Customers can contact you by phone, email, website contact form, and maybe by texting. Some shops also have AI chat programs, while others have a live chat program, enabling people to stop by your website to ask questions. Chat has become a regular source of new appointments for some shops - another way to outshine your competitors.
Before you make significant changes, before you change course, before you react strongly to something, ask yourself three things. 1: Are my shop and my staff operating honestly? 2: Are my customers and employees generally happy? 3: Is my shop turning a decent profit? If the answer to all three is “Yes,” then you might not want to fool with things too much.
Often, technicians know precisely why you do certain things, why you have a policy or procedure. But, sometimes, they aren’t sure. Or they have assumed incorrectly. Or, they have no clue at all. So, the first step in assessing why you are getting less than excellent cooperation on something is checking if you have ever fully explained the reasoning behind it. If you are not sure, post a written explanation and cover it at your next employee meeting.
Post the following numbers every morning for the day before and week so far for all employees to see. Include the goals.
1) Total billed hours for the shop
2) Total billed hours for each tech
3) Total idle hours for the shop (hours that techs were on the clock to work but not clocked onto a car)
4) Total ROs
5) Average RO
6) Total oil changes
7) Labor GP (gross profit) for the shop
8) Parts GP (gross profit) for the shop
After all, everything is going digital, which means many once-packed mailboxes have become echo chambers unless they have that one piece of direct mail. The one from you. “Someone sent something to me. I may as well look at it. Who sent it? What is it about?” Dust off that old direct mail special, spruce it up, and give it a try. It could be the boost you need right now.
It’s never been easier, yet it keeps getting worse. Spelling. Grammar. Punctuation. You don’t have to recall diagramming sentences from junior high – you just run it through some form of technology, and you sound like an Ivy League scholar. Proofread everything you or your staff writes that a customer will view, especially marketing pieces and signs. Bonus tip – proofread the content your marketing company produces for you.
How do successful shops make management problems go away quickly? Often, they “buy them” out. Money will fix many things in business. Consider nearly every kind of customer service issue. The odds are good that you can spend your way out of it and make it disappear rapidly. Build it in as an expense, adjust your prices, and spend your time making your business better and more profitable instead of fighting and agonizing over distractions that you can fix quickly with a few dollars.
We have dozens of things we want to get done. We choose one and go after it with determination. Progress is slow or non-existent. Solution? Drop it – for now. Odds are it will be easier at some other point in time. Plus, you have all those other things to do. Pick an easy one and get that done. Some things will never be easy, but they usually will be easier eventually. By constantly looking for the lower resistance things, you will get more done sooner overall.
Most auto repair shops fall into the following trap. Business improves. Profit increases. Success! Next step – service worsens. “We no longer have to bust our tail for everyone who walks in the door.” Sales may drop, level off, or grow slower than they could have. Avoiding this trap and maintaining exceptional service when things are going great are hallmarks of top shops.
Has everyone at your shop been vaccinated or recovered from COVID? Are you in an area where that is particularly important to people? Consider trying something like this:
“For your peace of mind – everyone at Acme Auto has been vaccinated (or has recovered).”
Odds are some folks will choose your shop for this reason alone.
Virtually all businesses of all types fall into one of two categories. The company is either run primarily for the convenience of and from the business owner and the employees’ perspective. Or it is run mainly for the convenience of and from the perspective of the customer. It is reasonable to say that nine out of ten businesses fall into the first category. The category becomes glaringly apparent when any problem or complaint arises. Anyone who has ever complained about a product or service is familiar with this. Ask yourself which category best describes your shop.
Industrial parks are great places to mine for customers. They are terrible places to locate your repair shop. Many shop owners are unaware of the impact of people seeing their shop as they drive by. Visibility is huge. “But, the shop, the deal, the room is so fantastic!” I am sure it is. However, this is one of those considerations where you should just say no and keep looking.
The problem is that we are all babysitters – or caretakers – of certain things and probably people to some extent. We are talking about everything you oversee, whether you own ten shops or are an apprentice tech, advisor, or office staff. There are things you are responsible for to make sure they are taken care of – both in your work life and your personal life. The further you advance, the more things there will be to watch over. The better you are at “babysitting,” the more successful you will be. So, accept the babysitting tasks and learn to master them.
Believe it or not, you can typically find the happiest technicians at the most profitable repair shops. These shops usually provide the best pay, the most training, the most comprehensive array of benefits, and the most sought-after working conditions. Low-profit shops generally mean lower pay and fewer benefits – and the least satisfied technicians and other employees.
Do you make it a point to communicate to all your equipment and tool suppliers at least once a year that you want to be the first guy they call when they repo something or get trade-ins? Keep a separate cash fund aside just for this. “Had to repo this one-year-old $7,500 scanner yesterday. I need $2,000 cash if you want it today.” Sold!
Not just with COVID. Ill with anything. When you make an appointment or write up a job or take in a car, and you detect any indication that the owner could be ill in some way, make sure to communicate the possibility in some way to your staff using the appropriate discretion. While taking precautions should be the standard operating procedure on every car, alerting your employees to situations where the odds of illness might be higher is something most of them would like to know.
Q: How do those precious few shops end up with grant money – often in large amounts?
A: They applied for it.
Sometimes competition for grant money is tough. But, in other cases, the pool of applicants is smaller than the funds available. Always keep your eye out for grants. If you qualify – or if there is even the slightest chance you might be eligible – apply. In many cases, the purpose of these grants is to lubricate the wheels of the economy. No one does that better than businesses that buy equipment and add employees. It might as well be you.
Even with a seemingly endless list of channels, it can be tough to choose what to put on the TV in the customer lounge. Try this instead. Search YouTube for things like “beautiful beaches,” “national parks,” or similar terms. Spend some time selecting the best ones. Viewed on a super big screen, this can make a remarkable difference in your waiting room.
Little things can make a big difference in the perception of your shop. Signs are often a great example. You could post one of these signs.
“Absolutely NO PARKING!”
“DON’T EVEN THINK ABOUT PARKING HERE!”
Or you could take a bit nicer approach.
“Please do not park here.”
(Make sure to include a smiley face behind the thank you.)
When posted like this, people are less likely to feel like someone is yelling at them. It might even work a bit better. But it will not work perfectly because jerks will always be jerks!
If we go through your ROs from last month, how many of them include an oil change? Ideally, at least half. More than half of the cars coming through your shop are due, overdue, or nearly due for an oil change. You do not want your customer’s vehicles in any other shop for something that you do. Especially when that quick lube does several other services that you do. Your staff needs to know that oil changes are critical, and the more you do, the better. Good advisors can turn many oil changes into nice tickets. Top shops run 50% to 60% oil changes. If you are sometimes suffering from weak car count and your oil change percentage is in the 25% to 35% range like many shops, the lack of oil changes could be a factor.
Sure, you can have a policy of always “yes” or always “no.”
Or you can do it better. Agree to do the estimates; however, thefollowing are mandatory – no exceptions!
1) Full name
2) Phone (or email)
3) VIN or license plate that you can use to decode the VIN
4) Make sure to enter all the information in your software for marketing
5) Return the call, no estimates while a caller waits.
This proess allows you to do a more accurate estimate at your convenience for a real person. It will also eliminate most of the time wasters and leave you with a higher percentage of people who can be converted into appointments.
To prevent possible confusion, add the following to all your online and paper appointment forms.
Dropping Off or Waiting for Your Vehicle
_____ I plan to drop my car off and pick it up when completed (I have transportation).
_____ I plan to drop my car off and pick it up when completed (I need help with transportation).
_____ I need my vehicle picked up and delivered.
_____ I need to wait at the shop while my car is serviced.
1: Failed TPMS sensors: Always recommend replacing TPMS sensors as a set when all are likely the same age.
2: Leaking TPMS Sensors: Always replace, do not attempt a repair.
3: Failed Ignition Coils: Always recommend replacing ignition coils as a set when all are likely the same age.
4: Old Fuel Caps: Always recommend replacing old fuel caps on vehicles that come in due to EVAP codes.
5: Old Oxygen Sensors: Always replace oxygen sensors that must be removed from a heavily rusted exhaust part.
You create a document or written text for something. Anything. It might be simple or may be complicated. You know in the back of your mind that you will write something like this (or maybe sort of like it) at some point in the future. The interval may be known, or it may have no specific interval. Take a few extra seconds to save it as a template and include the word template in the title. Now, anytime you search the word template on your computer, it will appear with all the others you create. Over the years, this will save you hours of wasted time.
Everyone hates comebacks. Customers, shops, advisors, and techs. Go into your software and documents right now and replace the term “comeback” with “recheck”. The customers do not care what you call them if you are handling them well, however, often employees will have a better attitude towards a recheck as opposed to a comeback. You can note in your tracking the reason it needed to be rechecked when all is said and done.
The largest and most comprehensive schedule of vehicle service-related online events and webinars are at this link.
Add a reminder to your calendar to check it weekly. Note all the webinars occurring over the next week and post the information to all your staff. The training is out there. Go to the only place where it’s all together in one up to date list.
Most of us are currently in uncharted waters. While there were a few shop owners who were well-positioned for the COVID-19 pandemic, many were not. Disasters happen. Weather events. Wars. Pandemics. Depressions. The best way to prepare for any kind of catastrophe is to experience it, learn, and plan for the next one. There will be a next one. Much of the plan will be the same for nearly any type of disaster. Record all that is happening now with your shop. If you have a disaster plan, use this situation to fine-tune it. If you do not have a plan, now is the time to create one.
Is this even realistic? Yes – and probably far more than many might believe. Make a list of every task that your employees perform. Now review the list with your employees, including an employee who is really into IT and techie things (or find an outside IT wizard to join you.) Plan on buying some technology items and learning new ways to work. The bottom line is that it is very doable for much of what occurs at your shop. The only thing holding it up is you.
The biggest problem with tracking comebacks lies in its definition. Exactly, what is a “comeback”? Ask ten different technicians, advisors, and owners, and get just as many interpretations. Make it simple. When a car comes back for any reason – note it as a comeback. No exceptions. Then, create a system to classify them, including a category for “unrelated” (meaning it is technically not a traditional comeback). What this will allow you to do is get an excellent handle on why each kind of comeback occurs and put you in a much better position to address them.
Are you hiding your shop’s reviews? Some people should see all of your reviews – your staff. What a great way to make a connection between your employees and your customers. Plus, it’s excellent positive reinforcement since most of the reviews will be pats on the back. Of course, they also get to see the occasional bad review, which could help reduce such reviews in the future. Save reviews as they come in, then once every week or so post them as an announcement at your shop on your chat program.
Not just techs, but advisors and all other people employed at your shop. When? Today. Repeat when? Tomorrow. Put a system in place where you are spending a few minutes every day checking who might be available. You can subscribe to a resume feed or a database where you can review new ones every day. The good ones will be gone fast, so you need to touch base with them right away. No current openings you say. But there will be sooner or later. It’s nice to have already interacted with a list of candidates so you are not starting from square one when you get that next surprise.
When was the last time you checked your internet speed, available options, pricing, and companies serving your area? The pace of change in this area is staggering. The extra few seconds you and your staff spend waiting for something to load many thousands of times each year (or month for many of you) add up to significant lost money. It can be very hard to see because the times are so small – but the frequency is huge. At the time of this writing, most shops have download speeds in the 30 to 150 Mbps range. After hearing of fiber availability in our area, we upgraded and are now running 750 to 950 Mbps (and about 600 up). Check yours now and add it to your calendar as something to review regularly.
1 Improve your inspections
2 Reduce technician interruptions
3 Avoid weird repairs
4 Increase customer interaction
5 Speed up your estimating process
6 Increase your production capability
7 Learn to be better salespeople
8 Speed up parts acquisition
9 Improve the accuracy of your parts inventory
10 Use photos to resell the job when the car is picked up
11 Find ways to boost morale
12 Improve your work assignment system
First, determine what your cost is to have a technician work on a car for one hour at your shop (sorry, there is no way to calculate your labor rate accurately if you do not first find out the cost of your technician). Multiply that amount by 3.3. Also, by 3.8. For most shops, a profitable and reasonable rate will be between those two figures. Yes, there are other factors, details, ifs, ands, and buts. However, this will give you a pretty good idea of whether you are in the ballpark.
You’ve used them for months or even years. Which programs and apps do you frequently use at your shop? Chat apps, calendars, office programs, email, browsers, video apps are some examples. Now, how often have you and your staff spent time on YouTube or a similar website watching a tutorial, a beginner video, tips and tricks for each one you use regularly? A half an hour once each week will make most of us more efficient, save wasted time and learn things we never knew! For example, did you know that the NFL schedule – and many more – is in your Google Calendar? All you have to do is turn it on (OK, not shop related, but fun to know!).
You have a policy in mind that you are sure is necessary and will be helpful, and maybe it will be. But first, ask yourself who will be affected. Are you sure that the net effect will be beneficial overall? While a new policy might seem to make life better for you and your staff, it sometimes makes it worse for all of your customers, too – including your best customers.
The best examples are policies directed at customers who are jerks. While the new policy may hit its intended target, it might also hit your best customers. Why should they be inconvenienced because of a few jerks? There are many creative ways to repel jerks or minimize their impact without affecting other customers negatively. Think of the possible unintended consequences of that new policy idea. Try to avoid creating policies that could cause more problems than they solve.
Not very long ago, adding air to a tire or inflating pretty much anything was a pretty simple deal. Compressed air was free and just around the corner for many of us. Today we have moved to air being hard to find, and you must pay for it!
If you have a repair shop, you have compressed air. Sticking a line through the wall to the outside and hanging a hose is usually a pretty simple task (bringing the hose in when closed is recommended). Add a FREE AIR sign or two. Mention it in your marketing. Offer to assist people when they pull up.
This tip is not for everyone. It is for the shops which have a website that boasts an air conditioning special – in January – in Michigan. It is also for the shops that check once every week or so to see if someone has used the contact form on their website.
Do you sometimes just vanish? Not literally, but do you do a disappearing act when you are expected to call, show up, reply, carry through, etc.? It has become one of the worst bad habits in people of all ages. If you are getting dozens of contacts from the guy trying to sell you an extended warranty for your car it’s perfectly acceptable to not reply. But most folks deserve a civil response. Return the call. Reply to the email. Do what you said you would do, and have it completed when you said you would. And show up! Everything is becoming trackable very quickly. Including your ghost performances. Sooner or later these will bite you in the backside.
For after-hours drop-off, most shops have had some kind of a key drop-box for many years. However, when customers picked up their cars after hours shops commonly have hidden keys in various locations while often leaving the car unlocked. But now more and more shops have some kind of a dedicated box that is not unlike the drop-off box secured to an outside wall. One of the most popular is a type of cell phone locker that has combination locks so customers can pick up the keys at their convenience while their car remains securely locked. The six-compartment version can be found online in the $250 to $300 range.
