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By Joe Marconi in Joe's BlogAuto 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 Joe Marconi
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By carmcapriotto
"Give Me 10 Mission: To provide a work-based learning model that any industry can utilize to bridge the skills gap. Combining classroom instruction with on the job work based learning opportunities. This program integrates the classroom with employers to create an introduction to a career path of the student's choice.
The program simplifies the relationship between an industry lead business and vocational education that can lead into a career path. We ask for no money. Our “ask” is for your time. Time to integrate a student into your business to create a career fit. It starts with 10 hours and can grow into a new employee. Can you “Give Me Ten?”
Sue Dixon, the creator of the "Give Me Ten" program, discusses the importance of collaboration between the automotive industry and education. The "Give Me Ten" program, which exposes students to the automotive industry and helps them explore potential career paths, is highlighted. The discussion also covers the need for updated curriculums, industry involvement, and the success of the "Give Me Ten" program in providing work-based learning experiences. Sue Dickson, Closs Tire & Auto Repair Inc, Waukegan, IL Sue's previous episodes HERE Show Notes:
The importance of collaboration with education (00:00:40) Discussion about the need for collaboration between the automotive industry and education to promote career pathways and work-based learning opportunities for students. Career pathways endorsement in education (00:03:30) Explanation of the career pathways endorsement in education, which requires students to complete 60 hours of career work-based learning in the transportation cluster. The "Give Me Ten" program (00:04:50) Introduction of the Give Me Ten program, which aims to simplify engagement between businesses and education by providing 10 hours of work-based learning opportunities for students to explore potential career paths in the automotive industry. The importance of collaboration between industry and education (00:09:15) Discussion about the need for collaboration between the automotive industry and education to update curriculums and provide work-based learning opportunities. Simplifying work-based learning and engaging businesses (00:13:02) Explanation of the importance of simplifying work-based learning and engaging businesses to create career pathways for students, with a focus on liability and industry standards. Starting the collaboration (00:19:47) Sue Dixon explains how to start building the Give Me Ten program in your own community and the support they provide, including a free consultation. 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:
-Follow on Facebook: https://www.facebook.com/RemarkableResultsRadioPodcast/ -Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/ -Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/ -Follow on Twitter: https://twitter.com/RResultsBiz
-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
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By carmcapriotto
Recorded Live at AAPEX 2023, Andy Bizub and part owner Brandon Ludwikowski discuss the transition from technician to business owner, the importance of a positive attitude, and the tools and knowledge required for technicians. The conversation also covers the division of responsibilities within the company, decision-making processes, and the importance of understanding business fundamentals and financials. Brandon Ludwikowski, Midwest Performance Cars, Chicago and Northbrook, IL. Andy Bizub, Midwest Performance Cars, Chicago and Northbrook, IL. Andy’s previous episodes HERE. Show Notes
Attitude is Key (00:02:12) Brandon emphasizes the importance of having a positive attitude in the face of challenges and setbacks. Providing the Right Tools and Knowledge (00:03:19) Brandon discusses the need for owners to provide technicians with the necessary tools and knowledge to perform their job effectively. Finding the Best Training Sources (00:04:51) Andy explains how he identifies knowledge gaps in his team and seeks out the best training sources to enhance their skills and capabilities. Using a dashboard for learning and improvement (00:09:10) Discussion about the usefulness of a dashboard in identifying areas for improvement. Dealing with overconfidence and ego in technicians (00:09:42) The challenges of working with technicians who believe they know everything and the importance of leaving ego at the door. Considering succession planning and bringing on an ownership team. (00:11:01) The reasons behind bringing on an ownership team, including geographical considerations and planning for the future. The journey to becoming part owners (00:17:56) Brandon discusses the process of becoming a part owner of Midwest Performance Cars and the decision-making involved. Andy describes the complementary skills and characteristics of the three owners: Chris, Ryan, and Brandon. Future plans and ownership transition (00:24:34) Andy explains the terms of the deal, including the timeline for the owners to fully pay for their shares and the possibility of Andy staying on as an advisor. The importance of balance sheets (00:31:46) Andy explains the importance of understanding balance sheets and how they show the true worth of a business. Teaching finance to the team (00:34:02) Andy discusses how he teaches finance to his team, emphasizing the importance of understanding numbers and making informed decisions. Transitioning from a single owner to a business owner (00:34:24) The conversation shifts to the challenges faced by single owners and how they can start transitioning to becoming successful business owners. The balance sheet and cash flow statements (00:34:40) Explanation of the importance of understanding balance sheets and cash flow statements for business owners. The benefits of having a coach (00:36:17) Discussion on the positive impact of having a coach for business owners. Transitioning to a business mindset (00:37:08) The importance of shop owners understanding the business side of their industry and becoming businessmen, rather than just shop owners. Thanks to our Partners, AAPEX and NAPA TRACS Set your sights on Las Vegas in 2024. Mark your calendar now … November 5th-7th, 2024. AAPEX - Now more than ever. And don’t miss the next free AAPEX webinar. Register now at http://AAPEXSHOW.COM/WEBINAR 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/ Connect with the Podcast: -Follow on Facebook: https://www.facebook.com/RemarkableResultsRadioPodcast/ -Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/ -Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/ -Follow on Twitter: 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 -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
Did you know most shops only utilize 20-30% of their bay capacity? Let's explore the concept of effective bay rate and the potential benefits of monitoring and analyzing bay usage. What is the potential revenue that can be realized by addressing these inefficiencies? Our panel highlights the importance of focusing on bay efficiency rather than just technician efficiency and the need for shops to adopt lean six sigma principles to maximize productivity.
