Elon Block

Andre, all of your posts on this forum, including this one, remind me of what
Michael Gerber, author of the book, The E-Myth says, which is:
"The system runs the business. The people run the system. It transforms
a business into a machine."

This is an image I have on my computer monitor, as a screensaver. It's a
constant reminder and helps me stay focused when I'm working with clients
(and even as I evaluate how to run my own business more effectively).

If you click on the image, you'll see it a bit better.

Hello, I have a small 2 bay shop with lifts in both bays, I also have a 3rd bay that has a chassis dyno. I try to do performance work, but working on the marketing aspect of that. I've always done heavyline engine and transmission work, alot of it for other shops. I've found a lot of value on here. I was talking to Elite Worldwide about consulting to help me with the general repair side of things. I'm still in sticker shock from the Conversation, but they did lead me here.

Many shop owners who have a specialty niche, such as yourself, are looking for ways to expand

and diversify their business. This is a smart move.

General repair is a natural extension of what you already do. However, auto repair and selling

service is a totally different animal because the general public thinks an oil change is an oil

change. Anyone can take care of a brake job.

You've been able to attract customers because of your specialty, which is a good thing. However,

when it comes to auto repair and maintenance, you need a totally different strategy. Otherwise,

you're stuck with competing on price, which is what you don't want.

Here's what I believe. Just like any other investment you make in your business...

Consulting should be self-funding. In other words, you should be able to clearly see what your

return on investment will be.

 

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.

 

Knowing what you know about your business, if you had a pile of cash to invest, what would you pay for your business and what would be an acceptable return on that cash investment?

 

I have bought shops at $0.10 cents on the dollar of appraised equipment, to other where I paid a 300% premium because I identified an undeveloped opportunity.

 

You brought up an interesting point, in my perspective most business people I have dealt with do not have an exit strategy from the business they are in.

You have both made some very important points. And it's never too early to plan for an exit by systemizing everything.

Here's something I had posted in August:

http://www.autoshopowner.com/topic/10178-if-you-had-to-sell-today-what-is-your-business-worth/

The more turnkey your business is, the more valuable it will be, when you're ready to sell!

Marcus Lemonis says, "When you add systems, you add margins."

Margins mean: you make the money now, while you own it.

And then, you make it again, when you sell it.

Related to the topic, Ratchet and Wrench posted this on their facebook page yesterday:

http://www.ratchetandwrench.com/RatchetWrench/July-2014/Determining-the-Value-of-Your-Business/

andresauto, you bring up some interesting points about the role of marketing and communication,
in everyone's business.

It reminds me of a quote from one of my mentors, Michael Gerber, author of the best-selling business
book, The E-myth. He says:

"Marketing is everyone's job. The owner of the business must start out by asking marketing questions."

"In fact, there isn't a function or position within the company that is free of asking marketing questions,
if by marketing we mean, 'What must our business be in the mind of our customers in order for them
to choose us over everyone else?'"

"And so, seen from the appropriate perspective, the entire business process by which your company
does what it does, is a marketing process."

Being able to communicate clearly and effectively when talking with customers is required in order to
thrive - not just survive - in today's very competitive environment.

It's been my experience, when you're able to do that, you'll get a 'yes' (almost) every time.

Just to answer a couple of questions that have surfaced in this thread.

First of all, thank you to ncautoshop and UsedTireShop for your kind
comments. It's my intention to help everyone I come in contact with,
in any way I can. And I always try to do that whether I'm being paid...
or not.

For the record...

1) The shop owners that are a match for my services are not big.

Instead, they are shop owners just like you who are wanting to be able to
take a vacation at least once a year without worrying about how the shop
is doing, in their absence. And to be able to be paid what you're worth,
without discounting, couponing or giving your profits away.

2) The shop owners I am able to help the most are the ones that have a couple
of hours per week to work ON their business, not just IN their business.

3)) That's the only requirement, along with having the same philosophy as mine,
which is in treating the customer right. In fact, I am deadset AGAINST anything
that looks or sounds salesy or pushy when it comes to selling.

Today's customers no longer tolerate that behavior and most of what I
write about proves that. So that is a breath of fresh air for the shop
owners that want to be successful without being the typical hard-sell,
smooth-talking sales person.

4) The promotional posts I have made have been primarily on the blog
provided to me as a benefit of being a paid member that supports this site.
Without paid members, it probably wouldn't be here at all.

Here is what they have put together in an effort to raise money to pay the bills here:
http://www.autoshopowner.com/membership_packages.html

What that means is: I have invested in this site so that I can help this site
stay online. I'm not going to pretend to know Alex or Joe's financial situation.
I do know forums cost money for hosting, security, etc. Without paid members,
many forums go out of business and offline.