If you have surfed homes for sale websites during the last few years you have watched virtual tours of houses. Realtors will typically spend $200 to $300 to have this done. The same companies who offer the service can come to your shop and do the same thing. The process takes about an hour and can be done when the shop is open in most cases. The tour can then be integrated with Google Maps and used on your website allowing potential customers to take a good look around at where they will be bringing their vehicle. Transparent and impressive!
When you and I are asked how to do something we normally respond with an action of some kind. But sometimes inaction works just as well. The typical successful shop today spends a lot of time and effort marketing as does its local competition. If you stop marketing to someone chances are good that they will wander off to a competitor who is begging them to come in with their marketing.
However, don’t stop after checking the “no marketing” box in your software. Cut and paste phone numbers, emails, and addresses into the customer note field and leave the designated fields for them blank. Nothing more than their name needs to exist in the “visible” customer data. When customer info is pulled for any kind of marketing campaign they won’t be included.
If you are a shop owner or manager attempting to run a shop the worst thing you can do is grab a tool and head for a car. But if you bring your toolbox (and common tools) home, or sell it, or give it away, or get it out of there somehow you will be spending more time managing as you should be doing. Talk to any shop owner who has done this, and I challenge you to find one who says it didn’t turn out well. The shop ends up being better managed which means profits increase. Plan to make that toolbox disappear this weekend!
If you have that constant nagging feeling that your shop management software system is dragging you down, then quit losing money and do something about it. Maybe that means there are things that can be done with your current software. Or, maybe it means the relationship should be over. Since the software is (or should be) the hub of your entire operation if it is inadequate you are losing money. In many shops, great software is allowing for large sales and profit increases without adding staff. Might as well join them if you haven’t already.
“It doesn’t work well. It’s too noisy. I look weird like I’m talking to myself.”
Voice to text. Incredible technology, but it does take a bit of practice to achieve great results.
1: Use a tablet or phone. Desktops and laptops often do not work well.
2: Talk at a moderate speed. Enunciate your words.
3: It will not work well with a lot of background noise. Try: In the car. In the parts room. In the tool room. In the office area. In the parking lot.
4: People are spending more time talking to devices of one kind or another, so it doesn’t look as weird as you think.
The potential for more technician produced hours is significant when you eliminate most or all the typing. The sooner you can get everyone on board the sooner everyone will be earning more.
You want your techs to get certified but getting them to do it is a challenge. How about every area of certification gets them $10 per week on the tool trucks? Techs like it. Spouses love it. For the typical shop today, there are about a dozen areas of certification that would be applicable. Nothing quite like having all your techs master certified – especially when you point it out to your customers.
You succeeded! You finally found that tech or advisor or manager or another staff member who you’ve been searching for so long. Now you can move on to other things, right?
Unfortunately, those days are gone for the foreseeable future. Today you need to “always be hiring”. Always looking, always advertising in some manner, always making just one more contact.
As you make it a habit it will become easier and more natural. Develop a system that works for you and spend some time on it every week. Odds are this will make a huge difference as you move your shop forward.
Odds are that a professional photographer can take far better photos than you. And the cost just might surprise you – lower than many would guess. Considering the impact that fantastic photos can have on your marketing efforts the fee will be a bargain for many. It’s the kind of thing that every shop should schedule every year or two to ensure their marketing has a professional appearance.
Unless a tech is a training addict, he (or his spouse) is thinking that I am taking an evening or Saturday away from home for zero pay. He’s right. It’s only fair to pay him an hourly rate for his time. It’s not unusual to see the attendance of local training skyrocket once a reasonable amount of money is added to the equation. Times have changed. Free mediocre pizza doesn’t cut it any longer. It’s time to step up and write that check.
There is no perfect email or phone blocking or filtering system. There never will be one. That means that if you attempt to filter out nuisance contacts you are guaranteed to also filter out contacts that you would have wanted to receive. Contacts that may have made you money or offered some other opportunity that you would have liked to know about. Learn to accept the bad with the good. Remove all filters from your business emails and phones. And don’t believe it when your smartphone says “Scam” or something similar. Sometimes your smartphone is dumb. My phone recently designated a shop owner friend as a scam call and my son nearly missed a good job offer because he had a call blocker turned on.
This is the day that you can save yourself many hours of management time and many thousands of dollars. If any of your policies are not followed, day one is the time to address it. For less critical things let them know exactly how it should work and make it crystal clear that you expect them to follow your rules. For more critical things – for example, showing up late – tell them emphatically that this is unacceptable and consider this to be their first warning. If you let things slide because you don’t want to get into a conflict right off the bat, then you can plan on constantly getting into conflict this person on the things you let slide for as long as they work for you.
One rule of being efficient is handling each incoming piece of information once and be done with it. That makes sense. However here is one idea that some folks find very helpful. Perform a quick scan daily of the senders and titles from all email that arrived yesterday. The point is not to go over things twice or rethink them. The point is that occasionally you will see something that somehow snuck by when it should have been handled in some way. Or new information may have arrived after that email which would change how you handle it. Occasionally, you might just prevent a disaster!
As business grows, the typical approach is to gradually improve the look of the shop and when business is great, we make the shop look great. But what if we want to speed up the process? Change your allocation of funds so that more goes to cosmetics initially. Seek out the most successful shops in the area and work on making yours look better. This is the number one way that you will attract new customers. The best-looking shop is perceived as the most successful shop. Look like the shop you want to be – then you will become that shop faster.
If you want to attract more applicants offer something no one (or almost no one else) offers in your market. Will your cost of doing business increase? Probably. Adjustments will likely be required somewhere to maintain your profits. Add one or two of the following to your ad title.
Four-day work week
More vacation weeks
Student loan payoff assistance
Running a small business – certainly an auto repair shop – asks you to be the ultimate multi-tasker. Don’t do it. It’s not efficient. It is highly stressful. Just take care of the one “A” priority item that is front of you right now (assign an “A”, “B”, or “C” to everything on your version of a “to do” list). Focus on that one thing. Get it 100% (not 99%) done. Then if there is enough time remaining today you can select another “A” item. Try it. It works.
Where we live in SW Florida not a week goes by that someone does not knock on our front door offering a service of one kind or another. Lawn care, pool maintenance, fertilizing, and roof inspection are a few examples. Most are polite, well groomed, smile and have a handout with information about what they do. They don’t do it because it doesn’t work. Auto repair is a perfect candidate for this type of marketing. The customer gets to see your face, hear your voice and get the impression that you are seriously interested in their business. At our shop we have an advisor, or another employee regularly visit more than a hundred neighboring businesses. It is by far the most effective marketing that we do. Maybe you should try it, too.
How many of your desktops and laptops have solid state drives? While the cost is higher the difference is like day and night with a speed increase for many tasks of X5. Really. At this writing the cost of upgrading a computer (that is not too old) is in the $300 to $400 range. If your current computers are dinosaurs anyway, then make sure the replacements have SSD. Add up all the time your entire staff spends in a week, month, or year watching the spinning wheel and you will see the efficiency benefits. Get your techs back working on the car!
There are a few shops out there who have a staff of computer wizards, but not very many. In most shops the staff is average when it comes to computer expertise. So, when we give them software with what seems like hundreds of bells and whistles – especially if not very intuitive, they can get overwhelmed and overstressed. Every one of those features may have a fantastic purpose, but are there so many of them (maybe not all that well arranged) that they have a negative effect on shop efficiency? If reasonably intelligent employees cannot become proficient and comfortable with a software within 30 days, you may want to consider something a bit more user friendly.
This idea works well with many employees. Shorten their work day. If they can’t make it in by 8:00, tell them you understand, and their new start time is 8:30. But don’t add hours on elsewhere. Try it for a week or two and if still coming in late make it 9:00. Sooner or later the problem will take care of itself. The tech will love the new lower paycheck as will Mrs. Tech when he brings it home. If not, she just might help him make it to work on time.
A typical shop owner or manager spends far too much time reinventing the wheel. Some management decisions are unique and require a lot of thought and effort, but most do not. They’ve been made already countless times in other shops. Many of us do get input from other shop owners or managers, but then we spend far too much time reanalyzing it.
When you have an issue that has been thoroughly researched by successful shop owners, and decisions were made with decent results – why research it further? Just do it. Odds are heavily in your favor that it will work well and for the few times that it doesn’t you can reevaluate and make changes as needed.
Customers today are looking for prompt service. A shop that is well managed can normally get a car in and at least take an initial look at it the same day or the next. The most profitable shops are rarely booked ahead more than day or so. Which means they operate efficiently, they have enough staff, their prices are appropriate, and there is a lack of unprofitable customers. Shops that are constantly booked ahead several days or even weeks typically have one or more of these issues. That means less profit and all the other negatives that accompany less money to go around.
As you move throughout your shop during the day watch for anything that could be interesting to a vehicle owner. Which is not as complicated as one might think. Things you see everyday are things that many customers have never seen including almost everything on the underside of a car. Take a photo or two and load them on your social pages. Add a brief description. When you take the photos always make sure to have open or glass bay doors behind you to prevent glare. Once you’ve done it a few times you will find the whole process to be both quick and easy – and people will look at them!
Does it make sense to maintain a constant price on a service regardless of circumstances? Or would it make more sense to adjust that price related to a variety of factors? The latter is standard procedure at many businesses and we expect it. The best examples are hotels and motels.
Some shops today are doing something similar. Factors may include seasons, days of the week, weekends, holidays, weather – or any other factor that causes business to increase or decrease. Many shop management software systems allow for adjustments to be made quickly and easily making this one more option in your management tool box.
There are several low cost or free programs available that can greatly improve the communications within your shop. One of the most well known is slack.com. It’s kind of a supercharged internal system of messaging and email and forums that gives you a single dashboard where it all comes together. Simple to learn. Uses are limited only by your imagination. “Channels” for low inventory, equipment needs, training, projects, suggestions, estimating, and announcements are some of the channels that we created. You can message one person or any number of people with one message. Access to areas can be limited to certain individuals. Send attachments. Easily find anything that was discussed days ago or years ago. Integrate with Twitter, OneDrive and a host of other apps. There’s much more you can do, but those are the things we did to get started.
Some owners and managers are regularly involved with the “front counter” but others are hardly ever exposed to all that goes on. If you are closer to the latter, once every 30, 60 or maybe 90 days get 100% involved. Get up there and do everything that your advisor does for a half or entire day. Everything. Odds are that each time you will come away with multiple ideas on how you could make the process better, more efficient, more profitable – and easier on your advisor!
If I ask your technicians and advisors to explain their pay system to me could they do so accurately in less than a minute? Or would they need several minutes to show me a spreadsheet with a set of guidelines on how to do the calculations – maybe stopping occasionally to ask someone else at the shop exactly how to figure something out?
Many shop owners assume all the employees understand the pay systems as well as they do – but often they do not.
Remember that if they do not fully comprehend specific incentives you will lose most of the effect of incentives.
It’s very easy to over complicate pay systems and many shops do just that. Techs and advisors often hope the paycheck is pretty good because they don’t really know exactly what to expect once the pay period is completed. Most employees do not like overly complex pay systems. The best pay systems are ones where they can know at any point in time exactly what their pay is going to be with a handful of mouse clicks.
Among the top 5 benefits that technicians want is a “generous tool allowance”. Less than 20% of shops offer any tool allowance at all. If we consider “generous” to be $100 or more per week, the number drops to less than 5%. Need we say more.
First, all parts should always be entered into your shop management system software and all stock orders should be determined solely by your software once you have it fully set up correctly. Sales reps should never do stock orders for you.
Second, for most vendors stock orders should be done daily first thing in the morning or last thing at the end of the day by the person most familiar with your parts inventory. This will allow you to reduce inventory quantities and expand coverage if you desire.
Remember, waiting for authorizations and waiting for parts are the two biggest causes of techs being idle. The parts issue can be improved easily with this method.
Ask ten independent shops for maintenance recommendations on a certain car and you will normally get ten different answers. No wonder customers get confused. So, why do we do that? Instead, just go with exactly what the owner’s manual says, then add in anything that obviously should be serviced even though it is not yet due.
Typical results? Maintenance becomes easier to sell. Maintenance sales increase. Customer’s cars are maintained better overall. Your job is a bit easier while your profits increase.
The point with any of these items is to have your name seen over and over – ideally for years to come. Think carefully about what typically happens with an item. Does it get used once and thrown away? Is it likely to get thrown in a glove box or drawer? We want something that has a good chance of ending up in a visible place on a desk, on a dashboard, or in a kitchen or similar location. Examples for a desk might be letter openers and cell phone stands. Another thing to consider – does it have a good size area for imprinting? Once you’ve chosen an item, your shop name in letters as big as possible is all you really need. The rest of your information should be seconds away on a device.
Ask yourself how often do you write down a phone number or website or other information off a sign that you see (other than for the used boat for sale at the end of the street)? Me too – almost never. Most people are going to enter the name they saw on your sign into their device, locate your website and then look for the information they want. So, use that space for something else. Make your shop name as big and easy to read as possible and skip all that other stuff.
Whenever a question arises about what occurred or may have occurred with a repair at another shop the correct answer is: “I don’t know. I wasn’t there.” Because you weren’t there, and you don’t know.
Add this question to your interviews and make it mandatory – “Are you concerned that this job will interfere with your life?”
Don’t hire them in the first place. With the increasing amount of information available today you can predict with a great deal of accuracy whether someone fits the profile. Make this one of your top considerations. Just like the best way to manage anything at your shop don’t figure out the best way to put out fires – figure out how to prevent the fires from ever occurring in the first place.
This doesn’t mean you never let someone go or that no one ever quits. If you hire carefully you can be reasonably sure that when an employee leaves they will have another job a week from now. You can be the shop that is forever paying claims. Or the shop that has a great won loss record of fighting them – a great feeling but can be time consuming. Or you can be the shop that says: “Can’t comment much on this since no one has filed on us in years.”
Sooner or later you will likely get back or wrist pain among other issues from keyboarding all day. If you haven’t done so already, put a first-class chair or stool at the top of your office equipment buy list. Advisors and other office employees are usually not as physically worn out at the end of the day if they have great seating. Some of the best ones are made by Herman Miller, but the price can cause sticker shock – typically in the $800 to $1,500 range per chair. Used and reconditioned ones are available, however be very careful as some of these are too worn to be dependable. After you make your purchase be sure to watch the videos on how to set it up properly. As time goes on you may find this is one of the best equipment purchases you ever made.
Lifting various items during a repair has always been an issue for technicians. As wheels and tires became larger and heavier the issue has become more significant. The good news is that equipment is available to greatly reduce the problem. Several companies offer folding arms attached to the lift arms, so wheels can be moved a short distance to the left or right onto the arm without placing them on the floor and having to lift them back up. For wheels that need to be serviced or moved away from the vehicle there are special carts (or dollies) that can hold one or more wheels again preventing the need to place wheels on the floor. Most techs love both items – odds are that techs at your shop will, too.
Have you ever thought of menu pricing your testing and diagnostics? This would prevent the need to call for additional authorization in many cases and allow you to quote quickly and easily.
