Last issue, we discussed long-term problems that are occurring on both sides of the automobile. These include customer apathy, the higher complexity and lower service requirements of today’s cars, and the fact that cars, customers, and employees have changed, but too many repair shop owners and managers have not.
So, how do you fix the business? It starts with you! Look at your business through critical eyes. Better yet, hire someone to be very honest with you about it all! Grow in knowledge with fresh ideas and a strong will to try new things. Read books and take classes at the local adult school or community college. Attend the local chamber of commerce and service clubs, find someone successful, and pick their brain.
Clean out the attic in your brain and accept new and different thoughts. Look at your business differently, advertise, join community events, and make your business the automotive hot spot! Solve problems for customers, educate them, and establish your business as the authority on car repair. Very important: become a leader of your business and lead by example.
Write down your vision of where your business should be one year from now; five years; 10 years, and include an exit plan. Describe what the perfect staff is. Decide your goals for the year (and make them ones that are reachable… challenging, but reachable). Determine yearly, monthly, and daily sales goals, monthly car count, average repair order goals, and gross profit goals. Your true aim should be handling fewer cars at a higher average ticket. Determine what needs to change to reach these plans. Do you have the correct staff, and in the correct positions? Do you have the correct customers? (That is a tough one because of our personal attachment with some, but it must be done and without emotion.)
Financial foundation: Understand what the important numbers are in your business. Confirm that your hourly rate is correct for your overhead. Measure everything. Think of the numbers as the score of the game of business (you must keep score to know who’s winning). Confirm that you have the information to make good decisions. Update your technology to manage your business; embrace the management software that allows you to manage your business with the least amount of time invested.
Employees: Establish goals for every position. For the service advisor, that means daily sales goals, gross profit goals, and average repair order goals. For techs, production goals and hours billed to the customers. Develop job descriptions for each position - even for owner - and share your expectations with each employee, including full-shop goals. Educate your employees about the business; share some of the numbers and make sure they understand why you need the goals met. Each position should have a minimum number of training hours per quarter (if you’re not learning, you’re going backwards!).
Marketing: Market in three phases, including for service reminders and recommended work, to keep your name in front of current customers, and to attract new customers (customers leave for lots of reasons, so the task of attracting new customers must be forever ongoing).
Customers: Study the demographics of your customer. Can you upgrade - newer cars, higher average income, etc.? Determine what your customer really wants from you. Remember that true customer service is not what you think is needed, but rather what the customer desires.
Win your battle through change - it’s the only way, but will keep you motivated! Act like it’s your first day in business. Many businesses failed to evolve through change and are gone forever. Good luck
Thursday, June 24, 2010
How to get away
For too many business owners today, the idea of jumping ship and heading out the door for a week’s vacation is unheard of. After all, there’s a business to run and that’s already a full-time job and a half! Somebody’s got to make sure the cars go out, the money comes in, the bills get paid, and the uniform man gets handled along with the plumber, the oil distributor, and the tool guy, too! So, how can it be possible to drop everything and take some time off?
Let’s take a peek at your true circumstance and make some evaluations. Do you wish you could take more serious time off? Can you trust your employees to do the job you need done? Do they work well together and with customers? Are they dependable and loyal? Are they self motivated and do they work through directives and tasks executed through the strategies of a self-directed team?
For owners with shops operating through a self-directed team, taking time off on a moment’s notice is a reality enjoyed more often than you’d think. For those driven to bless every move made in your business every day, however, here’s the good news and bad: The good news is that, sure enough, with you at the helm, business stands a good chance of moving right along the way you’d like. The bad news is that, in your zeal to master it all yourself, you’ve exchanged that victory for the chance to bask in the sun with the special people in your life - the personal time so desperately important in maintaining a healthy attitude today.
Is the idea of taking time off for a personal life truly unrealistic? Here it is in a nutshell: Self-directed team operations can be as much a reality in your shop as they are in shops just like yours. Your business is not unique - neither are your circumstances with it, problems and all. The difference is that others have taken the time to make the conversion that you haven’t. Maybe it’s time you did.
Consider transferring your responsibilities as a self-driven business operator to a strong self-directed team instead. Act on the following:
1) Most employees, even those who enjoy working independently, want to believe that they are part of a team working toward common goals. They need reassurance that they are valued members of a team.
