Transmission Repair

I've never thought of that, Joe.  All I asked of my employees was to give me at least 30-day notice.  But then again, we were a transmission shop and didn't have a predictable "busiest time of year".

The aftermath...

Here's what happened when I attempted to disassemble a lithium-ion battery.  Look at the 3:40 mark.

I paid my technicians by the hour and they're rarely late.  Being late was like a pay cut.  The lowest paid technician was getting paid $25 an hour, so if they were two hours late, that's a $50 ding into their paycheck.

This is a funny, but great article on employee relations and motivation.

The beatings will continue...

I don't know if it's legal or not, but I put it in my waste oil tank.

On 7/8/2023 at 11:01 AM, Joe Marconi said:

Great points about KPIs! Question, do you think team morale, culture and leadership also has a large effect? 

Yes.

We pay hourly because what we do (transmission shop) is so redundant.  General repair shops have too many one-off and diagnostic jobs for me.  Recently, in my retirement, I have decided to sell used transmissions without much success.  It sounded good, but it didn't work.

https://youtu.be/6C9974o07pE

Harvard Business Review Article:  Your Approach To Hiring Is All Wrong

We had a strong outside sales program for our transmission shop.  We didn't do G/R, so we would refer that work to the shops that used us for transmission repairs.  The outside sales calls were more of a social call than a sales call and that's what made our strategy so unique.  To read about our program and see if you could adapt it to your shop, read this program overview.  Please post any questions or concerns...

New edited link from the text below:  Penny Candy Jars From Walmart

The Candy Man Can

I always used clock hours to pay the techs.  Occasionally with a bonus for high production.

In my experience, for any given market area, there's always going to be a shop(s) doing extremely well as well as a shop(s) doing extremely poorly.  I had my belief corroborated by the ATRA (Automatic Transmission Rebuilders Association) training staff.

ATRA travels the country doing technical training seminars on Saturdays.  They noticed the same phenomenon no matter the market area or city.  So, for me, it's a given.  That's just the way it is.  Some shops are better run than others.  Some shops hire a coach or consultant, while others don't.  So be it...

I've never been a fan of customers making their own online appointments because it can and will disrupt the work flow in the shop.  There's too much out of our control.   The availability of online appointments makes it sound like we are like the "Maytag repairman" with techs just sitting around waiting for a new job.  Perhaps online appointments online may work for certain other shops, but I could never get it to work for us.  I tried.

Right To Repair doesn't cover WiFi communications, only hardwire.  Here's a good article where one government agency says to NOT follow another government agency's ruling.

When I first got into this business, I had an experience that taught me a valuable lesson.  I had a customer bring in a 30-year-old Chevrolet Impala.  A 1957 4-door if I remember correctly.   It was rusted out and in very poor shape.  It needed a transmission and wasn't worth the investment in my eyes.  I let the customer know my opinion and proceeded to knock the condition of the vehicle and generally berate the car.  The customer seemed to change their mind about the repair and left the shop.

About two weeks later, the local Aamco store manager called me and wanted to thank me for "selling a job for them."  I didn't understand and asked for a bit of clarification.  As it turned out, the customer had a huge emotional attachment to the vehicle.

It was originally his dad's car and he grew up in that car.  His dad used to give him rides in it.  He learned to drive and got his driver's license with that car.  Additionally, his first date with what later became his wife was done in that car.  After his dad passed away, he left ownership of the car in his will to his son.  As it turned out, the car eventually became a family treasure and heirloom.

Basically, I blew a very profitable sale by not asking questions of the customer and knocking the vehicle.  I lost the sale to my local Aamco.  I learned a very valuable lesson that day and never made the same mistake again... ask the customer questions and try to understand their motives.  And NEVER knock a customer's vehicle.

9 hours ago, Joe Marconi said:

And this technology is spilling over to all models and brands.  Technology is great, and it's also going to increase costs for repairs and routine services too. 

=========================

Joe, you're 100% correct.  Actually, many insurance carriers are quick to total an EV because the cost of repairs are so great.  I predict this won't last for long since the aftermarket parts industry will eventually make aftermarket parts.  But, until then...

https://www.ratchetandwrench.com/shop-life/article/11462586/curb-appeal

3:29

Some time ago, I had a similar experience of losing a major part of our business.  We had a GR shop that sent us a lot of referral customers.  It was well over half our business.  Long story made short, for reasons unbeknownst to me, they started installing reman transmissions from Jasper.  Our business suddenly became unprofitable due to our high expenses.  I learned to never have any job source become the majority of our business.

The good thing to come out of this was I suddenly had a crash course on a new type of marketing.  It was social marketing.  That saved our bacon.

A year or two later, I started dabbling in Pay-Per-Click (PPC) advertising with call tracking.  Over time I got really good at it.  I was able to generate an extra $500K in income, just with PPC.  That cost me about 10% of revenue or $50K/yr.  It was truly magical to me.