This is the blog page AutoShopOwner gave me as a benefit for my investment.
That is where I post my updates to my own website, which is what blogging
is all about:
http://www.autoshopowner.com/blog/16-elon-block-sellmoreautoservicecom/

I am also allowed to have a sig file, as a paid member, which is what you see
below my posts. These are benefits I paid for and therefore, I am using.

So, if I have done something to offend someone here, it certainly was
not my intention. And as skm suggested, you can ignore my posts.

phynny,

Thanks for the feedback. Since I joined here last year, it's been my intention

to provide useful information to shop owners. If you follow the links to my site,

you will see over 20 hours of free information which has helped shop owners

make more money, become more profitable and run their businesses more

efficiently and smoothly.

Maybe what I talk about doesn't apply to you or is of no interest to you. If that's

the case, that's okay. For those shop owners that are interested in how to

respond to the latest changes, like the Goodyear free flat program, it's my

intention they use it as an opportunity to make more money in their business.

Hi everyone,

New blog post on this very important topic here:
http://www.autoshopowner.com/blog/16/entry-190-did-you-see-the-latest-goodyear-tire-rubber-announcement/

All major pricing changes like this one, affects everyone in the auto repair industry.

The internet and all the information available to today's drivers has turned the
auto repair industry upside down. The shops that adapt to these changes have the
opportunity to do even better than the dealerships, box stores and big chains that
are not in touch with what has happened.

From our interviews, surveys, research and case studies of how today's customers think...

A customer calling about price is doing what they believe is logical, in their mind.
Understanding how the customer thinks and where they're coming from is the first step
to converting those callers and people at the counter, into a loyal customer,
for your shop.

Think about it. If they're calling you, there must have been a doubt in their mind
about what they were told by the shop that diagnosed their problem. Otherwise,
they would have had that shop take care of it. So, when they're calling YOU...
they're looking for a shop they can trust to take care of them.

For more on how the customer thinks...
https://youtu.be/-Uab-r8WJUs

Mike,

I'm aware that Tire Rack is offering that service. Just because they're offering it,

doesn't mean that in the event of an accident, they would not be liable.

Here's something to consider...

All tire manufacturers have clear warranty guidelines and have a section that

say something, such as: What is not covered under this warranty?

http://www.goodyearautoservice.com/assets/images/img/warrantyicons/GoodyearTireRepWarranty.pdf

There's a reason it's worded that way. It's because In the event of an accident,
that family's attorney would be suing EVERYONE involved.

Then, what happens is: the tire manufacturer's attorneys (and labs) would look at

the condition of the tire, see modifications and then, that manufacturer would

be wiping their hands of the lawsuit, because modifications were done AFTER

it left their warehouse.

Because anything that's done to the tire, voids that warranty AND releases that
manufacturer from having to reach into their pockets.

buy 3 and get 1 for free, even though they only really need one.

Mike, I forgot to mention...

And as you're probably aware...

Road hazard plans are usually based on tread depth and how long

they've owned the tires, so the tire may or may not be free.

Mike,

If you're deciding to start using any kind of release of liability,

I would strongly recommend you run it by an attorney who
specializes in this subject matter because releases of liability
these days are not worth much and will give you a false sense
of security.

As for your other question...

When it comes to the public and their understanding of what

it costs to maintain a vehicle, they are usually not aware of

things such as AWD or 4WD or a high performance Z-rated

tire...

And how the manufacturers have certain requirements for

the vehicle to handle and operate properly.

Based on that... here's one way to look at it...

If that customer has a tire that is unrepairable due to a road

hazard, they would most likely have to purchase 4 tires.

If they had purchased the road hazard... at least they would

not have to pay full price for the damaged tire - just the

other three.

In the end, it's really important the customer understands

exactly what their options are, including the limitations of

how the road hazard coverage would work, in the event

of a damaged tire that can't be repaired.

Mike,

There are two warranties available on tires.

There is the standard mfgrs warranty which covers workmanship and

material-related conditions only, meaning if something goes wrong with

that tire that's related to how it was built or the materials that were used,

the tire would be covered based on the warranty details.

Road hazard is a completely separate warranty and is meant to protect

the tire against road hazard only.

Which means the road hazard warranty is only meant to cover hazards, such

as pot hole damage, debris in the road, etc. (basically anything that falls

outside of the materials and workmanship mfgrs warranty).

The TechNet road hazard is written in pretty standard language, much the

same as every other road hazard warranty out there:
http://www.techauto.com/Road%20Hazard%20Tire%20Protection%20Plan_Terms%20and%20Conditions_final.pdf

When talking about a shaving machine...

