[Tom]

What did you switch to from pace, and why?
We have pace now and it looks like they were purchased by a bigger company. Not getting the same service.

Frank, this was a few years ago and we were looking for a few additional features. We switched to Fasttrak. Gained some, lost some.

[Tom]

We switched from Mitchell and later from Pace/Yes. (They were both good systems, but we were looking for a change.)

In both cases we were able to keep a read only version at no cost that gave us access to everything we had ever entered. They were exactly the same as when we were using them except we could not enter or edit anything. We kept them both for several years until the information was no longer needed.

[Tom]

I know this was quite popular at one time, however I have not heard of a lot of shops using it recently. it seems many are now using Facebook, Instagram, Twitter, etc. to do this type of thing.

HTH!

Tom

[Tom]

Since I live in both south Florida and Michigan, I can see where you would think that. Most roads in south Florida are smooth as glass compared to what we have in Michigan (and any other northern state). The need to check balance where you are is likely far less.

Up here it is common for weights to come off regardless of how well you secure them. After 5,000 to 10,000 miles most cars have at least one wheel out of balance enough to rebalance it – often a wheel is bent from pothole damage.

[Tom]

How did you sell balancing in the past?

How often?

How often do you rotate?

I kind of like the concept, but I’m afraid customers might get confused.

[Tom]

Brake fluid flushes:

1 – Manufacturer schedule

2 – Test results – we check every car for excess moisture

3 – If pushed for an interval when test passes and not in the schedule, 3 years (Honda interval for many years).

[Tom]

Since there are so many different drivers and conditions and uses it only makes sense to adjust intervals accordingly.

At our shop we keep it pretty simple. We use the factory schedule and adjust it if the fluid is definitely in need of service sooner as noted in our courtesy inspection.

We’ve found this to work extremely well with most customers and vehicles.

HTH

[Tom]

Randy, I am seeing a different approach.

When a brand or quality level becomes an issue, future parts for this type of repair must go up a notch – different brand / quality level (maybe OE, maybe not – situations vary). Customer does not get the option – option decisions are often forgotten when the whole deal goes south.

That generally means higher cost, so the challenge for the shop is to become very, very good at communicating to the customer why the cost is higher. I believe that with the right approach most good customers will understand and go with it. A few won’t but in the big picture it usually works out.

Similarly for related parts. For many years we commonly transferred oxygen sensors when replacing exhaust parts. Recent policy changes at our shop makes it mandatory to replace any sensors that have to be removed if they appear to be the same age as the exhaust part.

We are pretty aggressive in our exhaust pricing, so the price is still pretty decent with the sensors. We simply had enough of being the bad guy when the CE light came on shortly after an exhaust repair one too many times for my tolerance level. 🙂

Consumers increasingly expect perfection. We are going to have to figure out how to best deal with that new reality.

[Tom]

Dan, my wife heavily researched this, and a local shop owner bought something similar and loves it. We are planning to order it soon. Here is the link:

https://www.security-camera-warehouse.com/security-camera-system/12-channel-security-camera-systems/

Please let us know what you come up with!

Thanks!

Tom

[Tom]

I appreciate all the input. I like the idea of setting the expectations to reality before we even start. While we always get authorization first we’ve never got paid up front. Some of you have actually been able to do that?

[Tom]

Thanks, Andy. Not sure I’ve ever heard it explained so nicely.

[Tom]

Salman, if you have Mitchell 1 combined with Mitchell On-Demand you should be able to handle everything.

[Tom]

Jay, here are my thoughts:

1: Above average sales and average per car.

2: Considering volume and a 40 year history, the odds of that are pretty slim. While there are bad players in any industry, most “facts” about auto repair ripoff are mythical. Once you become immersed in the business you will better be able to answer that question.

3: Typically customer loss would be minimal unless he was heavily personally involved with the customer base. A good reference from him about you to the customers would be great.

4: Research your many options in the directories on the left side of the home page on this site for management, advisor and technician training.

HTH

[Tom]

Howstuffworks.com is perfect for this. I searched “brakes” and here is the result:

https://www.howstuffworks.com/search.php?terms=Brakes

 

[Tom]

You can do it either way depending on what you use for a labor GP goal.

The most common method in the U.S. would to be not to include it because if you do then you really should include all other employee costs of all kinds which can vary from one shop to another so it becomes difficult to compare them accurately.

A typical range here would be a GP of 70% – 74% if they are not included. If I am grasping the math correctly your labor GP would need to be in the 77% – 81% range to accomplish the same profit.

Hope that helps!

[Tom]

C.A.S.

It was 1994, the system was DOS and included a computer and a “scope” that communicated with the management system. It was changed to Windows95 early in 1995.

About $70,000 when all was said and done (really).

The company disappeared (not sure exactly what happened) and the software was reborn as Mitchell 1 / Shop Key. Other reborn versions emerged as Certinet and ACDelco WISE.

[Tom]

I think you listed the main ones. You could add car count, effective rate, new customers, and this year vs. last year. This is one of those things where some shops track one number and the next shop tracks 100+ in a complex spreadsheet.

My thoughts on which are most critical:

Gross sales

Gross profit

Average RO

Closing ratio

Compared to previous week or month or year.

