There are too many shop owners who prefer the feeling of a job well done over a financial reward when it comes to repairing vehicles, shop coaches suggest. That’s why they hesitate to raise their shop’s rates.
While that’s a nice thought, it’s no way to run a business observed Cecil Bullard, CEO of The Institute for Automotive Business Excellence, and Vik Tarasik, managing partner of Shop Owner Coach.
“The shop owner, in a lot of cases, is a guy who gets satisfaction out of fixing the car,” Tarasik said during the Shop Coach AMA (Ask Me Anything) panel at AAPEX 2021. “To him, the reward is not financial — it’s in a job well done.”
He admitted that he was one of the shop owners he just described until his own coach turned him around. He equated the idea to losing weight — most would like to lose weight but they won’t want to do the workout. If you want a better shop, are you willing to put the work in?
Bullard agreed. He sees that, for many, the reward is in the finished product. “I fixed that thing. It came in, it didn’t run or it ran poorly and I put my hands on it. It’s magic. I am ‘the man,’” is how he described the mindset of some shop owners.
Bullard went on to describe some shop owners as those who believe they’re doing good in the community by offering vehicle maintenance and repair at low prices.
“I think sometimes we think, ‘Well, if I’m making a profit, then that’s a dishonest thing. It’s not a good thing,’” he said. “That it’s morally corrupt to make $300,000 a year.”
He pressed the fact that it’s not wrong or corrupt to make a good living, especially doing something you enjoy.
“If you’re taking care of your customers and taking good care of your employees and their families, then you’re doing an honourable thing,” Bullard said.
What is dishonest is not telling a customer the whole story of their repair because you feel back about them spending money on their vehicle, he noted.
“I think it’s dishonest to tell the customer about $1,000 worth of work because you think they’re going to buy that when the car needs $5,000,” Bullard said.
One thing about knowing what you should charge in order to be profitable is to look at all criteria effecting profitability. What about your market competition? If they are offering cheaper rates it will effect those of us that charge for what we do. With the economy in its current state people are drawn to places with cheaper prices.
And it’s unsettling sometimes to increase our labour rates as we believe a fair labour rate is good draw for repeat business. for most jobs customers Costs don’t increase dramatically as we increase our labour rates 10 per hour might make you twenty dollars more for a set of brake pads and rotors installed but add up all your monthly hours times ten dollars and wow. I’m rural now and can afford to run at less than I do but charge 120 per hour to my neighbours 140 for strangers my local dealerships are all 140 ish and local shops range from 60 to 140