Rick White
Forum Replies Created
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Joseph,
Without more information from you, the first thing I suggest you do is to stop calling what you do an oil change. When you call your service the same as everyone else, you’re more likely to get compared to others, because they’re perceived to be the same. (NOT!)
If you agree with me, change the name to something else, and then talk about, and document, all the things you do above and beyond just changing one fluid in a vehicle. When what you do is different, and perceived to have more value, you won’t have people comparing you to others like you are now. You may have some people who do not want to do all that work because they just want the oil changed, but they’re not your target market in my honest opinion.
I hope this helps!
Rick
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Jay,
I’m glad you’ve posted something, and I think it’s amazing that you’re looking for help. My first question is, what is the mindset of the owners of the dealership? The advisors? The techs?
Before you try to fix something, step back and understand where everyone is coming from. You’ll find out who is against what you’re wanting to do, and who is for it. Once you’ve gotten their perspective on things, please share it so I can give you advice directly tailored to your situation.
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Rob,
Giving your techs credit for some amount of time that you’re not billing will affect your ELR. So won’t your canned jobs. Shops probably created those jobs ten years ago and haven’t updated them to reflect the labor increases.
What management system are you running?
Rick
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I know Tekmetric was sending out an email with weekly or monthly stats nationwide by area. I don’t know if they’re still doing it. It may be worth checking out.
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Good Morning, Tom!
I hope you’re feeling better since we last spoke. I would take a look at Federated Insurance and Zurich Insurance. Both have the ability to write coverage for loaner vehicles.
Sincerely,
Rick
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I do believe that things are not as dire as the news would like us to believe. Yes, there are layoffs and we need to have empathy for those people. I avoid blanket statements (everyone is unemployed or everyone is working are examples) because every sales situation is unique.
The national unemployment rate right now is estimated to be between 6 & 7 %. The peak of the recession in 2008 was 10%.
There are people working from home and there are people working in essential businesses or supporting essential businesses. I believe there are opportunities waiting for those shops willing to look for them and capitalize on them by serving their customer.
Stay safe!
Rick White
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Mic drop!
Well said, Tom!!!
Blessings,
Rick
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Allison,
I think it’s amazing that you care about this business enough to reach out for help. If the owner is willing to make some changes, I think you can help him do achieve some truly amazing results. You’ve got some great ideas in these other posts that can help.
If you’d like to speak to someone one-on-one to come up with a specific action plan moving you forward with no expectation, I’m happy to offer what I call a Test Drive. The Test Drive is designed to see your world through your eyes and offer insights and strategies to help you move forward. If this is something you’d like to take advantage of, please contact me at rick@180biz.com and we’ll set up a time that works for both of us.
Sincerely,
Rick White
180BIZ
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Matthew,
Before you start looking at software programs, I strongly recommend coming up with a list of musts, a list of wants, and a list of like-to-haves from a software system. The reason I say this is because it’s very easy to get caught up in all the bells and whistles you’ll see in a demo possibly causing you to make a decision on a system that doesn’t really meet your needs.
I hope this helps!
Rick
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Kyle,
Before you start looking at software programs, I strongly recommend coming up with a list of musts, a list of wants, and a list of like-to-haves from a software system. The reason I say this is because it’s very easy to get caught up in all the bells and whistles you’ll see in a demo possibly causing you to make a decision on a system that doesn’t really meet your needs.
I hope this helps!
Rick
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Claude,
I’m a huge fan of tracking numbers. If you’re going to share the numbers with the shop, then I would share shop numbers, not the individual performance of each technician. In the beginning, it will create a good-natured rivalry that will quickly turn into one or two performers winning consistently and the rest of your staff will give up trying. Sharing individual numbers to the group can also cause what seems like innocent ribbing that often hurts others and causes them to become disengaged with your company and the team.
If you want to see real improvement, set goals and minimum levels of performance for each position, baseline where they’re at, and then individually sit down and come up with a plan for improvement which will most likely be different for each team member. Then let them loose and provide feedback on a daily basis as a conversation, not handing them a piece of paper, that will allow you to come up with a daily plan for improvement.
I hope this helps,
Rick White
180BIZ
rick@180biz.com
540-833-2014 X 11 -
Tom,
I’m wondering if the customer misunderstood you and thinks you want him to delete the review. I’d call him back and make sure it’s still running great. If it is, I’d ask him to amend the review to show that while the issue did happen, you were quick to deal with it and make him happy. All you want him to do is put an accurate accounting of what happened which I think will resonate with his statement that the event did happen.
