Auto Service World
Feature   October 1, 2006   by Jim Anderton, Technical Editor

Don’t Forget the Details

Getting the most out of an electronic database and management system requires attention to the little things

Compared to first generation electronic repair databases and business management software, today’s shop owners have it easy. The days of hiring expensive consultants and memorizing dozens of DOS commands have been replaced with Windows-based graphical user interfaces and CD-based software that self-extracts, installs and updates automatically. Ten years ago the industry advertised “plug-and-play,” but today’s systems deliver it, with on-line packages that are moving valuable data off the garage floor and office and into cyberspace. To be a progressive business, Canadian shops simply have to have computer-based repair and management systems.

With second and third generation systems now replacing those early Windows and DOS-based systems, shop owners typically wonder how the new technology can be implemented with minimal disruption to the business and with the lowest possible cost. Here are some of the typical issues:

Will I need a new computer?

Very often, the answer is ‘No.’ With collapsing prices on late-model Pentium or equivalent processor-based computers and the need for speed driven by the Internet, many shops are already ahead of the curve before they upgrade business software. Is new hardware a necessity for a reliable installation?

“No, there really is no advantage,” declares Danny Lankar, president of Autogence, Inc. in Concord Ont., producers of the Lankar shop management software. “(Shop owners) will buy the hardware when they want to upgrade. They should always buy hardware to push the software. If their existing hardware can run the software, there’s no advantage to upgrading at that time.”

But with hardware now forming a relatively small proportion of the overall system cost (consisting of hardware, software, training and the transition costs from previous systems), is a new computer essential for reliability?

“It’s completely untrue,” states Lankar, adding, “It’s all about having the power to perform the function. If you have the necessary power, changing the software won’t make a difference.”

At some point, however, hardware does become obsolete, which in the computer industry can be as little as two or three years. Says Lankar; “If the shop owner bought a computer five years ago, they might need to buy new, but they might not, depending on the power of the computer they bought initially.”

If you’re using powerful, proven hardware for your existing business and it meets the requirements of the new package, staying with it should be the lowest risk approach.

What about peripherals?

While the information is digital and might be delivered by the Internet through a wireless router, the critical point where your business interacts with customers and technicians will still be on paper. Printers are, surprisingly, often forgotten when installing or upgrading an integrated shop system.

Taylor Colman, sales representative for COSTAR Computer Systems in Sherwood Park, Alta. says unequivocally, “shop owners should be buying a business printer, not a home printer. Many shop owners go to Staples or Business Depot and purchase a printer designed for home use; it’s designed to print a couple of hundred pages a month, but as soon as they try to print multiple copies of all their invoices all the time, they discover that it’s not rugged enough and it costs a fortune in toner.”

How much technology should a shop owner consider in a printer? According to Colman, “a medium end laser business printer is a minimum.” Shop owners can expect to pay $1,000 and up, rivaling the cost of the base computer itself, but from a cost perspective, the payback should justify the investment. Advanced models also allow colour invoices, photocopying, scanning and the ability to produce short runs of colour promotional materials.

“It’s the shop owners that spend $200 to $300 on a printer that find themselves in trouble,” advises Colman. “Spend a thousand dollars, get a great printer and you’ll never have to worry about it.”

How do you shop for a printer? Purchase price is only one consideration. Cost per copy is the real metric, and should include invoices, internal documents like memos and spreadsheets, as well as printouts of tech data and diagrams from the repair database. The total number may surprise you. Consumables, mainly toner, is a major operating cost, but modern units can also replace a photocopier and also any standalone office units, reducing the overall cost. Consider extended service or warranty plans for commercial units; many require scheduled maintenance (mainly cleaning), which is normally a service call.

Is it making money?

At the end of the day, week and month, shop management software is about improving profitability. How much better, however, is your operation with the new package compared to the previous system, paper or electronic? Regardless of the efficiency of a new software installation, it’s hard to measure how much better your operation has become if there’s no way to compare with the old method’s profitability.

