Tag Archive | "Garages"

KWIK FIT REFUTES MAIL ON SUNDAY INVESTIGATION

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KWIK FIT REFUTES MAIL ON SUNDAY INVESTIGATION


Chain denies tabloid claims

Chain denies tabloid claims

A story in the Mail on Sunday in February claimed that Kwik-Fit charged for parts that were never fitted on a car.

The article claimed that a reporter was told that her wheel ‘might fall off’ if she didn’t replace a bearing and charged for a plugs that were ‘not fitted’. Kwik-Fit responded with a statement that rebuffed most of the claims in the article. “We made a series of recommendations in respect of these cars, the majority of which the newspaper accepted were reasonable, however the article focused on a small number of allegations with which we fundamentally disagree” the statement read.

“We provided evidence to the newspaper to support our case, and offered to re-inspect the cars, however they refused and published the story. It is entirely appropriate and correct that we provide you with further details that counter the allegations made by the Mail on Sunday”.

The chain also published a read-out from the alignment equipment, which it says shows the vehicle presented was ‘ever so slightly toeing’ and the adjustment brought it back into manufacturer’s tolerance.

On the subject of the spark plugs, Kwik Fit says that it recovered waste spark plugs with UV dye on it “thus establishing that it did come from the car in question”. It also refuted that ‘scare tactics’ were used to sell a wheel bearing.

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IF YOU CAN’T BEAT THEM THINK SMARTER

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IF YOU CAN’T BEAT THEM THINK SMARTER


David Massey explores using car forums and social media to work for him at little cost.

massey

I couldn’t count the amount of times I’ve heard a customer say, “I’ve been on a forum and I think it’s this…” It is extremely annoying and turns me into someone angry and not very approachable. I guess it’s typical of the male ego, ‘how dare you tell me what I’m doing’ irrespective of the truth. It is true that some customers spend a decent amount of time sifting through the web and come up with some good info, but others will seek out any explanation of why a dash light has come on, for example, and are not easily dissuaded from their theory when confronted with expert evidence.

So if customers that browse the internet and tell you how to fix cars make your blood boil and gets you angry… then good! Because that means you have the motivation to do something about it.

It struck me that if customers can search and find specific information about their cars then why can’t you find specific customers for your business? The cat becomes the mouse and you’re holding all the cheese.

SPECIFIC CUSTOMERS
This is a brilliant opportunity where you can target and reach very specific audiences and really focus on your selected customer base that maximises profit and cuts out the unwanted work and customers we all dread.

If you type in a common fault into Google – I don’t know, let’s say intermittent loss of power 1.9 diesel VW undoubtedly the first place you would stumble across is a forum with 100’s of posts about turbo vanes sticking or faulty AMM’s. Try it for yourself, go on stop reading this for a minute and try it.

Now what if you had the ability and knowledge to direct people to your website instead and read informative and interesting articles about their problem? In other words by having blog posts or Facebook articles pointing to your site.

In January we were pretty quiet in the workshop and feeling fed up, I decided I wanted to learn how to build and optimise my own website. With fairly basic computer IT skills the amount I learned to never ever rely on third parties to promote and grow your business because nobody in the world has either the same passion or more importantly the same unique knowledge as you do about your business.

Before this exercise my website looked great but was very poorly ranked on Google and I couldn’t be found unless you actually typed in my URL (full web address). Most of my page listings could be found between page 10-20 of which I honestly believe have never been visited since the dawn of the Internet.

I specifically targeted the customers and demographics I wanted to target with strategic and careful methods by using specific faults, vehicle specific info and DTC’s embedded behind and into my website.

TOP RANKING
My website is now ranked first for just about every VW/Audi/ seat/Skoda related search in the Preston area and further afield. If you don’t believe me try it for yourself now with your smart phone or laptop.

I have done this extremely successfully, in fact so successfully it caught me off guard and has completely redefined ADS as a business. Just humour me and try this for a minute, carry out a search for Audi RS4 inlet valve cleaning and see who’s website comes up.

