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By Joe Marconi in Joe's Blog13 commentsMost shop owners would agree that the independent auto repair industry has been too cheap for too long regarding its pricing and labor rates. However, can we keep raising our labor rates and prices until we achieve the profit we desire and need? Is it that simple?
The first step in achieving your required gross and net profit is understanding your numbers and establishing the correct labor and part margins. The next step is to find your business's inefficiencies that impact high production levels.
Here are a few things to consider. First, do you have the workflow processes in place that is conducive to high production? What about your shop layout? Do you have all the right tools and equipment? Do you have a continuous training program in place? Are technicians waiting to use a particular scanner or waiting to access information from the shop's workstation computer?
And lastly, are all the estimates written correctly? Is the labor correct for each job? Are you allowing extra time for rust, older vehicles, labor jobs with no parts included, and the fact that many published labor times are wrong? Let's not forget that perhaps the most significant labor loss is not charging enough labor time for testing, electrical work, and other complicated repairs.
Once you have determined the correct labor rate and pricing, review your entire operation. Then, tighten up on all those labor leaks and inefficiencies. Improving production and paying close attention to the labor on each job will add much-needed dollars to your bottom line.
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By Transmission Repair
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By Joe Marconi
A friend of mine who owns a 6-bay shop in New York recently hired a tech. He was short a tech for months and was desperate. Without getting into details, the newly-hired tech lasted two weeks. Between his work ethic, bad attitude, and comebacks, it was a costly mistake.
Have you hired the wrong person in the past? I know you need to fill an important decision, but is hiring anyone the right move, hoping that things will work out?
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By Joe Marconi
It's a safe bet that nearly every auto repair shop is looking to hire an employee, most likely a technician. While I am a big proponent of a plan to recruit constantly, we can never forget about the employees we have right now.
Do all you can to create a healthy workplace with high morale. Have a one-on-one with all your employees. Find out what they like about working at your repair shop and perhaps more importantly, what they would like to change.
Ask your employees what they would do to improve your company. If you have never done this before, you may get the "deer in the headlights" look, but don't worry, keep asking and in time your employees will be a great resource for you.
When people feel appreciated and know that their opinion counts, it helps them from looking over the fence for greener grass.
What do you do at your auto repair shop to help retain your employees?
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By carmcapriotto
Guest Host and Shop Tour with Marc Pons, Chapel Hill Tire, 10 locations, Chapel Hill, NC. Carm joins Marc and visits 2 of his shops while we were in North Carolina for the ASTE 2022 Show. Learn about leadership, branding and empowering your team.
Marc Pons, Chapel Hills Tire, 10 Shops, Chapel Hill, Durham, Raleigh, and Apex, NC. Listen to Marc's previous episodes HERE
Key Talking Points
Solar panels that accommodate the electricity Mobile car wash and detailing ASTA apprenticeship program Tires are only 20% of the business now- full service to our customers Branding- consistent throughout all locations Transparency- career paths defined and structured with pay plans for each position Peer accountability Leadership is empowering your people and setting them free
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Check out today's partner:
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
Click to go to the Podcast on Remarkable Results Radio
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