Joe Marconi

Wow! Another great story about how great people make a great difference. I too have learned though the years that we are only as good as the people around us! Thanks for sharing that story!

Got your attention? Good. The truth is, there is no such thing as the perfect technician pay plan. There are countless ways to create any pay plan. I’ve heard all the claims and opinions, and to be honest, it’s getting a little frustrating. Claims that an hourly paid pay plan cannot motivate. That flat rate is the only way to truly get the most production from your technicians. And then there’s the hybrid performance-based pay plan that many claim is the best. At a recent industry event, a shop owner from the Midwest boasted about his flat-rate techs and insisted that this pay plan should be adopted by all shops across the country. When I informed him that in states like New York, you cannot pay flat-rate, he was shocked. “Then how do you motivate your techs” he asked me. I remember the day in 1986 when I hired the best technician who ever worked for me in my 41 years as an automotive shop owner. We’ll call him Hal. When Hal reviewed my pay plan for him, and the incentive bonus document, he stared at it for a minute, looked up, and said, “Joe, this looks good, but here’s what I want.” He then wrote on top of the document the weekly salary he wanted. It was a BIG number. He went on to say, “Joe, I need to take home a certain amount of money. I have a home, a wife, two kids, and my Harly Davidson. I will work hard and produce for you. I don’t need an incentive bonus to do my work.” And he did, for the next 30 years, until the day he retired. Everyone is entitled to their opinion. So, here’s mine. Money is a motivator, but not the only motivator, and not the best motivator either. We have all heard this scenario, “She quit ABC Auto Center, to get a job at XYZ Auto Repair, and she’s making less money now at XYZ!” We all know that people don’t leave companies, they leave the people they work for or work with. With all this said, I do believe that an incentive-based pay plan can work. However, I also believe that a technician must be paid a very good base wage that is commensurate with their ability, experience, and certifications. I also believe that in addition to money, there needs to be a great benefits package. But the icing on the cake in any pay plan is the culture, mission, and vision of the company, which takes strong leadership. And let’s not forget that motivation also comes from praise, recognition, respect, and when technicians know that their work matters. Rather than looking for that elusive perfect pay plan, sit down with your technician. Find out what motivates them. What their goals are. Why do they get out of bed in the morning? When you tie their goals with your goals, you will have one powerful pay plan.

Great advice! And very relevant!

I know two things about booking the next appointment. First, many struggle with it. And those that do book the next appointment at car delivery increase sales, maintain car counts, and have a better ROI. Why, they focus on the customer right in front of them. We all know that retention is less costly than new customer acquisition. So why do so many service advisors struggle with this?

The key word is humble. A very important point! Thank you!

You’re out to dinner with a friend. The service was horrible, the meal took forever to get to your table, and it was not what you expected. You get the check, pay the bill, and start heading for the door. At the door is a woman, a staff member, holding it open and saying in a monotone voice, “How was everything?” You pause for a second, look her in the eyes, and reply, “Everything was fine, thank you.” As you walk to your car, you turn to your friend and say, “That’s the last time I go to that restaurant!” It's often said that the kiss of death for any business is what your customers are not telling you. Most people avoid confrontation. If they don’t like the service, the price, or the product, many consumers will not say anything. They would rather leave it alone and move on and try another company. Think about your auto repair shop. Think about your customers. How many of your customers, after having a less-than-perfect experience, will not say a word to you or your staff? How many of these customers will come back to you? How many will not? It’s important to understand that your customers are not only judging you by comparing you to your competition but also by the combined experiences of all companies and the interactions they come into contact with daily. And most of those experiences are not good. So, it would be in your best interest to create an experience that tells your customers, “We care about you, and we want you back!” There are two things to consider regarding customer service and ensuring that you have met your customer’s expectations and created a memorable experience. First, when someone does give you critical feedback or post a negative review, use that feedback to learn and improve. How the customers view their experience may not be aligned with what you believe you have provided, but their opinion is their reality, and that’s all that matters. The other thing to consider is having open and honest discussions with your employees, especially service advisors, to understand what excellent customer service is like, and try to look at that experience through the eyes of the consumer. This may not be easy and will take training, but it is essential. Remember, it is the customer that ultimately determines what an amazing experience looks like.

I appreciate the feedback and the kind words. My father would often tell me, "We get old too soon, and smart too late." On of my core beliefs and purpose is to continue to help others in any way I can. And I am sure you feel the same exact way!

Many shop owners are not aware that if they pay a bonus to their employees, that bonus may be subjected to overtime laws. There is a calculation that must be used if this pertains to you. Contact your payroll company, and/or a human resource professional to make sure if you are in compliant with labor laws for your state, and they can also help you calculate the correct overtime. Below is a bulletin from a company called SESCO, a Human Resource Company.

