Joe Marconi

I hear this frustration too often. I think it's time for Mitchell to step up to the plate and have a dialogue with shop owners. Mitchell is in the driver's seat to be the number one Business Management Company, but they do fall short in many areas. I would like to hear from other Mitchell users, perhaps we can gain some traction and collectively voice our concerns to Mitchell.

This is not new topic for me, but I need to revisit it again. And I will keep revisiting this topic for the sake of our industry. For independent repair shops to "thrive" today, you must take a proactive approach with regard to business. If you only want to "survive" you can stop reading now. Waiting for the phone to ring, or for cars to breakdown, or for a customer to drive into your shop asking for a repair or service is business suicide. The days of broken cars lining up in front of your bays are over. Sure, cars still breakdown, but you cannot thrive with a wait-and-see strategy. Make sure you perform multipoint inspections on all cars in for any type of service. Yes, any type of service or repair. Look up vehicle history on all vehicles. Let the customer know of needed services, missed services and services due. And lastly, book the next appointment. Yes, I know....Joe's been preaching this over and over and it does not work in your shop. Fine, then let me focus on those shops that do book the next appointment. Because those are the shops that are adopting a proactive approach...and I will see those shops in the future.

I do agree that we need to pay our employees a decent wage. It's a main factor in attracting quality people to our industry. The only thing I would recommend is to carefully look at your overhead, cost of sales and make sure your generating enough profit. This may take some time, but it's worth it. In other words, it's one thing to want to pay someone a certain amount, but you need to make sure the company earns a profit and that the technician is generating enough labor production hours. I pay techs a base wage, which is above average in my area, and also pay production bonus on top. One more thing, money is not the only motivator for production. A healthy work environment, with a strong leader, and recognition of your employees will do wonders for your production.

Gonzo, I could go and on and piggy back on your article. There are so many fundamental laws that are broken each day. As we have said in the past, there must be a code book or consumer manual that teaches people these crazy things. It must exist, it must.

I will be there giving two presentations: "Beating Burnout" and "The True Cost of Comebacks" If anyone is going, please let me know. It would be great to meet you. And of course, please attend my presentations!

There is a lot more information needed before I can really determine what is going on with your business. However, we can draw a few general conclusions. It's not so much your prices or labor rate that is the problem, but how efficient and productive you are. In other words, how much labor is being produced per hour by your techs? You could have a $150.00 labor rate, but if a tech only produces $300 in labor in an 8 hour day, that translates into $37.50 per hour for that day, for that tech. You need to look at production, the type of jobs you are selling, you customer base, your profit on parts. And too much discounting is a sure way to go out of business. By the way, EVERYONE of my customers are family and/or friends, but I don't discount a dime. Good luck and I hope this helps.

Back in the late 1990’s, I began to get concerned about car counts and customer retention. Around that time, cars were beginning to become more reliable and many of the services and tune up components we once counted on, were going away. I also started to notice that many customers were going to the quick lubes for their oil changes. To be honest, I couldn’t blame them. There was a time when I did not offer any “wait” service and I was never concerned about the oil change business. That all changed. I began an all-out blitz to get my customers coming back to me for their next oil change. I especially made it a point to inform customers of their next appointment when we did not due their last oil change. I just informed them of their next service date and made sure they received a service reminder. The plan took time, but it worked. It increased car counts and customer retention improved. We still use this strategy to this day. Make sure you speak to all customers at car delivery about their next service. Book it in your calendar. And if the car was not in for an oil change, check the oil sticker, enter the date in your CRM reminder system, and assume that the customer wants to return to you. We need to be proactive these days. We cannot wait for the phone to ring, we have to make it ring!

It's always a little challenging when we realize there are more years behind us, than there are ahead of us. But, the really good news is that we learn to appreciate the things that you cannot define with a price tag. And that makes it all worth it to keep on pushing through life's obstacles.

Great question. Most shops attain a much lower profit margin on tires. I have seen anyway from 15 to 25% on average. For this reason, most shops do not include tires in their overall part margin. Many shop management systems, such as Mitchell1 have two matrix's, one to markup parts, and another to markup tires. Labor is another story. If your target is a 60% GP overall, you need to set your sights on a 70% GP on labor and an overall GP on parts at around 50%. It's attainable, but it also depends on your tire sales mix. And if you do a lot of tires, you most likely have Tire techs which are paid at a lower rate than Master Techs, which means your labor spread will be better. As you can see, there are a lot of variables here.

You make excellent and valid points. I think what upsets a lot of shop owners is the marketing strategy and advertising that undermines the professional. For example, I listen to a sports radio station on my way home at night. And on that station, three different auto parts stores advertise to the DIY market, which is ok. What's not ok is the message that they can help and save money, so why spend your money at the repair shop. There will always be the DIYer, I agree. There will always be the Home Depot market too, where home owners tackle home improvement. I think the issue is more about pride and our image than anything. I hope I am making sense here?

As shop owners, our focus is on business, for the most part. There is nothing wrong with this mindset, but it may push employees away from you. Whether you like it or not, people are more concerned about their own lives and what’s important to them. When speaking to your employees, find ways to engage in conversation that has nothing to do with business. Find out about their interests, and what’s going on in their lives. Simply asking, “How was your weekend? Do anything special?” can work wonders to motivate people. When speaking with employees, be more concerned about them, not you. This will send a message that you care about them as a person. In turn, they will care more about your business.

Welcome to AutoShopOwner.com. You are among the best minds in the auto repair/service business. Looking forward to your contributions on the forums.

Thanks for being so open with us Gonzo. It's a testament to your character. This was a life-defining moment for you and you got a second chance. I truly believe you will come out of this better than you were before. The industry needs people like you, so I personally look forward to many more of your tips, articles and laughs. Deal?

It is getting harder and harder to find quality employees the traditional ways. Shop owners need to find who the top talent is in their industry and get to know them. Create a network of people. In other words, always recruit. Build a pipeline list of people. When the time comes when you need someone, reach out to the these people. This is what large companies do, and it's similar to professional sports teams.