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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.
By Joe Marconi
In this week’s episode of Business by the Numbers, Hunt welcomes Mike Edge from Tread Partners, a fellow podcaster from the Gain Traction Podcast. The dialogue explores the symbiotic relationship between tire sales and auto repair services, emphasizing the strategic value of incorporating tire sales into auto repair shops' service offerings.
Why Sell Tires in Auto Repair Shops? Discover why even repair shops traditionally not focused on tire sales should consider offering tires to their customers. Mike Edge shares insights on how selling tires isn't just about the transaction; it's about fostering long-term, loyal customer relationships. This segment explores the concept that selling tires can be a gateway to securing a customer's business for all their vehicle maintenance needs over the next three to five years. Operational Insights and Strategies: Learn from the practical experiences and strategies of shop owners who have successfully integrated tire sales into their business model. This part of the discussion sheds light on operational considerations, such as space management, inventory selection based on local demand, and the logistics of tire delivery and installation. It also addresses the challenges and benefits of balancing tire sales with high-margin service work, ensuring shops can maintain profitability while enhancing customer satisfaction and retention. Navigating Equipment and Supplier Relationships: For shops considering entering the tire business, this section provides valuable advice on selecting the right equipment and building beneficial relationships with tire wholesalers and distributors. It emphasizes the importance of investing in high-quality, reliable equipment to streamline operations and enhance service quality. Mike also highlights the critical role of choosing a supportive wholesaler, one that not only offers competitive pricing but also provides exceptional service, ensuring shops can meet their customers' needs efficiently and effectively. Realities of the Tire Business With Hunt Demarest of Paar, Melis & Associates
Thanks to our partners, NAPA TRACS and Promotive
Did you know that NAPA TRACS has onsite training plus six days a week support?
It all starts when a local representative meets with you to learn about your business and how you run it. After all, it's your shop, so it's your choice.
Let us prove to you that Tracs is the single best shop management system in the business. Find NAPA TRACS on the Web at NAPATRACS.com
It’s time to hire a superstar for your business; what a grind you have in front of you. Great news, you don’t have to go it alone. Introducing Promotive, a full-service staffing solution for your shop. Promotive has over 40 years of recruiting and automotive experience. If you need qualified technicians and service advisors and want to offload the heavy lifting, visit www.gopromotive.com.
Paar Melis and Associates – Accountants Specializing in Automotive Repair
Visit us Online: www.paarmelis.com
Email Hunt: [email protected]
Get a copy of my Book: Download Here
Aftermarket Radio Network
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Through role playing exercises, our panel demonstrates different approaches to selling and communicating with customers. They emphasize the importance of understanding customer needs, building rapport, and being direct when necessary. The discussion covers the significance of tone, trust-building, technical knowledge, and authenticity in customer interactions. The episode concludes with a focus on continuous learning and the value of a supportive work environment. Rena Rennebohm, CEO and Creator of Empowered Advisor. Rena’s previous episodes HERE. Matt Bellinger, Service Plus, Watertown, NY Ali Norton, Rozema’s Car Care in Hudsonville, MI. Lee Fleming, SA Coach with Empowered Advisor Megan Dineff, Ervine’s Auto Repair and Grand Rapids Hybrid, Grand Rapids, MI Show Notes: Previous Service Advisor Role Play Episodes Megan's role-play (00:03:31) Megan, as the "friendship advisor," interacts with a customer and presents service recommendations. Discussion on customer buying style (00:06:48) Analysis of Megan's approach as a "friendship advisor" and its relevance to customer interactions. Matt's role-play (00:09:44) Matt, as the service advisor, interacts with a direct dominant customer and presents service recommendations. Discussion and feedback on Matt's role-play (00:11:37) Feedback and analysis of Matt's role-play, focusing on adapting to the direct dominant customer's buying style. Discussion on adapting to customer style (00:13:06) Importance of reading and adapting to the customer's communication style and preferences. Ali's role-play (00:17:50) Ali, as the service advisor, interacts with a technical customer and engages in initial conversation. Technical training impact (00:21:48) Discussion on the impact of technical training on service advisors and its potential misuse. Adapting to customer buying style (00:25:20) Advisors discuss the importance of adapting to the customer's buying style and the need to gauge their interest in technical information. Reading customer tone and style (00:27:26) Advisors share experiences and techniques for reading and adapting to customer tone and buying style. Building trust with new clients (00:33:44) Strategies for building trust and relationships with new clients, focusing on value proposition and setting expectations. Providing the Best Customer Experience (00:36:30) Tips on how to communicate to customers that they will receive the best experience at the auto repair shop. Empowering Customers to Ask Questions (00:37:23) Encouragement for customers to ask questions and for service advisors to be open to asking technicians for information. Being Authentic with Customers (00:38:19) The importance of being authentic with customers and ensuring that correct information is provided, even if it means putting them on hold. Learning from Customers (00:40:23) The value of learning from customers and the impact of technical training on the industry.
