HarrytheCarGeek

For me relationships with customers will always be high priority.

 

You are right, they put food on the table.

Plan your day, don't entertain people that are time wasters, time sinks I call them. Don't procrastinate make a list and put the money making essential things first to get them out of the way.

 

Have a pleasant attitude, your shops reflect your attitude, your managers take their cues from you. You have to lead, and to lead effectively you have to make sure all that needs to be done is done.

Social media, make it a point to post at least once a day on your social media pages. Post anything interesting that you have going on at your shop. Host a car clinic or any event that creates value and trust with your customers.

 

On another note, it is critical how you start your day, don't let anything negative poison your day. For example, you walk out of the house and step on dog poop, don't let that cloud your vision or attitude.

 

Remember the most precious commodity you have is your time! Don't spend it brooding.

 

So, do you calls, send your post cards, mail your specials.

I wanted to add, if you want increased sales, you could start today by making either 10 calls, sending postcards or letters per day, heck you may want to even put a couple of craigslist ads per day. so by the end of the week and month they add up to a nice bunch of sales!

Simple habits. March 31 is the end of the 1st quarter? Have you set your goals? Have you reviewed last years first quarters?

 

Simple disciplines.

The way we moved away from cheap oil changes was by first doing away with all signs that had low oil change pricing.

 

The main shop had a big sign that said oil change $24.95, I got rid of it and all the other signs at the other shops that said the same thing.

 

Then, I got rid of all printed materials that said anything about cheap oil changes.

 

While I had the signs removed, I had the computers updated with new job definitions. For example, LOF $24.95 became NLOF $59.95.

 

I also had new discount lines made in case the Service Advisors needed to apply a quick discount to avoid a scene for example, LOFDIS1 -$5.00, LOFDIS2 -$10.00

 

I kept the old job codes active until we had moved away completely from the cheap oil change routine. I kept a sharp eye out on the reports every week to make sure they were not applying discounts unnecessarily.I made them explain what happened on the conference call to make sure they understood how critical this move was for us.

 

Now, there is a psychological barrier and fear about doing this that I had to have my guys overcome. If you don't believe in what you are doing, neither will your guys.

 

What help me made the transition, was that the mechanics now had 30 minutes credit for and LOF, but they had to give me an inspection report on the vehicle.

 

Moving on, I had the menu board graphics updated. I had one that said Bronze conventional oil change $59.95 and it had only two items listed under it, 1. Up to 5 quarts 10w30, 2. Economy Oil Filter.

The other choice became, Silver-Plus, Which listed choice of semi-synthetic oil, oem quality filter, top washer fluid, inspect wipers, etc. for $74.95, Then, the next level said GOLD-Pro and gave choice of Full synthetic, oem or premium filter, top off washer fluid, set tire pressure, 30 points safety inspect for $99.99 Plus. Then the season package for $149.00 with tire rotation and balance, or new wipers, etc. The point being, making sure to recover our full costs and make an acceptable margin.

 

Your psychology into making this a reality is very important, if you don't understand your business this will not help you prosper, it will fail miserably. I had to fire a shop manager because he was the only one that didn't do anything to improve his numbers. Telling me how wrong I was when the other shops were doing extremely well.

 

So what were the results?

 

One of the shops saw about a 19% loss in LOF's 1059 vs 858. Revenue on conventional LOFs when up over 45%! From about $26.4K to over $48K!

We loss many trouble customers.

The mechanics attitude improved.

Compensation improved due to improved cash flow.

The class of cars improved too.

 

Now, there are other things I learned that I would like to point out.

 

Yes, customer referrals are essential, but poor customers hang out with poor customers, Good and Excellent customer tend to refer other Good and Excellent customers.

Cheap customers will make their poor life choices your problems too, learn to fire them and send them down to your competition.

Treat your excellent customers well, they will stick with you, learn how to profile and identify your best customers.

 

These are some of the things we went through, I hope you can benefit from our experience in this new year.

 

....

Happy New 2017!

 

I hope you have set your goals for 2017, if not, get working on them!

 

Every day take a step into achieving your goal, it is the simple positive habits that will make success show up at your door.

 

For example, if you wish more sales, choose to make 10 calls everyday, or send 10 letters or post cards. by the end of the week you will have achieved 50 calls or leads, your sells will soon show up.

 

Simple disciplines to success!

 

I begin by sharing with you a video of a presentation that has given me great happiness and success:

 

Joe, and everyone, I wish you a prosperous and happy New Year!

 

A toast, and raise your prices! Cheers!

Jeff,

 

Mechanics are service employees, they are not factory workers. You capture the value of a mechanic when services are rendered, a factory worker's value is capture when the product is made.

 

One man shops should not be competing in price on oil changes with franchise or chain shops, the cost of management and facilities cannot be spread out to multiple mechanics. If you think you will go out of business by charging full price on oil changes, you have no idea what it will cost you on your old age cost of living.

 

I will not beat a dead horse, all I will say is this, if you did over 1,000 LOFs you are losing serious money, hurting yourself, those that work for you, and the industry in general.

 

Customers don't know you are losing money and they will expect further discounts from you!