2) Employees want to feel you are thinking of their welfare. They want to know you care about what’s going on in your own business, right along with what’s going on in their personal and professional lives. You must acknowledge the positive with as much zeal as you notice the negative in employees’ contributions.
3) Team members want to feel employers listen to them. They like being a part of your business and feel ignored when you don’t listen to and act on their recommendations. Poor communication is the number one problem in employee / employer relationships. Employees are the biggest part of your business and it’s wise to listen to what your business is saying.
4) Team members want to feel special, not easily replaceable. They each want to feel like they are your best choice for what they do for you, and that takes complimenting their performance often and sincerely.
5) Team members want to be informed about your business. Inadequate or lack of communication about business expectations affects productivity too greatly to not inform employees about what’s going on.
6) Team members want to work for an employer who works efficiently and confidently. The character and performance employers display either inspire the actions of employees or discourage them. As team members experience the positive in you, they will easier take the action needed to be successful inside of business goals.
Although there is a continuous process of refining team strategies and performance to gain what the business needs, to seriously consider the reality of a self-directed team in operation is my biggest recommendation to increase odds to succeed.
Let’s take a peek at your true circumstance and make some evaluations. Do you wish you could take more serious time off? Can you trust your employees to do the job you need done? Do they work well together and with customers? Are they dependable and loyal? Are they self motivated and do they work through directives and tasks executed through the strategies of a self-directed team?
For owners with shops operating through a self-directed team, taking time off on a moment’s notice is a reality enjoyed more often than you’d think. For those driven to bless every move made in your business every day, however, here’s the good news and bad: The good news is that, sure enough, with you at the helm, business stands a good chance of moving right along the way you’d like. The bad news is that, in your zeal to master it all yourself, you’ve exchanged that victory for the chance to bask in the sun with the special people in your life - the personal time so desperately important in maintaining a healthy attitude today.
Is the idea of taking time off for a personal life truly unrealistic? Here it is in a nutshell: Self-directed team operations can be as much a reality in your shop as they are in shops just like yours. Your business is not unique - neither are your circumstances with it, problems and all. The difference is that others have taken the time to make the conversion that you haven’t. Maybe it’s time you did.
Consider transferring your responsibilities as a self-driven business operator to a strong self-directed team instead. Act on the following:
1) Most employees, even those who enjoy working independently, want to believe that they are part of a team working toward common goals. They need reassurance that they are valued members of a team.
2) Employees want to feel you are thinking of their welfare. They want to know you care about what’s going on in your own business, right along with what’s going on in their personal and professional lives. You must acknowledge the positive with as much zeal as you notice the negative in employees’ contributions.
3) Team members want to feel employers listen to them. They like being a part of your business and feel ignored when you don’t listen to and act on their recommendations. Poor communication is the number one problem in employee / employer relationships. Employees are the biggest part of your business and it’s wise to listen to what your business is saying.
4) Team members want to feel special, not easily replaceable. They each want to feel like they are your best choice for what they do for you, and that takes complimenting their performance often and sincerely.
5) Team members want to be informed about your business. Inadequate or lack of communication about business expectations affects productivity too greatly to not inform employees about what’s going on.
6) Team members want to work for an employer who works efficiently and confidently. The character and performance employers display either inspire the actions of employees or discourage them. As team members experience the positive in you, they will easier take the action needed to be successful inside of business goals.
Although there is a continuous process of refining team strategies and performance to gain what the business needs, to seriously consider the reality of a self-directed team in operation is my biggest recommendation to increase odds to succeed.
Time Management and Productivity
A simple improvement in daily productivity can result in a substantial increase over the course of a month. Let’s do the math based on 3 technicians working 8 hours a day. Your inventory labor is 24 hours of billable time each day and, in a perfect world, the shop will bill 24 hours. The question is, “How many perfect days do any of us ever really have?” We average about 72% productivity across the nation, which an 8-hour day tabs out to billing only 5.75 hours! If you are within the average 72% productive, billing 5.75 hours per day, per tech, strategies for improvement could start with increasing productivity to just 80%. You’d bill an additional .65 hours per day and, multiplied by 3 technicians, that totals an added 1.95 hours per day. In an average month of 21 working days, this is an additional 40.95 billable hours, an increase that many would consider substantial. Remember that this simple improvement represents only slightly more than one half hour per day!