Chris Cloutier is co-owner of Golden Rule Auto Care in Dallas Texas and CEO of Autoflow. Chris’s previous episodes HERE Brandon Crusha, Training Manager, AutoFlow. Craig O’Neill, VP of Training, AutoFlow. Listen to Craig’s previous episodes HERE Show Notes: Effective Bay Rate and Bay Productivity (00:00:22) Discussion on the importance of effective bay rate and the use of cameras and AI to improve bay productivity and efficiency. Realizing Potential Revenue through Operational Efficiency (00:08:14) The discussion focuses on how the use of cameras and technology can reveal potential revenue that is not being realized and the fear some shop owners have in facing this reality. The potential of improving bay efficiency (00:10:14) Discussion on the importance of managing bay efficiency and how to become more productive and efficient with limited bays. The role of technology in tracking vehicles in the bay (00:11:17) Exploration of how a tool can provide visibility into which cars are being worked on in each bay, highlighting wasted time. Challenges with diagnosing and tracking diagnostic time (00:13:11) Discussion on the inefficiencies and lack of process in diagnosing and tracking diagnostic time, leading to wasted hours and $0 tickets. The Shop Manager's Data Needs (00:19:40) Discussion on the importance of data for shop managers and foremen, including workflow software, bay capacity, tire sales, and profitability of ADAS services. The Expensive Alignment Bay (00:20:30) Exploration of the alignment bay as the most expensive bay in the shop and the need for better utilization of alignment racks. Using Technology Efficiently (00:23:26) Discussion on the benefits of using technology in the shop, including efficiency, identifying supply chain issues, and improving communication between technicians and service writers. Thirsty for New (00:27:53) The importance of being open-minded and continuously learning in order to improve operations and stay ahead in the industry. The Trouble with Potential (00:27:27) The concept of potential losses and the need to measure and track them in order to make improvements and increase profitability. The team's experience in the industry (00:35:15) Discussion about the team's experience as former shop owners and the value it brings to developing software. The long incubation period (00:37:02) Conversation about the six to seven years it took to develop the software, including false starts and multiple versions. Challenges in shop efficiency (00:39:33) Exploration of issues such as technician distractions, wasted time on switching bays, and waiting for parts, and the need for improved efficiency. The importance of building a good relationship with parts suppliers (00:43:11) Shop owners need to stop blaming their suppliers and instead foster a mutually beneficial relationship. The need for education and training in the industry (00:44:05) Shop owners should invest in educating their service writers and technicians to improve the accuracy of parts ordering. The benefits of using BayFlow as a management tool (00:46:47) BayFlow provides valuable insights and data that can help shop owners run their businesses more effectively. The adoption rate of DVI (00:50:49) Discussion on the slow adoption rate and challenges of implementing DVI technology in the automotive industry. Thanks to our Partners Shop-Ware and Delphi Technologies Shop-Ware: More Time. More Profit. Shop-Ware Shop Management https://getshopware.com/ Delphi Technologies: Keeping current on the latest vehicle systems and how to repair them is a must for today’s technicians. http://DelphiAftermarket.com Connect with the Podcast -Follow on Facebook: https://www.facebook.com/RemarkableResultsRadioPodcast/ -Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/ -Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/ -Follow on Twitter: https://twitter.com/RResultsBiz -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
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By Joe Marconi
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