Labor margin vs parts margin
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By CAR_AutoReports
How I went from an average credit card transaction of $360 in November of 2013 to $805 in October of 2019...
Everyone wants change to be easy.
Everyone wants to kill it in their craft.
How many of you are ready to put in the work? Take an inside look at the lessons we learned while transforming our business over the last 7 years. We're going to discover how we evaluated Joman in 2013 and how we designed CAR to streamline service, period.
I sat in several classes at AAPEX where I felt like everyone was talking about the things we spent the last 7 years building, so now I'm going to tell you how we did it and why our platform is the integral internal process that can replicate this machine anywhere on the planet where service is performed.
If Amazon were a store, how could it possibly look or operate.
Walk in, what level would you like to go on? Tech? Oh you just need an 'iPhone cable 6ft'? Got you, here's the one we recommend, along with a few others on the shelf. Want to see which is best rated? Lowest price? Manufacturer? How fast can you get it? Let me see this one; check some reviews, some comments... Ok, here's the one I need and it'll be at my house tomorrow? Awesome, thanks! Oh what's that, you need 2... your cord in your car looks the same? No worries! Still want it tomorrow? See you then! Now, with that frame of reference... look at your own business.
What you must remember is that even though you are not Amazon, customers have been conditioned to have a frictionless approach to transactions. That's why your largest competitor is yourself and your ability to adapt to this evolved phase of business consistency... that you are also a part of.
When a customer walks in your door, what do they see?
Must Have | HARD: Smile, let everything go that may be happening in life and get ready to deal with someone else's problem. Must Have: Counter/Desk clean and organized? Must Have: Computer ready to go? Unless you use CAR, then you can just take out your phone or the tablet we provide to every employee. Almost Must Have: A clean waiting room with available chairs? If not available for good reasons, that's a plus here. Like, there are other customers filling their space. Almost Must Have: Do you look like a disaster? *PS I did for years, still do sometimes. We all have off days.* Nice To Have:Water bottles handy? Maybe a coffee machine, if you have the space. The Hardest Goal: How clean is your shop? The internet doesn't need a smile or a clean office/shop, the internet is a place where business is done based on price or features and sometimes... both. You're in the business of service, competing against everyone from the other local guy to the large marketing firms with endless budgets. And it's evolving, faster than you've ever imagined.
If you're standing still, you're going to lose out on a great opportunity to evolve as a business and as a person, and possibly make the most money ever by providing good and honest service.
Phase 1 is to get you to think about your position in the market place. Compare yourself to the impossible, because doing so will open your mind to potential solutions to frictions that exist in your business today, by just thinking about them.
When Jeff Bezos evolved Amazon, he wasn't trying to provide the lowest price on products. He was and is trying to fulfill what his customers want, cheaper pricing on goods and near instant delivery. He's delivered on both. Your customers expectations are different, and if your service level is built on trust, price becomes much less of a barrier.
Tune in next week, where we continue this series of... How to evolve my auto repair business. I had a really great title for this series, but it was stolen and trademarked.
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By CAR_AutoReports
Our experience with ADAS has been a truly amazing learning journey. Our learning journey is making us wonder what the direction of the industry is with ADAS and more importantly... how service center goals for growth and profit align with maintaining customer satisfaction while performing precise services with a skilled workforce that is in decline. If you're thinking about ADAS... you should read this first.
Another acronym being thrown around is ADAS, short for Advanced Driver Assist Systems. I think everyone is stuck staring at those four letters without understanding the liability that those 4 letters represent for the future of the automotive industry, regardless of how much safer they make vehicles on the road. As one of the first facilities in NJ to purchase and utilize the ADAS calibration system from Autel, we have some really unique experience with it and want to pass on some information you should be aware of when considering whether or not you want to jump in.