Make an educated guess at how much time and money, on average, you believe will be needed to cover costs and make a decent profit on a specific type of testing. Don’t worry if you are off – you can change it in a few seconds at any time in your software. Sometimes you will be close, other times under a little or even a lot, and sometimes come up short. Track it over several jobs and adjust it as needed. Just make sure the average is close. Work with the technicians to come up with something that is fair to the customer, to the tech and to you.
The trick is to not to give in to temptation to reduce the price when it goes very fast and easy. You will need that to offset the ones that take a while to nail down.
You know how much money is lost when a tech or advisor is home sick. Before flu season each year hire someone from the local medical center or doctor office or pharmacy to come to your shop and offer to vaccinate everyone for free. Of course, it is voluntary but the odds of them getting vaccinated will go way up if it requires zero extra time, effort or cost to them.
In many shops advisors spend much of their time dealing with parts. It has been established that parts acquisition has a very large effect on technician production. See survey on the topic: https://www.
If your shop is big enough to have two or more advisors you might consider having one advisor deal primarily with sales and have the other split their time between estimating, parts acquisition and assisting the other advisor. As the need grows for more people up front expand the parts role accordingly. If you have three people up front it might be best to make one full time parts. At four people it’s no longer a question.
Having all advisors be partial sales, partial estimating and partial parts person is generally very inefficient. Also, the cost of a great parts person is typically less than a great advisor.
There’s certainly nothing wrong with not having a shop supply charge at the end of your invoice. Instead, some shops itemize every little thing. In some areas a supply charge at the end of the invoice might be illegal.
But, are you taking advantage of what you are not doing? Do you have written in large capital letters near the bottom of your invoice:
***SHOP SUPPLIES – NO CHARGE***
Whenever the contact information for a technician – or possible future technician – is made available to you in any way, record it.
Include the following:
If applicable, also include:
Is there a resume on file?
Do you have background check results?
Did you perform an interview?
Do you have the results of any testing?
Record this information about every contact regardless of whether you believe they are a possible future hire or if there is no way on earth you would hire them (of course, note this accordingly). As time goes by you will have hundreds, if not thousands of names.
You are building a lifetime database. When you are ready to hire, you will have a list of contacts who are technicians and who undoubtedly know others who are technicians. You can quickly email or text some or all of them to announce that you are looking.
You will come across some techs multiple times, yet years apart. A quick search of your database which finds information about them from the past can save a lot of wasted time and effort.
To start, search your computer for every piece of data as described and enter it into this new single document. Do the same with your email. If you still have paper resumes and applications in a file, add those, also.
It’s only a matter of time before you will be searching for a tech. In today’s climate, anything that makes that process a bit easier can be a huge asset.
You’d like to send customers something, but asking for their birth date just doesn’t work for you. Our service advisor was thinking about this one day and thought: “We have copies of driver’s licenses for everyone who uses our loaner cars – why not record those!” Of course, this won’t cover all your customers, but over time your birthday mailing list will grow into one more solid marketing tool.
How much should you pay your techs? What should your labor rate be? Many variables can affect each of them individually. But, the relationship between them is a bit clearer. A range often mentioned is 25% to 30% of your labor dollars can be paid to technicians – most of the highly successful shops today are in or very close to that range. A wider range might be 20% to 40% to accommodate for the exceptions on the edges. However, numbers outside of this range typically cannot go on for long before there is a shortage of money or technicians. So, do you lower your tech pay or increase your labor rate? That is something each shop must carefully consider. It is worth nothing that precious few shops close because their prices are too high while large numbers of shops close because their prices were too low.
Lots of people do. The one from the accountant. The one that the software produces. Sure, the numbers are all there, but in a different layout than how your mind grasps them.
Some people solve this by creating their own statement. It can be as simple or in depth as you want it to be. It doesn’t get used for official purposes – taxes, P & L’s, etc. It only gets used by you so you see the numbers arranged the way you would like to see them.
Try it. It just might give you a whole new (and better) outlook on your business finances.
One huge time saver that is available when hiring technicians and service advisors is an online assessment test – often available as a subscription allowing unlimited use over a certain period.
Keep in mind that such tests are just one of several things you should use when determining whether to hire. But they can be an excellent screening tool to prevent hiring someone who will likely never be very good at the position.
Example (true story) – you receive a resume, cover letter, application and so on. It looks reasonably decent – better than average. You send the applicant a link to a technician assessment test. Potential score is 100. He scores 7 (yes, seven). He may well be very smart, highly educated, and talented in many areas. But he probably was born with next to nothing in natural mechanical ability.
Interruptions eat away at productivity. Some interruptions are major, but many are minor and accepted as normal in most shops. While interruptions can hinder anyone in the shop, they are more of a problem with technicians who might be in the middle of something.
Stopping them for a few seconds may cause some techs to take several minutes to “reset”. Discuss the policy below at your next employee meeting, then post it at everyone’s work station – including the owner / manager who is often the primary interrupter.
When you are about to interrupt a coworker with any kind of question or other information, ask yourself:
1: Is an immediate interruption necessary right now?
2: Can it wait until a break?
3: Will an IM (instant message) get the job done?
4: Will an email get the job done?
Sooner or later someone will ask you what you won’t miss – what you will be happy to leave behind once your days of business ownership are over. It might be just one thing (doubtful) or it may be a list – maybe a very lengthy list for some.
Let me ask you a different question. Why not eliminate the things on the list? Give all those things over to someone else involved in the management of your shop. That means whatever remains should be things that you either enjoy or don’t really mind taking care of. You will likely find that most of what is left can be done remotely from your favorite getaway.
For a lot of shop owners, the picture has now changed a lot. The list of tasks and hours required have often been significantly reduced. The yearning for life without the shop might be gone or greatly diminished.
So, before you pack it all in, you may want to give this approach a try for a year or so. The industry needs smart experienced owners to remain involved. More importantly for many, you need something that needs you.
A down side of many jobs is lifting things. For technicians, it’s often the constant lifting of wheels on and off the floor – something that has become much worse as the wheel and tire sizes have grown significantly. Solution? Wheel Wings™ from Rotary. These are foldable round arms that attach to the lift arms (should work on almost any brand of lift). When removing wheels, simply fold them out, then instead of placing the wheel on the floor, place it over the arm which is just a foot or two away and at about the same level – all but eliminating bending your back. Your techs will love you!
Hopefully, not much. If your shop has not yet gone paperless for estimates, RO’s, inspections, and most other things that were once common to print, your shop has fallen behind. Customers will begin to view your shop as not very high tech, behind the curve – regardless of your actual abilities. Paperless operation has moved from one of those things you ought to do someday to one of those things you should have already done by now.
What about the cost? Should be minimal if you have up to date management software and equipment. If not, it’s time to move funds in that direction. First class software and equipment can do much of the work you are likely paying employees to do now – you may be able to reduce your payroll! Also, remember that it costs a lot of money for all that printing – paper, ink, equipment. Most of that will disappear once you have gone paperless.
If you haven’t been using some type of ride and delivery service, it’s time to try it. There are lots of players, big and small. We’ll use Uber as an example since it is the best known, but search your area for what is available.
Uber for Business – Transporting customers to and from your shop is a few clicks away. Uber Rush – Need a part quicker than projected delivery? Drivers are waiting.
Sign up is simple and free. If you already have a personal Uber account, you can expand it to include Business and Rush. You will have a “dashboard” on your computer or mobile device where you can quickly request what you need. The estimated price will appear and you place your order.
When you consider the cost of loaner cars or your time or having an employee gone to provide some type of transportation need, Uber is often a cost effective alternative. We use it often and love it.
Whether your staff meetings are long and detailed, quick and simple or even non-existent, ask these questions once each week to keep things running as smoothly and efficiently as possible.
a) What caused a slow-down of any kind during the past week?
b) What part issues occurred during the past week?
c) What IT items need attention in some way?
d) What equipment or tools need maintenance or repair?
e) What tools or equipment should we add to our wish list?
f) Which certifications or classes have you completed during the past week?
g) What suggestions do you have about anything?
Your management software is the single most important piece of “equipment” in your shop. The right or wrong software – or use of it – can significantly affect profits.
Place a recurring appointment on your calendar to take an hour or so once every 90 days to fully review any changes your software provider has made, then make the changes at your shop to best take advantage of them. If little or nothing changes over the period of a year, it may be time to go software shopping.
While you are at it, go through all of the settings. As things happen over time in your shop, you will often find that it would be better to alter a setting to better fit current conditions.
Does it seem that your advisors just can’t seem to keep up? Maybe this just isn’t their thing. Or, maybe they need training or better systems or – maybe they need better tools! We are always looking at better equipment for the techs, but what about the advisors? Are they due for an upgrade? The following should help – plus it will impress your customers who assume your level of mechanical ability matches the IT hardware that they see up front.
*Large touch screen all in one computer with the latest version processor and OS. (Today in 2016 that would be 6th gen I-7 and Windows10 Pro – soon it will change, so find out what it is when you are reading this.)
*At least one additional monitor (maybe two).
*Adjustable height sit/stand desk that holds at least two monitors.
Cost – $1500 to $2,000. Your advisor will love it and odds are that it will pay for itself relatively soon. The time wasted by advisors each day dealing with slow outdated hardware – and slow internet while we’re at it – is significant in most shops. Make sure yours isn’t one of them.
Maybe it’s when the car arrives, maybe when it leaves. Customer says these lights were on, tech says otherwise. Oh, boy – here we go! Let’s eliminate this fire before it occurs.
More and more shops are performing inspections electronically on a tablet or phone, and usually the ability exists to take a photo and attach it to an inspection line. So, add a “Warning Lights” line to the initial courtesy inspection you do on every car when it first comes in, and add the same line to the quality inspection you do on every car when it is done. Take in and out photos of the instrument panel. Now we can see who remembers correctly, and we can review it in the future should the question arise.
How often did they change the oil? Is the mileage accurate? How many owners did it have? Request the VIN of the vehicle that the engine is from. Then run it on CarFax Service History. On one engine we checked the mileage did not match. We declined it and informed the vendor. Another engine was from a one owner car and they religiously changed the oil twice as often as the manual recommended. We bought it and it worked out great.
1 – Location – Don’t fight a bad location – Move
2 – Facility – Stop in the local Lexus dealer – Then make your customer areas look like that
3 – Service – The way that your employees treat your customers must be exceptional
4 – Product – The quality of the repairs comes after #s 1, 2, 3
Some type of daily check of the previous day’s RO’s is mandatory to maintain control of your shop. If you can’t seem to find time to get into detailed RO auditing, at least do these three things.
1: Gross Profit – Are there any GP percentages that are significantly off, and why?
2: Ratio Sold Work vs. Unsold Work – Is the sold exceptionally low, and why?
3: CB’s and Other Issues – Are there any comebacks or other issues that required special attention, and why?
Set aside any that need further explanation and find the answers the same day.
At some point in time most shop owners have heard the suggestion to do alignment checks, ideally on every RO and usually no charge, in order to find cars that need an alignment and maybe some related service. Even if the alignment is OK, customers usually appreciate knowing that you have verified it. When purchasing one of the higher end aligners, this idea is often part of the sales pitch – and it sounds like a great idea!
But, a problem often occurs when trying to implement the policy. While it may only take a couple of minutes to perform the check, getting the aligner and the vehicle together is not always as simple as it may seem. Typically, the new policy is put in place and after a few weeks of wailing and gnashing of teeth it is discarded, and very few (or none) alignment checks occur. If that sounds like your shop and you are somewhat irritated every time you walk by that shiny aligner that was supposed to reel in some additional sales, here is a suggestion that just might help reduce that irritation.
Many shops use their alignment bay for all kinds of services. If that describes your shop, adjust the policy to state that all vehicles which are put in the alignment bay must get an alignment check. While it won’t cover all cars, the check is likely to show up on 10% to 25% of your RO’s when this easier to follow approach is used. That’s way better than zero or the occasional random check – and it will generate some additional sales.
During at least one of the interviews that you have with a potential employee have your spouse present. They do not have to ask anything or say anything other than hello and good bye (but if they do, that could be a plus). He or she will almost always pick up things that you missed, and don’t be surprised if your spouse says “NO WAY!” to someone that you think is just great. If they do say that don’t even think about hiring that person.
It might be an issue with a customer, a former employee, a vendor, a review, a neighboring business, local government, insurance, a warranty – or dozens of other things that can drive you up a wall and keep you awake at night. With rare exception, spending significant time and mental effort on these will cost you money in the long run – more than you might recover or save. These are “business expenses” in the real world today. While it may be against your inclination, it is usually best for the health of your business – and your health for that matter – to make it go away as quickly as possible and get on with making your business better and making money. As to the rare exceptions, if they are truly evil and need to be stopped, hire an attorney and crush them.
Efficiency often suffers and mistakes are sometimes made simply because everyone is not on the same page. An easy way to address this is to have a five-minute meeting first thing in the morning and first thing after lunch. Make it to the point, quick and simple. When are parts expected, which cars have to be done when, which cars are coming in, who is handling what, and so on. We get there faster when we all know where we are going.
Set up a remote office (or two). Not so you can work more hours, but so you can free yourself from being physically tied to the shop all the time. While it certainly can be set up at your house across town, it can also be 1,000 miles away. Duplicate your shop office completely if need be to feel comfortable. If you don’t already have cameras at your shop, add them. Look for the fastest software and hardware resources for working remotely as this will make a big difference. The technology available makes working remotely easier every week. Take advantage of it, lower your stress, enjoy your shop more.
If no one complains about your prices, they may be “too low”. Most businesses have at least some price complaints. No complaints or very few could mean that your prices are attractive to even the cheapest misers in town – customers that most businesses prefer to avoid. Sometimes pressure from this type of customer causes a business to undercharge everyone including those who would be just fine with paying a bit more. On the other hand if you get constant price complaints all day long, your prices may be too high – or it could be time to move to a different area – a massive undertaking, but almost always well worth it in the long run.
Showcase every area of your building and grounds – because ”beautiful sells”.
Start by making the entrance extremely nice, and then match that everywhere throughout the facility – the shop and equipment, the restrooms, the offices, the dumpster area – all of it. Make each one look exceptional. Even the back lots of first class businesses look good.
To customers these visuals are your service. They say how good you are at everything that you do.
Here comes the holiday stretch – Halloween, Thanksgiving, Christmas and New Year. Shop owners often complain about how slow it is during the holidays, especially around Christmas.
Implement a marketing campaign starting October 1st aimed at your customers and other potential clients in your area who have students away at school. Many of their cars will be home between Thanksgiving and the end of the year, and some of them will need a lot of TLC.
Offer inspection specials just for those cars. Get them fully fixed up so the kids have no issues when they return to school. Just a few invoices like that could make a big difference in your holiday sales.
If it’s typical, it’s pretty nasty looking. “Is that how you’ll treat my car?”
Customers notice the strangest things – including the minute details. Someone who is into the small details needs to be constantly monitoring everything visual about your shop.
Mice need to be cleaned frequently and replaced (or moved to a less visible location) when they no longer clean up well. The same applies to several hundred other items which are readily visible to customers.