“Obviously there are big gains when you add a new program, especially if you’re beginning to measure technician productivity and other factors like ‘profit by job’ for the first time,” says Nick DiVerde, general manager of shop management solutions for Mitchell1 in Poway, Calif. “It’s a matter of setting benchmarks before and after. That’s where the real trouble comes in; sometimes a shop owner doesn’t have benchmarks to start with. Even at the basic level you would want to start with number of vehicles through and measure the average repair order before and after the new system is installed. You need to track repairs to pass along enough information to motorists so that they perform the work that needs to be done. Those are quick and easy measurements. Revenue for a similar time period before and after is the most basic measurement we take.”

The reporting features built into all major integrated systems are essential tools for both benchmarking and business planning. Mitchell1’s DiVerde notes that “for many shop owners the business is about fixing vehicles; the rest takes care of itself. As they make decisions about systems they should ask about what reports are available to them as built it functions. They should have someone show them how to measure progress. Better systems will have a wide variety of reports.”

While comprehensive reporting systems can measure how a business earns money, how it spends it has usually been left for the bookkeeper as an accounts payable operation. While few Canadian shops are participating yet, integrated parts ordering will likely take the telephone out of the repair bay and increase productivity at the front end of the repair process. According to Bob Worts, director of sales and marketing for Carrus Technologies Inc. in Longueuil, Que., “you can improve your margins with computers, especially with Internet part ordering. It’s a growing feature. We studied parts ordering and found that it averaged ten to fifteen minutes per vehicle to order parts. If you’re doing ten vehicles a day, that’s a lot of non-productive time.”

While widespread Internet parts ordering represents the future, most owners of modern systems still don’t take advantage of even the simpler functions available. Worts notes, “It depends on how they manage their business. If they understand the bottom line and control of margins, they’ll use more of the reporting functions than average. If they use it as an invoicing and customer follow up tool, they’ll typically use only two or three reporting features. Most shop owners who are licensed technicians and actively work on vehicles don’t use anywhere near the features they should to understand the condition of their business. If they did a weekly margin report they’d really know where they stand.”

No matter how effective the software is, most businesses use the services of a bookkeeper or accountant. If a new system is Greek to your front office number-crunchers, a shop might give back much of the newfound bay-level productivity. It pays to notify them about your purchase intentions, advises Mitchell1’s DiVerde: “You need to know what kind of information your bookkeeper or accountant needs to make sure that the system can hand it off to them.”

What about training?

The hidden costs of any productivity software, for any business, are the costs of learning the new system. Training is a necessity and is usually packaged with new or upgrade systems. Are Canadian shop owners aware of the need for training? According to Bob Worts, “most owners ask. They know that they’ll need help up front to learn what’s included and where the functions are.” Worts notes that from a training perspective, it’s not necessarily an advantage to have an older system already in place: “It’s actually easier to go from no system at all to an upgrade. When you move from one system to another everyone compares functions from the old system. They tend to understand options like reports in the format they already know. It’s a key reason for training.”

Every technician knows the difference between a finesse job and a brute force job, and purchasing integrated shop management systems is a little of both. Dollars buy power, but don’t forget the details like printers, training and reporting. Everything counts.

What’s an operating system?

A surprising number of techs and shop owners use sophisticated software daily on the job and at home, yet don’t really know what technology they’re actually using. Modern software uses an “operating system” usually a version of Microsoft Windows. To the computer, the operating system is like the English language. Just as you use your knowledge of English to read a newspaper or write a letter, your computer uses its operating system to run software and let you interpret what it says in reports, invoices, work orders and diagrams, in a form you can read. Why should you care if it’s invisible? Because trouble, like systems that crash or lock up, may be due to problems with the operating system or the business software.

If you’re installing an upgrade on your existing computer, it’s important to know the difference before calling the software provider’s help desk. Keeping your version of Windows current by downloading Microsoft’s free fixes (available on their Website) is a good start, as is using a quality anti-virus program. Check with your software provider about anti-virus/anti-spyware programs, however, since some can block your software’s access to the Internet causing crashes or slow operation. And remember that switching to on-line systems requires a speedy Internet connection. Make sure that your local broadband provider offers the speed you need, or downloads will be at best maddeningly slow.

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