potential for hiring one in the future. Writing manifestos for job positions (00:11:13) Reggie talks about writing manifestos for each position in his company to better define roles, performance, and culture. Remodeling the Shop (00:16:33) Discussion about the renovation of the shop, including modernizing the colors, removing walls, and creating new spaces. Targeting a Different Market (00:19:01) Exploring the demographics and target clients in Kokomo, Indiana, compared to Noblesville, and the challenges and opportunities of serving a different community. Investing in Shop Updates (00:21:28) The importance of updating and investing in the shop, whether for attracting customers or preparing for a potential sale or exit strategy. Thanks to our Partner, Dorman Products. Dorman gives people greater freedom to fix vehicles by constantly developing new repair solutions that put owners and technicians first. Take the Dorman Virtual Tour at www.DormanProducts.com/Tour
Connect with the Podcast:
-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
-The Aftermarket Radio Network: https://aftermarketradionetwork.com
-Special episode collections: https://remarkableresults.biz/collections
Click to go to the Podcast on Remarkable Results Radio
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