TechNet clearly states in item #22 that the warranty is voided in the event the tire

has been modified. In addition, almost every tire manufacturer I'm aware of has

the same exclusion and will not cover the tire for workmanship or material-

related conditions because of the modification.

Another thing to consider when it comes to the tire shaving machine...
it's a good idea for the right application.

However, from a legal position, if that vehicle ever got into an accident and it
was discovered the tire had been shaved or modified by your shop, in any way,
they would come after you.

I'm not sure if you found these threads that discussed warranties:

http://www.autoshopowner.com/topic/10036-starting-to-sell-tires-and-looking-for-advice/
http://www.autoshopowner.com/topic/9790-selling-road-hazard-warranties/

Hey Folks,

 

My wife and I currently run a 1 bay operation. We are looking to expand into a larger facility. We are currently hitting 60-70 cars per month. Running the numbers to operate a 5 bay facility that we're looking to purchase. We should be doubling our car count to stay profitable.

 

Here is my marketing strategy to accomplish this, I would love your feed back as well:

 

-Ribbon cutting event, grand opening party, live music, food, beverages, give aways, have other vendors come out to support event, etc

 

-Direct mail campaign - MudLick mail? ValPak? (Thoughts)

 

-Google pay per click advertising

 

-Signage - it would be on a major road in community

 

Looking for the best bang for the buck opportunities to get up and running and then explore other marketing ideas for the future.

 

Thanks for your input!

AJ

AJ,

What sets your business apart from your competition?

In other words, if I were a customer in your area, why would I choose your shop

over all the other choices? (The answer to this question is going to drive any

marketing you are considering.)

Create an ethical environment that you can trust in and people around you can trust in. This is how you make it in life and in business.

 

Try it for a week, the worst thing that can happen is you feel better about yourself and like a more able human being.

Andre, I have been thinking about your post - ever since you posted it.

There's gold in your post and is really the answer to most problems I see.

My latest blog post here came as a result of me thinking about you (and

other shop owners like you) that have have shifted their thinking and

are now reaping the rewards of it:

http://www.autoshopowner.com/blog/16/entry-188-attracting-the-best-employees-and-marketing-for-new-customers/

It does take a leap of faith because it's counter-intuitive and contrary

to what's typically being suggested to run a successful shop.

Hi everyone,

Alex suggested I post in this forum.

For those of you that may new to the forum, I have created a blog here with

helpful articles and videos:
http://www.autoshopowner.com/blog/16-elon-block-sellmoreautoservicecom/

We also have a large archive of free training materials on our website:

http://sellmoreautoservice.com/aboutus/

Let me know if we can be of help to you and your business.

Elon
410-634-1640

I am struggling to increase ARO. I have incentives in place for hours produced, let our techs help create the inspection check documents, hired someone to clean and organize the shop daily and assist techs as needed so the techs can be focused on work but cant seem to break out of the 230.00 range. Any suggestions?

Bob,

From my perspective, everything you've mentioned seems to be focused on tech efficiency.

Can you clarify how that's related to increasing your ARO? Maybe I'm missing something.

What are you trying to do? Are you trying to increase your gross profit? Your tech efficiency?

Or something else different?

Hi everyone,

I had a conversation with a client yesterday who just discovered he wasn't going to be able to

sell his business, at the number he hoped for.

A little background:
We have only been working with him for 4 months. The original plan was to help him increase
his sales and profits and improve his paycheck.

Basically, he wanted to put systems in place to accomplish the following things:

• Increase the sales from $650,000 to a million dollars per year
• Maximize the gross profit
• Phase himself out of the day to day business operations

He is currently one of the two service advisors and was in the process of interviewing

his replacement.

His goal for selling the business was 2019.

To make a long story short, two weeks ago, he found out that due to an unexpected
family situation, he must sell immediately.

He was shocked to find out that his business is not worth what he hoped to get out of it,
mostly due to a number of factors discussed in these articles:
http://www.shopownermag.com/know-shops-sellability-score-part-1/
http://www.shopownermag.com/know-shops-sellability-score-part-2/

The number one factor that decreased the current value of his business is described below:

To be valuable to a buyer, your business must be able to succeed and grow without you at the hub of all ­activities, and your employees must be more than mere spokes that cannot operate independently of you. And the more your customers need you and ask for you personally, the harder it is for you to scale back your hours, take a vacation or eventually sell your business.

Your business is significantly more valuable if you are successful at building a “brand,” not simply a place where your own reputation and your personal handling of customers is what brings them back. It’s the difference between thinking of yourself as having a “job” that requires you to show up at work to make money, ­versus creating a “business” where the brand is more important than the ­personality of the founder.