HTH,
Rick
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Good Morning, Randy!
I agree. As with anything having to do with the government, it’s clear as mud. I think the main difference between the two exceptions and my post is the voluntary part of the discussion.
As an industry, I think we’re way behind the times when it comes to having a development program in place for each team member that has a budget allocated for such training including compensating them for the time they’re in training and based on the sketchy documentation found so far, for their travel time.
You can pay a lower hourly rate for training as long as it’s been agreed to by both parties before the actual training. Overtime has to be calculated differently as training hours would count towards overtime pay. You’d need to calculate an average hourly rate for the hours worked and then calculate their overtime based on that average.
There are really two things at play here. First, I believe compensating your team for training would be a HUGE differentiator of your business. Think of how many technicians would jump at working for a shop that paid them for training. Second, I believe the model of offering training at night and on the weekends is outdated and it’s time for it to go away. Your team is tired and they have families. I believe that a shop needs to have a plan where training can be attended during their normal workday which fixes a lot of these issues. I know that some owners will read this and say they can’t lose a tech during the day. My response is this industry needs to start charging appropriately so that there’s a budget that covers this.
Just my two cents.
Make it a GREAT day!
Rick
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To determine if your staff should be paid for attending training, you have to meet 4 criteria.
- The training outside of the employee’s regular working hours.
- Attendance to the training is voluntary.
- The course, lecture, or meeting is NOT directly related to the employee’s job.
- The employee does NOT perform any productive work while attending the training.
If you can answer yes to ALL four of these statements, then they can attend training unpaid. If you answered no to ANY of these statements, then they are entitled to compensation for the training. You can have a training rate which is lower than their regular rate as long as it’s above minimum wage with overtime. (FLSA 29 CFR 785.27)
Hope this helps
Rick White
180BIZ
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Al,
There are too many questions that need to be answered before I can give you honest feedback on your decision. I’d be happy to review the numbers with you, confidentially of course, and give you my thoughts. If you’re interested, please email me at rick@180biz.com or call 540-833-2014 X 11. We’ll set up a time to review the information together and come up with a plan moving forward.
If you’d rather not, I wish you the best of luck!
Rick
180BIZ
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I agree with Tom & Tom. If the belt is loosened only, then it should be an additional charge but not at the full rate as there is overlap.
Rick
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The big issue here is making sure there’s a healthy return on your investment for the equipment purchased. I’m attaching a simple Excel spreadsheet that will break down the information for you showing when you break even with the machine and then how much profit you’ll make over the life of the machine.
After you know you’re profitable with the purchase, the decision comes down to getting the highest quality and the best service you can for your dollar.
I hope this helps.
Rick
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Hi, Jay!
You’ve received some great advice here that you should definitely heed. I have some questions to ask so I better understand your position.
- What’s driving your decision to purchase an auto repair facility?
- What’s been your work experience up to this point?
- Is the owner of the business the current advisor?
- Is the owner still diagnosing vehicles?
These are important questions because unlike the majority of us that started or purchased a shop, you don’t have the experience or ability to perform these tasks so having the infrastructure in place for you to start is crucial.
As far as buying any business goes, you’ll want to see a number of reports out of their shop management system as well tax returns for the business covering the last four to five years. You may need to sign a Nondisclosure Agreement before these things will be provided. You need to see this information to be sure the business is healthy enough to support the loan payment, your pay, and still be able to save money.
If the business is a franchise, you’ll need to be approved before you purchase but should be able to receive training from them to get you started. There are some great training programs out there and I’d be happy to speak with you about your options when you’re ready.
Besides the business data, you’ll want demographic data of the community the shop is serving as well as digging in online to see what kind of reputation the shop has.
I hope this helps,
Rick
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Bob,
I highly recommend using NAPA Service Assistant or Carquest’s http://www.virtualvehiclemd.com as resources for your front desk person.
I hope this helps.
Rick
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David,
This is a great question and one that you’ll find there are as many different pay plans out there as there are shops. The first thing you need is a specific job description that clearly outlines his duties and responsibilities. That will help you figure out what he has control over. Then, when you’re thinking about his compensation, the simple question that you want to ask yourself is, “What do I want him to achieve in the areas that he can control?”