The fear of raising prices, both in labor and part margins, always brings an element of fear. This is totally understandable. However, that fear may not be real. The first strategy when pricing is to ensure that you build value in what you are selling. If the perceived value is low, price becomes important. If the perceived value is high, price begins to fade as an issue. Additionally, understand your key profile customer. You know who they are. They are those that throw their keys on the service counter and say, "Fix it, I'll be back at 5pm to pick it up, and no need to call me for authorization." Remember, you cannot be all things to all people. The bottom line here, is truly the bottom line. You need to charge the right price that ensures you earn a profit. Now, don't misunderstand what I am saying here. Raising prices to overcome inefficiencies in your business is not a sound strategy either. If your production levels are not where they need to be, don't automatically look to fault your techs. First, look for bottlenecks in the service staff, not charging the right labor hours, too much discounting, and not performing enough high profitable jobs. Your thoughts?

A shop owner friend of mine said that he was thrilled to finally hire a qualified tech. However, his toolbox box too big for the shop. Is this becoming a problem in your shop? How do you handle the ever-growing size of technician's toolboxes? SAMPLE of some of the toolboxes these days...

All great books. Perhaps we should start a Book List Post?

Thank you! I will get you the slides.

Ok, I am a little frustrated. My knee has been hurting me for a few months. I finally called an orthopedic specialist group (the largest and most well-known in the area). These are the events that occurred: When you call the office, you cannot speak to anyone. You need to leave a message or go online to fill out a form I went to their website, filled out the form with all my info, and requested an appointment The next day I got a call from the office; they wanted to verify my insurance (all about getting paid, NOT my knee pain) The person on the phone said that ANOTHER person would call me to schedule an appointment FAST FORWARD - I have since called numerous times and left messages to get an update on my request for an appointment Five days later, no call, still in pain... This is a reminder to all shop owners to call back your customers. The unknown and waiting is"painful"

As a former shop owner for 41 years, I know how important goal setting is. Join me, as one of the speakers, for this important webinar. Click below to register:

Thanks! These are great! And did brighten my day!

Repair shops that have done the math, know what their labor rate needs to be. However, are they leaving money on the table when performing some jobs, such as complicated driveability, electrical work, and other computer-related work? Shouldn't we base the labor rate on certain jobs by the technicians that are assigned to those jobs? In other words, if you have a drivability / electrical tech that is also the highest paid in your shop, shouldn't the jobs he or she performs be billed at a labor rate based on his/her pay scale?

Great points, Gerald! And I like your comment, "We're still in grade school." Achieving your objectives will require growth, financially. I wonder how other view this, an obstacle or opportunity?

We judge our shop's production by car counts and billable labor hours. But isn't this dependent on the ability of the Service Advisor to get write-ups done, cars dispatched, make sales, handle phone calls, walk-ins, etc.? If the service advisor's load increases, doesn't this affect overall shop production?

This makes so much sense, and should be read by every shop owner. Great outline and explanation! And you are right, I have started another post about Service Advisors being too swamped these days! Thanks!

Do you mean that you are over-booked and cannot handle any more work, no potential? What about tech production? Need a little more information.

No, I have not lost my mind. You and I both know that the oil change business is different today from what it was years ago. If we go back to the 1980s, and up through the 1990s, we judged customer visits by a factor of 4 to 5, which meant that we needed to see a customer at least 4 to 5 times a year, an indicator of customer retention rate and loyalty. Back then customers brought us their vehicles every three to four thousand miles for the traditional oil change. That business model no longer holds true. Today, the customer mindset has changed. Plus, oil change mileage intervals are a lot longer. For many, they don’t think about the oil change service the way consumers thought about it years ago. Just look at your customer base. How many customers drive well over the suggested oil change mileage interval? How many customers wait until the Maintenance Light comes on? Or even worse, the Engine Oil Light! I am not suggesting that you don’t perform oil changes, what I am suggesting is that you take a different approach. First, for those customers who drive well over the oil change mileage interval, it is in the best interest of the customer to educate them on the value of preventive maintenance. Instead of selling an oil change, promote the value of the vehicle’s scheduled maintenance service; for example, a 15k or 45k Service. This is not new; we all know this concept. Selling a maintenance service will help to ensure that we are doing all we can to protect our customers, promote vehicle safety, and extend the life of our customer’s vehicles. This concept also lowers the overall cost of vehicle ownership over the vehicle's life. Lastly, you have the perfect opportunity at vehicle delivery to educate your customers about the importance of preventive maintenance. Review with all customers, the service interval that is due next, and book that service with your customer. If we focus on what is best for our customers, we can’t go wrong. I frequently tell shop owners, “Every vehicle in your shop today will need a future service or repair. Make sure that your customers return to you.”

As always, thank you Carm for the opportunity! It was amazing and a lot of fun! And THANK YOU for what you do for the industry. Your efforts have made a positive difference in the automotive aftermarket! Keep it going in '24! Happy New Year!

Good point, in your business model there are not well-known parts, therefore those prices are not price-sensitive. Good point!

I think the past few years have told us that consumers, in general, want their cars repaired and serviced with a high degree of quality, a fair price, and a good experience. Let's face it, labor rates have gone up a lot for many shops around the country, but with little pushback from loyal customers. But, is this a complete picture? I am not sure, while labor is more accepted in the mind of the consumer, aren't part prices still an issue since it's easily researched, such as on Google, Amazon, Rock Auto, etc.?