Joe Marconi

Flat pricing or what I call, menu pricing, works for a lot of services: Wheel align, tire rotation, wheel balance, fluid services, LOF, etc. While just about any service or repair can be menu priced, trying to bridge that concept to many repair jobs can have a negative impact on your bottom line. A lot of repair work is vehicle specific. The job of assigning menus can be a daunting task, but not impossible. Be competitive on the services that consumers regularly compare to with other shops, but you need to be very profitable on repair work. If not, you will not make it. We often base of price structure on what the "other guys" are doing. We compare ourselves to the average shop. Remember, build an outstanding business and you can charge accordingly, but be careful, if your shop is not perceived as top notch, you will never be able to charge what you are worth. Personally, I don't want to be the average shop, anyone can be average. I strive to be the best and hire the best. It's like a ball team. Does a ball team work to be average and hire average ball players? No, they work to be the best and know that they can be the best with the right players, training and equipment. We are the same. Look at your margins, understand the numbers of your business and your breakeven. And never, never, never, base your bottom line or sales goals on breakeven. Just paying the bills is not the reason you went into business. Making a profit is.

BREAKING NEWS July 01, 2011 Right to Repair: Can 28,000 people be wrong? Piles of letters --28,000 in all -- in support of the Right to Repair legislation sit in front of legislators in Massachusetts. Source: Modern Tire Dozens of supporters of the "Right to Repair" legislation filled a State House hearing room in Massachusetts this week, calling passage of a bill that would require vehicle manufacturers to sell to independent car repairers the same repair code data they now sell or give to their franchise dealers. At the start of hearing testimony, the Right to Repair Coalition piled up 28,000 letters of support on a table in front of the committee to show the amount of grassroots interest from consumers for this legislation. Rep. Patricia Haddad, the speaker pro tempore, expressed her full support of the bill. In addition, several local repairers made a strong case for the legislation. “The time that the dozens of repairers took to come down to the State House and sit through a four hour hearing shows that this legislation is critical to repairers and the jobs and businesses they represent,” said Art Kinsman, spokesman for the Right to Repair Coalition. “Consumers pay for their cars, so they should be able to take their car where they want for repairs.” While giving the consumer more choice in where they can get their cars fixed, the legislation protects trade secrets and the intellectual property of the manufacturer. Recent polling in Massachusetts shows that independent repair shops are trusted by consumers on pricing, convenience, quality, and customer service. John Paul of AAA Southern New England testified that nearly 90% of their members, which is half the motoring public, support Right to Repair. The legislation has more than 60 co-sponsors, nearly double from last year, when the Right to Repair bill unanimously passed the Senate. However, the House of Representatives was unable to take action on the bill before formal sessions for the Massachusetts Legislature ended.

Wow, after reading the article it kind of makes me happy I never graduated college.

In 1975 I landed a job at a gas station in the Bronx. He too was a WWII Vet. And he did the same thing, he would chase people out with any foreign car.

Let me give everyone an update: It's been a year and a half since I gave away a windshield. The customer has not been back. SO, in my mind it was a scam and the customer got over on me. But that's ok, I am sure that we can all agree that we are all judged by a higher authority and I know in my heart I did the right thing.

What a great story! So, we can win and not always be everything to everyone.

You can call me old, but way back when I started there were only a handful of oil filter and air filter part numbers. Life was easy, yes....but it was also more effective. Today, with all the part numbers we have to deal with, the chance of making mistakes has increased greatly. The other day I "thought" I was helping my techs by pulling the parts for them. By accident I reversed the part numbers and gave a tech the wrong oil filter. The tech did catch the mistake, but it really bothered me. When you had a only a few numbers to deal with (1A, 33, 49, etc) combined with the fact that the filter looked different, the odds of making mistakes were a lot less. Now with numbers that have 5 digits, and many look the same, it's a problem. Plus, we now have to stock a massive amount of oil and air filters. Just looking at the numbers gives me a headache. Tell me if I'm overreacting or if you feel the same way.

Great report, the truth revealed...

Outstanding! This is what the public needs to understand about what is going on in our government.

I remember back in the late 80’s we started to see a high failure rate on GM ignition modules and other electrical components from one particular aftermarket company. The part store would send the part back to the company and the part would come back with a report from their engineer stating: "After testing this module, no failure found, installer error". This would make me furious. Other failed electrical components that I determined faulty would be refuted by their engineer and would get kicked back to me, which meant I had to eat the cost of the part. Well here’s what I did. The next electrical part failure I got I attached a form that I created which stated: "Joe Marconi, the Engineer and installer of this part has determined that this part has failed. Kick it back to me and I will forever take my business elsewhere"! I no longer had an issue, nor did I ever get another so-called engineer’s report. You are right Gonzo, how you conduct yourself and your business makes the difference.

Keep Your Friends Close, But Your Enemies Closer A quote made famous from the Movie, “The Godfather” The other day a customer brought me an estimate from the Local Hyundai dealer for 4 tires and a wheel alignment that was $150.00 cheaper than my quoted price. She said the service advisor told her that their tires prices could not be beat or matched anywhere. After a few phone calls it was apparent that the dealer service advisor was right. Even the local discount tire stores could not match that price. Even after a discount, my price was still $115.00 higher than the dealer. After speaking with her and reminding her that the same dealer tried to sell her a transmission she did not need a few years back, she agreed that price was not the only determining factor and we got the job. New car dealers are doing everything in their power to get customers into their service bays. Sluggish new-car sales have created a very proactive and aggressive approach to increase their car counts. Many dealers are offering cheap oil changes, tire rotations and alignments as lost leaders. What we need to do, as independent shop owners, is to become aware of these tactics and find ways to educate our customers. We must not burry ourselves in the sand, or fall into the trap by assuming the majority of consumers will not patronize the new car dealers. There are some dealers that are taking pages from our book and providing the service and pricing that is attracting consumers. Study your competition, know your competition. That is the only way to compete and win. Remember, “Keep your friends close, but your enemies closer”.