When it comes to customers, there’s no such thing as the little stuff.
How you dress determines how good you are at car repair, how good you are at completing repairs on time, how accurate your estimates are – bottom line – how professional you are.
Assemble a group of technicians and advisors and then ask customers who they want to work on their car strictly based on how they look. You can bet it will be the ones who are best dressed. If you don’t currently have the best dressed employees of any repair shop in town, you should.
Characteristics of an exceptional customer area – which says to customers that this is a first class shop.
1: It is professionally designed – hire a pro.
2: It has a focal point.
3: It has a consistent theme.
4: Auto repair related things are subtle (or not there at all).
5: Less is best.
It will take square footage (which most shops have one way or another).
It will take money.
It will likely be one of the best “equipment” ROI’s you’ve ever experienced.
…I’ll have a really cool looking shop.”
Or should it be the other way around?
The coolest looking shop is perceived to be the best shop – one that is likely to become wildly successful sooner than later.
Don’t just sit there!
Someone is in your customer area waiting while their car is being serviced, or they may be waiting for a ride.
Stop what you are doing and take a moment to chat. Where do they live or work? Where are they from? Do they like their car? As our culture is getting less personal, you get more personal.
Not my table
During an episode of a show that saves restaurants the show host and the employees were viewing a video of the staff at work. A customer made a request and was ignored by a waitress who commented that it was not her table. The show host got in her face with a raised voice and said: “If you are going to work here, there is no such thing as “not my table”!
Does anyone on your staff have an attitude of “not my table”?
“Well – yes, but they are flat rate or commission (or whatever).” So was that waitress who works mainly for tips. Tell your staff: “They are all your tables – they are all your customers. The request for help from the customer being handled by another advisor – even the comeback from another tech!” That’s looking beyond today and into your future. Some people “don’t get that”. They either need to “get that” or go damage some other business.
5 characteristics of an exceptional customer area:
It has a consistent theme.
It has a focal point.
Less is best.
Car service related things are subtle or not there at all.
It is professionally designed – hire a pro.
Yes, it will take square footage – which most shops have one way or another if they are a bit creative. Yes, it will take money – and it may end up being the best “equipment / remodeling” ROI you’ve ever experienced.
- It attracts good customers
- It repels bad customers
- Customers are less likely to be rude or angry if things don’t go perfectly
- The pressure from waiters is greatly reduced and often disappears
- Prices that allow for a reasonable profit are justified and expected
- It says that you are better at diagnosis and repair
- You feel better about yourself and your shop – you live there
How good is your customer service? Our standards in this industry are pretty low. Most of us think that 5 on a scale of 1 to 10 is great service. Most shops are around 3 or 4. This is fantastic news for shop owners with open minds looking for ways to stand out. Moving your shop to 7 or 8 (or even 6) puts you in a class by yourself. But, how do you do that? Forget best practices – that’s just what others already do and should be considered automatic minimums for any decent shop. What could you offer that no one else ever does? What would no one else even consider doing? Do that. Get ahead of the service curve and stay ahead of it.
Here’s Your Sign!
At an upscale restaurant recently six employees said something pleasant to us on our way out. Easy to do – yet very impressive.
Your employees don’t have to engage everyone in a long conversation, but when they pass someone in the parking lot or anywhere else at your shop it is more than reasonable to expect them to smile and say hello.
Place this sign where your employees will see it constantly.
“Smile and say: “Hello!”
How do I get to Carnegie Hall?
Practice, practice, practice!
Do you ever rehearse your presentation before you make the call to the customer? Run through it a few times, write notes, put things in an order that flows well. Then watch how much better your presentations (and sales) go. This is one more reason why advisors should have access to a private office, or better yet have one of their own.
Customers rarely use only common sense or logic to select a service. Yet we often approach marketing for new customers as if they always do, which explains why a fair amount of our marketing fails. How many Super Bowl ads have much, if anything, to do with the product? The speed of society today causes customers to make snap decisions. No time to research – just grab and go – often guided by feelings. How can you make sure that they feel good about you?
You will get more sales. And you won’t talk your way out of a sale that you have already closed.
Pause for 1-2 seconds after the customer stops talking, and then reply. This will significantly improve your communications.
Communicate clearly. Few folks do this well today.
Most customers want things to be simple, easy, and hassle free – including the extremely complex things.
People like, and are more inclined to buy, what they can easily comprehend. The easier you can make it, the better the customer experience and the greater the sales.
Take a little extra time with every customer both in person and on the phone.
During that time give them your undivided attention.
There is no looking elsewhere.
There is no one else to talk to.
There are no phones to be answered.
There is no “is my part here yet?” or other staff interruptions – make sure everyone knows that.
It is noticeable to the customer and will often be the difference in whether or not the sale is made.
Your car needs this! – Well, maybe it does…
When presenting services to customers, communicate confidently and with authority because confidence and authority sell. As soon as a customer senses that you are less than confident or unsure about your presentation the odds of the sale drop like a rock.
If this is the case review it with the tech, take a look at it – maybe research it on line. Do whatever you need to do to feel confident before you make your presentation.
Welcome to Wally’s! Watch your step and don’t touch that!
Tell anyone that you do car repair and Sanford and Son pops into their head. Negative stereotypes – Hollywood still portrays us that way. What can be done? In the grand scheme of things, not much.
But, what can you do to minimize them at your shop? Make a list of those stereotypes. Now, examine every part of your operation down to the minute details and see if you are reinforcing them or showing that they do not define who you are. Identify what you need to address and pick them off one at a time until they are gone.
How to blow a hundred grand Obviously, all of your customer service employees should be people persons (at least I hope they are!). But, what about the techs, clean-up staff, drivers, parts people, and everyone else who is perceived as being part of your shop? They should be reasonably customer friendly, too. As for the ones you have now who are not, train them or find them a place to work that better suits them because your business isn’t it. These people can cost you tens of thousands or even hundreds of thousands of dollars over time. You are better off being short staffed with friendly people than sufficiently staffed with average or less than friendly people.
Avoid droning on and on and on.
I rarely want to hear about the coefficient of friction.
I have things to do.
I want to know if you can fix my car, when it will be done and how much it will cost.
Make it clear to me that you will go into detail on anything beyond that.
Then, if I want more info, I’ll ask.
Your ads and website tell me…
…quite a bit, even if it’s not accurate.
Basic ads and websites mean the shop’s expertise is pretty basic.
Average ones tell me that the shop has average skills.
Excellent ones tell me that this is a shop which possesses exceptional capabilities when it comes to car repair.
Perception is reality.
When sizing someone up, how important is their attitude? How is yours when customers are sizing you up? Attitude shows and has a huge effect. Bad attitudes do not belong anywhere in your shop.
Big rewards are usually preceded by big dreams. Remember your dreams when you first had your shop? What happened to them? Get them out, dust them off, adjust them as needed, and go after them!
“But, I’m a 40 year old shop owner – dreams are for the kids.”
Life expectancy today in the U.S. is about 80 putting you at halfway. Or, figuring that adulthood starts around 20 you have about two thirds left to go. You have 40 years to make those dreams come true. If you are 50, you are only halfway. Even if you are 60, you have two decades to work on them. Imagine what you can accomplish in the next 20 years!
Reduce the verbiage. Get rid of obvious and redundant words. Just cut to the chase and make your point.
The world is filled with far too much text and too many words that say far too little.
Whatever you are trying to communicate, how can you accomplish it while using as few words as possible?
Like it or not, great service means speed.
How can you take care of customers faster at your service counter? During write-up, during check-out, on the phone, using email.
Make a list. OK, that’s better – but how about much faster? Develop your list further. Now, take care of the things that you have listed.
But, don’t stop there. Constantly look for ways to make it just a little bit faster.
How nice are you and your coworkers?
Are they super polite, friendly, and helpful?
Nothing else that you can do will draw customers in as much.
Post this on your monitor: “Be nice. Hire nice.”
This one thing can make a huge difference in your business.
Let me tell you about some of my other dates!
That’s a really, really bad idea. Don’t talk about any other customers past or present. I’m afraid what you might say about me after I leave.
Does that describe you in the morning?
Who would customers rather talk to?
Who has a better day?
Who is better liked?
Who enjoys themselves more?
Who sells more?
Go to bed, get up early with no alarm clock, have a good breakfast, relax a bit, and get to work well ahead of opening. It will improve your work day and a whole lot more.
When someone (anyone – customer or not) walks in the front door of your shop, how would the typical greeting that they receive be described?
Or, is it exceptional?
People don’t receive many exceptional greetings today. Once a week, once a month, or maybe even less. Settle for nothing less than exceptional at your shop. It’s simple to do, it’s free, and it will make a difference.
What’s the one thing that you would like to eliminate about the customer service process? What part of customer service interaction makes you the least comfortable?
It shows and it costs you sales. It is critical that you fix it.
One of the simplest things that you can is to practice it. Rehearse it. Role play. Over time it will improve and it will show.
Who are your Primary Competitors?
Can you name them? Are you sure, or is it an educated guess? For most shop owners it’s the latter. How could you make your reply more accurate? Actually, it’s right in front of you every day. Put a reminder on your tech work sheets right now to save the oil change stickers that the techs remove and put them in a container just for that purpose (next to the oil change sticker printer is perfect). Assign someone to empty it weekly and create a spreadsheet with the results. These are the shops where your customers definitely have been – the ones who are emailing and mailing them just like you do.
A second big impact will occur during the last few moments of a customer’s visit. What is the feeling that you want them to have as they leave your shop? How they feel when they leave will significantly affect how well their car was repaired and how great the odds are that they will be back. What lasting impression are you leaving them with?
While they are being checked out, does another person clear the car of any ice and snow? Is the car started in order to warm it up or cool it down? Is the car brought to the front door and pointed out so no backing up is necessary? Does someone act as a “doorman”, opening the shop’s front door, and then opening the driver’s door for the customer to enter, and finally wishing them well as the door is gently closed?
A big impact is about to occur
An image of what your shop is all about will be engraved in a first time customer’s mind within the first 3-5 seconds of walking into your shop. Really – it happens that fast. Once engraved, changing it is next to impossible. Walk in your shop’s front door and see what they immediately see (better yet, take some photos and view them on a large monitor). Is this the image you want them to recall? Is it the one you want them to communicate to others whenever your shop is mentioned?
Advertising is for losers who don’t have great word of mouth
This is a bumper sticker found on the back of pick-ups as they haul away what did not sell at auction from their boarded up shop. Consumer’s decisions today are not based on word of mouth nearly as much as they used to be. At one time, word of mouth was everything. But today we live in a house for years and can’t name the neighbors. Families are often spread from one end of the country to the other. Job changes are frequent so the long time coworker is becoming rare. The bottom line is that the sources for word of mouth referrals have been significantly reduced. Many shops are finding that most of their new customers are now coming from the internet and from driving by. Of course you still want good word of mouth, but don’t think that you can depend on it as your primary marketing tool.
Name or rename your shop very carefully. Your name is who you are. Many businesses have average names. Many have weak or terrible names. Just a few have excellent names. In our town we used to have “Northtown Movie Theater”. Now we have “Celebration! Cinema”. Names that stand out in customer’s minds make your marketing easier, cheaper and more effective. How about Celebration Auto Service? How does that compare to your shop’s name?
Take risks. Virtually all successful businesses do. No risk, no reward. Growth and success always involve a certain amount of calculated risk. Sometimes you need to “break the rules”. Don’t be foolish, but also don’t be afraid to do things out of the ordinary, outside of your comfort zone, and outside of “what auto repair shops are supposed to do”.
Then act like one in all that you do.
Talk like one.
Look like one.
Smell like one.
Write like one.
Spell like one!
Many customers will judge your car repair ability by your spelling and grammar ability. How is yours?
When the repair is not done on time, when a finger mark is left on the car, when the repair does not fix the problem, why is the customer upset? Seems obvious, but is it? In most cases it’s not the incident itself, but their perception that you don’t care about them. If they were important and mattered to you, those things would not occur. This is why just taking care of the problem often falls short of addressing it properly. It’s critical that you show that you care.
Thoughts on customer follow up. Phone calls are interruptions today. The sentiment is nice, but I really do not need a thank you about car repair when I am juggling three other things. Use email (which means you must get the addresses!). Never use any kind of form letter or form email. I can smell them a mile away. Always be specific. “Is the leak OK now?” Contact must be from the same person who waited on them (signing their name does not count…I can smell that one, too). Add a personal comment. “Hope your trip goes well!” This is not difficult to do if you properly interacted with the customer during their visit.
Describe your least desired customer and put them at one end of a line. Describe your most desired customer and put them at the other end. Now look at all of your marketing efforts. Determine what type of customer they are most likely to attract and place each one at the appropriate spot on the line. Do the spots reflect who you want to attract? For any that do not, alter that marketing effort or eliminate it. Place any new marketing idea on that line before you launch it. This goes far beyond your advertising. It also includes your shop both inside and outside, employee clothing and grooming, and anything else about you and your shop that customers will experience in some way.
Tell me how you feel about your brake job.
You will feel better in the lobby of a high end hotel than you will in the lobby of an economy chain motel. You will have a better sense of well being in a 5 star restaurant than you will in the local burger joint.
I am about to spend an hour in your customer lounge, or maybe several hours, or maybe even (gasp!) all day! How will I feel?
If I feel better, I will like your brake job better. Price becomes less of an issue. Complaints decrease. Referrals increase.
Go ahead – make my day
What could you do when a customer walks in your front door that would make their day?
Forget that you have an auto service shop or even a business of any kind. Someone is about to enter the room. How can you improve their day? How can you make the experience that they are about to have the high point of their day?
Everything in their day so far, and after they leave, will likely be just OK or maybe not so great. It would not be all that hard to beat out all those other experiences if you put a little effort in it.
So, what could you do? Do it consistently and you will lock in many customers.
What is the most prominent and popular event in your community?
What is the one that virtually everyone knows about?
Which one draws the largest crowds?
Where is there a potential for a lot of visibility?
Become significantly involved, participate in a big way.
Just what makes you so special?
I need my car fixed and you all fix cars. Why not just flip a coin? I
need a good reason (or two) to try you. What is that reason? If you
can’t easily come up with an answer, do a close examination of your
business and either find the answer or make the necessary changes so
there is an answer to be found. You need to be special in some way. Once
you figure out what that is, tell the world in everything that you do.
He’s everywhere! He’s everywhere!
Get exposure; the more, the better. Where can you place your logo? Where
can you post it large? Where can you post it often? Engrave it in the
minds of everyone in your community. The more well-known your name is,
the more customers will come. The shop with its name in the most places
is often perceived as the best shop in town.
That’s as clear as mud!
Your marketing messages should be immediately and abundantly clear to
everyone. Try them on your kids. If they say: “Huh?” then rewrite it
until they get it the first time. How often do you read an ad a second
time because you are not sure exactly what it means? Those ads are not
very good. They frustrate and confuse people. The same goes for all of
your customer communications. Make all of your messages simple and
Your situation is exactly the same as…
…as no one else. What applied to someone else does not necessarily apply
to you. Every shop is unique. So, the results at your shop will not be
exactly the same as they are at another shop. Dont be disappointed when
that sure fire idea backfires when you try it. Also, dont throw out
ideas only because they did not work elsewhere.