Most or all of the math should already be done in reports in a shop’s management software.

It’s easy to ignore it and just as easy to over complicate it – especially with numbers that are reviewed weekly.

[Tom]

Many shops avoid the parts and labor pricing issue by employing job pricing in their software where parts and labor are listed separately, but they are not priced separately. Example:

Water pump
Belt
Coolant
Labor
Total $423.59

There is no rational reason to break out the prices unless the law dictates it. And, if that is the case, the law in your area should be changed. Itemized bill? Of course. Parts numbers? No. Labor times? No. Individual prices? No. You got authorization for the repair at $432.59. You listed each item and did what you promised. End of story.

[Tom]

Maybe a reality check would help.

Is Amazon going to offer packages where you buy your steak and take it to the local Amazon partner restaurant to grille it? Nope – because Amazon would tell you that’s ridiculous.

Everything Amazon does is not brilliant by default. They can do really dumb stuff just like anyone else.

I thought Marcus Lemonis to be a business genius. Then he announced recently that Trump supporters are not welcome in Camping World stores where he is the CEO. That’s about half the population and I suspect that its the half who camps more than the other. In 40 years of running a business, I cannot think of anyone of over a hundred people we have employed who would have been dumb enough to do that.

It won’t be too long before Amazon pulls the plug on this fiasco after a cascade of b——- customers. We’ve all had the frustrated caller who wants to know why all the shops that he has called won’t install his part. Sure, a few will. But these are the sinking ships desperate to get any kind of sale.

The original Amazon program was different. We signed up to see how it worked. It attracted the worst of the worst customers from hell. We soon cancelled.

Bottom line – when Amazon calls, just say “no”.

[Tom]

Regarding Joseph Automotive’s comment about an Amazon door rate of $400 per hour…

While that may be a bit high, the reality is that a solidly profitable shop in the Midwest U.S requires $110 to $130 per sold hour in gross profit dollars from both labor and parts together.

So, if all parts profit is eliminated, that leaves only labor profit. A shop would need to add the cost of a tech during that sold hour to get the needed GP. Plus the 20% cut that Amazon gets.

Do the math and see what the labor will need to be.

 

[Tom]

Larry, I think very, very few people realize how huge this issue is and the impact of what is coming.

Bottom line is that the government is going to have to stop paying people not to work, but I have heard no one bring that up in any significant way.

Much wailing and gnashing of teeth coming soon due to all this.

[Tom]

If there is anything at all that you want the techs to handle when the car is completed, put it on a checklist. Ideally, the checklist is a job kit/canned job in your software that is applied to every RO every time. Tech does not get next car until checklist is done. In some software the checklist can be mandatory, so if all lines are not checked off, the RO does not move to the “work completed” status. One line says: “Any additional parts used?” Another line says: “Any parts that were on RO NOT used?” If no, that line is done. If yes, a field opens to record details. You can have one list for the tech and another for the shop foreman who does the final quality check. It will work if you make it non-optional – period, end of story. Techs can suggest editing, come up with ideas, etc., but list must be done.

Software is the most important piece of equipment in a shop. It is the center of the hub with all spokes going out from it. Great software – if fully utilized – can massively change the efficiency in a shop.

[Tom]

The cost of upgrading your software will likely by offset just by the time you and your techs can spend making money instead of the time wasted now doing the paperwork and math. Nothing wrong with the concept of your system, but the result you want can occur with a few mouse clicks with good software. Go the the software demos page on this site – lots of companies to check out. Good luck!

Demos

https://www.automotivemanagementnetwork.com/demos/software-demos/

[Tom]

Easiest way to track is with management software that does it fully.

Always pay the techs for what they have completed so far as much as you possibly can.

Can you post a math example of what you are referring to? I’m not sure I understand it.

 

[Tom]

If recommendations are driving them away, then maybe the presentations could be better or they are not customers you want anyway. We moved to using owner’s manual for recommendations (unless something obviously has an issue). If you sell every maintenance service in the factory schedule you will have to hire more techs to handle it all. We do same inspection on all cars. Presentation is a bit softer with new customers until they get to know us.

[Tom]

FWIW, I’d say you’re way too low – and the place she had it may also be too low.

[Tom]

Successful shops typically pay their techs 25% to 35% of their effective labor rate. So, to figure out what their labor rate should be they work the numbers starting with their average tech pay per hour, then calculate what their labor rate needs to be to hit the right percentage. Example, if you wanted 30% for the tech and 70% for the shop and you paid techs $28 per hour, you would take $28 divided by 30% (.30) which would equal $93.33

[Tom]

Unbelievable. I’ll bet that wasn’t cheap.

[Tom]

Good points, Larry.

Another interesting thing about most indie shops with higher average R.O. is that it is often assumed that the shop sells a bit more on every car, however the reason is usually more that the shop tends to sell large jobs on a regular basis.

[Tom]

You offer them equal opportunity, not equal results.

You get them both the same first class sales training and may the best man/woman win.

That’s the job of a salesperson. It’s competitive and incentive based.

Here’s the first piece of advice if you are the number two service advisor, but want to be number one – watch the driveway out front and when a car pulls in go out there, greet them and ask how you can help them. (Easy to do at your shop since it’s warm year round.)