The key is to think like a customer and not like a garage owner, who might type something entirely different to what our customers would.

All this data can be very easily analysed by using web analytics which gives us the opportunity to react accordingly and adjust our key words embedded within our websites or SEO (search engine optimisation).

You have to ask yourself why on earth would you pay a third party who knows very little about your business and cares even less be good at doing it for you? Simple when you think about it.

There’s nothing new in what I’ve discovered only the skills in order to implement the changes. Big companies do all this as a matter of routine, but most garages are literally decades behind in getting to grips with social media and an effective online marketing strategy.

The truth is change is happening and there’s nothing we can do to stop that. We must embrace the change instead.

If you’re curious to know a little more I have created and designed an in house web development program aimed at helping garage business emulate our success. Like the old saying: If I can do it, so can you.

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IS YOUR GARAGE BUSINESS SITTING ON A GOLDMINE?

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IS YOUR GARAGE BUSINESS SITTING ON A GOLDMINE?


Existing customers are the key to reaching that pot of gold, writes Andy Vickery

Andy Vickery is a consultant for the aftermarket

Andy Vickery is a consultant for the aftermarket

If you’re worrying about your garage’s declining MOT or servicing count, or the fact that you’re having to take more and more low value work from online referral sites, did you know that you could actually be sat on your own pot of gold that could be a solution to your worries?

This pot of gold is likely to be in your computer and contained within your garage management system – and it’s called ‘customers’. Obvious really, but in reality, existing customers are very often overlooked in terms of marketing or gaining more business in favour of chasing new customers.

Outside of the garage trade, marketing to existing customers seems to be a recognised and well-implemented method of maintaining and indeed increasing business. But for some reason, many garages are yet to take this on-board.

I know this to be true because I have talked to and worked with many garage owners who have databases of many thousands of previous customers and when I’ve asked them how often they contact them, they say ‘never’. They might send the odd MOT or service reminder, but that’s it. One garage owner I met, who’d been in business for 30+ years, who was recently struggling, and was clearly cynical about marketing in general, actually said to me: “why would we want to waste money contacting customers? They’ve used us before and know what we are like”. Not his fault for thinking this, you would kind of like it to be the case, but consumer buying procedures and habits are now changing, along with technology that is potentially disrupting what we once assumed or could rely on.

A strategy of marketing to your existing customers can be extremely beneficial to your business for many reasons, but before I go into those reasons, I’d like to rollback slightly to the importance of making sure you capture customer information in the first place.

ARE YOU CAPTURING YOUR CUSTOMERS’ DETAILS?

Making sure you have your customers’ ‘full’ contact details is extremely important for your business, but it still seems that many are uncomfortable with asking for this. Along with a customer’s physical address, you need to make sure you obtain an email address and mobile phone number.

This should become standard procedure when booking in a customer or at the point of handing back the car. It’s probably better at the outset as you can state that you may need to contact the customer. You can also make it a standard procedure to email receipts/ invoices to customers, a bit like some large retailers do. If the customer is reluctant to give details, tell them that they will be able to have a record they can file on their computer that will be handy when they come to sell the car. This is just an idea, but hopefully you get the picture – there are ways of gently getting this information, but you may have to counter a customer’s natural objection to disclosing personal info’ – tell them they will be entered into your monthly draw if it helps.

comped-pot-and-tree

EXISTING CUSTOMER DATA
So it is a great idea to implement a standard procedure for obtaining all customer information, but what about your existing customer information? Many businesses will have data that is incomplete or lacking email addresses or mobile phone numbers purely because they date back to pre- technology days.

In the first instance, it would be good to go through the data that you do have to try to categorise it somehow for future marketing. Obviously if you don’t have email addresses, you won’t be able to email those customers, but ‘lost’ customer letters and mailings are still a good technique of bringing business back in. You can then update the customer details when they come in.

