Ontario Automotive Service Providers Forum: Making Your Shop Profitable

To improve your bottom line, automotive repair shops need structure, benchmarks and strategies.

“We have to stop selling,” said Dave Meunier, president of TACT during his Automotive Industries Association (AIA) of Canada’s Service Providers Forum session. “We got lost, totally lost. We’re a service industry, not a discount retail industry.”

Meunier explains that in the ’70s when mechanics were on par in terms of pay with electricians and plumbers, technicians were racing cars in their free time.

“We’ve lost that passion and have been living in an oppressed industry,” he said.

Of course, back then most independent service shops had also sold gasoline. The owner or technicians would go out and interact with the customers as they filled the tank. At the same time, electricians and plumbers were building their businesses by word of mouth and great service.

Take the gas retail aspect away, and now shops seem to be divided between the service counter and the shop floor.

Technicians aren’t used to talking to people and working the counter, but that’s where shop operations are heading.

Meunier referred to the dental industry as model to base shop operations on.

“When you go into the dentist, do you leave without a next appointment?” asks Meunier. “No. And who tells you that you need to come in again? The dentist, not the receptionist.”

Often when one visits the dentist, x-rays and an exam occur to diagnose the problem. Once a list of “repairs” are determined, the dentist discusses what needs to be done, how much it will cost and how these treatments can be carried out in the near future. Not too often do you hear a dentist say, “well it’s going to cost you a $1,000, and I have time now so open wide.”

Meunier suggests taking notes from this form of consultation and future bookings.

Instead of rambling off $2,000 in repairs to a customer that just came in for an oil change, Meunier advises to do the oil change and communicate with the customer that there are repairs needed to keep the car in good running condition.

Tell the customer—like the dentist—what needs to be done. And say you’re booked today, but let’s book you in for a couple visits. Give them an estimate of what it will cost, to help them budget for the repairs.

Meunier said that too often, when he’s taken this approach, the customer wants to do the repair right away. “If you say that you’re booked, the opposite reaction happens and they want you to fit them in.”

Another note from dentistry, get your technician to talk to the customer about what they found, what needs repair and why, not the service counter.

Another glitch in the service industry is when it can take a technician multiple hours to diagnose a problem, and perhaps, a few minutes and $25 to repair it. Too many shops don’t bill for that time. But why not?

Besides, the true art of the trade is in diagnosing problems and having a solution. Technicians are not just parts replacement professionals.

“Do you think a plumber charges for his time to drive to the job, inspection and repair? Yes,” said Meunier. “At some point we stopped charging for knowledge”

At Meunier’s 10-bay shop in Edmonton, Alta., it offers a 12-minute visual inspection for free. This is to make customers aware of current or progressing problems that will require repair. The shop also offers a menu of inspections at a cost.

Meunier said, “We don’t have to sell because we don’t make the cars break down or cause the problems. We’re the ones that can fix them.”