Is Your Shop Operational? By Bob Spitz

Robert Spitz
Snr VP Business Development
Management Success!

First off, let’s define operational.  Operational is a term adapted from philosophy and science to the world of business.  It means the business is functioning effectively and its processes and procedures are running smoothly.  In other words, everyone in the business knows their job functions and is executing these functions efficiently.  Having a truly operational business system results in a higher profits and sustainability.  Generally speaking, the business runs very well without the owner’s constant attention.

What will it take to get your business to run at this highly efficient state?  Let’s take a look at this point-by-point and see if we can map out a plan that will allow you to reach this ideal land.

Goals for Your Business

Most entrepreneurs go into business with the goals of sustained financial security and personal freedom that elude many people who work for someone else. This being said, the ability to set effective goals for yourself and your business is vital to your success. 

Organization

Although, many technicians have dealership experience, they are not necessarily exposed to the dealership’s organizational and operational systems.  Consequently, these technicians are left with limited knowledge of operating a growing business.  

In the start-up stages, it may appear that little organization is needed to experience some initial business growth.  However, in the long-run, knowledge of how to operate all aspects of a business from marketing, sales, employees, production, operations, accounting, collections and expansion are key to a successful business.

Recruiting and Hiring

Most people in our industry start out on the technical side.  They’re good techs but have only learned that one side of the business.  A business cannot grow without people who are well trained in all aspects of business operations.  Knowing how to recruit, hire and train the right employees is imperative. Without good hiring techniques the business will most likely stay small, leaving the business owner wearing to many hats and feeling over worked. 

Employee Management

A common error among small business owners is to assume that their employees value their business as much as they do.  As a result, issues that are painfully obvious to the owner are often overlooked by employees, resulting in owners feeling disappointed and frustrated.  It is important for a business owner to clearly communicate the BIG PICTURE of their business and motivate their employees to subscribe to their vision and goals.   Having competent employees who clearly understand and appreciate all of the shop functions is critical to the success of a business.  Otherwise, the business owner may feel like they have all of the functions of the shop wrapped around their neck.

Marketing and Sales

“Build a better mousetrap and consumers will beat a path to your door.”  Maybe you have heard this old adage.  The problem with this saying is…it is incomplete.  You could build the best mouse trap the world has ever seen, but without a good marketing plan no one will ever know about it.   Without a good marketing plan and competent people on the front lines who know how to sell your services, your business won’t thrive.  We live in a very transitional period.  No one marketing vehicle can stand alone.  Only the most carefully crafted strategical marketing plans will allow you to outshine the rest.  

Transitioning

Probably the hardest thing you will do is learn how to transition out of the back to the front office, and then ultimately out of the front, too.  But you must do this if you have the goal of being highly operational.  You have to learn how to correctly recruit, hire and train technicians to handle your shop efficiently.  You have to know how to attract the right talent up front and train them to take care of your customers the way you do. Then the final transition point is learning to trust someone to handle the day-to-day management of the business for you.  This is a process that takes knowledge, skill and patience.  But, if you gain the needed knowledge and management skills you will be rewarded with the successful shop and life you envision.

Industry Analysis & Trends

According to a 2015 market research study conducted by IBISWorld, the auto repair industry is in growth mode.  “The Auto Mechanics industry has grown steadily over the last five years. Individuals and businesses have increased demand for industry services, as rising disposable income encourages consumers to opt for auto mechanic services over do-it-yourself repair. In the coming years, disposable income levels are expected to continue to grow, encouraging consumers to spend more on the maintenance and repair of their vehicles.”   The IBIS report shows the current revenue for the auto mechanic industry is currently at $57 billion.  So we ask you…. Do you want to take advantage of this industry growth trend?  Or, do you want to sit on the sidelines and watch others prosper?

In Conclusion

Management Success has been helping shop owners for over 20 years achieve their goals, and have the life they envisioned.  Take the next step to being highly operational by going to www.ManagementSuccess.com and taking our free online Shop Business Analysis! 

