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  • Saving a Struggling Shop in One Weekend

    Posted by Tom on April 7, 2015 at 7:18 am

    While one can spend a lifetime fine tuning to improve a shop, most struggling shops can be saved in a weekend.

    Spending on parts and payroll and expenses all together must be less than 80% of sales (65-75% preferred). We spend too much and then we under bill. Simple to change, but often hard to make the decision to do so and then follow through.

    Some changes can usually be made instantly while others may have to be executed gradually over a number of months.

    For every one hundred shops that go out of business due to under billing, you will be hard pressed to find one that went out of business because they charged a price that allowed a reasonable profit.

    If you are struggling, take a weekend and create your plan. Becoming profitable benefits you, your family, your employees and your customers.

    Tom replied 8 years, 11 months ago 2 Members · 2 Replies
  • 2 Replies
  • lowellnigoff

    Member
    April 7, 2015 at 7:52 am

    Greetings Tom,

    I am not sure I understand. Are you saying an owner should be netting a minimum of 20% and as high as 25 to 35%?

    Lowell Nigoff

  • Tom

    Member
    April 7, 2015 at 9:54 am

    Lowell:

    If owner’s personal pay/compensation is included – yes. 

    Although a lot of shops are hitting those numbers apart from owner’s pay and they say that is how it should be viewed.

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