The most important thing you said: "If you believe it will work, it does. If you don't believe it will work, it will fail". This is the first step toward success in business and in life. I live by that standard.

Another factor are the price wars. When areas fight to be the cheapest and prices start to decline all over, no one wins. Plus the weakest finacially will fail first.

Finding and keeping the right person is the age old problem. They are out there, but rare. You need to look for people that fit your model of honesty, integrity, strong work ethic and has intellegence. Don't always look for experience, look for attitude and aptitude. It is a process, a long process and you will most likely go thru a lot of oysters to find that perfect pearl...

Scott: Welcome to AutoShopOwner, glad you found us. I admire your business spirit. Being an absentee owner can be tough for a small shop. I have been in business for 30+ years and just recently have built my company large enough and productive enough to have some sort of flexibility; in other words I don't have to be here all the time. With that said, my shop still needs the leadership and vision from me, the owner. I am not saying it cannot be done, but you really need the RIGHT people and the very best mananger. Are you friendly with any shop owners now? Maybe you could spend time in a shop to get a hands on view of what you need to do. Your background in the world of business gives you a big advantage. Most of us (myself included) started as mechanics. It may be hard to believe but being a former mechanic actually hurt me more than helped me. Good luck...keep the conversation going!

There are a lot of issues to discuss here, and I want to be as brief as possible. First of all, no one is suggesting that we use a cheap oil change in order to attract and pull a bait and switch or use the oil change to deceive customers. I have always held my moral standards to the highest degree. You speak of gross profit, ARO and percentages. Let’s face it, unless you are charging $50.00 or better for a conventional oil change, you are not making any money anyway. In comparison, the $39.95 full service oil in the 1980’s was far more profitable than the typically priced oil change of today. I like oil changes; it keeps my customers coming back to ME. BUT, I don’t just sell an oil change; I sell an “Oil Change Service”. I inspect my customers cars bumper to bumper during each vehicle visit and my customers appreciate the fact that we are taking care of them. We have grown our business and car count by saying yes to customers, rather than no. The majority of the jobs we do are those GRAVY jobs. In my area, we are the go-to guys because we do it all; from tires, to transmissions,brakes, steering, diagnostic work and even while-you-wait oil changes. I don’t want my customers going somewhere else for their oil changes. That just leaves too much to chance. If I did that, some other shop will be getting all the add-on sales such as wipers, headlights, air filters, cabin filters, tire roations, batteries and God knows what else. That scenario is not acceptable to me. Saturdays and oil changes work for me.... my business. It may not work for everyone. Our sales on a typical Saturday, from the hours from 8-2pm, are nearly as much as during the week. We rotate staff so that everyone does not have to work 6 days per week. This business model has been so successful that we had to open up another facility in 2009 in order to maintain our customer base. Essentially we gave to our customers what they wanted; a full service, one stop auto service shop.

Great book well written, a must read for all!

Great story, great deal too. Funny how the father could not get the son to agree to your deal, there's a story in that too. I learned a lesson a long time ago when I first went into business. After giving some people the price for a job, they would come back with a lower price offer . Getting upset and explaining my charges did not get me anyway, so here's what I did. I gave a customer a price of $188.00 for exhaust work on his Buick. He came back with his counter offer of $160.00. I told him, "Sir the price is $210.00". He shouted back, "You Said $188.00". I said, "I know, you went down I went up, we can do this all day long or I can fix your car for $188.00". I still you this simple tactic.

We have built a very substantial Sat trade. Maybe because my shop is located in a residential area where people use thier cars to commute. I need to ask, why are you opposed to oil change services? When you look at the opportunity with oil changes, for me there is a lot of gravy work. Plus, when you get customers coming to you on a consistent basis, they will think about you before another facility. That's a win-win in my book. Your thoughts?

I'm not a cartoonist, but if I were I would draw your shop with a huge manget on top. That story is about as strange as it gets. You gotta be attracting these people in some strange, weird way...

Truly funny! Thanks for the laugh!

Thanks Gonzo, I just needed to vent a little. I guess what makes people like us go into business is our passion and to make a difference. You are right about the money, too. Employees (and customers) don't know how the money gets distributed. Thanks for the pep talk. I needed it...

I want to personally wish everyone a Happy Independence Day. I hope everyone gets the chance to spend time with friends and family.

Employees Are Not Assets I used to think of employees as assets. Well, that was wrong. Tangible properties are assets; like equipment, a home, tools and inventory, not employees. Employees are people, we don't own employees. At times, as we focus on the numbers of the business, we lose site of the human aspect of our employees. If you want to increase sales and produce satisfied customers, treat your employees in your company as people, with respect and appreciation, the way you would want to be treated. “People don’t care how much you know, people want to know how much you care”. From the book: It’s Not About The Coffee, by Howard Behar