WHY MARKET TO EXISTING CUSTOMERS?
Let’s try and answer the question raised by the garage owner who didn’t think it was necessary to market to existing customers. Customer long-term value: In the first instance, customers should be viewed in terms of their ‘long term value’ – not just a one-off sale. In terms of marketing, maximising the long- term value of a customer is much more cost-effective than trying to obtain new customers. If you consider the value of a customer over five or ten years, this will help you understand the value of investing in marketing to retain them.

Customer retention: Is there such a thing as brand or customer loyalty anymore? Yes, this is still alive and kicking, but it has to be worked at and earned. People have very short memories and can be easily tempted by other offers, especially if they are not shown that they are appreciated or important. Staying top of mind is extremely important if you want customers to return year-on-year, especially in this highly competitive and technologically disruptive age.

Upselling other services:
Making sure your customers are aware of your complete range of services is very important in terms of maximising their value. This will also make sure you don’t lose out when a customer goes elsewhere for a service that you could have otherwise provided. You may have recently added services; you may offer tyres, you may be air conditioning specialists – but you shouldn’t take for granted that your customers will know this.

Displaying your expertise:
Customers will often have questions in mind when they need help with their motors. They may have come to you for a service or MOT, but do you offer diesel diagnostics? Can you work on the brand or model of new car they’ve just purchased? Can you work on electric hybrids? It’s easy to assume that a customer would know this, but often it’s not the case. This sort of information must be given to existing customers on a regular basis, that way you will stop them going elsewhere for services you provide.

Justifying prices: When we did a survey a while back, although price was important to customers, it wasn’t the most important reason a garage retained their best customers. In terms of your ideal type of customer, you stand a better chance of justifying your particular level of pricing when you regularly communicate what you can do and your levels of expertise, that way, customers will understand the value of what they are getting and won’t question price.

Getting referral business: A key reason for marketing to existing customers is to stay top of mind when they need you, but a by-product of this is you also stand a much better chance of getting recommendations and referrals from your existing customers. You can even use this as a reason to contact existing customers, telling them that they will be rewarded for referrals.

TURNING YOUR EXISTING CUSTOMERS INTO GOLD
So whilst you might be sat on a goldmine, you will have to work at it and ‘mine it’ to convert its value. This can be achieved by regularly staying in contact with your database of existing customers. By doing this you will make sure they keep coming back to you year-on-year, buying more services from you, whilst also recommending you to others – that’s the gold!

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CAT AWARDS 2017: VOTING CLOSED

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CAT AWARDS 2017: VOTING CLOSED


Print

The voting has now closed the 2017 CAT Awards.

The CAT Awards in their current form have been around for ten years, but we’ve got a few tricks up our sleeve to keep the event fresh and the Awards themselves the must-have trophy for any business.

The 2017 event will be held on February 10 in the stylish surroundings of the Lowry hotel in Manchester. and we’ve revised the line-up of Awards categories to keep it relevant to the aftermarket.

Come back after the Awards to find out who this years winners are.

Thanks again to our sponsors, whoare:

 

Automechanika

Motaquip

Bosal

Haynes Pro

Haynes

Impression Communications

Mannol UK

PG Automotive Recruitment

 

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MARKETING YOUR GARAGE BUSINESS EFFECTIVELY

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MARKETING YOUR GARAGE BUSINESS EFFECTIVELY


Marketing is more than just a token social media page, writes Andy Vickery

Andy Vickery is a consultant for the aftermarket

Andy Vickery is a consultant for the aftermarket

Let’s cut to the chase, marketing to most garage owners and businesses is a can of worms. What works, what doesn’t? Are print, direct mail and advertising dead? Should we do more emails – should we do a video?

To most, marketing appears to be a smoke and mirrors art that is more about luck and being in the right place at the right time. After all, you’ve tried it and nothing appears to have worked before.

The problem is there are so many elements within marketing to attend to, but most only ever see the end results of what others are doing – an email, mailer or advert, and not what is going on behind it all. The best that most can come up with then is to copy what others are doing. But what if the garage down the road was just guessing at their marketing and you were to copy them?

