Joe Marconi

I want to wish all our members the very best during the holiday season, and the very best in the New Year!  

What you do every day is essential to the lifeblood of our country. You keep America moving, and you should be proud!

I recently spoke to a shop owner who told me his techs give him pushback on performing the multipoint inspection (MPI). After a few questions, I think I revealed the REAL problem. His techs are paid Flat-Rate, and not being compensated to do the MPI. When on flat rate, every minute means earned pay. However, is it a flat rate issue or a culture and leadership problem?  Or the wrong employees? 

I realize that time must be compensated on that type of pay system, but what about the customer and their safety? 

Many shop owners are saying that the great business increase we experienced in the past few years is fading.  I don't think so. Are things stabilizing? Probably. But we are in very good times, with great opportunity. Many shops finally raised their labor and prices that can earn them a decent profit, the average age of a car is around 12 to 13 years old and still rising.

I can't speak for everyone, but would like to hear your thoughts on the state of the Auto Repair Shops from your perspective. 

50 minutes ago, Transmission Repair said:

I've been a transmission repair specialist for all of my 40-year career.  At first, it was because I loved the challenge of automatic transmissions.  As time went on, I learned I was truly blessed because I haphazardly learned that specialization was the key as well.  Lucky me.  I don't know of a tech that can meet the time for any G/R time the first time they do a job.  For that reason, I never went into G/R because there were too many 1-off and first-time repairs.

However, I was tempted to go into G/R when transmission repairs got slow.  I agree that specialization is the key, as well as the future, of G/R.  I predict the majority of the shops will do what they've always done when technology changes; they will adapt.  After all, didn't G/R originally adapt from the blacksmith shops to cars?  Below is a recent CNBC news video that puts forward an idea of what the automotive industry can expect over the next 11 years...

https://youtu.be/P-NF-7miGLo?t=418

Good points, and perspective! And thanks for the link!

9 hours ago, Gerald Martin said:

Great questions Joe.  In my opinion, the future is bright for independent repair shops that embrace emerging technologies and invest in training.  See you all at Vision 2024 in Kansas City!

However, I can see the possibility that we no longer expect that every tech has the knowledge or training for every job that comes through the shop, as may have been expected in the past.  There may be alignment and ADAS techs, diesel repair techs, driveability diag techs, etc.  Oh, and high tech immobilizer and key programming work that requires locksmith level training.  A certain amount of specialization is inevitable, isn't it?

Wouldn't it make sense to have a goal of having two technicians in the shop that have competency for services offered by the company?

Gerald

 

Gerald, I agree with your assessment. Specialization is the key, and we need to assess the strengths of our employees and provide training in those areas. A shop's business model will dictate the competencies needed to provide top-level service/repairs to their customer base. 

One more thing to add to this discussion; top pay or A-rated pay cannot be reserved for the "traditional" definition.  Please note that flat rate pay is not the norm in many states, such as New York. Rethinking pay scales is also inevitable. 

Looking forward to Vision 2024! 

Too many shop owners spend too much time on new customer acquisition. While this is important, they sometimes forget about the customer right in front of them. 

Retention is your key marketing strategy.

Great topic SMP! As always, great podcast! 

When I started as a young auto technician in the mid 1970s, working in a general automotive repair shop was a lot simpler. After all, we mostly worked on GM, Ford and Chryslers, and most of the work was mechanical. Fast forward to today, can the General Repair shop model still work? 

Today's techs who work in general repair shops have to bounce from Toyota, to Honda, to Nissan to GM to  BMW, to Hybrids, and on and on. And then switch gears to a Ford pickup diesel.

Techs also need a working knowledge in, electrical, on board computer and driveability issues a wide variety of car makes and models. 

And what about the training needed and the tools/equipment need to service and repair a wide range of worldwide car models? 

If you are a general repair shop, I would like to learn more about how you are adjusting to the challenges of running a general repair shop. 

This is such an important topic these days. Since COVID and the recent inflation, many shops are finally aware that labor, pricing, and understanding their numbers is key to running a successful business. Another  must-listen/watch Carm podcast! 

15 hours ago, Obsidian Motors said:

I no longer offer loaner cars. Customer flipped the loaner on the freeway then she balked at accepting responsibility and having her insurance cover damage even though she signed the waiver for the loaner. I had to threaten to enforce what she signed in court before she bought her insurance company in to reimburse our shop for the total loss. I didn't receive tangible benefit for offering loaners when all was said and done. I do still offer local rideshare for regulars though.

