Auto Service World
Feature   July 1, 2000   by Auto Service World

MYOB: Shop Owner of Tomorrow Is Being Created Today

The installer maintenance and repair business in the future will be substantially different than today. And it has already started to change.

Everyone is aware that technology is moving forward at a rapid speed, a speed that many have difficulty keeping up to. Yet, to succeed in business, one must have a system to stay up with the latest developments.

These technological advances have already started and they will continue to change the dynamics, the look, and the day-to-day workings of the successful installer business.

Consider that a fully interactive, computerized vehicle will require technicians who are more highly skilled in diagnosing and repairing problems. Consider the extreme shortage of technicians currently in our industry. Consider that the number of aftermarket parts will double over the next seven years. Then consider the increasing amount of equipment that will be required per vehicle; specialty tools are increasingly becoming the norm.

Then there is the whole issue of the communication skills required by installer management to inform and educate a better-educated customer base.

If you also accept that the average installer in Canada does not have a vision of his future, but only lives for today or this season, and that his technical competency is not accompanied by an equivalent level of business management skills, you can begin to see the problem ahead.

The successful installer in the years 2005 to 2008–let’s call him the Shop Owner of Tomorrow–will be a highly informed, motivated, and focused individual. It is very possible he will have a business degree. This installer will be demanding in all his professional business relationships, because he must rely on other competent people to carry out important functions, insisting that everyone take responsibility to participate within the business to ensure that the business is financially successful.

This installer will professionally manage a larger facility, with a minimum of six to eight hoists under one roof. The size of the facility will allow the business to house an inventory to meet its average day-to-day needs, based on the customer base it is targeting; and this inventory will be closely monitored and assessed for minimum pre-set turnover levels.

The equipment will be very high tech, very expensive, and very numerous within this facility. The facility itself will be very clean, as the equipment itself will require a clean environment to ensure its maximum performance and the proper life span of the software and hardware.

The shop will be fully wired with computer terminals up front in the sales area (customer waiting area), linked to the Internet for customer use. The installer business will actively market its website, which is managed for it, updated frequently, and provides its customers with very useful information. Customers will return to the installer’s website frequently because of the value that the site offers.

There will be numerous terminals in specific areas of the shop designated for on-going technical training and updating management information. They will also be linked to their jobber/supplier for on-line ordering.

Management of this shop will have a very good understanding of its highly paid staff, and will have a close working relationship with them. This will ensure the business retains competent people with a career mindset, who participate actively in achieving the company’s vision and goals. Professionalism and pride will run throughout the installer’s business facility.

Think this sounds too far-fetched? Seriously consider it, because it is starting to happen now.

The average jobber must assess his business and determine what he is doing to ensure he is capable and competent enough to attract and work with the best installer customers. Jobbers running a business that relies strictly on low-pricing policies, pushing white-box parts because they are the cheapest price, will not attract the best installers or even be capable of working with them. If the jobber relies totally on today’s installer customers for his future, then the very longevity of the jobber business could be in question, as many of the one, two, and three-bay installers will not exist in six years time.

The jobber must ask what he offers his best installers that other jobbers do not or cannot:

Does he understand the installer customers’ business and their vision enough to ensure that his business can grow profitably?

Can he integrate that with an understanding of his role, as a jobber, within that business operation?

Do his marketplace representatives counsel his customers on their business?

Does he discuss and counsel his installers on financial issues such as establishing proper labor rates, establishing tier pricing, technician labor productivity, gross profit management, sales mix management, accounts receivable management, inventory management, environmental concerns; does he provide environmental information, and assist with niche marketing?

Does he truly provide services and add value for those installers who make him their first call?

The professional installer of today, and especially of tomorrow, is looking to do business on a business level, not just a sales level. There are too many areas of the business where problems can occur and lead to financial hardship and even the possible loss of the business.

The jobber and installer business is getting too complicated to just rely on low margin sales. This only creates volume, and everyone works too hard at not making any money, instead of working smart. Financial failure of the business becomes a strong reality when this happens. Relying solely on 1980s thinking is a proven road to failure. Your jobber business, like the installer’s business, grows in direct proportion to the quality of the relationship you develop with your chosen customer base.

In business today we all must understand that change is not an option. Your entrepreneurship must start showing today in order to capture the client of tomorrow. If you don’t … what is your alternative?

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