I duplicated that "Unicorn account" so many times that i was known as the "Richest Car washer in town" My very first customer in 1969 brought me a car that needed $75.00 to fix. When i quoted that repair he said i was too high and wanted to pick the car up. I told him give me 30 minutes. I washed his car and cleaned the windows so good it looked like a new car. The customer came up the driveway and asked where his car was because he could not believe that the cleaned up car was his. He asked me why i cleaned up his car when he did not buy anything. I told him that Jesus washed feet and i wash cars. I told him that i don't need his money but i need his referrals! He never spent a penny with me but over the next few months referred $4k worth of work to me. Our business is all about referrals. I spend my "Advertising money" on my customers and ask everyone for referrals. I even cut customer yards for referrals. The last time i did that before i retired it netted me a $25k mechanical restoration.

 

I am still in the trenches, and I am not giving away my work. Yes, i do complementary work and services to those customer that value my work. I do depend on referrals too, but I am not losing money on my bread and butter work.

 

Again, for those of you still in the trenches, do the math, print out the report listing all the oil changes you have done up to date in the last five years and do the math. Then tell me you think you can survive the next five years doing the same.

Somebody sold that "oil change customer" a car,clothes,watch,sell phone,place to stay,etc. I figure it costs $100.00 each to get a new customer to brag about my shop. Give every oil change customer a reason to sell your shop to others. I would change oil with filter, hand car and clean windows, place $2.00 bill with discount card behind his fuel door and ask for their referrals. I keep track of all referrals. After years of doing this i a few customers just swing by for a free hand wash, fluid level and tire air checks. My co-worker scolded me for wasting my time. I then pulled up the "time wasting" customers account showing that in the last few years they spent $6k but referred $40k worth of work to our shop.

No buying it. We all have that unicorn account, too. simple math. 1+1=2. How many oil changes did you do last year? How much did they cost you? How much revenue did you receive? Simple as that.

I totally agree with your point Harry, none of us should compete in the race to the bottom as Joe describes it. "If the competition around you is too stupid to figure it out, tie up their bays with oil changes, send them all the cheap oil change work to them, pull the gravy work off the vehicle and send it up the road to get the oil change done, see how fast they learn." see how fast you need to attract new customers is more like it. Most people don't like going to two mechanics, that guy that did your unwanted work will get the next batch of gravy.

 

We give away free flat repairs and tire rotations with a tire purchase. I offer free fluid top offs between oil changes. I do a lot of checks for free (not diagnosis) It eats time doing free work, but overall we gain much more than we lose.

 

"You can have everything in life you want, if you will just help other people get what they want." - Zig Ziglar

 

Alfred,

 

I speak from experience, I don't do cheap oil changes. My conventional oil change price is $49.95 and that is only if we already have the car on the lift for other work. If you are coming off the street the price is $59.95, synthetics are $99.95+

 

Try this simple exercise, go into your database, print out how many oil changes you did for the past five years, then deduct your costs from it, how much money did you made or lose?

 

I haven't lost any money on LOFs in the past 7 years.

 

Here is the kicker, the amount of revenue you are losing is tremendous once you see it and internalize it. What is worse, the time taken on oil changes that lose you money could have been used to make money and give better customer service to a much better class of customers.

If you are feeling guilty is because you don't know your true costs. List out your costs and then see if you feel the same charging your low rate, there is no more incentive to stop doing quality work than to realize you are losing money on your hard effort.

 

Once you know your true costs, see how fast the feeling of guilt goes away. And even faster once you pair it with a reticent customer that may think he is your best customer.

How much does it cost to say "No" to all the customers that want an oil change at market price? It'll never be a money maker but a good service to my customers. Same as inspections, free air, go for a ride real quick what's that noise type stuff. I'll never try to attract customers with $14.99 coupons but even at $32.99 or whatever it isn't a profit center on it's own.

 

My point in opening the thread was to open up the discussion of giving away services.

 

It should be repugnant to you to keep doing oil changes at below your cost for the sake of bringing in customers that do not pay their way and basically get from you a subsidy.

 

It should be ingrained into your brain that it costs you hard dollars every car that you pull into your bays. If you don't know what your costs are, you are subsidizing your customers with your old age suffering, you will not always will be young and strong and not putting money away for retirement will be a painful sin to bear once you are old.

 

If the competition around you is too stupid to figure it out, tie up their bays with oil changes, send them all the cheap oil change work to them, pull the gravy work off the vehicle and send it up the road to get the oil change done, see how fast they learn.

 

btw, some will not learn and go out of business.

Merry Christmas!

 

https://youtu.be/jAEJKg0lSPk

Thank goodness we are having an incredible season!

 

I just drop by to share with you this little bit of info:

 

THINK TWICE BEFORE PULLING THAT CAR INTO YOUR BAY FOR A CHEAP OIL CHANGE!

 

 

 

 

Hi Harry! When you say content, can you explain what you're looking for?? Is it to update/create a website? Are you just looking to add "blog" posts??

Also, do you have a website and if so, can you post a link?? I would be happy to have a look and may be able to steer you in the right direction .

 

Also, have you considered YOUR content?? I know, I know, you're probably not a writer, right?? That's okay. Grab a sheet of paper, create the topic and 3 things you want to say.