Offer them what they want, not just what you already have.
We tend to assume that what people want is what we are offering. How do
we know that? Might there be ways to package things differently so they
are more attractive? If you have certain services that never or rarely
sell, they probably should be changed or eliminated. For the ones you
want to keep, how can you alter those services to be more similar to the
ones that you sell often?
People want to see you, not your stuff in your Ads
Photos of you and your employees are what will get people to really
notice you. Not your building or sign or equipment. Take a look at a
group of ads for just about anything. Assuming size and colors are about
equal, which ones do you tend to look at? The ones with people. People
are interesting; stuff usually isn’t.
Of course we are all unique to some extent. But, how can you be significantly special? What can you do to make your shop jump out of the list of potential shops that a customer could choose? Think of other businesses that you go to and ask yourself why certain ones stand out.
Make it the best auto service experience ever
What can you do to make that first visit exceptional and memorable? Then
what can you do to consistently improve things so that each visit is
just a bit better than the one before? By making this your standard
approach, you are far more likely to be perceived as the best shop in
What risks or negatives can you remove to lessen fear?
What might worry a customer about doing business with you? What might
seem to be a negative? Whether the worry or negative is true or not is
irrelevant if it keeps customers away. Figure out what those things are
at your shop; then figure out how to reduce or eliminate them.
How would you compete against you?
If you were opening a shop across the street from yours, what would you
do take business away from you? What would you offer? How would you beat
you? Make a list and then address those things. Not because a shop will
open across the street soon, but because there are other shops in your
area which to customers is not all that different from being right
across the street.
We all ask this question from time to time. Most of us can come up with
a number of things. There are likely excellent reasons why you can come
up with this list. Why not do those things now? Usually the answer is
because of how difficult it would be to make those changes. But, the
sooner you make them, the sooner you change your trajectory and reap the
What impressions do customers get when they meet your family of
employees? Is this a family they would like to see move in next door in
their neighborhood? Do they get along with each other? Are they polite?
Are they friendly? Not just the people up front, but everyone who works
there regardless of what they do. Is there anything that you need to
Lots of ideas seem dumb. Maybe they’re not. Maybe you should try them.
Many incredible successes began with dumb ideas that no one else would
think of, consider or try. Avoid worrying about someone else thinking
that your ideas are dumb. Worry about whether or not they have a chance
of increasing your income.
Someone from the outside will notice things that you and your staff may
never notice. Not only the little details; but huge things sometimes.
Think of the places that you do business with, and think of the things
that you see time after time and wonder “Why don’t they do something
about that?” Because no one there is aware that it exists. There are
things like that at every business…including yours.
Customers generally have some kind of timeline in mind when they deal
with automotive service.
How fast do you answer the phone?
How fast do you say “Hello!” to people entering your front door?
Before the door closes as they enter?
How fast do you reply to emails?
“No one does that!” you say.
Not you, not your techs, not your office staff, not your shop where
their car is being serviced. Make all of this as easy to view as
possible. Very few customers will just sit and stare at these things
anyway. Most will take a very brief look or often none at all. But, they
know that they can take a look anytime which makes all that you do much
In most cases folks are not looking only for auto service, but a
relationship with someone who they can depend on to make this area of
their life something that they do not have to worry about. How well do
all of your employees understand this? How well do you communicate to
your customers that they can find a good relationship with you?
Have you ever decided to try a product or service, started the process,
and then just gave up because it was too much of a nuisance to buy it?
How sure are you that doing business with you is easy? How many hoops do
you make customers jump through? I promise you that there are customers
who wanted to buy from you, but found it too confusing or time consuming
It’s a good time of the year to do the same things at the shop that many of us do at home. Take a good look at where the heating and air conditioning is leaking out. Many shops are like Swiss cheese; holes everywhere! Check the insulation, weather stripping, overhead doors, service doors, windows, and any other spot that might be an issue. That infrared gun in your tool box is a great tool to find leaks. It’s the basic stuff like this that the expense hawks do to keep more money for themselves (and also end up with a more comfortable workplace).
It could be either or both. The largest plus is the “association” with others who also belong. Far too many shop owners live on their own little island either by themselves or maybe with a couple of others. Association members often interact with dozens of others not unlike themselves. Beyond associating, belonging can go several directions. You can’t just sit on your hands and wait for something to occur. When you jump in, you tend to get a whole lot more out. If you are not a member of your state’s automotive trade association, get off your island and try it for a year. If nothing else, it will give you access to some of the top shop owners in your region.
That should be a frequent comment from your customers when you give them a ride, give them a loaner or just talk about your personal and company vehicles. Owning newer low mileage vehicles suggests to your customers that you don’t follow what you often say to them. Today it is not very difficult for shops to own extremely clean cars with over 200,000 miles (one owner high end cars are cheap to buy and fun to drive). They make fantastic selling tools; and can save the shop a lot of money, too!
For quite some time now shops have regularly taken photos of various failures or the different stages of larger jobs. Then, when the customer is at the shop someone grabs their smart phone or digital camera with those photos to help with the explanation. Some will also load the photos on a shop computer for a better look.
The problems are that the camera and phone screens are small, and it can be inconvenient to get the customer to view a computer monitor. A big improvement can be made by using a tablet to take the photos and show the customer. Nice big screen and very portable. Try it…your customers will love it!
See if you can find one or two things that stand out as being good. Low miles, extra clean, no rust, sharp body style, great fuel mileage, never towed in, etc.
It’s far too easy to focus only on the negative when discussing car repair. By balancing it with some positives the tech, the service advisor and the customer will see things a bit differently which can often increase the amount of sale.
Of course you are already using regular mail, email and phone calls to remind your customers when their oil change is due. But, are you texting them, too? Something like the following can be quite effective:
“Hi Fred – According to our records, the oil change on your Pinto should be due about now. Reply to this text or call us today at 555-1234 to save $X off your oil change. Thanks from Harry at Main Street Auto!”
The technology keeps on coming and some of your competitors are always using the newest things. Keep up with them, or better yet, watch for those new things and be the first shop in your town to use them.
You received an estimate request by email or phone or someone just walked in and asked. You decided to provide one (good idea if handled correctly). So, now what do you do after they said “thanks”, but made no appointment? Do you call or email them one or more times over the next few days? If you do, at least some of them will respond and make an appointment since you are likely the only one to show interest and follow up. Remember, not everyone asking for an estimate by phone or email is looking for the lowest price in town.
If you are a typical shop owner, a lot of information comes to mind as you go through your week. Much of it is about things that you would like to communicate to one or more of your employees – projects, questions, ideas, etc. Keep a document on your computer for each employee where you record those thoughts, then email it to them once each week. Think of it as just one more way to prevent a few fires and get a few more things accomplished.
Did you know that Google reviews are not always listed in dated order? That great new review can get buried on page three while that old nasty review stays on page one. This is one more reason to post highly professional replies to all reviews, especially the bad ones.
Also, several shops have had their replies to reviews disappear although the reviews remain. It is strongly recommended that you save your replies in a document so you can repost them easily if this happens to you.
In many shops about the only reason the fax gets fired up is to receive parts diagrams, usually from a new car dealer. But today many shops can bring up complete OE parts cataloging for many makes on their computer. Some even transfer the parts with all information right to the RO and allow parts to be ordered from the RO. Cost to the shop is typically zero. Turn the 30 minute fax dance into a two minute done deal just like you do with your aftermarket suppliers.
If there is little activity at a shop, many people believe that the shop can’t be very good. Your parking lot and your shop should normally be at least half full both when the shop is open and closed. No, not with the junkers you should be making disappear. You can acquire cars with reasonably decent bodies for not a lot of money. How road worthy they are is really not important as long as they look decent (detail them to make them look even better). Also, make sure your employees know to put a few cars inside when the shop becomes empty.
For many business owners today, the reply is not near often enough. A customer emails a request and waits hours or days for a reply. Someone at your shop should be constantly monitoring the business email and replies should occur within a few minutes. If you really want to be in the lead, then have someone monitoring and replying to your business email on their cell phone when the shop is closed. If you are thinking that you do not get all that many customer emails, then plan on it staying that way as your customers wander off to shops who respond to them promptly.
Make it mandatory that when writing up an appointment RO, the customer is always asked what time they will be coming in. Of course you do this for waiters, but also do it for every drop off. Just “dropping it off Wednesday” invites inefficiency in your work day. Every incoming appointment RO should have a specific time (or at least a time range) noted. This will cause your customers to do a bit better job of keeping their appointments, plus it is guaranteed to reduce stress on your front counter…and every shop can stand that!
One common problem with night drops is getting initial approval for a specific dollar amount. Even though you ask customers to make sure to include a dollar amount (increasingly becoming a legal requirement), many still seem to forget. A statement asking for a dollar amount with a line to fill in helps, but it is still often left blank. A better approach is to also include several specific amounts for the customer to select. Please circle one: $100 $250 $500 $1,000 $_____. Add something like this to your after hours drop off envelopes and your response rate is sure to increase.
You absolutely must get those customer emails. Forget that you may not have had much success in the past. Remember that there was a time when it was very difficult to get cell phone numbers, yet today it’s automatic. Email is moving that direction rapidly. You don’t need gimmicks or contests. Just ask with confidence like you are asking for their phone number and you will likely get the vast majority to cooperate. Shops which have made it a regular practice have most of their customer’s emails…some with over 90%. That makes fast, low cost marketing a snap!
“Here is the fix and the price. Take it or leave it.” Hmmmm. Maybe I’ll just leave it. Or…” Here are your options. You can do it this way with the best warranty for $X, or this way with a good warranty for $Y”. There are multiple ways to do almost any repair or service, and usually more than one of them provides a reasonable repair without doing substandard work. You have a better chance of making a sale by offering yes or yes, instead of yes or no. If you do not already offer options, try it…you might just be surprised how much your customers will like it.
One thing that you will typically find in successful repair shops is a good incentive pay plan. Sales and gross profit based for service advisors and parts staff, and production based for techs. A decent blend of a basic base with significant incentive works nicely for many shops. Often shops do have a blend, but in most cases the base is too high and the incentive is too low, which severely reduces the benefits of an incentive pay plan. Other shops have excellent success with 100% incentive pay. Generally, shops with little or no incentive pay have low production and therefore low profits. Spend some time creating a solid plan that is fair to you, your employees and your customers.
It is often said that some of the worst people to have at your front counter are former or current technicians. Yes, it is helpful that they “know the product”, but too often they know it too well in the sense that they go into far more detail than most customers care to hear. When someone fixes your furnace at home, how interested are you in the detailed functions of a home HVAC system? A few of us are, but most of us just want to know that it will heat the house when we turn it on and how much we owe the furnace guy. Give customers the initial information in a brief summary and make it clear that you are more than happy to go into as much detail as they would like. We often do not realize that the customer on the other end of the phone is tapping their foot trying to get back to whatever they were doing while we drone on about fuel trim. It’s just not all that exciting to most folks…really!
Of course you send them to customers who had you change their oil. But, what about everyone else? Almost every car in your shop has an oil change sticker on it. Get the due date and mileage every time on every car. Then use that information in your software to make sure that they receive a reminder from your shop about when that next oil change is due. The point here is to do everything that you can to keep those cars out of any other auto service shop of any kind; especially the ones which tend to siphon off those simple and profitable services.
The reason that many shops say no is little more than a bad habit learned from people who worked in the past where customer service was not as critical as it is today. All that this potential new customer (or maybe existing good customer) usually wants is for you to show that you are interested in helping them. You do not have to diagnose and fix it on the spot. Just take a brief look and let them know what you suggest they do next. If the shop is full, take that quick look outside. Better yet, designate one bay for quick service so it can be made available in a few minutes when needed. You spend a lot of money and effort to get new customers. When they show up, make sure that you don’t send them to the shop up the street.
While it’s been discussed to death, far too many shops still do far too little with the factory maintenance schedules, or they over complicate the process by editing them and reinventing the wheel. Make it simple. Just grab the exact factory scheduled maintenance list that is due out of your software. Add the parts, and you are done. Do this the day before arrival for every car on your schedule. Mention it during write-up or drop off. Many customers have been well trained to make sure that the factory maintenance is always kept up to date and will quickly agree to have you add it to the RO.
Problem: Customer is waiting for an oil change (or other quick service) and it takes too much time to do the inspection that you want performed on every car.
Solution: Pare down that inspection to include only the most critical items.
Sure, it’s a compromise, but it’s far better than skipping the inspection entirely due to time constraints. Remember, you want a solid policy to perform some type of inspection on virtually every car that you service. You will benefit and your good customers will appreciate it.
Is there any rhyme or reason to your parking lot? Every shop, regardless of size, should have a clearly drawn parking plan posted for all staff to see. It’s a rule of auto repair…you will attract more of whatever type of car is most visible to people driving by. Preferred cars out front, least desired out back, and the rest in the middle. Each car backed into its parking spot. Fresh striping (repainted at least once per year) making it obvious where to park. Remember that what is obvious to you is not obvious to a first time customer. This is one of those simple and low cost marketing items that you can do which can make a significant difference in the appearance of your shop
Most shop owners underestimate the importance of their customer lounge or waiting area, and most shop waiting areas reflect that. In general, they tend to be dated, sparse, cluttered and tacky. Drop by several of the local higher end car dealers and check out their waiting areas. If you want to do business at that level, then duplicate what you see. For less than the cost of many scanners you can have a first class waiting area that will pay for itself. Also, if your waiting area has not been fully updated within the last five years, it is due.
Part of the morning routine at some shops is firing off brief thank you emails to everyone who picked up their car the day before. When you do so, it is important that you avoid a form letter format. Instead, mention something in reference to their visit that makes it obvious that it is a personal thank you. Benefits include solidifying the use of email communications with your shop in the customer’s mind, and giving them a simple way to quickly respond to you with any feedback. Plus, marketing ideas like this will not put a dent in your budget.
It doesn’t matter where you put them or how fresh the paint is; dumpsters are an ugly nuisance. But, some shops no longer have dumpsters. Instead, they have in their shop several of the large wheeled plastic trash containers which have become the norm in residential areas. No more emptying the trash, no more eyesore out back, no more nasty trash cans in the shop, no more trash running over into the parking lot, and no more worry about being the free trash receptacle for the neighborhood. And in some cases, the cost can be significantly less. Call your hauler right now and have them make the swap tomorrow.
If not, now may be a good time to think about it. If you have plans, consider moving them to the top of your to do list. It seems that in many areas, the local board in charge of regulations spends most of its time figuring out new and creative ways to make doing business as difficult as possible. Signs are normally high on their hit list. There are plenty of shop owners out there who wish they could turn the clock back and put up the biggest, tallest and best lit sign they could afford. Find out the maximum allowance for signs at your shop; then get the permit and order process underway as soon as you can. If digital reader boards are still allowed where you are, get one now. As fast as sign regulations are being created, a month from now may be too late.