I was never a fan of loaner cars. With car counts 100 plus each week, we would need a fleet of cars. However, many shop owners rave how great their loaner car program is.  I guess it is an individual choice.

For me, I set up deals with the local Enterprise and Hertz for discounted rates, and that worked great for me. In my area, Uber and Lyft are not that easy to get at times, not yet anyway.  I also used local taxi service. And, we also had a shuttle van for local rides. 

51 minutes ago, Hands On said:

I am well aware of how it works, I did not want 500 people who had 50 different phone numbers for my shop stored in their cell phone. What happens when you cease using that call tracking number?

You  make a great point!

To all ASO  members,

I want to take this time to thank you, our members, for making Auto Shop Owner the go to online forum for automotive aftermarket repair shop owners. 

There is a wealth of information withing these virtual pages and  more to come in the future. 

From Alex and I, we want to wish you the very best this Thanksgiving Holiday! 

This is a topic that is often discussed and heavily debated.

The fact is that these days the average consumer does not think about auto repairs or preventive maintenance as they did 20 to 30 years ago. Plus, back then cars broke down a lot!  

Today, we need to be proactive about setting the customer's appointment. Too many shops spend a lot of money to get NEW customers, when they HAVE customers right in front of them everyday. Why not bring them back?

Do you have a process that books your customer's next appointment? Yes, of why not? 

I know as well as you, the difficulties and the challenges of running an auto repair shop. I lived that life for 41 years, and now work to help other shop owners as a coach.  

Even with all the responsibilities and duties of a shop owner, perhaps one that is overlooked is taking care of yourself.  

Take time this Thanksgiving holiday to spend time with family and friends. Maybe do something that you really enjoy, away from the business.

Additionally, focus on what you have, not what you don't have. Show appreciation for the people who work with you too. 

We all need a mental and physical break from time to time. It helps to declutter our minds and reenergize our bodies, and pays off in the long run too! 

Happy Thanksgiving to all! 

26 minutes ago, Transmission Repair said:

The learning curve was long and slow.  I did a lot of research figuring out how the bidding system worked in AdWords.  They were using the Dutch auction, aka 2nd bid, method.  Only if I was the top bidder on a particular keyword, I would win the auction but pay only a penny more than the second-highest bidder.  It took me a couple of years to finally learn that.

I originally started bidding cheap with about 1500 keywords.  Over time, I learned that I only needed about 35 keywords.  Then I learned the power of negative keywords.  I put leaks, noises, and vibrations in as negative keywords, basically any minor work.

I also came to learn that no matter how much I wanted to spend, there were only about 1,500 clicks per week to be had in my market area.  The last 3 years we had before I sold our shop, I was spending about $1K/wk. on ad spend.  We kind of grew into an equilibrium of that much in ad spend with gross revenue of our small, 3K sq. ft. shop of $1.2M-$1.3M/yr.

I only used Google AdWords for the last 5 years we were in business.  We started out with $25/wk. ad spend and in 2 years we maxed out at $1K/wk. ad spend.  To answer your question, it took 2 years to get the results I wanted.

Google AdWords has changed a lot since I retired.  As I understand it, you can no longer have different bid amounts for different keywords.  Instead, you set up a weekly budget amount and AdWords does the rest.  My top #1 keyword was transmission repair.  I hope this can help others.

Wow, I guess it's important to have on ongoing marketing plan not matter what a shop is doing regarding advertising and marketing. 

And yes, Google ad words as changed a lot.  Organic SEO for most shops is perhaps better, it just take time to develop, but it's more lasting. 

Thanks for the info! 

47 minutes ago, Transmission Repair said:

Being a transmissions-only repair shop, I used Google AdWords to "throttle my business".  Normally, I would target AdWords for a 5-mile radius around our shop.  If things got slow, I would expand the radius.  Conversely, if we started scheduling something like 2 weeks out, I would actually pause my AdWords campaigns altogether.

The furthest out I've ever done is a 100-mile radius.  Because of our geographical location in the SLC area of Utah, we would then start getting out-of-state jobs from Nevada, Idaho, and Wyoming.  Over time, I eventually got good at throttling our business to where we usually had a steady, controllable volume of work.

