Joe Marconi

This is a strange year. Our car counts have gone from an average of 100 per week to 135 per week. And we see more new customers than ever before.

The only negative thing I see is that people are more cautious and budget their money. Our over sales are up, but not what we would expect from such an increase in car counts.

I think social networking is here and we need to be a part of it. I also would like to here form other shop owners about social networking.

I have them all; And all BG.

Transmission, Power steering, Fuel system, Engine Cleaner, Coolant service, Differential, brake flush, de-carb.

If you are performing preventative maintenance you are missing $$$$$$$$$$$$$

Welcome and the best of luck!

I think you are getting into this business at the right time. I have been in business for nearly 30 years and have never seen the opportunity that will reveal itself in the next 2 to 5 years.

My advice: Start small but always think big. Work ON the business as much as IN the business. Profit on labor and parts will vary depending upon your overhead and what the market will bear. Generally look for a 60% gross profit on labor and a least a 50% overall mark up on parts.

Establish a parts matrix. That means for low cost items that cost $10.00, you can charge $25-$35. The higher the cost the lower the mark up: For example; a part costing $500 will generally sell for around $800.00. The idea is to achieve an “overall” 50% gross profit or better.

Please forward any other questions… AutoShopOwner.com is here to help!

The need to network is more important now than ever before. With the knowledge we have, there is no issue that we can't solve with the collective help from other shop owners.

We need to make our claim now! The new car dealers that survive will be the strongest group of dealers ever.

Now is the time to increase our market share. If we miss this opportunity, I fear we will never have another chance.

Increase your marketing, training and promote you business by offering the very best in customer care.

Loaner cars can be a huge benefit. The problems are insurance and having enough cars available. If you advertise loaner cars and your car counts are high, you may end up disappointing people when you don’t have a car to give them. This is the problem even dealerships have.

We made a deal with a local Enterprise for a good rate. (Approx. $30.00 per day) Enterprise will meet my customer at my shop and handle the entire transaction. For high-ticket jobs, I will give them the rental if it helps to get the job.

Are there any rental companies in your area? If so, meet with them a broker a deal.

Joe

Right on target. No matter if it's your part or the customer brings it in, you are the Pro and responsible.

I agree, build relationships and don't be everything to everybody.

Joe

Just remember, for every dollar of labor sold, usually equals a dollar of parts sold. So, when you allow customer to bring in their own parts you are giving up a lot of needed income. Plus, you may be attracting the wrong kind of customers.

Remember the old saying...You wouldn't bring a steak to the restaurant and ask the chef to cook it up for you? Would you?

For my business, 35% is just too low. I’m not sure how the people are where you are, but for me, I’m not really concerned if a person knows how much the parts cost. If I go to home depot and buy a faucet for $25.00 and installing myself, that’s my choice. But if I call a plumber to install the same faucet, he will charge a markup on the part and labor. The plumber has overhead and has to insure it. It doesn’t matter at that point if I know how much the faucet cost, does it?

One of our responsibilities as business owners is to make a profit and to put away money for the future and for reinvestment into our business. Too many of us give away too much and too many give away their entire career.

I try to stay in the range of 50-60% gross profit on parts. I don’t really go by anyone’s list. I know what I need to stay in business, so I charge accordingly. When I sell a job I sell value and benefits and sell the entire job. I don’t focus on parts or on labor, but sell the entire job as one.

This is the way I do things and have been doing it for nearly 30 years.

Here are my thoughts…

You need to create a parts matrix that allows you make 50-60% gross profit on parts, overall. That means that small items you purchase for around $10.00 you need to sell in the range from $20-$30. Smaller items like hardware or bulbs that cost you under a dollar, you can sell for $4 or more. Items you buy at $50.00, I would sell for a minimum of $110.00.

The higher the cost, the less you can charge. If you buy a used rear diff for $500.00 you can’t sell for $1,100, but you can easily sell it for $800.00.

The idea is try to get into that 50-60% overall gross profit. You need to track your profit and adjust until you achieve your target goal.

Your overhead might be low now, but if you want to grow you will need to charge accordingly.

Systems like Mitchell Manager can set this up for you.

Most shop owners were techs that became business owners. The skills for fixing cars are quite different from the skill needed to fix a business.

I think all shop owners can benefit from management and finical training. Too many shop owners spend countless hours wearing all the hats of their operation, literally killing themselves. This is due to their lack of business education.

Shop owners need to take a few lessons from the franchise world, create a plan, systems and policy. The best run businesses are those that can operate without the owner.

Thanks for the tip. I have the new Wireless Launch as a demo. It seems like a nice tool.

Soory, that's a typo: 8:5 mon thru fri.

And, I agree, Sat is an important day and we need to consider at least one late night. A local dealership just opened up on Sundays and I heard they had nearly 30 cars that day. This should tell us where the industry is headed. We may not like it, but we may not be able to change it!