For far too many shops the answer is “Not very well.”. If you have a website (and you certainly should), someone needs to go through it end to end once a month and test the most popular items weekly. Does the scheduling feature work right? How about the contact form? Are there any broken links? Is the information up to date? There is nothing quite like a “Get ready for Winter” promo in March that expired three months ago to make you look less than brilliant to a potential customer. I’m guessing that a lot of readers are checking their sites right about now!
You know, the ones we all refer to as “Lost customers”. Most shops just let them wander off. But, many better shops don’t give in that easily. One item on their marketing schedule every 90 days or so is to run a report on customers who have not been in for over a year. These lost customers are contacted and asked why they have not been in lately, and offered an incentive to return. While it is true that many of them are lost for good (moved, quit driving, married a mechanic, etc.), there are usually enough who will respond and make the effort worthwhile.
Everyone likes to be thanked and that certainly includes your customers. Always make a point of communicating a sincere thank you to anyone picking up their car. They could have gone to dozens of shops, but they chose you. Next, some type of thank you follow up is in order. It could be an email, regular mail, a phone call or maybe a text message. A common mistake is to think that people get tired of you “bothering them”. There may be a few here and there, but the vast majority who appreciate it offsets that quickly. All that thanking may get old to you as you do it over and over, but your customers only hear it from you once in a while. They know which businesses appreciate them. Keep thanking them and never stop!
All you have to do is ask. They will tell you a lot if you survey them. However, avoid the typical type of survey with multiple choices. Also, a survey requiring written replies will be ignored by many who have good input. You want to make it as effortless and nonthreatening as possible for your customer. Create a survey with open ended questions where the replies can be anything that comes to their mind. Then have a third party perform the survey by phone where all your customer has to do is talk to an unknown voice who he or she will probably never meet. The more replies you get, the better. You will need at least fifty or so to gather solid results. Avoid cherry picking the ones to call and make sure to include customers who have not been to your shop in a year or more. Very few shops perform a survey like this because it is not a small project, but the information that you gather will be invaluable.
…then why do so few shop owners put much effort into getting more of them? Ask any group of shop owners what is the best way to get new customers and the number one answer is almost always referrals. Yet, most shops devote the majority of their marketing money and effort to other areas. Shops which have focused on getting more referrals generally report good success. Some shops develop specific rewards programs, others participate in local business groups (some of these are devoted specifically to gaining referrals) while others simply make it a habit to ask for referrals from their existing customers. Ask yourself how you could get more of the type of good referrals that you currently get. Then move some of your marketing budget and effort to doing so. Odds are good that your return on your marketing investment will improve.
A significant time waster in many shops is unnecessarily looking up information that has already been looked up in the past. Anytime that an oil change occurs on a vehicle for the first time, the part numbers for the oil and filter, oil capacity, and the light reset procedure should be saved in your software with that vehicle. Once you locate where the owner stores the wheel lock tool, note that in your software. Some shops also save brake and alignment specifications and details for all of the fluids. This can be a big time saver on vehicles that you end up servicing for many years, and also for certain ones where the information is harder than normal to find.
At least, that’s what many shop owners will tell you. But, what does that mean? Often it means if there is time, if we constantly remind the techs, it comes last in the initial process, it is what the tech decides to inspect, there are quite a few exceptions, etc. In other words…”No, we really do not inspect every car.” Try this. Use a well developed form every time. Perform the inspection first before the sold testing and services are performed. Do not give the tech the next RO until the inspection on the current car is fully completed. Finally, eliminate all exceptions and excuses to keep that door shut. If your techs are not finding $500 to $1,000 or more of legitimate work on the average car coming through your shop, much of your potential income is being ignored every day.
Move it out! Tell the tech to stop working on it, move it outside and work on his or her other jobs. Then call the customer and let them know that the car will not be done today because it is turning out to be a bigger job than anticipated. If needed, get them loaner car, rental car, ride or whatever they require. When the tech returns the next day, make the car his first job. Since yesterday he has had time to think about it, do some research and maybe discuss it with others. Also, he is now fresh and probably in a better mood. Odds are that the issue will now be resolved much sooner than it would have the day before.
Many shop owners do not realize how much time evaporates because of incomplete vehicle information. Make a new rule. Get all of the information during the first visit, every time, no exceptions. This prevents the person doing an estimate during the car’s sixth visit from having to dig around in the snow, hopefully on the right car, on a particularly cold and busy day to find the tire size when the tech is gone on a long test drive. Sound familiar? There’s ten minutes you will never get back. Also, expand the list of what information is collected to cover almost every situation that commonly occurs. Does it have rear heat or rear air conditioning? Wheel base for trucks? Build date? Finally, consider designating one employee (the one who is great with details) to get the information from every vehicle when it arrives for the first time.
In many shops one reason that additional legitimate work is often not sold is because it does not always get estimated. A solid system will normally increase how many things are fully estimated and improve the odds that the service advisors will make the sale. Have your techs look up the labor for each repair or service that they recommend, note the book times and any adjustments that they feel are needed along with the reasons why. Assign one employee, preferably your most detailed and efficient one, to do the parts estimating (and ordering, pricing, inventory, etc.). You should soon find that more estimates are being created causing the average RO amount and overall sales to increase.
Here’s a simple plan to make it better. Write down your specific goals about how you want it to look and be maintained. Discuss your goals at a staff meeting and ask for input. Divide the shop into areas and assign each one to an individual employee. Create a detailed checklist for each area of what you want them to do. Set a weekly deadline for each person to turn in their checklist. Pay employees accordingly for time spent and adjust the pay in relation to how well they perform. Remember that if the shop is messy, it’s because you allow it to be that way.
It didn’t happen. This phrase is more important today than ever, but it is also easier than it has ever been to make it happen. You’ve already made sure that everyone at the shop has their own computer work station and can type reasonably well, right? If not, put those at the top of your to do list. Once these are in place, the recording of information and documentation of what was said and what occurred becomes much easier. In addition to making sure that everything relative to the job is written on every RO, use email, instant messaging, and computer documents to communicate and save information. The demand for this is only going to increase. Don’t get caught behind this technology curve.
Techs need information that is both plentiful and readily accessible. This means that, with the exception of certain private and financial information, techs should be able to quickly access almost everything that you have available. In addition to repair information this should include vehicle service history, relative websites, email, instant messaging and so on. To make access both fast and easy, techs should have computers as close as their tool box and have them hooked up to high speed internet. Remember that the most common reason that techs are inefficient is due to the environment that they are working in.
A common complaint among shop owners is how often their techs go over the allowed time, especially for testing. Do you always make it crystal clear how much time is allowed? Are the times clearly written on the RO next to each labor operation with a big red circle around them? Is a reasonable written explanation mandatory when the time is exceeded by more than a tenth or two? Has it been made clear that any and all information that the tech has which may affect the time is welcomed and encouraged? Putting these systems in place will typically achieve two things: Less time wasted and improved labor estimates. In this economy most shops could use both.
Do you have a solid system for handling RO’s? If anyone in your shop is asking where an RO is more than once in a great while, your system needs help. Create a written “road map” of where every RO is supposed to be at every point in the service process. Be specific, but also keep the plan no longer than a double spaced single page. Anyone in your shop should be able to find any RO almost instantly. Failure to do things like this exceptionally well wastes a little bit of time each day and ends up costing hundreds of dollars (or more) over the period of a year.
“But, the car will only be in the shop for a few minutes!” True, but a few minutes is all it takes to “lose the keys”. While it may not occur all that often, when it does it really throws sand in the gears and, worst of all, it’s very embarrassing when the customer watches you and your staff do the key search dance. Those little vinyl key tags (or similar) are cheap. Use them every time and prevent just one or two more fires this year.
When we buy equipment, we always (at least in theory) calculate our ROI (return on investment). A label maker can pay for itself very rapidly…in a matter of hours in some shops. However, pride keeps a lot of people from stooping to the level of “labeling everything”. We are smart! We know where everything is! The most labeled shop I’ve ever been in was a one man operation where the need for labeling would seem to be the least. But this guy wanted peak efficiency and profits, and he was getting just that. Remember that the next time you wish that your efficiency was a bit better or when you are wasting time looking for something that is lacking a labeled location.
Many shops seem to be inundated with homeless parts. They lay in odd locations, often for extended periods of time, and eventually may just disappear. Some get reordered (now we have two, but no one knows that). When a part arrives at your counter, send it immediately to its proper home. If there is no specific home yet, then create a home (you could even label it “no specific home yet”). Create homes for every part in your building such as: Waiting for approval, Technician Fred, Cores, Returns (one for each vendor), Needs to be added to Inventory, etc. You get the idea. Stop homelessness at your shop today!
Too often, the answer is no. Here are some ideas that should help. 1: When the part to replace a defective one arrives, immediately place a defective (or warranty) sticker on the box so everyone in the shop knows to put the old part back in the box and save it. 2: Put all defective parts in a specifically labeled location (a large plastic bin works well). 3: Create files for each vendor that contain the necessary claim forms before a problem occurs. 4: When a parts vendor picks up a defective part, place a copy of the receipt in those same files until you get paid. 5: Assign the job of checking both the bin of defective parts and the appropriate files weekly and handle them as needed.
It’s a problem in almost every shop to some extent. Many causes of parts waiting can be reduced or eliminated with some simple fixes. 1: When anyone (tech, advisor, etc.) is 90% sure that a part will be needed, order it now. 2: Restock common parts from primary vendors daily. 3: Assign parts handling to one individual as much as possible. 4: Check the schedule for tomorrow and beyond every afternoon and order parts likely to be needed. Finally, when implementing these or any other parts handling systems, make sure that each one is scheduled and assigned so it actually happens.
How good are the communications between staff members in your shop? Is the process simple and quick, occurring just once in most cases? Here are a few methods which have helped greatly in many shops: Instant messaging, emails, dry erase boards, PC’s for everyone, texting, and advanced phone systems. In many shops verbal communication and walking around to find someone have been significantly reduced allowing everyone to spend more time doing their job with more accurate information.
Many shops have a shelf or cabinet for shop supplies located somewhere in the shop where everyone goes for almost any type of supply item. Duplicating the shelf in several places throughout the shop will keep your techs closer to the job they are working on, and prevent several wasted minutes each day. Do that for a year and you have some real money. Also, if you do not already do so, encourage the techs to keep the five or so most used supplies on their tool cart.
If you’ve ever spent time on the phone trying to get the parts guy at the dealer to understand what part you are looking for, or faxing pictures back and forth with the dealer parts department, you know how frustrating and time consuming it can be. Crash guides, which are used primarily in body shops, will usually simplify the process. The tech looks at the picture in the crash guide (things like the inside guts of a door), picks the part he wants, you call the dealer with the part number, and you are done. Crash guides are available by subscription or can often be found used on the internet.
A common problem in many shops is keeping track of the special tools that are purchased. Did we ever buy that tool? Where do we keep it? Who knows the answers? Try the following. When you buy a special tool, enter it into your parts inventory including the part number, description, and location in your shop. Now the techs can easily see if you have it by checking the part number (from the service information) in your management system. They can also see where it is kept; which makes it both easy to find and easy to put away when done.
You come up with a good marketing promotion, but you fail to place it on a marketing schedule. You decide to restripe your parking lot. It looks great! But, you do not place it on a maintenance schedule so it is done again every spring. Schedules are not only for service appointments. The smoothest operations schedule (and assign) virtually everything that they want to recur. Lower the stress level and prevent wasted management effort dealing with the same things over and over again. Schedules are one easy way to do just that.
Is there a lot of time wasted waiting for estimates in your shop? Or, are estimates for additional items found often not performed because they take so long to complete? Part of the solution may be as simple as reassigning what your staff does. Do you have certain employees who are better at estimating and others who are better at dealing with people? Some shops have one person do most of the estimating and another take care of most of the customer contact, and find this to be far more efficient than having two or more people basically doing the same thing.
Many shops buy equipment and tools without a definite plan and end up wasting a lot of money. Creating a good plan is easy to do and to follow. Ask each one of your staff to make a prioritized list of the items that they believe are needed. This is often quite different from what many shop owners anticipate. Combine the lists and set a solid budget on how much money can be spent each month. Then start picking off the items on the list when enough funds are available. This system allows you buy the most critical items first while preventing wasted purchases.
Ask each one of your employees to make a list (the larger the better) of anything and everything in your building that they believe would not be seriously missed if it was gone. Odds are that you will be surprised at some of the things that they come up with. Now it’s your turn. When none of your staff (this works best if does not include you) have any significant objection to something disappearing, this is your cue to make it vanish. If you can’t bear to see it go, then take it home or to an off site storage building. Excess stuff equals decreased efficiency. Removing it will give you a better workplace and a nicer shop for your customers to see.
The lack of a technician time tracking system is a one of the biggest money drains in many shops today. There are dozens of excuses. But, the bottom line is that running a shop without tracking the tech’s time is like running a gas station with no meters on the pumps. When you track anything, you tend to get more of it and this certainly applies to tech production. It’s a simple process that has been used for decades to allow both employers and employees to increase their income. Do yourself and your staff a big favor and start tracking tech time today.
If that question occurs frequently at your shop, it is likely time to improve your tech assignment system. Review incoming cars the day before and assign as many as you can. Assign drop-offs immediately when possible. Prioritize both assigned and unassigned (jobs that can be handled by any tech) both the day before and as soon as they arrive. Your techs should be able to glance at their computer screen at any time and know exactly which car is next in line for them without asking the service advisor. A good system here will pay big dividends, especially when the shop is very busy.
Complete the RO (as much as you can) before the car arrives. If you consider all of the things that you put on an RO initially before the car is serviced (it should be a fair amount of information if you are doing your job properly), you will find that most or all of it can be entered before the car shows up. Use phone and email to find out what you need to know in advance instead of holding the customer up on your front counter where things are often busy and the customer has other things to do and places to go. Then when the car does arrive, all you need to do is ask if anything has changed since your last contact, have the customer sign and you are ready to go!
One of the most common problems in many repair shops is the lack of time and effort taken with customer write-up. Selling (in a good sense) is the key to success for a repair shop today. The write-up is where great selling begins. Do you collect all of the important customer information every time? Do you probe for the details of exactly what the customer wants and needs? Do you use customer history, current mileage and interview questions to determine other possible services? An excellent write-up procedure will often take 10-15 minutes and is normally performed best over the phone when the initial contact for service occurs. If your staff is too rushed to take the time needed to handle the procedure correctly, it may be time to review the tasks which your employees on the front counter have to handle and adjust them accordingly.
Are you closely monitoring which shops in your area are closing? Each has a certain amount of resources which could be valuable. Obviously there is equipment, inventory and the building. What could be of far greater value are the customers in the database. They will need to go somewhere and it may as well be to you. In some situations, you may want to take over the entire operation. When shops are closing, the early bird usually gets the worm. Monitor for possible closings in your area and be the first to contact them. The potential to help your shop may be just the boost you are looking for.