Then there’s being drawn to the latest ‘shiny’ object. A media rep calls from an online technology company that promises your business will be in front of a gazillion customers visiting their website every day.

The media rep tells you that this is what you should be doing because everybody’s doing it and you’re going to miss out. The rep then goes on to say ‘you’re not still using old-fashioned methods of marketing are you?’ It’s enough to make your head explode.

When you first set up in business, nobody ever told you that you had to be a marketer as well. But marketing isn’t difficult, that is when you know how. If you can fix cars, you can certainly embrace a few concepts that will improve your marketing.

CHANGE YOUR THINKING
The problem is that many just don’t take marketing seriously enough to turn it into a business process. The first thing to do is to see marketing as part of the process of running your business, like you would with doing the accounts or any other admin’ system or procedures you might have in place.

Realise that marketing is something that requires investment, but that it’s also a process that will provide a return on investment. A problem that many have is they try to do marketing that is free or cheap,
which sadly ends up being ineffective for that very reason.

Marketing and sales are as important as the work you do. The main difference to any other business procedures is that your marketing process is what will bring customers to your door, pay the wages and overheads and hopefully make you a profit.

marketing

CLEAR ON YOUR MARKET
Who are your best customers? What is your best type of work? Determining your ‘target market’ can be a very technical subject, but these two basic questions are a great place to start. Taking a step back to consider these could provide the impetus for change in your business. Once you know the type of customers you want more of, you will be able to devise promotions that ‘talk their language’, promote the things that will resonate with them, and turn up in the right places to get you noticed.

YOUR MARKETING MESSAGE
Again, this is a subject that could fill a book or two and indeed has. But what you say to your customers is important. Too many rely on advertising that just contains a logo and a list what they do – which is actually
probably no different to the business down the road. Put yourself in the position of the customer; who should they choose when both garages appear to offer the same services? The cheapest?

Your ideal customers are likely to be those that have values above what you actually do. They see a value in your training, your honesty, the fact you are involved in community projects. How can you make yourself different from your competitors? These things do help customers make a discerning decision. So, going back to your ideal customer, what is it that appeals to them?

MEDIA – DELIVERING YOUR MESSAGE TO YOUR MARKET
Do you start a Facebook Page? is Social Media what you should concentrate on? Let’s get one thing straight from the outset – when it comes to marketing, no one method should be utilised at the expense of others. And as far as Social Media is concerned, it won’t necessarily be the one thing that is going to bear the sort of fruit you require very quickly; certainly not on its own. Use Social Media, but in a measured way.

By spending a bit of time considering your market, your message and your media, you will be able to put together much more effective marketing; there will be more of a method and strategy behind it – it may not be perfect straight away, but it can be refined as you move forward.

ARE YOU COMMITTED?
The last part of the equation is commitment. Marketing is not something that should be seen as free or cheap, or indeed something that is done only once. It is a continual process. Your final thing to do is to set up a marketing calendar then stick to it, measure it, refine it and repeat it.

motorrepairmarketing.com

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NEW PHONES BUZZING IN WORTHING


Steve Reeves shows us around a South Coast factor that has received an upgrade

screen-shot-2016-12-05-at-10-29-01-2

Today is a busy day at CPA Worthing, though to be fair it is always busy at the original branch of the twelve-strong chain.

However, the extra rucus today is caused by the installation of a new IP-based phone system. As we arrive, Nick Fulford from the Parts Alliance’s IT team is busy testing connections and setting up screens, which when up and running, will display info on ring time, missed calls etcetera.

CPA Worthing was originally setup by Nick Best and Keith Anderson. A number of other names familiar to the aftermarket also joined the company in due course, including Operations Manager John Austin who remains with the company to this day. However, it is General Manager Steve Reeves who we are meeting today.

SYSTEM
“We’ve got a great system going in, backed up with mobiles so we are not going to miss any calls” said Reeves, indicating to Fulford who has his hands full testing several new handsets. “We’ve accepted it with open arms” he said, adding that as one of the larger branches in the Parts Alliance network.