Low productivity happens, but why? It’s always easiest to blame the techs, but several factors contribute.
Battling strategies between technical and sales staff created by inadequate skills: An example would be a service writer who does not agree with the charges and timeframes the technician has recommended. The service writer ignores the proper resale rules and adjusts the charges to the customer, selling the job for less. This heavily impacts productivity. On the flip side, regardless of skillful sales management, inability in technicians to perform the work properly will always impact productivity, too. Insufficient space to handle the car count: Too few work bays, too many work bays inside of too little space, poor work space layout, poor access to equipment - all of these impact your time management. Very often, we choose to work with familiar struggle rather than endure change and make it right. So, what are the psychological working conditions in the business? Is that environment stressed with problems?
Insufficient time available for the service advisor to properly write the estimates: This may or may not be an “understaffed” problem. Sometimes, adjusting the work responsibility will free up more time for better estimate preparation. There is a certain percentage of service advisors, however, that start fires when none are currently burning to help substantiate their participation at work (putting out fires is work) as they avoid the “dreaded estimate write up.”
The service advisor lacks adequate time to properly present the estimate to the customer: Proper presentation must include a description of goals and strategies for repairing the vehicle to show value for the money you’ll be asking the customer to spend. Just because the service advisor finds time to close the sale does not mean that a “good sale” has been closed. Making a sale simply confirms that a transaction will take place; making a good sale rewards both business and customer by satisfying all expectations.
Lack of adequate car count: Correcting this problem needs to include reviewing the success rate of your advertising and contact strategies; the ratios in curiosity calls versus calls converted to appointments, and the ratios of appointments honored versus “no shows.” Tracking these will help decide if low car count can be due to poor phone skills or poor advertising; maybe both are culprit.
Too many cars (yes, it happens): Too many cars but low productivity can equal the service writer needing to qualify the customers better. Failing to thoroughly inspect every car for needed work is another contribution to low productivity. Consider this: you’ve spent a ton of money advertising to get the car in there; you’ve spent a healthy sum on training and continue to invest in motivation and knowledge for your employees to bring that customer in and make good sales; you plan your future according to prospects that are based on customers’ needs… why would you not take full advantage of reaping full benefit from the opportunity you have when the car finally comes in?
Low productivity happens, but why? It’s always easiest to blame the techs, but several factors contribute.
Battling strategies between technical and sales staff created by inadequate skills: An example would be a service writer who does not agree with the charges and timeframes the technician has recommended. The service writer ignores the proper resale rules and adjusts the charges to the customer, selling the job for less. This heavily impacts productivity. On the flip side, regardless of skillful sales management, inability in technicians to perform the work properly will always impact productivity, too. Insufficient space to handle the car count: Too few work bays, too many work bays inside of too little space, poor work space layout, poor access to equipment - all of these impact your time management. Very often, we choose to work with familiar struggle rather than endure change and make it right. So, what are the psychological working conditions in the business? Is that environment stressed with problems?
Insufficient time available for the service advisor to properly write the estimates: This may or may not be an “understaffed” problem. Sometimes, adjusting the work responsibility will free up more time for better estimate preparation. There is a certain percentage of service advisors, however, that start fires when none are currently burning to help substantiate their participation at work (putting out fires is work) as they avoid the “dreaded estimate write up.”
The service advisor lacks adequate time to properly present the estimate to the customer: Proper presentation must include a description of goals and strategies for repairing the vehicle to show value for the money you’ll be asking the customer to spend. Just because the service advisor finds time to close the sale does not mean that a “good sale” has been closed. Making a sale simply confirms that a transaction will take place; making a good sale rewards both business and customer by satisfying all expectations.
Lack of adequate car count: Correcting this problem needs to include reviewing the success rate of your advertising and contact strategies; the ratios in curiosity calls versus calls converted to appointments, and the ratios of appointments honored versus “no shows.” Tracking these will help decide if low car count can be due to poor phone skills or poor advertising; maybe both are culprit.
Too many cars (yes, it happens): Too many cars but low productivity can equal the service writer needing to qualify the customers better. Failing to thoroughly inspect every car for needed work is another contribution to low productivity. Consider this: you’ve spent a ton of money advertising to get the car in there; you’ve spent a healthy sum on training and continue to invest in motivation and knowledge for your employees to bring that customer in and make good sales; you plan your future according to prospects that are based on customers’ needs… why would you not take full advantage of reaping full benefit from the opportunity you have when the car finally comes in?
