Joe Marconi

If you listen to the news reports, you might as well climb out onto a window ledge and throw yourself off. We know things are bad, but we don’t need to hear it 24/7.

Is there no good news anymore? Of course there is.

It’s more important now than ever before to remain positive and upbeat. I know it’s hard. I’m a shop owner too. But to focus on the negative news and things that can go wrong just may make you another causality of the recession.

People want to do business with winners. People want to work for winners. In times like these, the difference may be your attitude.

Great advice and response, I totally agree.

Have the passion to be the best. Understand both sides of the business, the mechanical side and the business side. Your success will be determined by how you run your business and your knowledge of business. I learned the hard way, but once I understood it, it changed my life.

Are there sales goals to reach? Do you consider your break-even?

I have my business set up in a way that all positions are taken care of. My role is to oversee the operation, work on growing the business and to coach the people around me.

There was a time when I did everything. From service writing to working on cars, all the office work, road testing, etc. But I was killing myself. We are much more profitable now that I concentrate on running the business, instead of working in it.

We have 4 techs, a service advisor, office manager, shop foreman and a clean up crew.

So, you find that offering specials increase car counts?

New cars are not selling and people are keeping their cars longer. People will eventually need cars for themselves and/or children. They may not be in a position to purchase new. You have a distinct advantage, since your customers already trust you. Offering them a used car may be another way to add a few bucks to your bottom line.

You stand behind your work. I know you do, because I do! But what about a part company that gives you grief over a part failure. Who pays for the comeback? We need to talk to our suppliers. And the worst are the new car dealer parts departments.

I recently had an issue with a catalytic converter that was special ordered for a Jeep that took a week to arrive. The O2 sensor hole was drilled in the wrong place and the dealer told me it would be at least another week to get another one.

It took my tech 2 hours to cut, weld and re-engineer the converter. When I brought it up to the dealer he told me there was nothing he could do about it and would issue no form of credit for my labor. That dealer no longer gets my business.

With the closing of new car dealerships in our area, we have seen a lot of techs looking for work. If you are looking to hire a tech, my advice would be to carefully screen these techs. The first to get let go at the dealer may be the bottom of the barrel or the least experienced. The dealership also may be looking to get rid of the dead wood.

Discounts eat into profits. All of us understand this. In this economic climate it seems many businesses are offering discounts to increase sales. But at what cost? Another problem, it may to hard to increase prices when the economy turns around if you have established yourself as a discounter.

However, if discounting drives more traffic into your bays and gives you the opportunity to increase other related sales, is it wrong?

I would like to hear from other shops on how they feel on this topic.

Many shops put their advisors on salary with a performace bonus. Salary based pay has its pros and cons. For those advisors that don't watch the clock, it can work out to the shop's benefit. For advisors who need a lot of flex time for family reasons, it may present an issue.

Not a problem, I enjoy the conversation.

I'm glad to hear that you understand the need for growth. One thing to remember, create a stradegy for steady, contiunous growth. It's not one thing you do that will make your business a sucess. It's a combination of everything you do. Work hard on your business and understand the numbers.

Like Walt Disney said; "Dare to Dream"

Yes. Depending on the position and after certain goals are met, a bonus will be paid. The precenages vary per person and goal.

Eric, if you want to grow and thrive in this business you will need to expand. With your present situation, it will very difficult to increase sales and productivity. Even with the addition of another tech. You need to look into expanding your bays or finding a new location. If you find a new location, try to go as big as possible. Trust me, I have been in business for 29 years and having bay space is a distinct advantage.

Another recommendation I can make is to slowly remove yourself from the bays and into the office. Or get someone who can run the service counter. I used to think that no one could do as good a job as I could. That’s bull! There are good people out, find them!

Your mindset will also dictate your ability to grow. If you go to work everyday and your focus is on fixing cars, you will become very good at that. You need to go to work with the mindset on growing your business. If your focus is on that, you will eventually become good at growing your business.

I am in the process right now of expanding my shop. We are going from 6 bays to 10. It’s a huge undertaking, but one that I believe will be my retirement.

You can read my blog (Joe’s blog) about the process of expanding. Good Luck!