The original name of the business is Car Parts and Accessories, so it should perhaps come as no surprise that the customer area resembles a traditional accessory shop, albeit one inside an industrial unit. Around half of the room is taken up with an L-shaped CPA team on new phones counter that on our visit had five staff members variously serving walk-in customers and picking up the soon-to-be- replaced phones.

CPA team on new phones

CPA team on new phones

“The way and the speed that you pick up the phone is important” stresses Reeves. Telephone policy is something that is strictly enforced at CPA as it remains the main way that customers form their impression of a business. “The garages want to know that they are dealing with people they can trust – with my guys they can” he adds.

The main stockroom is large – although no-one is quite sure exactly how big. What we do know is that it boasts a large mezzanine for the slower moving items and has a room used for meetings and as an office.

EXHAUSTS
Down in the main stock area, we notice a large amount of floor space was dedicated to exhausts. “Exhausts will become a shrinking market” asserts Reeves. “With the the exhausts you’ll find that some parts don’t move for three, four or even five years. It’s ugly as well. There may be a plan to shrink some of our exhaust stock as there are specialist centres. If Joe Public wants a rear box, we can obtain one of those on the same day from a supplier. Long have gone the days when a third of a building this size would be exhausts. You’re hanging up fresh air and I want the space for other products”.

As with any branch in this buying group’s network, there are all the brands you might expect: Delphi, Denso, NGK and so on. We also noticed some Yuasa batteries stocked alongside the group’s usual range of Banner products as well as Comma Oil held in various grades and quantities. A team of three people picks the stock, with seven vans running in and around the surrounding area. There is also an inter-branch ‘tea van’ to keep stock balanced across CPA. “Getting stock to customers quickly is like a hot pizza because delivering a cold one is not going to be any good” he concludes.

With a focused team and the new business systems to help keep the business on track, we are sure that CPA will be delivering ‘hot pizzas’ for many years to come.

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ESSENTIAL WINTER VEHICLE CHECKS – BRAKE CALIPERS


PROMO ARTICLE ON BEHALF OF BRAKE ENGINEERINGbrake_img_new

With the onset of Autumn and Winter, garages have a key part to play in ensuring cars are fit for purpose.

The most common failure during this season is of course the battery, and it goes without saying, frozen coolant and screen wash due to insufficient additive, or out of date antifreeze.

With the roads clogged with ice, it is even more important that the brakes are operating efficiently and more importantly, evenly across an axle. Locking up of a front or rear wheel can lead to a nasty spin and accident. Salt and grit can also lead to issues with corrosion.

A visual inspection of the mechanical and hydraulic parts is the first step, looking for in particular leaking, cracking and wear of all associated parts.

Having completed the visual checks, now check the physical operation of the caliper, in particular, the free sliding action of the guide bolts in the carrier. The piston should push its pad into contact with the disc, and the carrier should pull the other pad into contact.

If this fails to happen, and there are any signs of corrosion or damage, dismantle the caliper and remove the pads. Take the carrier, and clean using brake cleaner and a wire brush. Pay particular attention to the guide pins, and guide pin bores and make sure you don’t damage the rubber components.

Under no circumstances must any attempt be made to “re-work” the carrier, i.e. using a file to “clean out” corrosion. Any work of this nature can lead to excessive clearances to the pad abutments, which will result in clanking and rattling noises on braking. If necessary fit new guide pins and dust covers.

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KEEPING THE RIGHT PEOPLE


Holding on to the best candidates means more than just money says Andy Savva

Andy Savva

Savva has run various large independent garages and has been a troubleshooter for underperforming franchise workshops. comment@haymarket.com

One of the greatest challenges facing garage employers today is discovering and retaining good technicians, reception personnel, as well as support staff such as administrators, valets and drivers.

As a former garage owner, I know how difficult this can be.I realised early on in my business career that focusing on recruitment, selection and retention was one of the most important steps towards building a successful business.