Open door policy with employees
Talking to clearly communicate your intentions is not just a workplace practice, it’s a real job. How you deliver your message implies the response you are seeking from your recipient. Your attitude behind the words can tell someone that you’re looking to blame, when you’re really just frustrated and looking for help. Each exchange has its own level of intensity, so each one risks potential loss or gain in efforts to truly achieve the goals targeted for the encounter. How the words are delivered and their reception by the other will make the difference. If you regard “communicating” as anything less than a real job, you’ve set yourself up for a mental rollercoaster with everyone you share your day with.
You’ll be further ahead if you can grasp the concept of “job” and remember that not many jobs are easy… that’s why they’re branded “job.” Striving to succeed, we can never disregard changes we’ll need to employ. Customer demands and industry regulations force practices to be constantly refined. For most employees, though, change is difficult. They entered the job through a list of expectations that were acceptable to them at the time. As changes are enforced, our expectations for their job description and performance often change, too. While some employees may accept this, it’s not always the case.
Their comfort zone has been disturbed and that, to them, doesn’t always say, “Good job, but I want you to change.” Often, they’re hearing, “I want you to change” and missed the “good job” part. We must somehow be able to transfer information that will satisfy a clear explanation to them that includes actually saying the words, “Good job.” It gives two opportunities to settle their disrupted comfort zone. Employees are more motivated to participate in change when they truly feel they’re making a positive contribution based as much on “whom” they are as “what” they do. The “who” substantiates a position in your employ but the “what” substantiates only the job, something they were looking for when they came to work for you.
We’re all capable of “thinking” a problem into existence and employees are no different. When we fail to communicate correctly in “approach, words and attitude,” they see a problem. They can dwell on a situation negatively in their mind until, at last, it’s true and suddenly they’re justified in what they’ve been thinking all along! Anger in our employees is not always our fault, but, nonetheless, the frustration they can feel from their perception alone can exist. For the sake of success, it’s imperative that we open up those lines of communication.
W e must remember, too, that we’re not the only ones with problems. With today’s staggering economy, personal debt is higher than ever. The pressure is on at home and at work, so employees get angry more often and stay that way longer. People want to place blame for their problems.
Good communication with your employees can offer them understanding and support and actually aid in minimizing their dilemmas. It can create a happier employee and, therefore, one who is more productive (happier plus more productive usually equals longer employment with you, too).
So, how do you widen the door of your “open-door policy”? There are four key requirements. First, talk to your coworkers about the problems in the business that includes their position. Second, open the conversation by announcing that you’ll be looking for their input (advanced invitations for them to participate will quickly capture their attention and motivate them do just that). Third, enter the conversation open-minded, anxious to have them share their ideas for solutions.
Fourth, have patience when listening. Give a strong ear to their comments and feedback, because very often the solution is closer than you know. Employees who feel they are being heard will produce more and be happier to do so. So, widen that open door.
You’ll be further ahead if you can grasp the concept of “job” and remember that not many jobs are easy… that’s why they’re branded “job.” Striving to succeed, we can never disregard changes we’ll need to employ. Customer demands and industry regulations force practices to be constantly refined. For most employees, though, change is difficult. They entered the job through a list of expectations that were acceptable to them at the time. As changes are enforced, our expectations for their job description and performance often change, too. While some employees may accept this, it’s not always the case.
Their comfort zone has been disturbed and that, to them, doesn’t always say, “Good job, but I want you to change.” Often, they’re hearing, “I want you to change” and missed the “good job” part. We must somehow be able to transfer information that will satisfy a clear explanation to them that includes actually saying the words, “Good job.” It gives two opportunities to settle their disrupted comfort zone. Employees are more motivated to participate in change when they truly feel they’re making a positive contribution based as much on “whom” they are as “what” they do. The “who” substantiates a position in your employ but the “what” substantiates only the job, something they were looking for when they came to work for you.
