Joe Marconi

We hear all too often that the "other shop they went to, does not charge for diagnostic testing" or "waives the diag if the customer agrees to do the work" This may have happened years ago, but I really can't see this has common any more. Shop owners know the costs of complicated diagnostic testing. And shop owners know that 2 hours of testing has no part profit, so in order to maintain your hourly gross profit, you need to charge. And depending on your labor structure, many shops use a multi-tier labor rate to offset those jobs that have little to no parts for a particular job.

Joe, more and more shop owners feel the same as you do and are going through the same things. What we need is unity to find common ground on this.

It's not about the brake job. It goes beyond that in everything you do. The value I am referring to is exaclty what you state: Your morals and ethics and the relationships you have built. And I am not in agreement that what most customers care about is the bottom line, maybe some, not most. We have all sold top of the line tires not because of price, but because of value. I am not saying you can charge whatever you want, but when the customer is treated with respect and is shown that we do care, price is not the determining factor. This is not theory and it is not abstract. You build value with a focus on customer service. You build value by becoming known for going the extra mile, for being active in your community, for being part of fundraisers, kids sports, for treating people as family and by the quality of your work. Be known for more than just the local auto repair shop. As a fellow shop owner since 1980, I can tell you that there are some customers that only see price, but most want to be treated with respect. And I know that the majority of shop owners are just like me, they will go to the ends of the earth to win over a customer. Capitilze on the things that your customers recognize. Focus on why you do what you do and focus on the customers that show you the respect; those key profile customers. I hope this clears up what I am trying to conevy. It's a lot to communicate in a post.

The balance between being profitable, competitive and fair to the consumer is a tough battle. And this issue will not be solved overnight. Plus, there are a lot of variables. The fact remains that the future auto repair and service business will become more labor-oriented with less parts. There will always be parts and labor, but as the automobile evolves, things will change. Unless we realize that we need a certain gross profit per hour, it will be hard in the future to remain in business. I am sure no one is suggesting raising labor rates so high, the public revolts. I think for now, we all need to settle down and do the math. What do you need per hour in gross profit? What is your breakeven? And how much do you want to earn and pay your employees? These are questions that must be answered. Profit is not just for your wallet. It's needed to reinvest in your business, attract the best people, pay for continued training and prepare for your future. A lot to consider here. In the end, whatever choice you make is yours. It’s your business.

I just want to add on thing to this conversation: Don't give up on value. The reason why independent shop can charge a higher price for a brake job, for example, is becuase the the value they bring to thier customer. Trust me, I have done consulting wotrk for major companies (I cannot reveal the names) and they are baffled with the prices we get on brake jobs. The typical repair shop is the go to place and preferred by consumers over any other auto repair center, and there is a reason for this. We are committed to our customers and the community. I know there are so many other peices to this puzzle, but value does play a key role in our business.

Wow, I understand your frustration and right there with you. And I hear the same things you do. The reality is that things will not change until the vast amount of shop owners stop and truly understand what they need to earn a profiit. The Auto Repair Shop owner are the hardest working people on this planet, and I am one of them. I wish and pray that we can earn what we deserve. Parts are another issue. The world has changed and getting your gross profit on parts the way you once did is a thing of the past. Shop Owners, listen, the only way to remain in business and earn a profit is through labor. We will win this mindset when we all realize that labor drives our business. Plumbers, electricians and other trades learned this years ago. When willl we? And, by the way...this topic is far from dead.

What are you doing for Valentine's Day? Each year we purhcase small boxes of Chocolates and chocolate roses. We give them out to our customers and delivery drivers a few days before and the day of Valentine's Day. It's a big hit. Everyone loves a little gift. Other marketing ideas to bring a little fun to auto repair and service?

It disturbs me to hear that you were ganged up on Facebook. We are professionals and need to conduct ourselves to a higher standard. We can all share and learn from each other. If someone disagrees, that's fine. But we need to be civil. I have been around for over 46 years in the auto business, forty of them running my own company, and I can tell you, the auto repair world has changed and we will see even more dramatic changes in the next five years. Sadly, for the most part, most shop owners have not gotten the income they deserve and it points right back to labor dollars; which has always been an issue. But now, it's the difference between keeping your doors open or shutting them down for the last time. Achieving your labor dollars to attain profitability is the only way to remain in business. We do more diagnostic testing than ever before in our history. And think about the jobs you do that require little to no parts: Removing a bumper cover to replace a side market bulb, Removing the bumper cover and radiator support to gain acces to a leaking 50 cent o ring at the receiver dryer. There is no way any shop can charge thier standard labor and remain in business. Let's please have an open and honest discussion and move forward!