Facility Is Too Small - Size matters, A LOT with ADAS calibrations and if you have less than 2500 sf of space with a booming business... chances are you don't have the room to perform calibrations. Your exact business configuration will help determine this, but you ideally need a location where you can pick up 10 feet of open space all around a vehicle for most calibrations, but some calibrations may require 20 feet or more. Floor Isn't Level - If your floor is uneven, you can't perform ADAS calibrations, period. Can't Program? - If you are not experienced with programming modules or updating vehicle modules, you will not be able to perform a fair amount ADAS calibrations. Can't Diagnose? - If you don't have a team that can efficiently and accurately troubleshoot the vehicles already coming into your shop, ADAS isn't going to be any easier, it's going to be significantly harder. Who Needs OE Information, I have "X"! - Replace X with All Data or Mitchell or even the instructions in your scan tool. What happens when the manufacturer updated the information on the procedures yesterday and they didn't share that information with anyone yet? We've already encountered steps missing from the Autel scan tool... Minimum Insurance Policy Is More Than Enough - We have more than double the minimum and we are worried it's not enough. With lawsuits that settle into the tens of millions of dollars, we're not sure what enough is anymore. Don't Document Your Process? - This is where a lot of people will scoff. Who has the time? Save pictures and files, where am I supposed to do that? Who's gonna pay for this? We've figured this out and more importantly... we get paid for documenting. Do you? Mobile Calibrations? - Besides the fact that you're trying to transport $20,000 of equipment needed for calibrations in a van, this one is so serious... we couldn't give you a 2 sentence paragraph, read below. How are mobile glass services, like Safelite, performing calibrations on the go? We don't know, but we have A LOT of questions surrounding this. A recent calibration of a 2019 Toyota C-HR, after a windshield replacement, has some really interesting requirements. Requirements which we are used to, but we want to know... how is a mobile tech handling this? These are the requirements that must be met prior to starting a calibration:
It is our experience that once a windshield has been replaced, the vehicle should not be moved for a period of at least 2 hours (weather dependent) in order to allow the glue to harden properly. So, what's going on? Is the mobile glass tech filling up the vehicle prior to replacing the windshield? How many of you had a windshield replaced and a vehicle calibrated with a fuel tank that was not full? We don't know how many corners are being cut and where they are being cut... but what we do know is that the above requirements have been there in every vehicle we have calibrated at this facility thus far. Lastly, pay particular attention to this requirement in this photo...
*Calibration should be performed in a window-less environment with no bright lights or reflective materials. Ensure no other black and white patterns similar to the calibration pattern should be behind the calibration pattern. In a world where reducing liability is at the forefront of most public discussions, there are sure a lot of companies undermining their insurance policy in the field.
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By Gonzo
Breaker, Breaker… In my many years of repairing cars I’ve helped out a countless number of other shops with their electrical problems. Some shops I would see a few times a month, and others only once in awhile. This was years before the internet was around, and cell phones were only a fad and way to expensive to have. So, most everything was done by a land line or over the CB radio. Back in the mid 80’s and 90’s I had one shop that I talked with nearly every day. Great guys, but not so great as mechanics. The owners name was Joe. His shop was small and seemed to be a place for wayward towed vehicles and obscure customers looking for dirt cheap repairs. His main business was his tow service, and the repair shop seemed to be there just to fill in the gaps on those slow days. One afternoon I got a call from Joe about a car his crew had given up on. They threw the parts cannon at it, but couldn’t get this car to come back to life. Joe was with tows, and needed the mechanics he had to drive the other tow trucks. This particular car had been in his shop for quite some time and I don't think the customer was too happy about it. So, to speed things up a bit, he dropped it off at my shop. “I’ll be on the road all day. I've got to get back out there. I've got tows lined up all day. If you get it going, could ya run it back to my shop,” Joe said, as he made a dash for his tow truck. “No problem Joe, I’ll get right on it,” I said, just as he drove off. The car was an 80’s GM. I could see all kinds of shiny new components under the hood, and could tell they put a lot of effort into swapping parts to find out what was going on. The symptom was; if you flipped the key to the crank position it would immediately start, but die just as quickly. The parts they changed were the predictable parts cannon fodder that the typical parts slapper would try. Tune-up parts, an IAC, TPS, MAP, ECM, etc… etc… all of which might, could, should’ve, probably, maybe, and of