The implications of poor recruitment selection decisions for the business as a whole can be catastrophic and so often visiting garages up and down the country I find staff members who are placed in positions without the necessary skill set for the job they are doing.

Why this is? Well the answer is garage proprietors are reluctant to pay a salary for the right person, so they end up recruiting people without the right skills and then asking them to fulfil jobs that they are just not capable of doing. You may ask me: ’What’s the right salary?’ Well my answer to that is clear.

If you have identified the correct person with the right skill level and pedigree, why not ask them what they would like to be paid to work in your business? That’s exactly what I did, and guess what? It always caught people by surprise because they were never asked that before. They never knew what to reply back to me, so I used to ask them what their current salary was, and when they replied back £32,000, I’d say well we are in luck then because I’m prepared to offer you £36,000, is that ok with you? If only I could take a picture of look of happy shock on their faces.

SALARY CAP
If you are going to worry about £2000 or £3000 per year, per employee or have salary cap for specific positions or any roles for that matter you will never attract the right person in an already under skilled sector. My attitude was find the right person and offer them a package they could never say no to.

You don’t just want to compete on money to get and keep the best candidates though. You want to demonstrate that you have created a workplace that attracts, retains and nourishes good people by doing things like providing an adequate staff room, and acknowledging good work. There are logical and consistent operating policies and procedures. You provide them with the correct tooling and equipment to carry out their duties, and let them know that they will be a respected team member who will be asked their opinions before business decisions are made that could affect them.

Illustration of a mechanic clinching holding spanner wrench looking to the side set inside shield crest on isolated background done in retro style.

MISSION SHARED
Do they understand your vision and values? If it’s a yes to all the above before you know it your creating a retention environment. Why would they want to leave you? Where would they go? Are there many other garages offering the package they currently have? Above all I insisted on a culture of openness and shared information. I wanted my team to know where the company they were working for was going and what it will look like in the future. I wanted my employees knowing how their specific jobs fitted into the grand scheme and what they can do to help my business get to where I wanted it to go. My experience taught me if you operate in an open environment where information is shared you will certainly benefit from higher retention rates. I would have failed if I knew my employees had thoughts like:

  • “It doesn’t feel good around here.”
  • “I don’t get the support I need to get my job done.”
  • “They wouldn’t miss me if I were gone.”
  • “I am not paid enough”

The lack of opportunity of staff promotions in most independent garages can create problems as some employees who are ambitious to progress in their career positions are very much restricted. This was always on the back of my mind, and to be honest, there was not much I could do in this area if a particular employee decided to leave for a senior role which I could not offer, however hard that was for me seeing them move on, although luckily for me, this only happened a couple of times. My overall goal as an employer was to make my business a place where people wanted to come to work. A place of discipline yet fun to be in and a place where everyone respected each other to cultivate a feeling of family.

These are the fundamentals that are needed to succeed in recruiting and maintaining a stable group of team members. Yes, I may have been the owner of Brunswick Garage and the driving force behind so many ideas however none would have been implemented without my wonderful team that I assembled.

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THE GOING RATE IN THE AREA


Working out how much you should charge should involve more than simply plucking a figure out of the air, says Andy Savva

Andy Savva

Savva has run various large independent garages and has been a troubleshooter for underperforming franchise workshops. comment@haymarket.com

One of the most and frequent responses I hear from independent garage owners when asked: ‘What’s the basis of your labour rate?’ Answer: ‘it’s the going rate in the area’.

There is a law in this repeated answer. How can you set your labour rates within the same bracket as your competitors? If you do that tells me that you have the same fixed costs, rent, rates, insurance, electricity, gas, salaries etc. as everyone else, surely this cannot be possible?

Of course it isn’t the case. While independent garage owners will have similar running costs they won’t be exactly the same, yet labour rates are set on the basis that it’s the going rate within a given postcode. Let me tell you here and now this is certainly not the way to set your labour rates.

