Salary or flat rate, how do you do it...

[328ijunkie]

We currently run our 3 techs salary as the variability/predictability of our jobs coming in I don't feel is fair for the techs, some days they work 8 hours on a huge projext that we're not making a ton of money on and other days they'll bill 10-12 hours in a day. We can't really justify to them that flat rate will be better for them. On the other hand they occasionally have motivation problems when on salary....

[mspecperformance]

We currently run our 3 techs salary as the variability/predictability of our jobs coming in I don't feel is fair for the techs, some days they work 8 hours on a huge projext that we're not making a ton of money on and other days they'll bill 10-12 hours in a day. We can't really justify to them that flat rate will be better for them. On the other hand they occasionally have motivation problems when on salary....

 

 

Maybe the problem is those huge jobs that you aren't making money on?

 

This has been a problem for us that we have since tried to correct. Every job we take in now we want to make it profitable which means charging the right amount. If a big engine swap or complicated modifications are eating away tons of time you should charge for it. Being that you have a lot of enthusiast based customers that price shop between other enthusiast/forum shops I know it is easy to bring your pricing down in line with what your customers expect. For my shop if we look at a job we can't make money on we either quote high to cover our end or we send it away. Sending business away has honestly been one of the top changes that have impacted my business in a tremendously positive way.

[Mario]

I just pay hourly. I find it too difficult and unfair in my area to pay flat rate. We deal with too much rust, cars are older, the wide range of vehicles we work on (Ford, GM, BMW, VW) I can't expect my techs to be a speed wizard on every make & model.

 

I tried paying flat rate, and had a good tech quit because he was not making what he needed. A combination of all of the above. I'd rather have the vehicles fixed correctly with little to no comebacks (come backs are very rare here). Nothing I hate more then having to fix/adjust/tinker with a completed job after the fact because somebody tried to "beat the book".

[Bob K]

I agree. I'm in the rust belt too. I pay hourly plus a monthly bonus to my techs for achieving a specific sales number. I use a parts matrix to ensure proper parts margin and am now focusing on increasing labor hours billed. Everyone benefits. No arguing over who gets the best jobs.

[328ijunkie]

Were luckily down south so that isnt an issue here for the most part...

The big jobs that hurt us overall are mainly the problem and we bill as appropriately for them as we can but the market will only bare so much..

[mspecperformance]

Were luckily down south so that isnt an issue here for the most part...

The big jobs that hurt us overall are mainly the problem and we bill as appropriately for them as we can but the market will only bare so much..

 

 

I would suggest you sit down and make a decision on whether or not these big projects will be profitable enough for you to grow and sustain your business. For me and my shop, we looked at what we were doing and saw it for what it was which was a big waste of time. To make big builds profitable, you would have to be charging 10-20k per job for the amount of actual hours you put in let alone the time when the cars sit on your lifts or in your shop taking up valuable space that you are losing money on every second they are there.