Business
https://youtu.be/LOkePodEzpA Brian Gillis is the Chief You Net Results Strategist, with 25+ years experience in auto shop operations, hiring, recruiting, systems, processes, multi-store experience, and employee training. More about Brian Gillis… 25+ Years owning and operating auto repair shops in Texas, Georgia and Colorado, multi-unit stores Hired and Trained over 2000 staff members Budgeting and Profits Brian’s Specialty Smooth as silk with customers Brian's previous episodes are (https://remarkableresults.biz/?s=Brian+Gillis). Bob Greenwood is one of 150 Worldwide AMI approved instructors. He has created Business Management development courses for aftermarket shop employers/managers, Jobbers and Jobber Sales representatives which are recognized as being the most comprehensive, industry-specific courses of their kind in North America. His courses address the creation of measurable bottom-line profitability and not just developing activity to keep busy, by covering the very detailed nuts and bolts issues that are required to be clearly understood by every level of the industry if an independent shop is going to financially prosper and enjoy a professional future. Bob’s previous episodes are (https://remarkableresults.biz/?s=%22greenwood%22). Link to Automotive Aftermarket E-Learning Centre Ltd. (AAEC) (http://www.aaec.ca/). Key Talking Points: Must know your true cost of doing business to set your labor rate. Know your numbers. Always review them. Multiple labor rates are needed today. One catch-all labor rate will not support the sustained profits necessary to survive Minimally you need three labor rates:Maintenance Rate Diagnostic Rate Re-Flash Rate Additional to consider Fluid Installation Rate Tire Inflation Rate Do not look down the street to set yours. Understand your business A formula is necessary. See below slidesCost Per Billed Hour Formula (CPBH) Bob. Technicians wages need to be expensed not put into the cost of goods for his formulas to work You may have a productivity problem, and the formula will help you determine that The only way you can lower your cost per billed hour is to increase the number of hours you bill.The industry is stuck on sales and activity but should be measuring productivity You may have big sales gains, but have little profit to show as a percent of sales Labor rates on diesel and fleets should be different Rethinking labor rates are critical because when parts are not sold in conjunction with labor you will be making less money at your standard labor rate See slide on show notes page: Setting Your Door Rate for the three basic rates. Below shows two different formulas to discover your three labor ratesMaintenance Door Rate4.5 Times Top Technicians Basic Hourly Wage 85% times your CPBH Diagnostic Door Rate5.35 Times Top Technicians Basic Hourly Wage 125% Times Your CPBH ReFlash Door Rate6 Times Top Technician-Basic Hourly Wage 135% Times your CPBH We are in a knowledge base business, and we must be paid to cover your costs to obtain and sustain that knowledge The Cost Per Billed Hour (CPBH) reflects your efficiencyIf you are inefficient, your cost per billed hour is going to be higher If you are efficient, your cost per billed hour is going to be lower You’ve got to understand your numbers inside and out today Bob recommends twice a year review of labor rates and CPBH Your labor rate should respect the competency of your team You also need to understand the average billed hours per Repair Order (RO)It helps you see how easy it would be to raise your labor rate How many diag hours should we bill vs maintenance hoursMeasure this. Bob suggests today: 25% of your maintenance hours should be diag hoursIf you bill 100 hours of maintenance, you should also have 25 hours of diag billing Diag hours are when you interpret or analyze informationTest driving you are analyzing Scope time is analyzing...