bstewart

You would want X% growth over last June. This eliminates seasonal changes that show up month to month.

I work in Parts at a Kenworth dealership and we've got tons of LED lights rigged the same way. We always aim them right at eye level so the customers blind themselves. It's funny to us Parts Techs, but in reality it's a great selling feature.

I don't know what your exact fees are, but credit card is usually around 2-4%, while debit is usually less than 1%. In Canada, these are the average costs for a $40 transaction: Debit is $0.19 (0.5%), cash is $0.25 (0.6%) and credit card is $0.82 (2.1%). Yes cash has a per transaction cost higher then debit (counting cash multiple times, filing your deposits, money lost, give a penny etc) From what I understand, the standard business solution to this problem is: Raise your rates by an amount equal to your average credit card fees, for example say your fees average 3%. Then offer a discount for payment with cash or debit, could be 2.5% or 3%.

Admitting you have a problem is the first step to finding a solution, great job! A good place to start would be buying Mitch Schneider's Automotive Service Management book series, they run about $25 each there's 8 of them. They are fantastic for getting your shop's numbers under control! "Managing Dollars With Sense" would by far be the best one for your particular situation, but I'd highly recommend the entire series. That one book answers the exact questions you're asking.

There would most certainly be a reason if this happened to anyone. I've known several restaurant/pub owners who have had to do this actually. It's generally because a "customer" comes in, buys a cheap item (generally a drink with free refills such as coffee or soda pop) and then spends little or nothing else. This takes up a table that could be generating income (same as a bay) and keeps a server busy and away from well paying customers (same as a non-producing tech). One owner had several pool tables and hosted a weekly pool league night, bringing in 20+ pool players at prime dinner time for 3 hours (great idea right?) He ended up hating this decision because they all ate dinner at home first, and only spent a couple dollars on non-alcoholic drinks. Some of them even complained that the waitresses didn't come often enough to "freshen up" their drinks, even though they weren't buying any food or alcoholic drinks. The owner ended up cancelling the pool league night all together.

My personal opinion is the opposite. How many former mechanic shop owners out there are struggling and failing because they have been "in the business" for so long? They spend all day working in the business, doing things as they always have been, running on autopilot. Instead, they should be working ON the business, watching KPIs, managing people and planning for the future. I believe that non-mechanic owners have a different view of the business, look at it more like a business then a job. Obviously training and learning how to run the business is essential, but non-mechanic owners don't get caught up in the day-to-day stuff as much IMO, they work ON the business more. There is still a struggle, but it's a different kind of struggle. I'm sure there's several owners on here who will agree with my opinion (Xrac I believe is one).

I have a personal relationship with a local Mac dealer (I don't deal with him so no bias). I asked him about this tool and he said it was excellent, one of the best ones Mac offers. He hasn't had any issues "so far," he gave it a glowing review. He sold a pair to a local body shop recently and they love it. Works very good with European vehicles - the body shop had problems with Porche and Land Rover on their previous tool but not the Mac one. Fully upgradable and downgradable - if a new update gives you grief, you can go back to an older version that works properly. Works well for telematics - you buy bulk OBD2 dongles and give to your good customers, and you can do OBD2 diagnostics even if the car is far away. Worst I could say is it -might- be a bit overkill for a small shop if he only deals with domestics or something like that.

How about one for Canada?

Well said. Lots of times these type of situations are miscommunications between all parties that get blown out of proportion by hot headedness. Step back, take a deep breath, and work through it like the professionals that we are. Don't let anger cloud your vision, it only makes things worse.

I've seen the 20-20-40-20 rule: 20% cost of goods sold 20% production labour 40% operating expenses including non-production labour 20% profit margin

The number is similarly high for Canada as well. Last I heard there was $14 billion in unperformed maintenance in 2014 - and increasing fast!

With recent advances in technology, you shouldn't even have to fly anyone in until you've done at least 1 or 2 Skype interviews. A good friend of mine took a job in Australia after doing multiple Skype interviews with his future company (not auto repair). They gave him several "signing bonuses" contingent on a 4 year contract (if he breaks the contract he has to pay back a portion of the bonuses).

No, he's referring to charging a higher markup on low price parts and lower markup on high priced parts to achieve a desired overall profit margin. Some of your prices will be above list and some will be below. Don't forget that you're adding your warranty to parts and inspecting them for defects/counterfeits. Here is a sample of what a matrix could look like (this should yield about 50% parts GPM): $Part cost Gross Margin Divide By 0.01-5.00 70.0% 0.30 5.01-10.00 60.0% 0.40 10.01-75.00 55.0% 0.45 75.01-200.00 50.0% 0.50 200.01-500.00 42.0% 0.58 500.01-750.00 35.0% 0.65 750.01 and up 30.0% 0.70

Did you have a grand opening? Host a BBQ and get a local radio station to come out? Don't forget that mailers are not a one-and done promotion. You'll probably get very low response from your first couple waves, but keep sending them to keep you in their minds. Also, make sure your shop (if it's an older building) is surgically clean, especially the front and bathroom. You don't want to drive off a sales lead because of a dirty bathroom.

http://www.autoshopowner.com/topic/9322-meeting-with-owner-about-to-buy-his-shop/ Check out post #14. Search is your friend, 80% of the questions you'll ask have already been answered on here. 400k is probably reasonable if the SDE is truly $140k based on the formula: (2 x SDE) + inventory, since inventory will likely include equipment in the calculation.