Why does that issue never get handled? Why is it always on the back burner? Maybe it’s not that important and should be scratched from your to do list. But what about the important issues which still do not get addressed? Odds are that no one has set a specific deadline. How can you hit a non existent target? If you assign deadlines to your most important projects, it becomes more likely that they will get done. Just make sure that you do not set too many deadlines too quickly. Be reasonable about how many you set and how soon you set them. Then hold yourself to what you have set.
Contrary to the gut instinct of many shop owners, busy does not mean great profits. Far too many shops spend a lot of effort trading dollars around while retaining very few for themselves. When it gets very busy, it can become easy to spend money that otherwise would not be spent. It also becomes more difficult to stay focused on maintaining a solid gross profit in all areas. Remember that the most profitable thing that a shop owner can do, both when things are slow and when things are busy, is to manage the money.
That is, some way to get around while you service their car. Do you have a solid system in place to offer them as many options as possible? How many of these are readily available for them at your shop: Loaner car, rental car, pickup and delivery, shuttle, or bus? The more alternatives you can offer the better. Make a list of transportation options part of your standard operating procedure and include the list in your marketing.
At least, that’s the sentiment of many in our industry. However, many shops have found wait appointments to be a huge opportunity. Instead of seeing them as interruptions, systems are created to deal with them efficiently and profitably. It is far easier to sell a customer a service face to face (with the car handy to look at) compared to over the phone. Ask what you could do to address the problems that you now have with waiters, and then put systems in place to keep customers from wandering off to the shop up the street that is happy to have them wait.
Are you really getting everything that you should from each customer visit? I’m not talking about pushy selling. Instead, I’m referring to informing the customer of all possible repairs and maintenance. This requires a thorough inspection, a check of the service history, and finding out what factory maintenance is due. Then each item needs to be estimated and mentioned to the customer. It sounds pretty simple, but many shops do not take the time to do it properly on every car, every time. And, it shows in their average RO.
Most shops do a reasonably good job of asking questions about the customer’s concerns. However, many shops depend mainly on the ability and memory of the service advisor to do so. A better approach is to create a standard list of questions in your software so the process is consistent and thorough every time regardless of who is doing the write up. This will allow anyone on your staff to do a reasonably good job of writing up a customer when a service advisor is not readily available. For best results, have both the questions and the replies print out on the RO. The techs will know what to expect each time and be less likely to ask the advisor to call and get further information.
Yes, this seems pretty basic, but the vast majority of problems which occur in an automotive shop are related to not handling the basics thoroughly and consistently. Of course we get the name, address and a phone number or two that will be used today. But, instead of thinking only about this visit, what other information might be useful for future visits and marketing? Did you get work and cell numbers for both spouses? Fax numbers? Email addresses? (You have made email collection mandatory, right?) Some shops also get birthdays so the customer can be sent something special once a year. And, don’t forget to briefly review current information for returning customers to see if anything has changed.
In a typical repair shop the staff spends too much of their day dealing with problems which have been dealt with before (and will occur again) due to the lack of simple systems that prevent the problems from happening in the first place. The loaner car is not completely ready for the customer because there is no assigned and scheduled procedure in place to make sure that it is always ready to go. Of course there are dozens of similar issues, each one consuming valuable staff time and killing efficiency. When a common problem occurs, note it, and create a simple system to deal with it. Then put it in place and watch as the staff becomes less stressed and more productive.
How do you really know? Here’s a simple way to get a pretty good idea. Spend some time doing a little investigating to get a reasonably good idea of the sales at other shops in your area. Then take the total number of techs and service advisors (added together) at each shop and divide it into their sales. Now, compare the findings to the number at your shop. Odds are that you will find a very wide range of results and get a fairly good handle on how your shop measures up. Too many or too few employees will prevent you from maximizing your potential, something that is especially critical in a tough economy.
It’s really quite simple, and many shops have mastered the practice. Kill the GP (gross profit). In an effort to “make customers happy”, we’ll drop the parts GP a few points. Let’s do the same for labor. Add that to decreased sales and we have a sure fire way to destroy our already sagging profits. Do not give in to this temptation like so many shops do when the going gets rough. There are many creative ways to offer attractive pricing and options without decreasing your GP. Remember, when business slows, getting your proper GP becomes even more critical. Closely monitor the way that your GP is trending in both parts and labor so that your profits are not wiped out.
For many shops, the reason is within. It starts with a sales drop that is often due to market conditions. So, the techs figure that if few folks are buying the things that they are finding, why bother to look very hard for other work. Of course the service advisors have noticed increased sales resistance, so why waste time estimating and presenting all of those things that won’t be sold anyway. We’ll just wait until things get busier and then we’ll get back to doing a thorough job of inspecting, estimating and presenting. After all, that makes perfect sense, right? Of course, just the opposite is true, unless your goal is to decrease sales even further. If there was ever a time to look harder, estimate better, and take more time in presenting services, slow times are it. What are you doing at your shop to crank up efforts in these areas?
For many people, the area they work in can make a huge difference in how much they get done and how well they do it. Set up their desk area in such a way that the only thing in their range of sight is the one thing they are working on at the time. Basically, have an area behind them to place all of their other work. Also, it can be very helpful to have a private office available for them to make selling calls. You just might be surprised how well your advisors can do if you provide them with an excellent environment to do their job.
You have a list of things that you want to occur every time, but you just can’t seem to get it to happen. The answer is in your management software. Create a canned job that is placed on every RO. For every item that you want done, write a single line with a brief reminder. The advisor then deletes that line when the item has been completed. Examples might include: Add the warranty, update the recommendations, or get the email address. Give your staff the tools to do the job the way you want it done. A simple system like this can significantly improve you finished RO.
It may seem obvious to you, but do you have a clear written work flow policy that everyone on your staff follows? When the shop is full of cars, a weak procedure for what order to follow can throw sand in those efficiency gears. Make sure that your staff understands that all tests and inspections are to be completed and turned in to the service advisor before they start installing parts, changing fluids, etc. Techs get a feeling of accomplishment when things are done, so they are inclined to install those shocks, service that fluid, and fix that light before fully completing and turning in testing and inspection results. But, soon they are stuck with nothing to do! Explain to them why a good work flow benefits everyone. Then get an extra car or two done when your lot is full.
A few years ago, marketing budgets were relatively small. A few years before that they didn’t even exist! Today they are often a huge part of the expense statement (you do have this area broken done to a dozen or more lines, right?). Here are a few marketing costs to look at for some savings. Discounts: Use them when you have to instead of just giving them away when they may not be required to make the sale. Switch to more email: It’s a lot cheaper than snail mail. And, speaking of snail mail: Send it only to people who are reasonably likely to respond. Postage: Check into permits which can reduce costs significantly. Vendor programs: Make sure to audit the cost vs. benefits each year before you renew. Printing: On line printers are often far less costly than local stores. Radio: Consider Google or similar types of radio ad purchases. Yellow Pages: A recent news article stated that this method is dropping fast, including the internet versions. The bottom line is that you need to thoroughly review all marketing costs at least once a year and keep this area of your budget under control.
We certainly need to keep our buildings in excellent condition to project the best image to customers. However, we also want to get the most out every dollar we spend in this area. Several suggested areas to review include snowplowing, lawn care, and general building maintenance. Are you shopping for the best deal every year for these services? Have you considered which services you can have your employees handle? Rent is another large expense for many shops. If you are in an area which has taken a severe economic hit, have you asked to renegotiate your lease? Maybe the landlord wants to do what he can to keep you happy and increase chances of renewal. It won’t cost you a thing to ask!
Of course there are a number of taxes that you simply have to pay and there is nothing you can do about them. But, are your property taxes too high? How about your personal property taxes? Real estate values have been dropping like a rock. Have you checked to see if the value of your property should be reduced? Might you be over reporting the value of your equipment? These are easy things to overlook when we review our expenses. You probably pay plenty of taxes already. Don’t pay any more than you legitimately need to pay.
If you don’t have them, it’s a problem. Of course, if you do have them, it’s a problem, too. The trick is to take the time to create a good system to address the issues which occur when offering loaners. Excellent procedures will reduce the vast majority of the problems that tend to happen. Develop a solid system for loaning the cars out. Set a budget and stick to it no matter what. Make a weekly inspection checklist to keep the cars ready for use. In today’s market, most shops should offer loaner cars. Figure out how to do it right and you will appreciate the benefits.
It’s common for shops to tie some type of marketing to the Christmas season. Some may also do something for the 4th of July. Now, if we take a look at our calendars we quickly see that there are plenty of other holidays; and it seems like there are more being added every year! It’s pretty easy to pick one holiday each month and figure out some type of marketing to coincide with it. Get creative and make it fun for your customers! A holiday of the month promotion might be a great marketing system for your shop. After doing it for the first year, you will then have it solidly in place and you can repeat the system annually with only minor modifications.
What causes sick days? Sick employees, of course! So, how about doing what you can to prevent them from getting sick in the first place. Before winter arrives, offer free flu shots. They really do work. When winter arrives, do what you do at home; fire up a humidifier. Offer to assist with a health club membership. Basically, make a list of all of the things that you do (or should be doing) to maintain your health. Then see what you can offer to your staff. When the car count explodes during lousy weather, your odds of having a full staff will increase.
Often we place our focus primarily on what we charge for parts. While that is certainly important, make sure that you also concentrate on what you pay for parts. It is generally agreed that the cheapest part is not always the best way to go, however successful shop owners make sure that they are getting the best price they can for the products which they prefer to use. Great vendor service is critical, but it also needs to be complemented with excellent pricing. Working on both ends of the parts gross profit picture is the best way to achieve your targets.
Internet usage is growing rapidly and will continue to do so. More and more customers prefer the ease of using the internet instead of stopping in or calling your shop. Develop a specific estimate request form on your web site where customers can submit information to you. Once it is received you can take your time to research the options and contact the customer. This will also allow you to get their email and other contact information for your marketing efforts. Remember that estimate requests are often the first step to gaining new customers. The easier you make the process, the more new customers will end up at your shop.
Should it be? Hotel prices typically vary a large amount depending on days of the week. Yet their costs remain close to the same. Gas prices frequently go up during holiday periods. Rental prices are often seasonal. Might this approach be applicable at your shop? Are you slow or busy when you are preparing an estimate? What does your schedule look like? When you are saving estimates for future use, enter both an ideal price and a minimum acceptable price. Following basic supply and demand principles may be an excellent way for you to keep the work load steadier while improving your gross profit.
Pay systems are often frustrating. Since there are certain benefits to salary or hourly and certain others for flat rate; how about mixing the best of both worlds? Take what would be the right hourly or salary pay for your shop and cut it in half. Then do the same with flat rate. Add both of them together to determine tech pay. The tech now has a more predictable weekly paycheck and the shop benefits from the incentive part. Different levels of the flat rate portion of the system are recommended to maintain proper labor gross profit for the shop depending on the amount of hours produced.
Are you someone who gets involved with almost every detail of what goes on in your shop, but you want to spend more time working on the business instead of in it? Odds are that you have at least some relatively intelligent employees. After all, you hired them! So, how about letting your staff handle more of the day to day details. The typical shop owner finds that when he or she does so, most items are taken care of in a proper manner. Concentrate on the more critical issues that should be occupying most of your time and allow your staff to do what you pay them for.
Tow truck drivers can equal free and highly effective marketing if you handle them correctly. Do you offer them coffee in cold weather and cold drinks when the weather is hot? Do you offer to help them with whatever they may need? Do you promptly move cars for them to make it easier for them to unhook? Do you show that you are happy to see them when they walk in the door? Make your shop the friendliest place that they visit during their day. They will remember you and your car count will reflect it.
What has been happening to your GP (gross profit), car count, average RO, expenses and other key numbers over the last few years, quarters and months? You probably have some idea, but do you have solid data at your fingertips? Take a few minutes at the end of each month to place your key numbers on a simple spreadsheet. This will allow you to look at the trend of each one over time, to catch weak trends before they get too bad, and take advantage of good ones.
For years, the approach to purchasing health insurance for many shop owners has been to see what several companies offered, discuss it with the employees, chose the one that seemed to offer the most for the lowest cost, then figure out how to pay for it. Maybe it’s time to try something different. Spend some time figuring out what the shop can afford for this expense. Set a non budget killing maximum. Then ask potential insurers to put together the best package they can. Discuss the options with the staff and select the one that works best for your shop. What works for your budget may not be the most deluxe plan that everyone desires, but remember that a shop that is closed because expenses got too far out of hand supplies health insurance to no one.
Most would agree that both management and technical training are becoming more critical each year. Not too long ago this often meant significant planning, travel, cost and lost production. Today with the increasing availability of on line options things have changed. Set your own schedule while making the most of employee down time. Travel only as far as your desk or lunch room. Costs are typically low and sometimes free. What most of us need to do first is to change our mindset and create systems within our shops to take advantage of these new methods of learning. Search on line, ask your vendors, watch your email. Come up with incentives for your staff while setting goals for hours per month. Then watch as skills and profits increase.
You’ve been in business for a number of years and you’ve accumulated a lot of knowledge about how to do things and not to do them. One problem may be that you are now saddled with the baggage from a lot of less than great decisions. It might be your building, your staff, your business model or a host of others. While constant adjustments are critical, sometimes adjustments simply aren’t enough. Just like with cars, sometimes it’s best to take what you have learned, junk most of what have now and start from scratch instead of trying to tune up something that is destined to never go very fast regardless of what you do. Pretend you have no shop and write out your plan for opening one, taking into account all that you have learned. Maybe you will literally start from scratch, or you might find it is at least time for a major overhaul.
A lot of equipment is needed to run a modern repair shop. Poorly equipped shops are often pointed out as an industry problem. While this is certainly true, there are also many shops that are over equipped for their needs, often because the owner is a tool and equipment junky. Discipline yourself to do an ROI (return on investment) calculation for all equipment purchases, and use realistic amounts in your estimates. If the numbers do not work, then consider a lesser version or used options. In some cases, it still may not work and you may be better off spending those funds elsewhere. There seem be an increasing number of ways to spend money in a repair shop today. Make sure to leave enough for all areas by not overdoing it with equipment.
We’ve heard it over and over, yet often we still do not fully comprehend how critical this is. It’s tough to find a great location and it can have its drawbacks, so it’s easy to convince ourselves to take the larger shop, better deal or easier route of a less than great location. Then we spend massive amounts in marketing trying to get people to come in. The fact is that, in most cases, the average or below average business person will do better in a great location than the excellent business person will do in a weak location. This business is difficult enough without adding the location hurdle to your list of things to battle. Avoid weak locations and make your business life significantly easier.
If it is not the large majority, it’s time to get up to speed! For most shops the availability of on line ordering is excellent, however many simply don’t put the systems in place or don’t use the systems that they have. And that does serious damage to efficiency which means lost profits. Insist that your vendors work with you to put the systems in place. Then make the use of the systems mandatory for your entire staff.
