mspecperformance

Pricing is a hot topic as always. Food for thought though, when was the last time someone scrutinized what your hourly labor charge was? More often than not if a customer has a problem with pricing its either a comparable from another shop's estimate or its a blanket statement of, "Thats expensive" or "Thats too high" or something along those lines. I live by the rule of thumb that if you are providing high enough matching value then the RIGHT customers won't complain (the majority of the time). The rare cases you may have a bottom feeder customer that won't be happy unless you take a few dollars out of your own wallet to fix their car. Otherwise I have never had a problem with labor rate increases. I've done probably 5-6 in the last 5 years.

There are many CRM companies out there both automotive industry specific and broad based. I heard Fredrick is gaining traction. There is also Mitchell CRM and MechanicNet I think. There are a bunch. I used DemandForce years ago and I hated them.

It really depends on your business model. To hit industry target numbers you are looking at getting an average GP on parts of about 50%. If there are lot of dealer parts in your mix and you are not comfortable charging over "list" then you better make sure your labor GP will make up the difference. Essentially all you would be doing is hiding the profit in your labor so you can show your customers a lower parts price. I personally have not had an issue with any customers bringing up the price on our parts. We charge higher than list on dealer parts but we also provide a much longer warranty and an expert certified technician that is performing the service on their vehicle. They get our continued support as a client after the service. Our customers see it as a win and vote with their dollars. Also let us not forget that when you take your car to the dealer for service, you are paying over list for the parts portion of your ticket. If you aren't then that is a poorly ran dealer and you bet your ass their profit margins are in the toilet!

Honestly I don't really have a favorite. I like the more literal logos but everyone seems to like the wrench and piston logo!

I've read Influence and I can only imagine its more powerful as an audiobook. I have his latest book Pre-suasion is on my list.

http://www.designcrowd.com/vote/essential-auto-care-logo-poll

Hey ASO community, we are planning on opening a general repair shop and we had some logos created. Please vote and help us narrow down our choice. Any feedback is greatly appreciated! http://www.designcrowd.com/vote/essential-auto-care-logo-poll

I get a many non Euro requests as I do Euro requests. People don't seem to read very well on average as we have nothing on our page that indicates we work on anything but Euro. The positive is we have has such a positive response for non Euro (and amongst other sources) that it has prompted us to start a general repair shop as a second brand. Lets see how that goes LOL

PAP, what model rack did you get?

Jay I understand your logic however I would be wary if I didn't have a better plan of how my car count, ARO and profitability would look like beyond the 2-3 months of free rent. That's why having the right marketing plan and projections is of particular importance to me.

It all depends on how you analyze your financials. For tax purposes we have to all file our figures accordingly so nothing is different when it comes down to filling out IRS paperwork. With that being said there is nothing inherently wrong with setting up your P&L to show labor costs as an expense and not apart of COGS. You would just have to come up with a system and key metrics to track your numbers differently. I think most of the aftermarket indy industry at large is used to calculating labor as COGS so it's much easier to relate financials and also get great ideas from different sources. It still doesn't take a genius to figure out your own calculations. Bottomline is the bottomline. If you are making money consistently and have a repeatable and explainable system then who cares. In regards to "cheap" oil change. I believe that the biggest gripe is not with the business practice itself not working but rather the perception that it devalues the industry as a whole with discounting and the "cheap" mentality. I have to admit I have definitely struggled with this concept mightily over the years. I think part of the problem I have is that virtually 100% of the shops around me that have a culture of discounting and using price tactics are horrible operations and are a black eye to the industry at large. The strategy works. There is no denying that. Look at Greg Sands and the 100's of shops he has operated.

You are calculating everything by total sales from all locations? It may help if you do more of a breakout per location. I was mainly interested in how fast you are getting your stores up and what kind of car count and ARO you are seeing from them. I see that you are opening #3 which is impressive. I am in the middle of expansion myself. I have a very robust plan that I've been working on for the better part of the year but I am always looking to improve it. As you probably are aware since you've expanded, getting the car count and numbers up when launching is extremely crucial for cash flow. Your number seem extremely low for 2 stores, how are you handling the expenses? It might be just a different in area that I am not taking into account. Thanks for sharing your numbers by the way

Did you flush mount your alignment rack?

What has been your experience with car count and ARO for your first month up to 3 months?

Jay, what kind of marketing are you doing especially for launching the new shops?

btw I love your business! I remember when you guys just joined the forum and to see the evolution of TrackSpec is impressive!

I was trying to avoid ikea but that looks great! I totally dig the idea of making the waiting room almost like a nice home living room.

Anyone have any good suggestions on furniture for the waiting area? Stuff like Service counters, waiting furniture, refreshment table? I like the seamless look with units that have space for a fridge and integrated waste receptacle. I've looked at what NAPA Auto Care has as well as Bosch. I am a bit iffy on that stuff and its ridiculous expensive for laminate furniture. Anyone else have any ideas?

I'm not sure if its really catching on where I am at. When we launch our General Repair I will look into it a bit further. I would need to really see some ROI.

Everyone loves an asian boy, or at least thats what it says on my T-Shirt

OMgoodness its going to an asian triad meeting of shop owners LMAO. The universe is about to implode. I think RW has selected me to be the token asian for the industry. That looks pretty interesting, I think I'll look into this! Just make sure you roll out the air mattress for me Tristan lol

Hi Jay, I mean completely no disrespect and I just wanted to lay that out there because text can be misconstrued... When you mention your break even point for an oil change is 19.99 it kind of gets alarm bells going off in my head. Are you calculating your costs correctly? What is the oil costing? What is the filter costing you? How about the technician? Are you calculating their labor cost properly? Are you giving them additional pay/time (if you pay flat) for the inspection portion? Do you have just a lube guy do all your oil changes? Even if I were to offer a 19.99 oil change, my costs including my tech even with the crappiest oil would probably somewhere around $30-40 I am assuming. I am just asking because it has been an absolute mystery to me how you are making enough money to open several locations in such a short period of time with such a low labor rate and charging such low prices on for instance: brakes. I have done the numbers several times and it is nearly impossible for me to figure out how you are profitable unless certain assumptions such as you are paying a low salary to your employees (low payroll) and you are keep an insanely high car count with a decent ARO. I want to know your secret lol. If its cool send me a PM with your gross sale and net profit. I am genuinely curious.

Ouch! That really sucks. I havent played with a labor matrix as mitchell doesnt employ one but I can totally see what you are talking about.

Thanks for sharing some of your numbers more in depth! It definitely helps give some perspective. My current shop is a Euro only so our KPIs work a little differently. I admittedly have no experience with general repair and higher car count operations. I think the cheap oil change as a loss leader used with the correct sales system will work. I'm sure nothing else about your operation says "CHEAP" and you are selling value above all else. Off topic, what shop software are you using and what was the "glitch" you found?

since Anderson did volunteer some his numbers, I would like to see what his his true net is for his business, not his property included. At least then we could speak apples to apples. I totally get what you mean by what you are getting per employee. It does make a lot of sense as I am for a more lean model with less payroll which means maximizing on my staff's abilities. In the way it was explained to me which makes a lot of sense, you do everything you can to sift through oil change customers and build them into repair customers. I believe it can be done with the proper attitude and system. I'm excited to try it at least.