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Nine Ways to Improve Your Bottom Line

Joe Marconi

Entry posted by Joe Marconi in Management

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The strategies outlined in this blog reflect real-world strategies I have learned and used in my 41 years as an auto shop owner. I also use these strategies when helping clients as a business development coach. 

While running a successful auto repair shop today has many components, the list below contains the top 9 strategies I believe every auto shop owner should consider when looking for ways to improve their bottom-line profit. 

Ten Ways to Improve Your Bottom Line:

  1. Hire the best people and have enough staff. You will have a much easier time achieving success when you’re surrounded by the right people.
  2. Calculate your correct labor rate and adjust that labor rate every quarter.
  3. Charge a higher labor rate for jobs that do not include any parts, such as electrical testing, check engine lights, onboard computer issues, and drivability problems. The missing part profit must be made up somewhere.
  4. Review and refine your checklists and procedures to improve overall efficiency.
  5. Make sure all your equipment is working correctly and that you have the equipment and tools needed for the vehicles you service and repair.
  6. Make sure your part margins allow for a respectable gross profit.  
  7. Make sure your inventory is up to date, with up-to-date pricing, and you don’t have too much stock sitting on the shelf.
  8. Make sure you have a process to get the proper credit for part cores, returned parts, and defective parts.
  9. Invest in ongoing training for all employees.

BONUS TIP: Speak to your accountant and business coach about tax planning strategies. But do not wait until tax season. Tax planning should be done throughout the year.

I hope you found this information helpful.

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Transmission Repair

Transmission Repair 412

Posted

Great tips, Joe!  I wish I had those tips when I was in business before I retired.  The one tip the I, as well as most shop owners struggle with is "Hire the best people and have enough staff."  Easier said than done.  I hooked up with 3 automotive technical colleges in our region with limited success.  They were 

Automotive Technology | Transportation Technologies | Utah Valley University

 

Automotive Technology

 

I still had to train the students as if they were green off the street.  That part didn't bother me.  What bothered me was the unrealistic expectations the student had as far as production and salary expectations.  The students couldn't grasp what a major investment we were making in training them.  They weren't used to working alone and having production expectations put on them.  After many years, I went back to hiring out of the industry and paying above normal salaries/hourly pay to attract the best of the best.

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Joe Marconi

Joe Marconi 1,349

Posted

35 minutes ago, Transmission Repair said:

Great tips, Joe!  I wish I had those tips when I was in business before I retired.  The one tip the I, as well as most shop owners struggle with is "Hire the best people and have enough staff."  Easier said than done.  I hooked up with 3 automotive technical colleges in our region with limited success.  They were 

Automotive Technology | Transportation Technologies | Utah Valley University

 

Automotive Technology

 

I still had to train the students as if they were green off the street.  That part didn't bother me.  What bothered me was the unrealistic expectations the student had as far as production and salary expectations.  The students couldn't grasp what a major investment we were making in training them.  They weren't used to working alone and having production expectations put on them.  After many years, I went back to hiring out of the industry and paying above normal salaries/hourly pay to attract the best of the best.

Surrounding yourself with the best people is something that is critical to all businesses. And there are many shop owners that have a difficult time getting the right people.  However, it's the first step to success for any organization. After that, it's the leadership of the company.  Too many leaders Demotivate their employees.  But that's a topic for another post! 

Thanks Larry, for your comments! 

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