Transmission Repair

It's against the law to pay less than minimum wage. If flagged hours total less then minimum wage the minimum wage would be paid. When I worked at a dealership, we had to both flag hours and punch a time clock for the actual number of hours were we were there. If the total amount we were paid, in dollars and cents, divided by the number of hours worked was less than minimum wage we would get paid minimum wage. That was our guaranteed minimum.

I have a rule to never do any kind of advertising without a tracking number attached to it. Call tracking is a measurement tool let you know what advertising works and which ones don't work.

In the transmission business, PPC is better spent getting new customers. Repeat customers in the transmission business is usually either a warranty issue or somebody with real bad luck.

I agree!

Writing a ticket will let a customer know you intend to charge.

For the second half of my career, I was really big on sales and management training. Elite was one of many in my career. I used to think that the training HAD to be industry-specific. Not so. I had Roy H. Williams in Austin, TX as a trainer around 2014-2015. He would say, "I don't care if your selling and managing jet engines, a donut shop, or a bookstore, the principles in sales and management remain the same."

Joe, Great post, brother. Here's what we think of even less. That is before we retire, IF, the BIG IF, we are selling our shop to employees or anybody of the technical mindset, hook them up with a shop trainer. If I had it to over, I would have paid a trainer's fees a couple of years in advance for my purchaser. They had the money to buy the shop, but little more. They were expecting an immediate return on investment because they didn't have any money to do otherwise. Food for thought. I did sales and management training shortly after retirement and in almost every shop, I got disappointment after disappointment. The biggest disappointment was after the gig was over, the shop I was coaching went right back to doing the S.O.S. they were doing in the first place that got them in the jam to seek coaching. All, but 1, is now out of business. The one that's not out of business is only 3 miles from my house and stopping by to say HI! keeps them on track. Thank goodness it doesn't cost me a hotel and airfare. A profitable, well-run, and managed company rarely seeks consulting services. I read somewhere that a shop owner thinking about retirement was going into coaching shops. He's living in a dream world and his desire has no basis in reality. If you think owning and running an automotive shop takes commitment, you don't know what commitment is until you coach other shops. Personally, I couldn't do it. I only lasted 6 months and I had enough. I wasn't cut out for living out of a suitcase and dealing with hotels, airlines & airports on a weekly basis. I'm too old for that. 🙂

Joe, You talk realities. We would all like to think our crew at the shop could handle everything like we did after we're gone. The truth of the matter is for former employees need to get strongly engaged in coaches like you. Bob Cooper, and other shop coaches in your company. I spent a lot of money with Bob Cooper's company years ago, but it was a great deal in the long run. No regrets. J. Larry Bloodworth, [email protected] (801) 885-2227

Joe, Remember the last time our Democratic White House enacted laws to tell us what we should be driving? Cash For Clunkers? It rated right up there with hurricane flood cars. Both were "great plans." Neither one worked. 😞

Can't afford to retire or sell is a good reason. Like Joe said, plan an exit strategy or life may give you a curve ball. Joe has taught me a LOT.

In the transmission business, "Can you just"-type customers are few and far between. It's basically a non-issue with us.

Welcome, Joe! This is the place to ask questions and even maybe, perhaps, pick up a job. Asking for career advice would be best answered by older shop owners like Joe Marconi, myself, and others. I wouldn't put much weight on anyone's advice who is not heavily involved with running a shop. My advice would be to get the most training and learning on electrical system, software, and electric vehicles (EVs) possible. Today's vehicles are like a cell phone on wheels. Your generation will see EVs, electrical problems, and software reprogramming issues rolling into the shop. Our generation only got a taste of what's to come. In my opinion, a formal classroom with textbooks is the best place to learn electrical theory and reprogramming procedures. Engines, transmissions, brakes, and suspension... not so much. A shop setting is best for those areas. Personally, I chose transmissions and powertrains, in general... nothing else. Specializing, in general, is more profitable. My advice would be to also work in a shop setting to find out what type of auto repair specialization you want to be in. In years long gone, it used to be a technician would work on all Makes, Models, and type of work that came into a shop. Not so much now or in the future. Pick areas of specialization that interests you. Google my name. Call, write, of text me if you would like more information. J. Larry Bloodworth, CMAT (retired) [email protected] (801) 885-2227 Draper (SLC), Utah 84020

Tom, you say you have no desire to own commercial real estate in NJ, but in the very next sentence you say leasing has always been the best option for you. My experience has taught me to play as a mortgage holder with a pre-payment penalty clause to where the mortgagor has to pay all unearned interest in the event of an early payoff. I've done it both ways, lease and sell, but made the mistake of not having an early payoff penalty clause. I don't know about you, but I'm 67 and have very serious doubts that I would outlive a 30-year mortgage. J. Larry Bloodworth, [email protected], (801) 885-2227.

I started out by being the mortgage holder to the real estate. $9,100 month. Then the owner sold it all and the new buyer paid the mortgage off in one lump sum. I didn't have an early payoff clause/penalty. Sadly, we had to pay $400K in income taxes because the real estate alone sold for $2.3M. Damit that hurt. 😞 Leasing is better.

Are you selling the real estate with the sale of the business or just the business?

We never had a formal onboarding program. I would normally shadow the new employee for a couple of days answering questions.