course, eventually with enough darts thrown at it, could have hit the target and fixed it. But it didn’t. I wasn’t about to go that route. Time for some real diagnostics and not just shoot from the hip. Why not start with the basics- fuel, air, and fire. Spark was good, timing looked good, and the intake had a good air pull. I gave it a shot of carb. cleaner, and as long as I kept spraying… it kept running. Ok, time to check the fuel pressure. Interesting... there was pressure. Hmmm, now what to do? The next obvious thing (to me) was to check fuel volume. I disconnected a fuel line and gave the key a flick into start. The fuel shot out into the drainage bucket, but then trickled to a stop. I did it a second time. Not as much fuel made it out this time, but the scenario was basically the same. It was always a quick burst followed by a trickle. Maybe I should look at that gas gauge. Well, wouldn’t ya know it, the gauge is ready E. It had just enough in the tank to pressurize the fuel lines but not enough to keep it going. Might as well grab a gas can, and put some in the tank. I’ll try it again… vroom, vroom, vroom, alright! It’s running great! Looks to me as if the entire problem was that it was out of gas. However, with all the new parts they installed, I couldn’t be sure if this was the 'only' problem or an after affect of having the car in the shop so long while trying to solve another problem. It could have been any one of the other components (within reason) they changed that really 'did' need to be changed. Later that day I drove the car back to Joe’s shop. He wasn’t there, but his dispatcher was in the office sorting out tow tickets and monitoring the CB with the volume up full blast. In the background you could hear the CB chatter from all the area’s tow companies. About then I heard Joe’s voice over the CB, “Did Gonzo call yet? Need to check in on him, we need to get that car back to the owner.” “He just walked in Joe, over,” the dispatcher told him. “So what was wrong with it,” Joe asked between the squelch of the CB radio and all the other chatter from the other tow companies. The dispatcher turned to me and pointed at the mic. So, I told him . The dispatcher, with a stunned look on his face, said, “I can’t tell him that. He is going to be so pissed.” “I don’t think you should either. At least not until he gets back,” I said, while breaking into an ear to ear smile. The CB comes back to life with Joe’s voice again; “So what did he find out, over,” Joe's frustration was showing through as his voice barked out of the CB speaker. The dispatcher said to me, " Old Joe sounds pretty pissed." I don’t know whether it was the way his day was going or how much time and money he's spent on this car. Either way, he’s not going to like this answer. “Go ahead… tell him,” I said to the dispatcher, still sitting there hold the mic button, “He wants the answer, so let him have it.” “Alright, Joe, are ya ready for this, over?" the dispatcher said, then waited for a response from Joe. "Yea, go ahead, over." "It was out of gas.” A dead silence came over the CB. No chatter, nothing, not another sound for what seemed to be an eternity. Then, all hell broke loose. Tow drivers from all over the city were razing poor Joe. The CB was full of laughter and goof ball comments, but not a word from Joe. Poor Joe, you asked for it, and now you got it. “Tell Joe to stop by the shop, he can settle up with me then,” I said, while trying to hold back the laughter. As I walked out the door, the CB chatter could be heard all the way to the parking lot, and the comments were still flying. It was one of the funniest moments I’ve ever had for doing nothing more than putting gas in a car. When Joe came up to pay the bill I told him I had a little something for him. I handed him a little tiny gas can on a key chain. I figured it might be a good reminder for him to always check the basics before loading up the parts cannon again. After all these years I’m sure he hasn’t forgotten about it, and I’ll bet he doesn’t tell too many people where he got that little gas can key chain from… but now, it wouldn't be so much on the CB, but over the internet.
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By slowtech
Just got my e-mail on the latest forum topics. Out of 20 topics 7 are marketing ads from the same person. Also under popular forum topics of 5, 3 are ads also by same person of which no discussion took place. So how are these popular. I get a ton of advertising e-mail. Just didn't expect this from ASO. I do look into some ASO sponsor ads. But this is not necessary.
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By Joe Marconi
I am writing this on my last day of vacation in California, spending time with family. It took me a few days to totally relax, but made it a point to not look at emails or call the office.
We all need downtime. I know there will be a ton of work to be done when I return, but I also know that the time away has recharged my batteries and I will be more productive.
Being away from business and spending time with family puts things into proper perspective. You realize that a lot of the things you stress over, are really not as important as you think.
Take time to enjoy life. We all know how quickly time passes us by. And remember, no one on their death bed ever said they wished they spent more time at work.
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