Your first challenge is to calculate your complete running costs for your business as mentioned earlier, this should be straight from your annual accounts. Let’s assume this figure is £395,000 this includes staff salaries for five techs and three non-productives, all your rent rates, insurance and general running costs etc.

So before anything happens you need to generate £8230 per week. Now on average the labour/parts split for an invoice is around 50/50, so an invoice of £200 will have £40 vat £80 labour & £80 retail parts sold. So the figure of £8230 now becomes £4115 for labour hours sold (income) just to cover the complete running costs of the business.

At this point I would not consider the mark-up of parts (usually around 30 to 40 percent) as I considered this income as a bonus.

I always based my business objectives of making my garages sustainable & profitable on labour hours sold. You then calculate the potential labour hours you have available to you to sell, think of the number of ramps and working bays times the number of productives (five ramps/ technicians x seven hours per day) x five days per week for 46 weeks in the year which takes into account holidays, training and sick days etc… Stay with me!

So if we use the calculation above the potential labour that can be generated will be 175 per week and if we multiply that by 46 weeks, we potentially can achieve 8050 labour hours (income) per year. Now we already know that we need to generate £395,000 per year to meet our fixed cost expenditure without making a profit, if we then divide the potential labour hours available (8050) by running costs £395,000 we get a labour rate of £49 per hour.

REAL TERMS
Now an important point, whatever labour rate you set will not necessarily mean that is what you recover or receive in real terms. In my travels up and down the country reviewing many different independent garages I how found that most do not sell more than four hours of labour per technician per day. A low figure which has a dramatic impact on the overall labour rate originally charged.

If your labour rate is say £50 and you are paying a tech to be there for eight hours, the labour rate is actually approx. £25 per hour. That’s called a recovery rate. Now this figure will fluctuate due to many factors like, productivity, utilisation, efficiency of the workshop, types of jobs you undertake, skill level, tooling and equipment that you have and any discounts as well as small repairs (bulb changes, lubricant top-ups) that are not charged for.

WILLING CUSTOMERS
There are many consumers willing and able to pay more for a service or product as long as they feel they have received value for money. I did not want to be in the same bracket as every other independent garage business offering the same services as everyone else not really offering anything different. This is much harder as we are all then trying to attract the same customer and it only pushes labour rates down or they never seem to go up for the right reasons.

The other concern I have with our sector both franchises and independents that advertise lower labour rates advertised for older vehicles. This drives me mad, why should we charge less? Is it because some other technician is going to come out of the tool cupboard who has less skill, paid less, who only works on older vehicles, so we can charge less? Of course this is nonsense, it’s the same techs, their skill level is no different when applied to older or newer vehicles.

I am happy to report that when I sold Brunswick Garage in December 2015 our labour rate was £90 per hour. However our actual recovery rate was £82 per hour, extremely healthy and unmatched as far as I am aware.

My final comment is, whatever your labour rate is, always remember that even if its higher than most, you must be able to justify it if and when questioned by your customers. You must ensure you continually explain the services and products you offer, and communicate the benefits why people should use your garage rather than competitors.

DON’T FEAR CHARGING HIGHER
When I began Brunswick Garage I knew my labour rate (£82) would be way above what other local independent garages charged. The average was around £50 in my part of North London. This did not bother me at all because I knew what I was offering potential customers, no one else could or would match us in terms of facilities, skilled staff, OE equipment and tooling, etc. So my labour rate was set to cover these costs and leave me a reasonable profit to keep investing in my business and people.

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QUICK, CHEAP AND GOOD… PICK ANY TWO


Mike Owen Is a consultant with many years industry experience in the independent and franchised motor trade

Mike Owen Is a consultant with many years industry experience in the independent and franchised motor trade

Mike Owen: Introducing a Service Level Agreement between factors and garages could stop the current race to the bottom

As you would expect, generally I’m quite well organised, have to be, but sometimes we all get caught out – to quote Robert Burns, ‘The best laid plans of mice and men….’ your intentions go wrong or an emergency happens that, by its nature, causes a meltdown in the vision that you held for your project. This is the stuff of the Independent Repair Industry – we manage crisis; in fact we are so adept at that most don’t bother with the plan in the first place favouring ‘it’ll be alright on the night’ modus operandi that sees the garages working late in the evening and
most weekends.