Thanks to our Partner, NAPA TRACS 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/ -Join Our Private Facebook Community: https://www.facebook.com/groups/1734687266778976 -Subscribe on YouTube: https://www.youtube.com/carmcapriotto -Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/ -Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/ -Follow on Twitter (X): 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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The Value Paradox: We all want top-notch service without the hefty price tag. However, quality comes at a cost. Andy Bizub explores this conundrum and how it mirrors the choices we make. Consumers often face a choice between the cheapest and the luxurious with little interest in the middle ground. This observation sparked a conversation about how the automotive industry can apply this pricing strategy to their businesses. Remember, it's not just about the price; it's about the value and experience you provide. Andy Bizub, Midwest Performance Cars, Chicago and Northbrook, IL. Andy’s previous episodes HERE.
Watch Full Video Episode Consumer choices in the airline industry (00:02:05) Discussion on consumer choices, pricing, and quality in the airline industry and its parallels to the automotive service industry. Charging fair prices (00:05:07) Exploration of the challenges and mindset of shop owners regarding charging fair prices and the impact of consumer behavior. Creating exceptional customer experiences (00:07:45) The importance of providing exceptional customer experiences and the impact on customer loyalty and satisfaction. Transition to becoming a high-end shop (00:12:21) The journey of transforming a failing shop into a high-quality, exceptional customer experience establishment. Retail examples and business strategies (00:14:08) Comparison of retail examples (Nordstrom, Target, and Walmart) and the importance of offering a superior customer experience. Consumer mindset and experiences (00:17:38) The impact of consumer mindset on the value of a bargain versus an extravagance, as observed in the airline industry. The year of the customer and the client experience officer (00:18:05) Discussion on the importance of prioritizing customer experience in businesses and the challenges of adapting to pre-COVID business operations. Managing labor rates and shop supplies fees (00:19:30) Exploring the impact of customer experience on labor rates, decision-making regarding shop supplies fees, and the comparison with dealership invoices. Pricing strategies and customer experience in the automotive industry (00:20:52) Examining the impact of pricing strategies on customer experience, including the frustration caused by hidden fees and the parallels with the airline industry. Adapting labor rates and dealership comparisons (00:22:23) Discussion on adjusting labor rates, the impact of dealership labor rates, and the importance of providing a better customer experience. Challenges of being in the middle in the automotive industry (00:26:06) Exploring the challenges of being in the middle of the pricing spectrum and the impact on talent acquisition and business sustainability. Building an effective team and book recommendation (00:28:08) Insights into building a motivated team, the significance of maintaining a clean and professional image, and a book recommendation for business and life lessons. Leadership, self-improvement, and the value of asking questions (00:32:24) Discussion on the importance of self-improvement, effective leadership, and the value of asking questions to enhance understanding and decision-making in business. Family Business Challenges (00:34:32) Discussion on the challenges of working in a family business and the expectations placed on family members. Navigating Family Business (00:35:03) The difficulties of navigating a family business and the expectations placed on younger generations. 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/ -Join Our Private Facebook Community: https://www.facebook.com/groups/1734687266778976 -Subscribe on YouTube: https://www.youtube.com/carmcapriotto -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
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Understanding Gross Profit per Hour: The Key to Efficiency, Pricing, and Financial Health [E148] - Chris Cotton Weekly BlitzBy carmcapriotto
The Weekly Blitz is brought to you by our friends over at Shop Marketing Pros. If you want to take your shop to the next level, you need great marketing. Shop Marketing Pros does top-tier marketing for top-tier shops.
Click here to learn more about Top Tier Marketing by Shop Marketing Pros and schedule a demo:https://shopmarketingpros.com/chris/
Check out their podcast here: https://autorepairmarketing.captivate.fm/
If you would like to join their private facebook group go here: https://www.facebook.com/groups/autorepairmarketingmastermind
In this podcast episode, Chris Cotton from Auto Fix Auto Shop Coaching discusses the critical role of gross profit per hour as a performance indicator for auto repair shops. He explains how to calculate it and its importance in assessing efficiency, pricing, labor, training needs, and financial health. Chris also highlights its value in staying competitive. The episode includes a nod to the sponsor, Shop Marketing Pros, endorsing their services.
The importance of gross profit per hour (00:00:05) Chris discusses the significance of gross profit per hour as a key performance indicator for independent auto repair shops. Formula for calculating gross profit per hour (00:01:56) Chris explains the formula for calculating gross profit per hour and its role in pricing strategy and efficiency. Labor utilization and financial health (00:03:00) Chris emphasizes the importance of labor utilization and how gross profit per hour directly affects a shop's financial health. Calculating gross profit per hour (00:05:24) Chris provides examples of calculating gross profit per hour using a spreadsheet and discusses the importance of this metric. Measuring efficiency and pricing strategy (00:11:48) Chris explains how gross profit per hour helps measure efficiency, productivity, and pricing strategy in an auto repair shop. Competitive edge and conclusion (00:14:48) Chris discusses how a healthy gross profit per hour gives a competitive edge and concludes with a message about the podcast sponsor, Shop Marketing Pros.
Connect with Chris:
#autofixautoshopcoaching #autofixbeautofixing #autoshopprofits #autoshopprofit #autoshopprofitsfirst #autoshopleadership #autoshopmanagement #autorepairshopcoaching #autorepairshopconsulting #autorepairshoptraining #autorepairshop #autorepair #serviceadvisor #serviceadvisorefficiency #autorepairshopmarketing #theweeklyblitz #autofix #shopmarketingpros
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