A significant portion of shops make less than 3% net profit yearly (poorly run shops). Many of these businesses are actually losing money every year (negative profit & failing). This means that if they have $500k of revenue each year, these shops have $15,000 profit or less at the end of the year. Another large portion of shops that are better run but still have issues will make 3-20% net profit. The best run shops can make 20+% net profit, but this takes extremely good planning, management and employees. I don't know the actual numbers, but I'd be willing to bet that 20% of shops lose money, 30% make 0-3%, 40% make 3-20% and only 10% of shops make >20% profit. Just make sure this is in line with what you are reading and planning about owning an auto repair shop. If any shop owner is telling you they are making 50-60% profit, they are talking about gross profit, before expenses. Be very careful about this, as there are many, many shop owners out there working 50-60 hour weeks and not making any money at all! This is because they run their shops poorly, don't charge customers properly and generally don't know what it takes to run a business! Take the time to go into a business ownership class for sure, this will earn you more money then anything else you can possibly do. Some of the busiest shops are making no money, because they don't know how to run a business. Once again, be careful of what you think you know. It sounds to me like you "managed" a gas station (1 man operation?), but that's not the same as owning a shop, not even close. Setting prices, managing employees, hitting key performance indicators (KPIs) are all things that I'm guessing you don't have a lot of experience with. All I'm saying is, do your research, get training, read books, websites and articles. Write a business plan, speak to an accountant, lawyer, banker and insurance broker before doing anything. Know everything you possibly can -before- buying/owning the business, or you most likely will be one of the failing businesses, or treading water with very little profits. Also, be prepared for all the old mechanics to quit or be fired by you. They will most likely resist change or not fit into your vision/business plan. Sorry for ranting...

This is 100% true. I'm glad it didn't take 10 or 15 posts before this answer came. Gather up every top tech that you can, just know that there is a huge skills shortage in this industry and top techs will become harder and harder to come by. If you aren't making money off your top techs, either a) they aren't a top tech at all, or b ) you aren't charging enough for what they do.

Not only do most shop owners not have an exit strategy, they also significantly overvalue their business based on the years of hard work they've put in & customer rapport (goodwill, that generally goes away with the original owner) rather then basing a value on the numbers, KPIs or any kind of return on investment.

This was my first thought as well. If you want to increase lift productivity try 3 tech to 5 lifts. However, if you track tech efficiency you might see a slight drop in their overall numbers, but a corresponding increase in lift productivity. It's a trade off, and you'll have to run your own numbers to see if your business would be better off with: - 5 lifts at 90+% productivity and 3 techs at 120% efficiency OR - 4 lifts at 70% productivity and 2 techs at 140% efficiency Obviously with a 3rd tech you'd make more money, but would the productivity gains outweigh the loss in tech efficiency or not? Second, you sound like you've probably got this covered already, but make sure that your shop is 100% laid out to not reduce tech efficiency at all. Lastly, make sure that you invest in the best shop tools you can afford to enhance tech efficiency.

As a Canadian firearm owner (long barrel hunting guns only), I have to agree with Mario. In Canada, there are far less guns, and much less gun violence. From our perspective up here, it seems like there is too much "gun availability" in the US. Too many people with mental illness or crazy thoughts like delusions of grandeur have extremely easy access to guns. Have stricter requirements for who can own guns. Too many people with not just a couple guns, but an entire armada in their house, guns and ammo that they've been acquiring for years. Do they even get used, ever? To top it off, too many people keeping loaded guns where their kids play. Nothing is more heartbreaking to hear of a child who finds a loaded weapon, and kills themselves or one of their siblings or friends. This kind of thing should NEVER happen. I'm NOT saying don't own guns, I'm saying keep them locked up, keep the ones you actually use on a regular basis, just reduce the availability for bad things to happen, and they won't happen.

I heard Mitchell did a scheduler update to improve usability. Is it much better now?

While I do agree with Joe in regards to bigger jobs, everyone else is showing the holes in the utopian theory. Over time, a certain amount of commoditization happens in any industry. Phone your dentist and ask how much a basic checkup or a tooth whitening is. They will likely tell you over the phone, because this is commoditized. The same has happened for many services in the auto industry - the problem is that owners and SA's give out prices on things that aren't commoditized as well. Asking for the price on a wiper install, an alignment or an oil change/3 month service - these are commodities - which is why they show up on menu boards. Regardless of how you feel about giving out these prices, the customer is always gauging your prices, and commoditized prices are a good way for them to do this. If your alignment is $40 higher then most other shops around town, they might not want to bring their old busted vehicle to you. If your alignment is $40 less then other shops, they might not want to bring their brand new BMW or Mercedes to you. If your pricing is way out compared to other shops - you should have a good reason why that you can quickly explain (only employ ASE techs/factory scan tools/better warranty etc) In reality, it is a combination of all these things that contribute to your pricing, but in this world of immediate gratification, we need to adjust to the new realities. Customers (which have been in the dark for decades) are now clamouring to be informed about their vehicles - and will use any and all methods available.

Sounds like this is exactly what you should be doing if this is the case. Don't sell yourself short. It sounds like you've already got a name built for you, and you're the only outfit in town who they even want touching their vehicles. Most people (especially high end clients that you seem to have) pay for good service and good work, not cheap prices.

I picked up a book called Service Consultant: Working in an Automotive Facility by Ronald Garner on Amazon for $9 plus shipping. That would be a good (and cheap) place to start. It's a hardcover textbook style. Some parts are fairly dry, but if he wants to better himself, reading that would be a good place to start, before training.

This thread is exactly like another thread here... Also by the same user... His only two posts are exactly the same advertisement. Please delete these two threads and IP ban this user. http://www.autoshopowner.com/topic/10055-ford-ids-vcm-2-purchase