Milehigh

Joe - Are you still using Auto Alert? (http://www.autoalert.com) I called them up and they said they only deal with new car dealers... Are these the same guys?

We recently had a customer tell us that we were nearly $100 more expensive on a Timing Belt job (Volkswagen Bug) than the dealership. I called that dealer (as a regular customer) and asked for a price on the same vehicle, only find out we were, in fact, $89.00 higher.

 

Now, we all know the price game when people call on the phone, they usually give a bottom, starting price. Also, how complete was that price? And, what would have the price been after the car was inspected at the dealership is another story.

 

The fact is we see more and more lowering of prices in service as dealership, especially from Toyota, Honda, Ford, GM, Subaru, Hyundai, Nissan and Chrysler in our area. The goal is to increase car counts in the service bays. Smart dealerships understand the relationship from the service bay to selling future new cars.

 

As independent shop owners we need to be aware of this. I dont want to enter a price war with the dealerships, but I dont want my customer to perceive the wrong message either.

 

Any industry that enters a price war will have deep casualties among all.

 

Your thoughs?

Joe,

I suspect that trend will continue as dealers fight to stay alive in the face of declining new car sales. As the baby boomers begin to retire in 2013 and beyond, I don't believe that dealers will be able to reverse the negitive trend. There will be some dealerships that will not survive, but they are bound to drag down service costs in their market area until they exit.

To counter the decrease in dealer prices, I believe we must keep an eye on costs, educate our customers and have great customer service--all of which we should be doing today. I think there is an opportunity to capture younger customers with the use of social media and by offering some 'hip' products, such as, low cost wheel and tire packages, dual exhaust systems, performance packages, etc.--These kids are the key to countering an aging population if you can make them your customers TODAY.

Okay...back to my coffee. Have a great weekend.

As I get ready to launch a new business, I wonder how many owners utilize Commercial Account Representatives to solicit commercial or fleet work. The facility we are considering (10 bays) sits between two towns that have approximately 2200 registered businesses. I believe we can capture our fair share of the commercial business if we make it a priority and go after it. However, I'm concerned with the overhead costs of a account representative. Does anyone have experience with using commercial account representatives to solicit commercial work? What salary model do you use--commission, base+commission, salary. As always, I appreciate your experience and input.

Six Sigma! I am impressed. I have not met anyone yet in the auto business who has knowledge of six sigma. I have studied six sigma principles and use a lot when creating my work flow processes,especially in the area of reducing comebacks.

I'm sure there are plenty of folks that pracitce Lean principles in teh auto business--they just may not know it. I agree that reducing comebacks is very important and Six Sigma can help if you properly document each comback and work hard to fully understand the root cause of the failure. Thanks for all your help.

My service writer/manager and I do all pricing, selling and parts ordering. When we are both working it is the service writer/managers job mostly. I help when he is too overloaded plus I always handle the pricing and sale of all tires. On our days off we each do the others job with the help of one of the techs that we have trained to help run the front.

Okay I get it now--two up front (you and a Service Manager/Writer) and six good Technicians in the back. There must be days when you are slammed up front--do you ever feel like its too much? Also, I see you are selling tires--do you have General Service Technicians that just handle the tire and lube work?? Thanks again for your experience and candor.

Great question. Car counts must be taken into account as another factor in determing staffing for any shop. Before I expanded, my facility was a 6 bay shop. I can tell you what my business model was, which worked quite well and maybe you can draw some conclusions.

 

For our 6-bay shop we had 4 techs, one service advisor and a shop foreman. I helped out on the counter when needed and helped with diag work, when needed. Our car counts back then were 100-135 cars per week. We were open Mon thru Fri and half day on Saturdays. Our avergae repair order was approx $375.00. We also have a clean up person who worked every day from noon to closing to keep the shop clean.

 

This model for us worked. Every shop is different. Don't overload your shop with service personell. The right service advisor can handle one to three techs easliy. I recommend to create a lead-tech position or foreman to help with work flow. This will help with productivity. Most important; create systems and polices that MUST be followed by your techs and service advisors. This is key to your sucess.

 

Hope this helps.

Thank you Joe for the details- this looks very close to what we believe would be the right mix. I have a background in Lean/ Six sigma so I'm a BIG believer in systems and policies. Thank you again for your wonderful explanation.

I think that is overstaffed. I operate a 7 bay shop with gross sales of $900,000+. We currently have our largest staff ever: two service writers and 6 technicians.

Thank you for your feedback. Do you operate 7 bays without a service manager? Does one of your Technicians fill that role for you? Additionally, do your Technicians order parts or do the Service Writers handle that? Thanks again.

I'm new to the forum and would like you thoughts on the proper staffing level for a 4-6 bay shop. I realize there are several variables that must be considered (Hours of operation, experience, estimated work load, product mix, etc.) but, based on your experience, are there some general rules to staffing a facility? I recently read an article that suggested a minimum of three Service Managers, four Sales Associates, and at least four Technicians. Would this model work in your shop? Would you recommend a tweak or two? Thank you for your input.

Shop Article

http://www.shopownermag.com/Item/88203/recipes_for_shop_success.aspx