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When business got slow for us during 2009 for a three month stretch instead of laying anyone off we ask the ones that could afford to do it to work a four day week. Myself and my service manager also took a $100 per week pay reduction. Our guys really appreciated the fact that we all shared in the situation. Fortunately it was only a brief time period.

Here is another great article on profitability by our own Joe Marconi: TB Service Zone Newsletter

My guys are paid on a commission with a guaranteed base. We have four different categories that pay different percentages but they are paid the percentage on both parts and labor. My lowest paid guy is guaranteed $400 per week and my highest paid is guaranteed $700 per week. On any given week they can make more but they will never make less. My techs work 44 hours per week most weeks but once per month they only work 40 hours. Paying techs flat rate without some base guarantee is not something I would feel right in doing.

I dislike working on cars for people I know who expect favors. I dislike working on cars for preachers who are always looking for a deals. Joe is correct. The thinking I am your friend, you should give me a deal is not a friends thinking. A friend will think I am going to bring my business to you and you charge me a fair price because I want you to succeed. My guys are always complaining because a friend or family member wants them to do a 4 hour repair on their day off and pay them with a 6 pack of beer.

If you are paying Mark flat rate and you have only booked 56 hours over the last six weeks it means he has only earned $728.00. That is only decent pay for about one week. Is this part of the problem? How can you increase his earnings? Why are your billed hours so low? What labor guide are you using?

Great story! Congratulations on getting it published. I have met more then one of "my mechanic" who is a complete idiot but whom a customer trusts implictly. It was dumb of this guy to send the customer to you and then for him to question what you had done. In my book if you had been shaving the repair it would have made him look bad for recommending you.

I dislike lose leaders and super low discounts. It attracts a bottom basement type customer and the shops that use it usally do a bait and switch, hard upsell type approach. I like to do what you do which is offer a value package. We do however, use a competitive brake promotion that is low enough to attract interest but not too low to not be profitable. We use it to attract new customers. We feel that the majority will keep returning once they have dealt with us.

We do very much tha same as Joe. I think you have to.

You are absolutely correct as to how the customer often has the wrong part. When the consumer goes into AutoZone on a weekday evening or weekend they do not realize that the manager isn't there or any commercial sales account people. There is a $7.00-$8.00 person behind the counter that doesn't know anymore about cars than they do. The combination of the consumer not knowing even basic information about their car (is it a 3.0, 3.3, or 3.8 6-cylinder) with a counterperson who is not knowledge results in the wrong part at least 40% of the time. Often I get someone wanting me to install their $50 water pump on a $400 timing belt/water pump job or their $40 heater core on a $600 heater core job. I always tell them that we do not installed customer supplied parts and that who ever did this job they should let them supply the part so they can have a warranty on the whole job. Some get it and some don't. Here is someone with a liftetime warranty on a $50 part and no warranty for the several hundred dollars of labor. The general public also doesn't get the fact that our shops buy parts at a discount to what they pay. Recently I quoted a fuel pump job at around $600 parts and labor. From the guy's wife I found out that he eventually changed the fuel pump himself but wound up telling her he didn't really think he saved anything. I found out that he paid more than $125 more than we would have paid for the fuel pump and it took him a whole day to get it done. At least he wasn't the guy who paid to have his fuel pump installed only to find out the problem was not the fuel pump but the fuel pump regulator. A job that should have cost less than $300 parts, labor, and diagnosis wound up costing him over $850 because he was trying to save a buck.

Here are sales ideas that may be worth reading: Sales Ideas...

Twest6792, welcome to the forum. Yes, Joe, we would all be more interested in how you track or manage productivity.