Utah totally stopped requiring an annual state inspection a number of years ago.  More recently, they changed it again to include cars older than 10 years must have an inspection, and newer than 10 years don't.

Some shops' revenue model uses failed inspections as the major driver for new work.  Personally, I'm neutral on the issue. 

Interesting topic.  Believe it or not, Google Drive and Google Docs are both in the cloud and FREE.

We use QuickBooks Pro Desktop as both our SMS and accounting software.  There's nothing QB won't do.  We paid Intuit to do payroll and our 941.  They would simply dial into our shop, log in, and extract our data.  Our data remained on our PC.

I gave up on paying any SMS for all the reasons previously cited.

You said, "Let's discuss some of your best ways to attract and hire qualified auto technicians. "

This doesn't answer your question about attracting and hiring qualified technicians, but a horror story of trying to use money as the main motivator to hire and keep technicians.  In my experience, it flat doesn't work.

That's a double-edged sword.  I've noticed serious  techs tend to "embellish their qualifications."  Case in point:  I hire a seasoned builder from out of state.  He's in Arizona and I'm in Utah.  Unloading his tools was a real chore.  He had all the right tools.  Soon after hiring him, I noticed we were starting to get a lot of Honda warranty jobs he built.  I asked him how much Honda experience he had.  "Oh, I built hundreds and never had a problem."  As most of the Honda transmissions he built were becoming huge problems.  They are built like a Swiss watch.  Everything has to be on the money.

One day I decided to call his former employer and ask about the Honda situation.  His boss told me "Oh, we never build Honda transmissions; they are too hard.  We usually buy a used unit."  I probed a little deeper and asked him if they buy nothing but used Honda units.  He replied, "If it's not a used unit, then it's a reman from a Honda dealer. We don't build Hondas."

Because the labor market was so tight (and it still is) I hired him at $104,000/yr. salary. ($2K/wk.)  He was unusually fast and the simple transmissions he had no problem with.  I continued to look for a transmission builder.  As soon as I found one, I cut him loose.  My next builder was much better because I worked with him before.

END OF REPORT

49 minutes ago, Joe Marconi said:

I am a firm believer of the multipoint vehicle inspection. However, I am not in favor in performing lengthy inspections for free. 

When I ran my auto repair company, my techs were required to perform a courtesy inspection on every vehicle. This was to ensure the safety of every customer no matter what the car was brought in for. 

But, there are times when a more lengthy inspection is needed, and must be explained and billed to the customer.  For example: If a customer complains of a vibration or drive line noise, the service advisor must explain and sell the appropriate test procedure for that particular problem.  The courtesy inspection is still done, but the more involved testing inspection is billed to the customer. 

The reason I bring this up is that as a business coach I see too many shop falling short on billed labor hours due to giving away too much, and not charging for testing and inspecting, when appropriate. 

How do you approach this issue? 

 

 

 

I was in the transmission business for 40 years.  There were 3 jobs I refused to spend a lot of time, especially for free.

LEAKS, NOISE & VIBRATIONS WERE A MONEY-LOSING PROPOSITION. (remember this)  We were always busy.  "Lost opportunity cost" was my reasoning.  We could be working on a transmission malfunctioning instead of a small-ticket repair.  With that being said, our MARO (major RO where the transmission had to be pulled.) Was $3,500 and our ARO was $1,250.

If I couldn't diagnose in no more than 1 hour, I sold diagnostic time, then"free" went out the window.  The kind of customer that always slayed me was the guy who come in and he's convinced that he has properly diagnosed the transmission as leaking.  Not so fast Kemosabe.

The engine is leaking motor oil, PS fluid, or coolant and it's blowing back on the transmission making appear to be leaking.  What really killed me was when I asked how big of a spot it leaking, they would tell me "about the size of a quarter every other day."

End Of Report

I've come to the realization that I don't need to play with individual stocks.  Rather a mutual fund or an annuity.  If I've got my math right, our retirement savings will last for at least 30 years.

34 minutes ago, bantar said:

😁  I should say casual reader...  you won't find me reading a book for fun.  However, I pound-down technical data though.   My guys are at their computers often researching the system info, although this week, one was off on the model year and wasted some time because it changed that year.  For a short while, we had one that didn't bother.... reading... tightening bolts... etc.

Oh, I get it now.  I prefer reading technical data myself; or anything pertaining to transmissions or drivetrains.  It's not only more relevant, but it's more succinct.  Over the years, that has morphed into reading sales, management, and marketing material as opposed to the technical.  When I go to expos and seminars I always take the management track, not technical.  Today, I read some technical, but mostly management and marketing.  The hardest thing I had to learn was how Google's PPC and call tracking worked.