Joe Marconi

Before I pay anyone (Service advisor, tech, foreman, etc) I establish goals. I factor in my breakeven, previous sales, return on investment and then set a bonus for a percentage after that figure is reached. I have found that to pay a percentage of sales without a benchmark goal takes away their incentive to do better.

We really should consider the chat session, please contact me.

Joe

I understand what you are doing. My only concern is that some of those dealer ads are misleading. For example: Timing belt $199.00. If they come to you with a coupon, it's up to you to inform them that this probably does not include the water pump, coolant, drive belts, etc. The cusotmer may think that YOU are trying to up sell them.

I don't like price wars. I need to be competetive, but profitable.

I don't mind competing apples to apples, but I rather take my chances building my business based on value proposition. In other words, what makes my company stand out against others? We all sell the same things, what can I do that will make people come to me. If it's only the price or for a discount, it won't be long untill you're pricing yourself out of business.

I have plenty of customers that tell me I am sometimes more than the dealer but they come to me for all the other reasons: the ride home, the while you wait service, friendly staff, clean shop, etc.

Just my thoughts, what do you think?

There is a future in the auto repair buisness. 150k is a lot on money for any career. It's not impossible but you have to work really hard and dedicate yourself to the trade. There will always be work for us in this business, inspite of the economy. You just need to be good and be the best.

Just wanted to bring up this subject again:

Welcome Walk-ins and don't be too tied down to a rigid schedule. I understand you need structure and have to organize your work, but people today are frustrated and fed up with poor customer service. Try to accommodate people on their time. We have and it’s has paid off, especially in this climate.

My techs get paid according to their experience, ability and ASE certifications. All techs are paid a salary plus a productivity bonus. Each tech must produce an hour of labor for each hour worked. If a tech books more hours than he worked, he will get a bonus for those extra hours. For example: If a tech works 42 hours in a week but produces 46 hours, he will get paid an additional 4 hours in his pay as a bonus.

My lead tech will make an average of $26 to $40 per hour, depending on how good the work was. Less experienced techs will earn from $18 to $25 per hour.

We have 4 techs at the present time, one service advisor and a shop foreman.

The 4-bay expansion is not yet complete. We will open this spring and add another tech.

Sounds like a good idea. Benchmarking and share ideas is a good thing. I will do some homework and see what I find.

No, sorry. how would that work? There's no actual interaction, or shop visits?

Sometimes when the owner is also the lead tech, there is not enough time to devote to running the business. Your ideas and thoughts about running the business are right on track. The big problem you will have is getting your father to believe in the concept that he must run the business and hire people to work with him. This will allow him to gow the business and also reduce stress.

Doing repair work with pits is a hard way to be productive. You need to have lifts to be more productive. Pits are nice for some service work, but only having pits is a hard way to make a living.

We make it a point in my shop to be an organized and as clean as possible. The way I feel is that if you are going to spend 8 to 10 hours a day working, it should be a nice place to work. I don’t if it’s possible to convert your layout so lifts can be installed. You mentioned moving your location; that might be a better option. In any case, having lifts, tools and the right equipment makes all the difference in the world.

Advertising is important in order to maintain and grow a business. The most important form of advertising, although, is to your existing customer base. Advertising to your own customers is cheaper and you stand a better chance of getting these customers to respond to your advertising. Most of my advertising and marketing is to my own customers. We send them service reminders, seasonal promotions, newsletters and we also collect email addresses and send people email reminders for service. We also have a web site and use google and yahoo search engines to direct people to our web site.

I don’t do yellow page advertising anymore and stopped all print ads in local newspapers. For me, they don’t work anymore.

We started TV advertising this past summer and it’s been very good. I also purchased local mailing lists and send these people post cards with offerings. This works good also.

The best advertising is word of mouth. Provide excellent service; be polite and accommodating to all your customers. When people are treated nice and the job is done well, they will return. That’s how you build a business…. one customer at a time.

Just wondering; do you share our dialogues with your father?

People are starting to drive more and that's a positive thing. Heating oil is down also. Let's hope this stays for a while so people can catch up on their bills.