Simply put, you want to make your goals his goals. Things like gross profit, billed hours, hours per RO, net profit, and parts gross profit are just some of the ideas for a compensation plan.
If you’d like some help with this offline, shoot me an email to rick@180biz.com and I’ll be happy to offer some individual guidance.
I hope this helps,
Rick
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Howdy, Randy!
I personally would insist on using only the recommended oil when performing any service. Looking at your form, I’d recommend adding what the recommended oil should be and what oil the customer is requesting be used to better “protect” you. The reason for the quotes is I still don’t think this document will exempt you from a liability issue if brought to court.
Merry Christmas and Happy New Year!
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UPDATE: We’ve had a number of people request access to the webinar I offered in an earlier post and I’m happy to report that we’ll be offering this webinar FREE on Friday, November 3, 2017 at 12 PM EDT.
You can sign up for the webinar by clicking here.
If you have any questions or comments regarding the content, I’m happy to speak with you privately if you’d like. You can email me at rick@180biz.com and we can set up a time to talk.
I hope the webinar helps you deal with this very real issue.
Rick
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Carhospital is absolutely correct. There are two types of implied warranties that are in play in every state of this country. They are an Implied Warranty of Merchantability and Implied Warranty of Fitness. I go over both of these warranties in the webinar I offered to share with the group in an earlier post.
The reality of the situation is we need to have a better strategy dealing with the transparency the internet provides. To be successful in business, you need profit. In the past, we’ve split up profit over multiple income streams to hopefully get the amount needed to not only survive but thrive. Ultimately it doesn’t matter where the profit comes from as long as there’s enough. I believe it’s time to entertain a new way of selling parts and still achieving the needed gross profit. I would sell the parts at cost or slightly above as a handling charge and move the gross profit to the labor. I’ve been working on a model for this pricing strategy and have it just about nailed down.
I would still insist on allocating parts for quality and counterfeit issues. Once you show a customer you’re charging them cost or close to it on the parts, all this goes away. This isn’t something to be upset about. We’ve been enjoying the transparency as customers for quite some time. It’s just time for us to adjust.
Flame suit on.
I hope this helps.
Rick
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I recently did a webinar that covers installing customer supplied parts and the different issues associated with this topic including how to present your decision to your customer that doesn’t involve a steak and a restaurant, and if you’re going to install customer supplied parts, what to do to be successful. I’m happy to share with you if you’d like to watch it. Just shoot me an email and I’ll get you access to it. You can email me at rick@180biz.com and I’ll make the magic happen.
Rick
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If you want to email me at rick@180biz.com, I have a form I can go over with you and send you. It takes a bit of explanation so let me know when you can talk as well and I’m happy to share it with you.
Rick White
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Bernard,
I agree with Tom. The reason shops break out tire sales from other part sales is because of the different profit margins associated with tires. By breaking out the tire sales and cost from your other part sales and cost, you’re able to see what your actual profit margin is on each and adjust accordingly against your profit targets.I also agree with you Bernard in breaking out the labor from the tire as it allows you to capture more revenue.Have an AWESOME day! -
Jeff,
Before anyone can really answer your question, you need to provide more information. What’s your ratio of new customers to existing per month? If you deal with a lot of new customers, your average sales will be lower. What kind of vehicles are you working on now? What percentage of your sales is maintenance? Once you can give more information, it will help give you a range of what’s reasonable to expect.If you’d like to discuss in private, you can shoot me an email to rick@180biz.com and I’ll be happy to help you in any way I can!Sincerely,Rick -
You can find out more about the 5 S’s here: http://en.wikipedia.org/wiki/5S_(methodology)
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Thank you for your quick response, Rob!
When calculating your ELR, I would keep your oil services and tire rotations as part of the calculation because these jobs definitely have an impact on your ELR. What’s ELR percentage? What’s your goal?
We have a powerful KPI class I’ll be presenting at Super Saturday, November 11th at Trevose, PA if you and your team can make it. If you’re interested, let me know, and I can get you more details. If you’d like an Excel sheet that makes it easy for your advisors to verify their ELR, contact me at rick@180biz.com, and I’m happy to share it with you.
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Brandon,
You’re going to find that almost every shop has a different job description, goals, and expectations for each position. That being said, you want to have a compensation plan with a base that allows you to live and a healthy bonus structure based on criteria that you can measure and control.
I hope this helps!
Rick