I learned it took about 3 clicks to get an appointment and clicks were averaging about $12/ea.  The cost of customer acquisition ended up being about $36 to $40 each.  Not bad considering the nature of big-ticket transmission repair.  It worked well for us.  I learned how to work on my business and not in my business as we did all our own website and AdWords campaigns.

Our AdWords campaigns were definitely not like this:

How long would it take to ramp up the advertising? In other words, how long did it take to get the results you were looking for? 

I was speaking to a fellow shop owner recently. When I asked how was business, he replied, "Ok, I guess, a little slower than normal."  I followed up with another question, "Have car counts slipped?" He replied, 'Funny you should ask, car counts are good, in fact, very steady. It's sales that are off." 

As a business coach, I see this all too often. Complacency can set in when the good times are perceived as the norm and likely to continue, and the staff, particularly service advisors, don't stick to the sales process. 

The bottom line is this: All auto repair shops go through ups and downs. The best way to smooth out the highs and lows is to stick with the sales process, create that amazing customer experience, perform the vehicle  multipoint inspections on all cars, and perform the car delivery process properly by informing customers of future needed service and book the next appointment. 

Follow this process, don't let complacency become your repair shop's norm. 

3 hours ago, xrac said:

Joe, I wasn't working so I got my facts more straight. See my revised post above. The time to order the tires allowed them to be caught. Made for an interesting day.  

Wow, this would make a great TV show! It's also great information for other shop owners to be aware and mindful of how some people will cross the line of ethics and break the law. 

Thanks for sharing, Frank!

1 hour ago, xrac said:

Thursday a first time customer wanted $3,400 in tires. Paid in person with a credit card.  The Tires had to be ordered. Turned our Credit Card was stolen. Credit card company alerted the police. The Police contacted us and set up sting for today when they came to pick up tires. Three people were arrested. Police said it was a crime ring they had been trying to catch for some time trafficking stolen credit cards.

Wow, what an amazing story. So, ordering the tires gave you and Police time to set up the sting? 

Let us take time today to thank and honor the Veterans who served in our nation's Armed Forces.

1 hour ago, weighit said:

When I was running a shop I needed a replacment tech and found a fellow working at another shop I knew of. In the interview he said he had been at that shop for 5 years and made X per year. I said working here for me you should make at least 15% maybe 20% more the first year, so he came to work with us. At the end of that first year he was well over 30% more than he had been earning, I asked what he felt was the reason he made more with us? He said I'm actually getting paid for what I do. The estimates are much more accurate and even though you expect more from me than the last shop management did, I feel I'm able to give you my best, and make much more money for my family. It was how we estimated and priced the work that we did, trying to make each job pay what it should. Giving away labor or time was not how we advanced. 

Excellent Point!  Too often, we beat up on the technician, when the real problems rests with how the estimates are being created. Too many labor dollars are left on table by not accounting for the true worth of job. Thanks for your perceptive! 

Your post should be required reading for shop owners. 

An intense podcast on a very important topic. A must listen for ALL auto shop owners! 

13 hours ago, Andre R said:

We've been starting to use a matrix on our labor times and it seems to be working although it's still a work in progress.

 

That is great to hear. Many shops are experimenting with a labor matrix. We all know all too well that many factors go into the correct labor times, and also that the Labor Guides are not correct. 

11 hours ago, weighit said:

When I had employees I paid them $2.00 more per hour than any of the competition paid their guys. One, I knew they all worked hard for me and deserved what I was able to pay. Two, I didn't want the the competition to try to steal them away from me. I knew what I made every year working for a dealership, and when I opened my shop I knew what I needed to do to attract good help, pay them well and say thanks often.  While I made more, they made more. I suppose by now with the way things have changed they would all be in the mid 30's to low 40's per hour. By the same token, I would be earning mre too.

I agree with your philosophy.  

I too was a firm believer in paying above scale.  Even my part time clean up kids were paid higher than min wage. I tool the advice from Howard Shultz of Starbucks. If you want great people, them pay them well, treat them well, and provide them with a benefits package. 

8 hours ago, vbtoytech said:

$41 increase in labor rate got a $0 increase in tech pay.  They are hiring all tech school kids, we are training them for free, and making less money while the dealership is billing more.  See how long we stay.

Are you a tech, manager, shop owner, other?   Can you please provide more information.  You post is a little disturbing.  Your post is an important topic, and I would like to expand on it.