 

As an example, if you were talking about air conditioning, your topics may be....

1) Is your car air conditioning blowing warm air?

2) How to tell if your car a/c system needs recharging

3) Can I recharge my a/c system myself? The truth that nobody else will tell you.

 

Now, that's not what I would call 'refined' topics or titles, but it's a start.

 

With your list, simply use an mp3 records - most smartphones let you record - and send the file to a company that does a transcript. Now, they will transcribe it word-for-word. So if there's a few uhmms... and awwws... and stuff like that, no problem

 

Ask them to send it to you in a Word file (which is pretty typical anyway) and then you just edit it out.

 

From there, you're done!

 

Hope this helps!

 

Matthew Lee

"The Car Count Fixer"

 

Matthew,

 

Thank you for your reply.

 

I am using demandforce for my campaigns. Yes, we have been writing the articles in-house for the past 2 years, we send out a newsletter every two weeks to over 7k subscribers, and we are averaging out about $41K in revenue per newsletter. We know it works, but keeping the content fresh and insightful has been a chore. I wanted to buy 150 to 300 articles of about 500 words for the next year.

The statements made above sort of explain themselves. I have always been taught.....

 

When discussing parts discuss margin not markup, if you dont know the difference it is rather large. To mark up a part that costs you $100 50% you would charge $150. To have a 50% margin on a part that costs you $100 you would charge $200.

 

This has nothing to do with the comeback ratio. The best shops still need a minimum 50% margin on parts to maintain profitability.

 

Has you known this when you were in business you may have had the opportunity to fund a retirement program not only for yourself, but also the employees and have more than a tool box of old tools.

 

It is unfortunate that so many techs hang their own shingle and never learn the business skills to be successful. The only thing you are doing by working cheaper is subsidizing customers vehicle expenses at the cost of your own families financial health.

Awesome post, we should start a thread with Autoshopowner.com's greatest insights and sticky it!

 

 

So would I, what does that have to do with this post?

 

I think he was replying to my post on #19.

 

Gavilan, $10 million dollars how?

 

See, being rich is not only having $10 million. But for the sake of simplifying let's say you meant $10 million cash. Okay?

 

Now, Felix, with your permission not to hijack your thread, I would like to show one of the many ways, you become "rich" in this business. Okay?

 

See, your way of thinking also has a lot to do with being rich.

 

For example, poof, there, you are sitting on a pile of $10 million cash. What now?

 

If you don't know what to do next, you are not alone, a good 97% of the population would jump up and run out and spend it. That's not being rich.

 

Someone with a little bit of life experience would open a Treasury Direct account and place it there for safekeeping and income.

 

But if it was someone with business experience, he would plan how to get the best return on his investment.

 

But in our example, we are not there yet, we need to figure out how to be $10 million cash rich.

 

So, I will show you one of the many ways I would do it if there is no objection.

 

 

Be a businessman first. Sit down with a retired (or active) accountant and understand financial statements. Understand Gross sales, gross profit, expenses and net profit. Understand the industry benchmarks you want to follow so you can measure, adjust and baseline against. It's easy to say I want to make a profit. There is a huge difference in 3% and 20%. Figure out how to measure the businesses performance.

 

Next, sit and dream about what your business is. Who you cater to and who you do not. Figure out who you compete with and who you do not. Because your in business does not mean you must compete with every shop./offer/special.

Before taking the leap be financially stable. If you cant go a month without a paycheck and are going to always work from a position of fear it wont work.

 

Know the 80/20 rule. 80% of you headaches come from 20% of your customers. 80% of your profit comes from 20% of you customers. MOST IMPORTANT THING I can tell you...figure out who you wish to cater to, the top 20% or the bottom? Understand what value is and how to deliver it to the top 20%. ( I gave away my answer to the last question)

 

Building a business takes a long time. The more you know who you are (as a business) who you cater to and keep score of how you do it the more profitable you will be and the more fun it will be.

 

Dont bend your beliefs to gain a job.

 

Trying to manage cash flow on 3% net profit is not fun and takes many years off your life.

 

 

Wheelingauto, what a beautiful post, thank you!

 

$1,000,000 Gross Sales x 0.03 % Net Profit = $30,000

$1,000,000 Gross Sales x 0.2 % Net Profit = $200,000

 

20% profit is over 6.5x the 3% profit.

Who does your annual calibration for torque wrenches?

 

We run 3 per shop minimum, and it cost about $160 per year from Snap-On (for the 3). I used to use GE but they went overboard.

My thought when I said that was not to have getting rich as your main objective and goal, customers real fast pick up on that.

 

I am not trying to be obtuse or dense, but still don't get it. If you want to get rich in this business, you certainly can, just like in any other business. And what do you mean customers pick up real fast on that?

 

If I am giving them great value, fast and efficient service why would they care if I get rich off this business?

 

Granted, we haven't defined what we mean by rich, so yeah, we have to define and set the minimum parameters of what "rich" would be in this business.

We recently celebrated or 45th anniversary!

 

Congratulations, JimO! And kudos to your dad for having the vision to unite you with your brother!