Digital Days

There is no escaping the fact that this is the digital age of automotive repair. Digital diagnostic tools take their place beside carts of hand tools, computer chips record vehicle operating parameters and customers pay for work with the swipe of magnetic stripes on their credit cards.

But these digital days don’t always manifest themselves at the front door.

“There’s still a lot of small mom-and-pop shops that have no computerization at the Point of Sale (POS). They may only be using some off-the-shelf accounting product on the back end,” says Bill Colman, president of COSTAR Computer Systems. And other shops still stuff invoices into shoeboxes under the counter.

But today’s shop management software offers much more than a terminal to spit out Repair Orders. Reporting tools can analyze the profitability of a specific job or your entire business. Systems can be integrated with digital catalogues and drop-down menus, limiting the mistakes that come with clumsy keystrokes when employees are ordering parts. And customer histories can be archived and checked whenever a car darkens the door of a service bay.

If the systems are used properly, the information can translate into higher profits.

“The smaller the shop, the more they really need a sophisticated tool to manage their business, because they’re not turning the jobs they should be turning,” Nick DiVerde marketing director for Mitchell1 says. “They’re operating with a staff that wears many hats, and often they’ll write a business and they’re not cognizant of the profit margin they need to maintain.”

“Their POS (Point of Sale) is no longer just a glorified calculator,” adds Richard Lewis, director of sales, North America, for Janco International. “It’s more data, it’s technical information at their fingertips.”

With the right information, a small shop can ensure that its door rates are competitive with those charged by larger dealerships down the road, he says, referring to the need to access up-to-date price lists. “There was high profitability in parts, and that’s not true anymore. You can buy brake pads today for $7.99 to fit almost any make and model of vehicle. In the past they were $29… You can’t just take a part and round it up 65 per cent.”

“It’s absolutely critical to have a piece of software that integrates your POS (Point of Sale system) with inventory control and back-end accounting,” Colman suggests. “Otherwise it’s too labor-intensive and too error-prone… you’ll have some sort of duplication.”

Equally, customers need to be moved in and out of the shop as quickly as possible.

To meet this need, users of the Mitchell1 system can match symptoms with associated diagnostic times, says product manager Brian Warfield.

But the presence of the software isn’t everything. Many shops aren’t taking advantage of the tools at their disposal.

“I’ll bet you 50 per cent of the systems aren’t used to their full extent,” says Bob Worts of Carrus Technologies, which offers business-specific AutoWay, CollisionWay and GlassWay shop management tools. And the most common area to be overlooked tends to be marketing tools.

“It’s a lot cheaper to keep the existing customers you have,” says Rich Diegle, a spokesman for ALLDATA, which includes its ServiceCenter product in ALLDATA Online and DVD subscriptions. “But they’re just worried about getting people in the door and they aren’t looking down the road.”

Several software packages include marketing programs that can draw on service histories. Lankar Systems’ Automotive Business Management System (ABMS) that’s used by clients including Mr. Transmission, Bestbuy Auto Parts and Bumper to Bumper, for example, also includes quarterly mailers or emailers. And technicians can access a report on jobs that customers passed on when they were last in the shop. Carrus, meanwhile, has the added benefit of being built on a bilingual backbone, meaning that customers can receive documents in French even if the data has been entered in English.

Then again, the systems are only as good as the information that’s been entered in the first place.

“How many times have you seen a bill that said ‘Mr. Smith’ or ‘Counter Sale’?” Lewis asks, referring to how many employees don’t enter the required information at the first point of contact with a customer.”

The key here is to ensure that all information is entered correctly with the first point of contact with a customer, he says.

It’s why systems should be judged on the ease of data entry. Janco, for example, offers the ability to correct single data fields without having to re-type an entire form.

“You don’t have to be a typist anymore,” Lewis adds, referring to drop-down menus. “Most mechanics just hate typing anything. We’re all trying to get rid of the garbage in, garbage out, by getting rid of the spelling errors.”

Of course, it’s just as important to track the money that you’re paying out.

“Some of the shops, these guys still have invoices hanging around from parts suppliers and they’re waiting to type them in,” says Diegle. But a tracked inventory can help make future decisions regarding parts. “Such as how many water pumps did I sell for a Honda Accord in the past six months? It might be something you want to keep on the shelf.”

Worts says some shops are also reluctant to run the productivity reports that can demonstrate how each employee is performing. “And what happens if I’ve only booked 40 hours of work?” he asks. “What do I do with my employees? Let them play cards? No, I send them home.”

A scheduling component of his company’s system also books required time in the service bay, and allows managers to note when specialists aren’t in the shop — meaning that there’s no worry of scheduling a repair for a time that they aren’t available.

So, too, can the management systems ensure that employees charge for every part associated with a job.

“This is the biggest area where guys lose money,” Worts says. “Look at the number of times you go through an exhaust install and see the number of times they forget to put clamps on the work order.”

But perhaps the most important step is to ensure that employees are properly trained to use the systems.

“If they looked at the shop management system the same way they look at the new high-tech alignment machine they have in the back, that’s where the difference can be made,” Colman adds. “When you look at an auto repair shop, they wouldn’t think of bringing in a piece of diagnostic equipment without training people how to use it.”

The introduction of new software requires a culture shift, he suggests. “We find it is never dollars. It’s about, ‘Do I have the time?’ ‘Can I make the commitment?’ ‘Am I willing to invest the time?’ When people are under the gun and working 10 hours a day, it’s not an easy sell … the first few months is never easy.”

Still, the transfer to a new software system doesn’t mean that you have to scrap every record that you’ve entered into an older system. The data can often be exported into an Excel spreadsheet or a comma-delimited file — a computer file that separates each field of information with a comma — that can be added into a new system.

You just might want to think twice before going through the trouble.

“I always tell people, ‘Think of the management system you have right now. Think of that as the old filing cabinet,” DiVerde says. Not only will the software be based on a 286 or 386 microprocessor that won’t run today’s programs, the data itself is probably based on cars that customers don’t even own anymore, he suggests.

Shop owners with older DOS-based systems are the ones most likely to face the problem, Lankar says. They don’t have drop-down menus or lists from which to work. “I’d say most shop owners now are putting real good data in the systems … that problem has kind of gone away ever since the advent of Windows.”

Equally, it’s important to purchase a name-brand, business-grade computers, they say.

“Computers break down into two categories — home computers for the hobbiest, or business grade,” DiVerde says. That means more robust hardware, and
additional memory. The motherboards are made with better components; the network cards will carry names such as 3Com or Intel.

An 80 Gb hard drive will hold a decade of service histories for a shop that does $1.2 million in business every year, Lewis adds.

Computers that can read DVDs as well as CD-ROMs are also able to access libraries such as information from ALLDATA using fewer disks, he says. “They’ll tend to last. You’re not pushing them in and out of the driver.”

“It’s a tool, and the tool is only as good as you know how to use it… the more time you put in up front, the more success you’re going to see.”

For more information on shop management software systems, visit suppliers at the following Web sites:

ALLDATA ServiceCenter

CAR Systems Inc.

www.carsystems.ca

Carrus Technologies AutoWay

http://www.carrustechnologies.com

COSTAR Computer Systems

www.costar.ca

Janco International StockTrac

www.jancointernational.com

Lankar ABMS

www.lankar.com

Mitchell1 On Demand 5 Manager

www.mitchell1.com