*IBISworld Mechanics Market Research Report
(http://www.ibisworld.com/industry/default.aspx?indid=1689)

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Management Success! Honored to Have Hosted Omani Officials a Second Time for Automotive Training Courses

LOS ANGELES, CA - June 17, 2014

From May 28 to June 11, Omani automotive engineers Faham Yasser Obaid Al Salami and Aflah Nasser Abdul Wahab Mundhiri, who work in the Workshops Department under the Directorate General of Transport at the Royal Court in Oman, participated in comprehensive management training courses at the Management Success!’ training facility in Glendale, California. While the courses were directed towards automotive shop owners, Management Success! consultants and workshop instructors spent individual time with the engineers explaining how to apply the principles they learned to their large government fleet.

The Omanis’ visit comes on the heels of last year’s visit from two other Omani engineers, also from the Royal Court Workshops Department.

Al Salami and Mundhiri took the trifecta of Management Success! primer management courses: Controlling the Front, Improving Business Through Communications, and How to Get Compliance. These courses focused on a two-pronged approach to effective management, covering theory with the first and practical skills with the latter two.

What made the experience unique was that the engineers got to network with many automotive shops during the courses, allowing them to gain different perspectives into how to manage an automotive business.

“We appreciate the opportunity to study at Management Success! and to interact with automotive shop owners from the United States. We will take home our new skills to increase the efficiency and flow of our departments,” Salami and Mundhiri said in a joint statement.

Robert Spitz, Senior Vice President of Business Development at Management Success!, was incredibly honored that the Omani government chose Management Success! as Oman’s official automotive management training company, and he enjoyed hosting the visitors.

“It was a great honor to have Faham and Aflah here with us over the last two weeks. They were great to work with, and I know the instructors had as much fun as they did in the process,” Spitz said.

In addition to attending classes, Al Salami and Mundhiri explored the sights and sounds of Los Angeles for the first time, visiting spots like Grauman’s Chinese Theater and the Glendale Galleria.

With a great time had by all, Al Salami and Mundhiri foresee an ongoing relationship.

“We want to thank all of the staff and instructors for their attention and care, and we look forward to working with Management Success! in the future,” Al Salami and Mundhiri said.

About Management Success!:

Management Success! is an auto industry consulting firm that specializes in elevating the quality of life of shop owners all over the US, Canada, and overseas. Founded in 1993 and headquartered in Glendale, California, Management Success! helps shop owners become effective managers in order to increase profits. The Management Success! team believes shop owners deserve to be well-compensated for their hard work. Management Success! fully arms shop owners with every executive ability needed to win.

For more information, please contact:

Morgan Scott
eMarketing Manager
Management Success!
(818) 500-9631
www.managementsuccess.com

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The Real Reason Why Independent Repair Shop Owners Are Struggling, by Robert Spitz

Robert Spitz
Senior VP Business Development
Management Success!

Some say it is because people are leasing cars, and therefore feel no need to maintain them. Others say it is the auto makers’ grab for domination of the repair market.  Many say it is because there are no more good technicians. And a few blame the increasing complexity of cars, the economy, the weather...

The only reason an independent repair shop struggles to make ends meet is lack of management know-how. Specifically, paper flow, routing, and tracking of key statistics are not done or are inadequate; the owner is wearing too many hats, cannot delegate, and is therefore “too busy” to really make any money; doesn’t do the basic, routine internal marketing actions to make the most of the existing customer base; doesn’t know how to handle personnel or “handles” them poorly; doesn’t know how to find good technicians at the drop of the hat; doesn’t provide adequate incentives to employees based on their production.

There are hundreds of things in a successful repair shop which must dovetail like clock-work for that shop to run at peak efficiency on a consistent basis. When they do, it’s a money-spinning thing of beauty. But that all falls under the heading of management know-how.

Why is it that one shop is busy all the time and another right next to it is dead? Why can one technician rapidly know out whatever job you throw at him – with high quality – while another suffers from broken bolts and wrong parts, takes forever, and blames everyone but himself?