The majority of buyers who contact me don’t want to be a slave to the business and work every hour that the business is open. In fact, many buyers already own a business and are ­looking to supplement their income by purchasing an additional business where they will provide part-time ­supervision and marketing and business acumen. These buyers will pay a premium for a business that can clearly demonstrate its ability to run ­profitably without the seller as the critical hub.

It's interesting to see Art's current listings and see how the performance numbers

relate to the listing price for the businesses:
https://art-blumenthal.com/

What are your thoughts on the sellability score Art talks about, in his articles?

1) You pay a lot of money to make the phone ring.

2) Consumers are conditioned to ask for price based on the constant bombardment of advertising.

 

It's an interesting situation because of the conditioning you mentioned. In other words,

almost every shop is promoting a product or a service that is price-related.

Then, they get frustrated when customers call for pricing.

I'm not saying there's anything wrong with marketing...

Because it provides opportunities to add a new customer to your customer base that will

now use your shop for all their repair and maintenance needs whether you have a

promotion running or not.

From my experience, it boils down to: How good is your staff at converting those

phone calls or walk-in's, into an appointment?

And then, converting them into loyal customers?

Mr Block, This is a very good point and interesting one . I have been a MAST dealer for 25 to 30 years my loyalty numbers have always been around 88 to 91% loyalty every year. I am tracking this year at 54% . Therefore , all my backside money is being held. This is the first time in our companies history , since 1961, this has happened. I sent a pretty testy letter to Mast headquarteres for them to explain this and how it could happen. My PD is ATD my SD is TCI. It is obvious ATD rollout of there new online ordering has been a catastrophe and Michelin fill rate is horrible. I hate to say this good or bad although I feel at this point they are scrambling to reestablish there presence in a quickly changing market. I am waiting for a response from Michelin If they do not figure a way for my company not to be punished for there lack of product, I will make a change after all these years. The MAST program needs overhauling , it is basically same as it was 20 years ago.Thanks for bringing this to light, we are all in this together. I am so glad I found this website. Thanks David

I'm just curious. Are you saying Michelin is penalizing you for you buying outside their program?

I agree that weather can have an affect when the city is shut down,

as a result of snow.

But that's usually only a temporary couple of days here and there.

Once the streets are clear, it's business as usual.

Will some people hold off until February? Yes. But then, your February

should more than make up for the few that didn't come in, during the

previous month.

What that means is... if you keep your eye on one of the most important

numbers, which is growing your number of loyal customers...

They will still be driving back and forth to work, and wherever else they go,

which means they are still going to be due for oil changes, scheduled

maintenance, etc.

In addition to that, winter months are hard on many of the vehicle systems.

Batteries, belts, alignments, etc. They all need attention, which creates

an ongoing stream of opportunity for you.

mspec,

You're in a populated area and...

You are surrounded by dealerships that do not have very good reviews,

which puts your shop in a great position to pick up all those customers

that are dissatisfied.

Cars still need oil services, maintenance and repair work, in the winter.

Those vehicles are going to be in somebody's shop.

I'm just curious, why do you think business will be falling off for your shop?

It's only three of us, my wife, a helper and myself. (we're looking for additional employees but trying to find good help isn't easy).

Neither my wife or my helper seem to be able to stick to systems - it's good for a week and then they go in every other direction and I'm left trying to get us back on the right road. I guess we just can't find a set of procedures that fit us well!

Here are a couple of questions for you. What is your wife's role in the business? What are the systems

you want them using that they are struggling with? What procedures are you using that don't seem to fit

you well?

New announcement from Michelin. Looks like they're getting into the online game with a new and
different approach to making it easy for the customer to do business with them. There are a number
of interesting things in the website's FAQ's that caught my eye.
http://www.moderntiredealer.com/news/story/2015/08/michelin-pilot-program-sells-tires-online-and-offers-concierge-service.aspx

Even if you're not a tire dealer, this move is a game-changer, What are your thoughts on this?

Hello all, It's time to re-up with the phone book ads again and was just wondering if you guys are in more than one. In years past I was in two but the last 2 years has been just one. I haven't kept track of the calls like I should have I do be leave it does generate the phone to ring but not for all the right reasons, you know the ones I'm talking about The CC processors, Auto zone O2 sensor installs, other bs type calls. So other than logging every call, is there anything automated. The book company has a tracking phone number they can use in place of mine to track calls coming from the ad/s but not who there from or what type of calls they are. Any and all insight on the subject would great thanks again.

All companies trying to sell you their credit card processing services, marketing programs or anything else

are using a list they purchased from a list broker. They are not combing the yellow pages.

I see your yellow page listing includes a website address. Is your website down?