Dollars and Sense

Not Happy With Your Bottom Line? Then Change It!

By Bob Greenwood

Shops across the Atlantic region struggle every year as they hold on to the business methodology of the 80s and 90s. This mindset and business process is playing havoc with the shop’s profitability and alsO leading to undesired stress in family lives

Why not sit down and resolve in your own mind to change the businesses bottom- line profitability by working on only three things for the year 2010.

It has nothing to do with increasing prices but everything to do with internal processes.

Consider implementing your self discipline to make sure these items are seamless by the summer of 2010. You can do it, but it will require self discipline and personal resolve not to give up. It will also require increased communication and discussion within the entire shop. Embrace this challenge and watch your bottom-line move like it never has before.

1. Coach and Build a Team:

Shop management and staff must recognize that their future incomes will rely on the success of all of them working together as a team. Each player brings a skill and attitude to the shop and has a
responsibility to the team to do their very best with every shift. The score card will be customer/client reactions coupled with measuring the increase in the team’s overall
pay cheques.

Consider that we, as an industry sector are no longer in the break down and repair business as the mainstay of our business but now we are in the maintenance and service business looking after
very high-tech vehicles. It is no longer our job to sell a repair but we now realize it is our professional responsibility to advise the client who hires us for our advice and counsel based on the client’s situation. This is why fully completed vehicle inspections must be performed and properly documented. If the front counter does not have all the facts, then the relationship
of trust cannot be built by allowing professional counselling to take place.

It’s also time to get away from the old bonus programs and flat rate concept and move to a shop profit sharing plan. The old processes only promoted an “all about me” attitude, created internal jealousy, and offered nothing about serving the client in a professional way. Under a shop profit sharing plan each player of the team will be paid their hourly wage based on the skill they bring to the shop, however, everyone from the top technician to the bookkeeper will be involved in the shop’s profit sharing program. When management understands how to implement this and the staff understands how it works, then not only does the client see a big difference in their experience visiting the shop but everyone’s pay cheques move in the right direction.

2. Capture time properly

Time clocks must be installed throughout the shop for each technician and used properly. Too many people have been taught that the clock process was to only monitor the technician. I respectfully disagree. A time clock today monitors each function that is performed on the vehicle. This is part of our professional documentation ensuring the time spent is accurate compared to the time sold. If the technician runs into an unforeseen problem as a seized bolt that ends up taking another half hour on that function, the right documentation to show the client what happened is now in place. It was not the shop’s fault a seized bolt occurred and that extra time must be paid for. Without proper documentation on file, it would become a problem at the front counter and potentially harm or even destroy the relationship with the client.

3. Ensure Proper Front Counter Billing

Too many shops do not bill/invoice correctly. This is partly due to the fact that management perceives “price” is everything and the only thing to retain a client. Again, I disagree. A customer wants value for the price paid. Define the value your shop brings to the marketplace and where the clients in your area are located who are looking for the value your shop offers.

Consider this very simple business fact: you cannot discount yourself into prosperity! You just keep busy, but you do not make any money for the time and effort put in. You buy yourself a job.

When the front counter slows the process down, has all the documented facts from the technicians and understands the client’s personal parameters with their vehicle, the service advisor can now counsel to the client’s best interest to ensure the vehicle remains safe and reliable.

Consider that slowing the process down and billing accurately for the labour services rendered, coupled with a clear explanation of all performed duties, allows the client to fully see your skill and professionalism and understand all the parameters of their vehicle. When the front counter rushes the process, then billings are missed and customers are rushed through a process that leaves a bad taste in the their mouth.

Work on making 2010 one of the best years of the past five. I’m confident hen everyone in the shop comes together to learn and discuss the new business realities, not only will the clients be thanking you, the teams pay cheques will increase and the bottom-line of the shop dramatically improves. This continuous profitability provides the funds to move the shop forward into the high-tech future.

Much, much more in the print addition of Auto Atlantic.
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