I agree, say yes to everyone. Noiw is the time to build for the future.

I know Lang Marketing has info, but I'm not sure where to find free info

All great suggestions, my additions:

* Take a look at your facility, what image does it portray to the public

* Consider consumer clinics

* Host car care clinics or charitable events at you shop

* Get invloved with the community

* Join the local chamber and network with local businesses

Let's keep this going....

You had me for a second.

My blog as a lot of good info. Are there any specific questions you have???

This is a great time to get into the auto service business. Let us know how we can help you. You can also post a topic.

Good luck and welcome to AutoSHopOwner

Joe Marconi

I am right with!

Geoge Washington, Thomas Jefferson and Ben Franklin are turning in their graves!!!!

You can learn a lot about a shop’s spirit from a simple phone call. As chairman of a local automotive shop-owners business council, I call members to remind them about future meetings. This one call in particular, to a local shop, really got me thinking. I decided to write about it because it relates to our role as leaders and how our actions trickle down to every member of our company.

So, here’s a replay of the phone call to XYZ Auto…

In a flat, monotone voice the service advisor picked up the phone and said, “XYZ Auto, this is Tom”. I responded by saying, “Good Morning Tom, this is Joe from Osceola Garage, how are things going today?” He replied by saying, “Going today? How do you think things are going? I’m stuck working in this place.” To avoid any further confrontation I quickly asked if I could speak to Jim, the owner. After 5 minutes on hold and with a huff as he picked up the phone, I hear, “This is Jim”. I said, “Jim, good morning, this is Joe from Osceola Garage, how are things today?” Jim replied, Ok, I guess. I’m alive. If you call being stuck in this place, alive”. In an instant it hit me, the service writer’s emotions and actions mimicked the emotions and actions of the owner.

Jim went on to tell me that business stinks, his employees don’t care, the customers don’t want to spend any money, his overhead is too high, he works too hard, he can’t take any time off, the weather is lousy, and his kids and wife are driving him crazy. I was tempted to drive over to his shop to take away his shoe laces and belt, in fear he might hang himself.

After listening to his depressing statements, I couldn’t help thinking that his negative attitude IS the reason why his life stinks. His focus on everything negative is not only killing his life, but also killing his business. And, every person in his company probably has a negative attitude because of Jim. In fact, I have no doubt that the air of negativity is also affecting his customer’s actions.

Remember, you are the leader of your company. How you act and feel will trickle down to every member of your team. If you are upbeat and positive, your people will follow the same. If you walk around with your head down, drowning yourself in sorrow over all the things that can go wrong, things will go wrong. Your people will follow you as you head down that slippery slope to depression. People don’t like to work in a place that’s depressing. Productivity will suffer as a result.

We all know the state of the economy and that this may not be the best of times. But trust me, things will get better. History has proven that this recession will not last. Plus, shop owners are among the most resilient business people. Our ability to solve complex problems puts us in a class of our own. There may be some casualties along the way, as some people will give up. But the majority of you will make it through, and you’ll be stronger because of what you endured. So keep your head up and give your people a reason to go on. Shop owners that maintain a positive attitude and find ways to stay alive will thrive when the economy bounces back. The next time someone asks you, “How are things going?” You respond by saying, “Great! I can’t wait for what the future has to offer me!”

Never heard of it. Do you have any more information? Do they have a web site? Can they give you testimonials of other shops?

Joe

I have a local company I met through the Chamber of Commerce. They send out post cards every quarter. We purchased a mailing list for a five-mile radius from my shop. We compare the list against our current database so as not to send to existing customers. I had a post card designed by my son (who is a graphic designer) and have a printer generate the post cards. We have been doing this almost a year with good success.

I prefer using a post card that displays my logo and colors. This way people will recognize it when seen over and over. The key is being consistent with your advertising, sending the same message each time that shows your company logo.

Monthly Car counts: 480 to 525

Bays: 6 (soon to add 4 more)

Hours of operation: Mon-Fri 8-6, Sat 8-3

I'm afraid we have put our future generations in jeopardy. We are rewarding companies who committed fraud against this country. If I do a poor job in my business, I will suffer. No one will bail me out for doing a lousy job.

Great points Tom, right on target.

Effective advertising is the age-old dilemma. It’s difficult to measure and judge advertising. Word of mouth is truly your best form of advertising but it can work too slowly if you trying to achieve certain sales goal.

We all need to advertise. The key is to balance your advertising so that you can touch many people with different forms of media. You also need to experiment and track what forms of advertising works for you. In addition, you need to maintain an advertising campaign for a reasonable length of time to measure its effectiveness.

I’ve tried probably all forms of advertising and now concentrate heavily on my existing customer base. To seek new customers we now use radio, TV, Google, Yahoo and mass mailers to consumers in a five-mile radius of our shop. I have given up on most print ads and the yellow pages.

Remember, what works for one shop, may not work for another. But you will never know until you try it out.