We would maintain 60% as gross profit/20% net profit. People rarely price transmission parts. I agree that if part margins go down, labor must go up to maintain a 60% gross profit level.

The ATRA Powertain Expo is my favorite because I learn a lot and get to visit with online friends.

I've been in transmission repair industry for 40 years and been a shop owner 26 years. I've already retired quite comfortably.

As I posted earlier, we were open 5 days a week, Mon-Fri 8:00 am - 6:00 pm. However, if we had slow days, I would give the guys time off. Some of the guys took it, some didn't. This is because I paid the employees by the hour. Giving them time off was considered a pay cut by some and if they needed money, they wouldn't take off. What I've learned from this thread is that a 4-day work week doesn't mean the business is open only 4 days a week. Employees only work 4-day work weeks but the business is open 5-6 days a week. Here's a video from down under New Zealand with their perspective on the 4-day work week. 12:56

Although we had a classroom with weekly in-house training, we put away $200/wk. for the ATRA Powertrain Expo every year into a separate banking account. Our weekly training was the employees' highlight of the week. Here's why... We supplied lunch and during lunch we would chit-chat and discuss "The Job Of The Week" which was the past week's job that kicked our proverbial tails. After discussing The Job Of The Week, the formal training through online or live would commence. We did that every Tuesday and the entire event, including lunch would last about 90 minutes. Sometimes suggestions for making the shop better would come up, shop policies would sometimes come up. Over the years, weekly shop training and lunch became so automatic, everybody, including me, it was a given. I don't know how any well-oiled shop could not have them.

This topic has been beat to death. Let's just agree to take the "Wait and see." position, Okay?

Funny you should post this today. Just today I went to a non-factory Apple iPhone repair store. They are open only 3 days a week, Tues, Wed, & Fri. only. They were closed today... I won't be back, either. The REAL 4-day work week goes for employees only, not the store hours. Here's another way to think about it....11:41

I would be lying if I said nobody ever had something negative to say about my strategy. I've been told my strategy is unethical. Another said "You can't get that kind of money for that job." Another said, "How can you let that customer walk? Just because you're greedy?" and on, and on. All complaints were some variation of those 3 objections. That didn't deter me. One thing for sure, all the shop owners I did consulting work for and practiced qualifying customers that way, went back to their old ways after I left. Only one of them are still in business. My opinion of why they are still in business is because they added full car repair to their formerly 'transmissions only' business. The biggest problem I see with struggling transmission shops today is they don't cover their costs. I train them in job costing and I hear objections like "I can't get that much." or "If I charged that much, I'd be the highest priced shop in my area." etc., etc., etc. My experience has been that they either follow my training (or any good training) or go out of business. A great example is my former shop. I sold my former shop to a multi-shop owner/competitor. They had 4 shops in total, we were shop #5. Before the sale, we were doing a consistent $1.2M/yr. in sales for the 3 years prior to the sale. Their rent was $11K/mo. or 11% of sales. Within 5 years, sales were down to $400K/yr. Rent became a whopping 33% of sales. No shop can survive like that. They eventually folded, employees left, and they took all the shop equipment with them. The $85K judgement we got against them wasn't worth the paper it was written on. Sad, sad, sad state of affairs in the end. Perhaps I'll write a book about it some day.

Great questions, Joe. My answer on both questions would be "it depends." There's a lot of variables involved before I give a definitive answer. All I can say is what my experience has been in the past because at different stages of my career, I've asked myself the same questions. I'll just tell you about one. I came to the crossroads in my career when in deciding if I wanted to take in European vehicles, specifically, European transmissions. Every job was like a new adventure in uncharted waters. They took more time, more money for parts, and a higher percentage of those Euro jobs would turn into a "dead job" sitting in the back parking lot awaiting payment. I considered myself lucky if we were paid as soon as the work was completed. To add insult to injury, there was a higher rate of no-goes (failed the final road test) and warranty claims. Perplexing to say the lease because I didn't want to turn away work. Unrelated to this topic, I bought a list of all the vehicles currently licensed in our county from our state's DMV to see where our bread & butter-type jobs were at. I put the list into a database and would write queries. Two years after I bought the list, a new question/query came up. I wanted to see how many European makes are there in our county. I couldn't believe my eyes at the answer... an infinitesimal 6%! In my mind, I see way-more than that going down the freeway. Moreover, I later discovered from AAA that the rate of European vehicles nationwide was only 10%. Ever buy a particular model and color of a vehicle that you never see on the road? Then, after you start owning that particular model and color of a vehicle, then they seem to be everywhere! A similar phenomenon I call "a head-turner" was exactly what was going on with me. Every time I saw a Euro on the road, it was a "head-turner". Any other type of car was merely just traffic. I soon reasoned if I ever chose to not work on European vehicles, I would still have 94% of the market! After several months of thought, I finally would say "no" to European vehicle owners in a very special way. My strategy was to price the work so high, the customer would be the person saying "no" and not me. Anything can be had/done for a price. Looking back, that was one of the best business decisions I've made in my career. In the end, we still worked on Euros, just not near as many. I guesstimate we still had 95- 96% of the market The lesson I learned was to NEVER say "no" to any customer. If the customer has the type of car or job you don't want to take on, don't be the person that says "no". Let the customer say "no".