But, does it have to be? Make a list of every conceivable marketing idea (regardless of how odd it may seem) that you have ever heard of. You should come up with a rather long list. Now, divide them into low, medium and high cost. Chances are that the low cost list will have quite a few items. Many will require more creativity and elbow grease than money. Visiting other shops and businesses in your area would be one example. Low cost (or often free) marketing efforts require very little response to make them worthwhile and will frequently out perform many conventional high cost methods.
A better question might be: “Can you afford not to have them?” As with anything that you buy there are many levels of quality; however even the basic inexpensive systems can provide an excellent improvement in your shop’s security; often for well under $1,000. Most will record and can be viewed remotely from anywhere that you have internet access. And, it’s not just crime that is being addressed. Was that wheel cover or body damage there when the car arrived? What actually did happen in the shop, at the front counter, or in the parking lot? Put cameras near the top of your equipment to buy list before you wish you had done so sooner.
That is, the “furniture” in the shop area. In many shops the equipment was put in place years ago. New items were placed where they would fit. But how efficient are the locations now? Is the brake lathe located where most of the brake service is done? Is the supply cabinet at one end of the shop? Take a look at everything and rearrange it to achieve minimal steps for all staff. Then the next time you add or replace a piece of equipment spend some time at your staff meeting discussing the most efficient place to put it.
How about the speed of your advisors and techs? How many two finger typists do you have? Poor typing skills are killing the efficiency in many shops. This is one area of training which needs to be at or near the top of your list. Buy some typing programs. Create a contest with prizes for the most improved employee. This area will only become more critical as time goes on. Excellent keyboarding skills improve efficiency and profits, and can be achieved at a very low cost to the shop.
The typical shop has too little inventory and much of what it does have is incorrect causing significant inefficiency. Waiting for parts, even for a few minutes, is time and money which is never recovered. Let your management system decide what to stock. It does not matter what type of part it is or whether anyone else stocks it or if you only stock one of them. If the part sells every 120 days or less, stock it. If not, return it. Use your management system to reorder weekly or even daily. It’s really that simple.
That must be the correct way since so many shop owners seem to follow that policy. However, a fellow shop owner frequently reminds me that we should do just the opposite. Of course, he is right. Just think of how much grief you could have saved over the years if you took more time to find the right people and spent much less time getting rid of the bad apples. Make a sign and post it in your office today: “Hire slow, fire fast!”
Sometimes we get mixed up in our sales approach. We really want that job we are being asked about, but we don’t want to sound like we are desperate or that we are begging for it. On one hand I am not suggesting that you become a beggar. But, there is nothing wrong with making it clear to the customer that you really want to do that job. Be confident. Be politely aggressive. Go get that job!
Some of us have a very bad habit. We figure out what we need to do to hit our GP (gross profit) targets. So, we adjust the numbers accordingly in our management system. Then, when we are working up an estimate or preparing the final bill, we override the system we put in place and destroy our GP! Of course we then complain that we just can’t seem to hit those GP targets. Either learn to break the habit or have someone else do the estimating and billing. Your profit and loss statement will appreciate it.
If you are the typical shop owner the answer is: “Budget? What budget?” What would you call someone who will spend a quarter million, a half million, one million or more dollars in the next twelve months without a written plan of where that money will go? While it will take some time and effort the result will likely allow you to add 5%, 10% or even more to your bottom line at the end of the year simply by creating a written plan and making a reasonable attempt to follow it. Written budgets typically identify areas of waste and give you good reasons to say “no” when you should. So, start something new today. Create a plan, stop the leaks, and keep more of the money which you have worked so hard to earn.
Right under the hood, that is. Way back in the good old days it was common for shops to place stickers in the engine area, usually on the air cleaner or the radiator shroud. Today you may have to be a bit more creative, but you can be just as effective. Create a weatherproof sticker about the size of a business card which includes your shop name, web site, phone number and a towing number. Select a bright color that catches the eye. Place one under the hood of every car that goes through your shop. Even though many customers are unlikely to be able to do much about a leak or noise or other issue, many will still open the hood to take a look. Save them the trip to the phone book and give them the number they can punch in their cell phone right now.
There are telemarketers and there are businesses who call their customers. You should be the latter and should be doing it often. Is their oil change due next week? Call them. Are there recommendations from a visit a month ago? Call them. Haven’t seen them in a long time? Call them. Car serviced last week? Call them. The trick here, as with most everything, is to create a system, assign someone (a nice someone!) to do it, and then go for it. It is inexpensive, personal, and very effective when you communicate your concern caring for them and their car as opposed to just another guy trying to sell them something.
Maybe it is. But that is not enough today. You must also appear competitive and that is a totally different issue. Does it matter what the shop up the street charges? You bet it matters. You need to know what other shops are offering, especially for common services. This is often how customers judge you. Make sure that your prices are adjusted in such a way that customers see you as being reasonable. Survey your competition annually to make sure that you are in the ball park on price sensitive services while also making sure that your total gross profit targets are being achieved.
You used them on the job, so it would seem reasonable that you charge for them. But adding a generic line to the bottom of the bill is no different than many of the charges which phone companies and others tack on as far as the customer is concerned. Who likes that? Take some time to enter small items into your inventory and create kits listing these items which are specific for the job being performed. List them on the bill as you would any other part. Include them in canned jobs so they come up automatically when that job is performed. This way you charge for the items you used and the customer does not receive a bill with vague added fees at the bottom.
While it may seem to be an obvious thing to do many shops still do not consistently check for which factory maintenance items are currently due on every car in the shop. Most shops today have quick and accurate access to what is due. You can either created canned jobs for everything listed or offer items individually. Almost every car will be due for something. Create a solid system where techs and advisors check it every time on every car and watch your average RO increase.
There is certainly no rule that says you must send all recommendation follow up letters at the same time interval for every customer and vehicle.
If they just spent a small amount of money, a few weeks would seem reasonable. If they just dropped four figures you may want to give them 60 to 90 days for their budget to recover. If you find an air conditioning issue in the fall in the frozen north, set the follow up date for April of the next year. Look at the each situation individually and adjust follow up dates accordingly in order increase your odds of a good response to your reminders.
Do you even have one? Maybe you should. It could be a type of service, or one or two vehicle makes. Look around your town. Very few businesses operate today without some type of focus. An auto service shop without some type of specialty is likely to have a more difficult time in the coming years. While conventional wisdom says that narrowing the focus of a business will be a cause for decreasing sales, just the opposite is more likely to occur if the shop uses the proper approach. Then you can enjoy less hassle and lower costs in the areas of training, equipment, inventory, software, marketing and a number of others.
While most management software systems have provided for multiple rates for years many shops still use one or two rates. Here is a simple way to get ten rates. Designate all labor procedures at one of four difficulty levels (some labor guides do this for you). Assign both a repair rate and a diagnostic rate to each level. Then create a tire rate and an oil change rate. This will give you far more flexibility in achieving your gross profit goals.
Maybe you should. Is your day a bit short of full? Is there a tech available for a few minutes? A free quick look can be a powerful marketing tool when done properly. Develop a system to perform free quick checks and begin a relationship with a new customer. You may just end up with some four figure RO’s that you never would have gotten otherwise.
Five estimates to write, seven calls to make, a dozen parts to order and three techs screaming because they are stuck. Who will you handle next? Probably the most demanding customer who may not be the best for your bottom line. Try recording the previous average RO dollars for each customer on your schedule. Now the decision becomes simple. Highest average RO (and most likely to buy) goes to the front of the line. This approach will get your techs busy faster, achieve the best total for your day and take care of your best customers.
Mailing to your data base can be very expensive, especially if you do it often. How carefully do you look at who you are mailing to? In the typical shop well under half (maybe as few as a quarter) of your customers really carry the load. The rest will rarely or never respond regardless of what you send to them. Take some time to thoroughly examine each customer. Set some minimum standards on who should receive your mailings. This will often have a large impact on your costs without a significant change in response to your direct mail marketing.
Does every tech and service advisor at your shop know exactly what their daily goals are? Hours for each tech? Sales for each advisor? It is difficult to hit a target when one does know what it is. Sure, you may mention it from time to time, but is it a number that is in front of them all day every day and engraved in their minds? There are many ways you can do this including software which is available today that tracks these numbers live. Give them something to shoot for, reward them when they succeed, and watch your sales move upward.-
If you are not thrilled with many of the new customers wandering through your front door, ask yourself what you are doing to attract them. Is it your marketing? Your building? Your staff? Something drives them to your shop. What might you do to attract a better crowd? Many shops do a great job of drawing in excellent new customers. What are they doing differently than you, and how could you do the same?
While waste oil furnaces have been around for years, many shops which spend a lot on heating still do not have one. For the typical shop it is far easier to add to the bottom line through expense savings compared to sales increases, and heating is often a huge expense. This is one where you really should take the time to do the math and explore the options. Waste oil furnaces have improved dramatically over the years. Several thousand dollars in savings is not uncommon for many shops.
Or, do we? Calculate your cost of uniforms for the next five years. Probably a lot of money! How much would it cost you to purchase uniforms, a good washer and drier, and supplies for the next five years? Chances are it would be a whole lot less. Some shops assign a staff member to wash them. Others have each employee wash their own. If they get too nasty, buy replacements. This simple system is currently saving sharp shop owners many thousands of dollars.
Often the answer is because they are treated as an afterthought. Separate them from the other services the car is receiving. Perform courtesy inspections on every car first thing in the morning so the service advisor can review them and prepare estimates. Then proceed to the requested services for the day. This will prevent the advisor from being overloaded with a lot of information all at one time and likely result in a higher average RO.
The typical shop owner spends way too much time putting out fires. Many of these are very preventable. When the next fire occurs make a few notes and create a system to prevent it from occurring again. Keep it simple, preferably one page or less. Do it immediately while the situation is still fresh in your mind. Review it with the staff the next day. Then watch as the fires subside.
It can be very difficult for a service advisor to exchange information with several different techs. Consider funneling that information through one person in the shop by creating a shop foreman position. This can often increase production and quality while lowering stress for everyone involved.
“If it isn’t written it didn’t happen!” is what they say. While some shy away from checklists for everything, far more shops utilize too few checklists as opposed to too many. Create them, borrow them or buy them; whatever you need to do to ensure consistency for both your techs and management staff. Checklists are available today from many trainers and management sources including Automotive Management Network which has an area specifically devoted to checklists and other management materials.
Of course all shops track what they sell. But how many track what they didn’t sell? This is very critical and should be tracked carefully in every shop. Simply note a total of all items estimated before the sales call is made to the customer. Then after the call note the total of the unsold items. At least one company offers software specifically for tracking and creating detailed reports about unsold work so that management is able to make adjustments and improve overall sales.
If you have not started yet, it’s time to get going. Email is fast becoming the way to market and communicate. There are many creative ways to gather emails, but the best one is to simply get in the habit of asking every customer. Make it a policy for you staff. The future benefits will be huge!
Keep it simple and practical. Include the following: Night drop form, prices for common services, current special, pictures of the staff, request an estimate form, appointment form, brief list of what you do, a map, transportation options, and a number to call for towing.
Every shop gets them and every shop needs to make them disappear somehow. Instead of having them hauled away, try to secure legal possession. Then spend a small amount of time making them look presentable, take a good assortment of pictures, write a thorough description, and place them on Ebay or similar sites. It is often surprising how true the phrase: “Once man’s junk is another man’s treasure” can be!
Most shops have an advertising line on their statement where dozens of items are lumped all together. Take a few minutes to list each item separately along with a few details and the annual costs. This will greatly help in controlling spending and allow you to quickly see whether you can afford to add something new and where you may need to cut.
Treat them just like a service on a customer’s car. Create an RO, write the details of what needs to be done, assign it to a staff member, place it on the schedule, and give it a priority. Do this for every project at your shop so they are ready to go when staff time is available.
Most shop owners wait until the end of the week or month to see what is going on. Technology today provides ways to monitor technician, advisor, and shop progress live. Consider software like this for your shop so you can address issues before it’s too late to fix them.
The keyboard is fast becoming the most used tool for everyone in the shop including the techs. How good is your staff? Set up a typing game on each of your employee’s computers. Make it a competition to see who can improve the most. When the shop is busy this could make a significant difference in how much work gets done.
Watch them closely and work on them in the following order to make sure your business is profitable.
1: Total expense percentage.
2: Total gross profit percentage.
3: Car count.
4: Average RO dollars.
Too often shops work on these in a reversed order and constantly have a hard time showing a decent profit. All the sales in the world won’t do much good if the expenses and GP are off.
It’s really quite simple, yet most shops do a poor job of the following:
1: Inspect every car thoroughly.
2: Estimate everything the tech notes, no exceptions.
3: Inform the customer of everything that is found, no exceptions.
It is the responsibility of the shop to fully inform the customer about the condition of their vehicle. The shop should not be deciding which information the customer should receive.
Create a schedule where you take each employee out to lunch once every month or two away from the shop. This time can be used in many ways to help the employees, you and your shop.
Look into multiple ways to increase your web site traffic including optimization, pay per click, and specific wording on your main page.
1: Have some business card size stickers made which list the basic information about your shop. Place one under the hood of every car that you service.
2: Buy a sandwich board type sign with changeable letters. List specials or other shop information on it and set it out by the street during the day.
3: Install flags near the front of the shop to attract attention.
While there are literally hundreds of numbers we can review when we look at expenses, sometimes it’s worth taking a very basic look at our costs. Here is one method that’s very easy to remember. Of all of the dollars you take in allow 25% for tech wages, 25% for parts purchases, 25% for all other expenses leaving 25% for you and the company. If you can stay within these numbers, you should do alright. The best shops will beat these numbers and do that much better.
You created a special for brake inspections. A new customer shows up at your counter with the special in hand, but she is not looking for a brake inspection. Instead she needs a wheel alignment and asks if she can get the discount in your brake special. Odds are one of the biggest reasons you created the special was to get some new customers. Do you really want to chase her away? Smile big and tell her: “Yes, we can do that!”
In many cases, they know very little. Most accountants service many types of small businesses. The numbers from those other businesses are often of little value when looking at the numbers from an auto repair shop. Look for an accountant who is an auto repair shop specialist or one who services a significant number of auto repair shops. They will be much better suited to give you valuable advice about your numbers.
Have you ever completed a jig saw puzzle? How many pieces did you put in place at a time? One? Maybe two or three occasionally? That’s how to fix the management of your shop. By taking on just one or maybe a few pieces at time you will begin to fix those things that are in need of repair.
Recall for a minute a few of the customer situations which have gone bad in your shop. How would the folks in Mayberry have handled them if they were on your service counter? Take a few minutes and imagine what they would have done. Odds are this will lead you to an approach that will work pretty well with most reasonable customers.
- Sometimes you just need to build a little trust. If the customer appears to have some potential, write them up for a “No Charge Quick Check”.
- Allow for and pay the tech for a few minutes to “take a look” at the issue. If the solution is obvious, estimate it and offer the repair.
- If more than a quick look is required, offer testing as you normally would do. You will find that in many cases these quick checks will turn into profitable jobs.