The year was 1980 - the year I founded my company. And, like many new business owners, I didn’t have a clear understanding of what was needed to grow a successful business. I thought that success would be determined by my technical skills and my willingness to wear the many hats of the typical shop owner. It wasn’t until I began to let go of trying to do everything that I realized that success is not just dependent on what I do, but by the collective work accomplished by the team. I eventually discovered that I was not the center of my universe. After a few years in business, I began the transition from simply owning a job to becoming a businessman. And, while technology has reshaped our industry throughout the years—and will continue to do so—there is one constant that will never change: success in business rests largely on the people you have assembled around you. By the late '80s it was obvious that I was doing way too much. I looked at each role I had my hands on: shop foreman, service advisor, shuttle driver, bookkeeper to lot attendant. And, as long as I’m confessing all this to you, I need to disclose that I was also the shop’s maintenance person; making repairs to the bay doors, the slop sink and equipment. You name it, I did it. I was literally too busy to be successful. In order to lead my company, I had to first clearly define my responsibilities. These are working on the business, recruiting and hiring the best employees, becoming a leader of people and making sure that my business was successful. I also needed to fulfill the obligation I had to my employees. I realized that this required a deep understanding that putting people first is the best strategy for success. This was difficult at first because it requires working on things that have no immediate impact on the business. Unlike working in the trenches and having your hands on everything, working as a businessperson means that you need to spend time building for the future. The things that are most important to your success in business are the things that have a payoff down the road. I also clearly defined the duties I should not be doing and assigned those tasks to others. This is a critical step for any shop owner. Warren Buffett says that in order to be successful in whatever you do, it’s crucial to focus on the things that generates the greatest return and that you can’t do it all, and that means sometimes you have to say, “no.” By the late '90s it became clear that the most valuable role I played in my business was that of coach. All the best marketing plans and the best business strategies mean nothing without a team of great people around you all pushing in the right direction. And that takes a strong leader. Not just a boss, but a leader. Leaders inspire people. Leaders get others to reach down deep inside themselves and perform at their best because they are aligned with the leader’s vision. Leaders inspire others through praise and recognition for the work they do. When people feel their work matters, they have a purpose. People are motivated by the heart, not the wallet. That’s not to say earning a decent wage isn’t important. But a focus on money alone is not a strategy for success. Focus on people first and profit will follow. Spend time with your employees. Get to know them as people, not just the role they have in your company. Find out what their dreams and goals are. And then find a way for others to achieve what they want out of life. People cannot be motivated until they realize that what they do every day helps them to achieve what they want in their personal life. There are other people in our business world that we must never forget. And that’s our customers. If you were to ask me, who is more important, my employees or my customers? I would answer, “They are equally important.” You cannot have a successful business without the right employees and the right customers. One last bit of advice I can give you is to focus on your success, no one else’s. Be very clear about the pathways you take and never forget about the obligation you have to others. Build a company culture of teamwork, quality and integrity. Focus on what’s in the best interest of the customer and the people around you. Put people first, and everything else will fall into place. This story was originally published by Joe Marconi in Ratchet+Wrench on February 4th, 2020 View full article

Well said Joe! And my hat's off to you for being professional and recognizing that we need do what we can as an industry to attract and retain quality people. And also attracting and retaining customers. Thanks for sharing and best of luck to you!

With Mother Google literally tied to our hands, through our cell phones; are part margins becoming more difficult to achieve? Traditionally, shops use a 50% part margin, which they deserve. But, we live in a world today where part prices are so transparent that maybe we need to rethink this. Consider this: What if we concede on prices? Hold to a suggested list…BUT…raise our labor rate to offset the loss in overall profit. In other words, keep your parts prices at a margin the consumer will not question, but raise your labor to make up the part profit? This is being discussed around the country and there are shops that have implemented this strategy. We can’t give up our overall gross profit, so is this a viable option? Your thoughts?

Got your attention? Good! Take it from me, a shop owner for 40 years; before you invest a dime on advertising, get your internal marketing in order....in other words...get your house in order. No amount of advertising or marketing means more than what you do each and every day. And that is creating an amazing customer experience that gives your customers a compelling reason to return. Make sure that each customer contact point creates a positive experience. The phone call, the drive up to your shop, the parking lot, the customer write-up, the upsell, the car delivery and every other point of contact with the customer. These things I speak of means more than any money you spend on advertising. So, before you spend that dime, get your house in order. And remember, everyone in your shop is an important part of your marketing strategy!

Usually the winter drops off in sales, but along with car counts. This year is different. Customers seem consumed with debt and worried about thier finances, and putting off needed vehicle maintenance. Not good. In the long run this leads to breakdowns and larger repair bills.

It takes a while for any new employee to get up to speed in thier new position, no matter how seasoned they are. We have found that using checklists for basic procedures are a great way to acclimate new employees. What strategies to you use to get new employees up to seed?