Baptist Cowboy A cowboy, who just moved to Wyoming from Texas , walks into a bar and orders three mugs of Bud. He sits in the back of the room, drinking a sip out of each one in turn. When he finishes them, he comes back to the bar and orders three more. The bartender approaches and tells the cowboy, 'You know, a mug goes flat after I draw it. It would taste better if you bought one at a time.' The cowboy replies, 'Well, you see, I have two brothers. One is in Arizona , the other is in Colorado . When we all left our home in Texas , we promised that we'd drink this way to remember the days when we drank together. So I'm drinking one beer for each of my brothers and one for myself.' The bartender admits that this is a nice custom, and leaves it there. The cowboy becomes a regular in the bar, and always drinks the same way. He orders three mugs and drinks them in turn. One day, he comes in and only orders two mugs. All the regulars take notice and fall silent. When he comes back to the bar for the second round, the bartender says, 'I don't want to intrude on your grief, but I wanted to offer my condolences on your loss.' The cowboy looks quite puzzled for a moment, then a light dawns in his eyes and he laughs. 'Oh, no, everybody's just fine,' he explains, 'It's just that my wife and I joined the Baptist Church and I had to quit drinking…' 'Hasn't affected my brothers though.'

We bend over backwards to take care of our customers and have almost no situations where this occurs now, but the few times I have had situations in the past where an unreasonable customer said they were going to call the BBB I almost wanted to laugh because I know what a total waste of their time it is.

Wow you guys have opened up a lot of subjects for discussion. If my writing isn't too good it is because I am bouncing down I-24 south of Nashville. Concerning the BBB I think they are a scam. They pressure businesses to join so they can collect the dues and then they do nothing. The consumer seems to think that BBB has some power or governmental type clout. They don't do anything. They are a joke. Even if a business is real shady it is hard to get any scoop on them from the BBB. They don't report it they don't want to get sued. They just want to collect the dues. Concerning the really cheap shop. They will not be able to retain help and they will have to use cheap parts. Short cuts and poor quality work will be their norm. They will fight with customers over warranty work becuase they can't afford to do otherwise. They will not be around for long but long enough to damage all of the more responsible businesses. I saw this type of thing in the environmental consulting/contracting business I was in before.

Joe, I think this is a smart move for you. You and Autoshopowner.com have a lot of potential but that is a time committment. You could easily move into an expert role through the forum and yyour writing. I could easily imagine you an author, speaker, consultant should you have the inclination to do something like that.

Glad you found us! Welcome!

Why They Stay, Why They Leave Employees...

This is an ok article but really pretty basic. My guess would be that the authors never have had a lasting relationship with one shop. Having been in this business for eleven years and having been on the other side of the counter previously I can say that to me the best thing is for the consumer to find a shop they can trust and build a relationship with. I think that is the kind of place most of us on this board are.

The shops in the article below are the top 10 shops in the 2010 Motor Age Top Shops Contest. The number one shop is actually in the town where I live: Menke's Automotive - - Motor Age - Automotive training, certification & parts info

Welcome back Joe! We really did miss you. You keep things stirred up. Glad you had a good time. All I did while you were gone was work and make money!

You make a good point. Having a wide enough profit margin helps insure that comebacks and warranty items can be handled without stressing the business. Prior to opening our shop eleven years ago I spent about 10 years working in environmental consulting and contracting. Part of my job was estimating. We bid on literally hundreds of private and Federal, State, and Local governmental jobs. After all costs associated with a job were totaled we did 25% markup to cover overhead and we did 10% markup for profit. We were very competitive and while we made some money we never got rich. Where you tended to make your money was with change order and unit price items. In my opinion a shop that only charges 25-35% markup on parts will always struggle and it will never be much more than a job for the owner.

Besdides the doctor has never had to deal with Swedish or German or Italian engineering!

As a general rule we do not install customer supplied parts. Occasionally we make exceptions if we are exceptionally slow or if there are extenuating reasons. We are busy enough that we do not have to do this. The people with their own parts are not the people we want. I turned a guy down today who had his own brake parts. If we make an exception we usually up the labor.

Here are earlier discussions of this subject that you should read. Parts markup - AutoShopOwner - Automotive Management Network