We’re all capable of “thinking” a problem into existence and employees are no different. When we fail to communicate correctly in “approach, words and attitude,” they see a problem. They can dwell on a situation negatively in their mind until, at last, it’s true and suddenly they’re justified in what they’ve been thinking all along! Anger in our employees is not always our fault, but, nonetheless, the frustration they can feel from their perception alone can exist. For the sake of success, it’s imperative that we open up those lines of communication.
W e must remember, too, that we’re not the only ones with problems. With today’s staggering economy, personal debt is higher than ever. The pressure is on at home and at work, so employees get angry more often and stay that way longer. People want to place blame for their problems.
Good communication with your employees can offer them understanding and support and actually aid in minimizing their dilemmas. It can create a happier employee and, therefore, one who is more productive (happier plus more productive usually equals longer employment with you, too).
So, how do you widen the door of your “open-door policy”? There are four key requirements. First, talk to your coworkers about the problems in the business that includes their position. Second, open the conversation by announcing that you’ll be looking for their input (advanced invitations for them to participate will quickly capture their attention and motivate them do just that). Third, enter the conversation open-minded, anxious to have them share their ideas for solutions.
Fourth, have patience when listening. Give a strong ear to their comments and feedback, because very often the solution is closer than you know. Employees who feel they are being heard will produce more and be happier to do so. So, widen that open door.
Good Sales?
America’s true entrepreneurs today display through every type of advertisement an eagerness to meet the challenge to be the best at what they do. Once prospects accept your invitation to try your business, the results will ultimately be justified through these means: applying four very basic yet critical strategies in the four rules of business. Your ultimate goal must always target a customer encounter that will leave both you and your customer beaming with gratitude for the experience that just took place. You should never have to ask yourself, “What just happened with this sale? It didn’t feel like a ‘good sale.’” Regardless of how strongly you believe you’re doing it right all the time, revisit the four rules of business regularly. Post them somewhere in a private area to do a self-check and be honest with yourself in your relationship with each of the strategies.
The first of these rules is: Customer satisfaction before profit. This is the most important rule because it strengthens your odds to make every good customer a repeat customer. Satisfied customers come back and satisfied customers tell others about you. Satisfied customers remember they were truly satisfied with how you handled their problem, and satisfied customers are who we want filling up our waiting rooms. As I’ve continued to say for so many years, “Without money nothing happens, and without good customer service nothing happens for very long.”
The second rule is: You must know who the boss is in your business. Most of us decided to challenge the rest of the business world with our talent and open our business based on our ability to beat the daily grind of taking orders from someone else. Finally and at last, we opened the doors of our own business and lo and behold we found ourselves with a whole new boss: the customer! Now, we have lots of bosses! Do we like our new bosses any better than the old one? Most of us would answer “yes,” but at great sacrifice. Customers are tough to deal with regardless of industry. We’re customers ourselves so of course we know that, which makes owning the responsibility to provide satisfaction a goal we must meet!
The third rule is: Know what’s in the job for you. You invested in both your life today and your future tomorrow when you opened your business. Take care not to give the store away-your life and future depend on it! You must make the profit you need while building a good customer base at the same time. You must not leave yourself out of the loop trying to satisfy all but yourself. While the customer is the most important component in your business, their satisfaction can never be at the cost of sacrificing your own dreams!
The fourth rule is: Profit before work. This is the most abused rule! The average repair shop in America today records a substantial amount of debt in accounts payable that they’re behind on in payments compounded by additional personal money invested through credit card debt just to sustain business. Add this to regular operating expenses each month and the light at the end of the tunnel begins to get real dim! If you see your name on this list of statistics and you’re tired of being last in line for a paycheck, I have some words of encouragement that should help: You can conquer this situation, but only when you begin to get paid for everything you do and at the right price!
To see if you’re minding all four rules, consider the following statements and answer “yes” or “no”:
I have more complaints than satisfied customers
I see many of my customers at other repair shops and don’t know why.
I didn’t make the money I thought I would with opening my own business.
My customers tell me how to repair their car and don’t want to pay me to diagnose the problem.
I’m afraid my employees will quit me if I don’t do what they want.
I always say “yes,” even when I mean “no.”
I quote prices to customers before I research the labor and call for parts prices.
I don’t want people saying my prices are too high.
If you answered “yes” to six or more, your road’s end may be closer than you think and it’s time to change direction now! I am available to talk with you by calling me toll free at 1-888-338-7296.
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