The motor factors find themselves in an even worse situation; once removed from the scene of the disaster you pick up the shock waves that are, of course, no fault of the repairer – in their opinion. Of course you then still have the exertion of pressure in that you are expected to have the stock on the shelf and to have a van and driver to deliver the requisite parts at ‘warp-speed’. Once that van has left, have another on standby to deliver the parts they forgot in their haste in ordering the first parts and you have to be prepared to do all of the above without the need to turn a profit!

I was working with a parts wholesaler recently and was truly amazed at their costs of distribution, staff, vans, fuel and stock required to run a ‘phone and go’ service.

CHOOSE TWO High Quality
This puts me in mind of the Chicago printer, who after a lifetime of working hard and earning little put a notice up in his shop window. It read: “We have three basic elements that we can offer you, there are ‘Good’, ‘Cheap’ and ‘Quick’ – you can choose any two but never all three; you can have a Good job Quick, but it won’t be Cheap. You can choose a Cheap job Quick but it won’t be Good or lastly, you can have a Good job Cheap but it won’t be Quick”. Perhaps we as an industry are guilty of loosing this perspective?

If you were to visit your doctor and have been referred to someone who knows what they are doing and been told that your life threatening condition needs urgent surgery, do you say ‘hold on, I’ll look it up on the ‘net and see where I can get it done cheaper?’ I suspect the answer is no, more likely your next question will be, ‘Today, tomorrow or when?’ and the answer will be at some future date not ‘…sew up Mrs Jones and get her off the table, this guy needs help’; now turn this scenario into a situation in our industry?

I hear the term ‘exceeding expectations’ coined regularly, especially by VMs, but there is another level that surpasses this which is ‘exceeding common sense’. We must remember that the vehicle owner/user will take all we can offer but will expect that as a minimum next time; do they offer this to their clients in their walk of life – in that case you are the customer, do they? The motor industry in not being more professional does little for our perception in the eyes of the customers who, because of the way we conduct ourselves think that we are all desperate for their business and that we will jump through burning rings naked and work for free.

Despite the sheer volume of vehicles on the roads lead times at most garages varies and this over availability leaves the vehicle owner spoilt for choice. A direct comparison can be levied at the feet of the parts wholesalers who, in order to court business have moved away from the old business maxim of ‘Sales for vanity, profit for sanity’ in favour of business at any cost.

PROFIT CLINIC
I run business ‘Profit Clinics’ on behalf of parts distributors for their garage customers and one of the first exercises explore how they are performing currently against their potential. Invariably there is room for improvement, the clinic goes on to explore where their best profit lies – their best profit is within labour, but only if they manage it properly, up to 70 percent gross profit or more. In truth a garage requires parts to make their product, labour, saleable and to this end they need the right parts on time – price is almost (but not quite) immaterial.

As stated in previous articles, I work for both dealers and independents alike and I yearn for the day when the relationship between independents and parts sales becomes formalised as it is with the franchised dealers and VMs. Yes, I would like to see Service Level Agreements (SLA) – not as draconian as the VM’s impose but some form of terms and conditions, not every nut bolt and split-pin being haggled over on an individual basis but perhaps with rebates based on turnover thresholds –
Why? Because it would help take the ‘amateur repairer’ out of the equation but also call for the garages to negotiate with customers rather than their suppliers as their ultimate cost price would be volume driven.

There is a lot of spin-off from SLA’s not least of which are relationships, loyalty and parts planning rather than the ‘jump- and-dart’ that we see currently, it would also allow for the parts suppliers to go the extra mile on the occasion that it is needed – but don’t worry it will never happen because we still worship the one great God, which
is turnover.

Posted in CAT Know-How, Factor & Supplier News, Garage News, NewsComments (0)

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