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Hey all Auto shop owners,


Got a question and need all the input and advise I can get.


A little history, I am Alan and I am a proud owner of a small Automotive shop. We only have 3 bays and 1 tech. I have been the service advisor/manager of the previous company for the last 5 years.


About a year ago, the previous owner called it quits and closed the place down due to financial difficulties.


Long story short, I kept the same locations address, changed the business name due to logistic reasons and kept the best technician for the shop.


He is currently and has always been a flat rate techician, meaning that he is paid according to what he produces/completes.


I am coming into a possible problem where I am in need of more production. He was much more assertive in the beginning and now he is not producing as much as he use to. He used to take 20 minutes lunches and now he is taking 1 hour lunches everyday.


I have tried to motivate him by giving him raises, bonuses, and positive reinforcement as much as possible.


I am inclined to bring another tech in. Flat rate or hourly? My tech is pretty sensitive and if I were to bring another tech in flat rate, he may be offended and possibly complain about a lost of hours for him.


On the other hand, if I brought in a hourly, I don't want him to use him as a personal assistant and try to take extra hours for what the hourly guy completes.


I have been straight up with him and tried to motivate him and would not want to lose him as my lead tech.


Any opinions and suggestions would be appreciated.

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I have seen this problem all too often. Production is the key to success in any shop. But, having to the right people always comes first. It sounds like there is a issue with the tech you have right now.


Whether on flat rate or hourly, each person must know what is expected of them. They must know that what they do matters to the over financial stability of the business. If you have the right person, and you are a true leader, they will listen and they will act accordingly.


As the owner, you must do what you need to do. If someone is an obstacle, remove the obstacle. Give the person a chance, but with the understanding that we all need to pull in the same direction. That we are a team.


You should not fear hiring someone if it is the right thing to do. We tend to wait and procrastinate for reasons that usually end up hurting us, and never the person we fear in the first place.


Being a shop owner means that sometimes you need to make those hard decisions. Always asks, "What is the right thing to do for the long term and for the greater good of all?"

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Thank you so much for your response. One of my other concern is also whether I have enough work to satisfy a new hire (hourly or flat rate).


At this point, my lead tech knows that anything coming through the door is for him to earn. But it would be a problem if I hired another flat rater and not have enough work for both of them.


And if I hired an hourly tech, would I send the hourly home early if it is slow?

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I think you need to talk to your technician. If his work performance has drastically reduced find out why. There is something going on in his personal life. There is a reason he lost motivation. If this doesn't help, find someone who is money motivated, or find out what motivates the tech you have now. Good luck and never let an employee be the fall of your business.

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  • 3 weeks later...

You may have made the same mistake I did. I am paying my flat rate tech too much on the hour and that is was is slowing his production. It seems nice to pay them well but if they are comfortable with say $1,000 a week in pay, they will work really hard for that 1k at $20 am hour or not very hard at all for $30 an hour. You would think that everyone is as money motivated as you are but I've come to find out that is just not true.



Sent from my iPhone using Tapatalk

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  • Have you checked out Joe's Latest Blog?

      Most 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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