Running a shop is just as technical as fixing cars. There are certain management tools you must have to get the job done at all. There are certain business aspects you need to know cold, so that you can think on your feet with them and track where you are at at all times.

Shop owners who do not have a command of the Management Technology are really nothing more than shade-tree managers and will always have some external excuse to justify their ineptitude. So, don’t buy into the industry doom-sayers’ negative rationalizations. 

For many years now, we have helped thousands of independent repair shops in every part of the country become and stay more successful than they even thought possible. I can therefore assure you with complete certainty that the only difference between a struggling shop and a successful shop is the owner’s level of management expertise.

Your shop will rise to your level of management expertise and no further. If you want to keep getting what you’re getting, just keep doing what you’re doing. If, however, you want to create a better scene for yourself, your family, and your employees, call us at (818) 500- 9631. We are industry-specific and here to serve you. Please call now.

Management Success!

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The Adventures of MACH TWO – Chapter 3 & 4 by Mike Lee

Mike Lee
co-founder
Management Success!

Background

(MACH TWO gets his name from the fact that while at work, he is constantly going MACH TWO with his hair on fire.)
In the continuing adventures of MACH TWO, a once mild mannered technician turned automotive shop owner, he is in total overwhelm and he can't seem to find enough time to think.

Chapter Three:
Why Did I Come Out Here?

Oftentimes, MACH TWO finds that his day starts off bad and just continues to get worse throughout the day.  The shop opens up and there is a rush of customers.  Usually, while he is trying to get them handled, the employees are working in cruise mode.

By 11:00 a.m., the shop is in total chaos.  Of course, in the middle of all of this chaos, the phone rings and a customer wants to know what has been found out about his car.  MACH TWO puts the customer on hold and walks into the shop to find out the diagnosis of the customer's car.

Before he gets there, Bill, one of his technicians, wants him to look at a problem that he has with a customer's starter.  Then Frank wants to know what h should do with the linkage problem that he has on this hot-rod.  Ten minutes goes by and suddenly, MACH TWO is standing in the middle of the shop wondering why he came out there in the first place.

Part of the problem is that MACH TWO has no plan of attack.  He runs his organization by the CRISIS METHOD of management.  Basically, he is solving every problem in the organization.  He has the jobs that he is supposed to do, plus the problems that everyone else is supposed to handle but can't.  So, because he is busy solving all of his employees' problems, he never gets a chance to do the things that he should be doing.

The symptoms that exist in this type of shop:
The employees can't seem to handle the tough problems required to completely perform their jobs.

The real problem is:
The shop owner lacks employee handling and training skills.

Solution:
The shop owner needs to let all of his employees solve their own problems.  The way to do this is to consult the employee on the steps necessary to finding his own solution instead of giving the employee the quick fix that he/she wants.  The shop owner can do this by asking questions.  Find out exactly what it is that the employee does not understand and work from there.  Unless the owner starts doing this, he/she will never be able to grow and expand.

Chapter Four:
What Do I Do Next Boss?

MACH TWO finishes road checking a car and pulls back into the shop.  The first thing he notices is that all three of his technicians are not working but just standing around waiting for him.

MACH TWO goes ballistic.  It is four o'clock in the afternoon, there are cars all over the place, and he has lied to half of his customers about when their car is going to be done.
The office manager runs out and indicates that Mr. Royal Pain is on the phone demanding to know if his car is going to be done tonight.  Of course, he has been calling every half hour asking the same question.  She also tells you that she has two other customers on hold.
The blood pressure gauge on MACH TWO begins to burst.  He yells at his technicians to get back to work.  "Work on something, I don't care what, just don't stand there!" he yells.  He tells the office gal to just hang up on Mr. Royal Pain.  He then goes into the office and barks at the two customers on the phone.

When he finally arrives home, he yells at his kids, kicks the dog and ignores his wife and just sits in the chair staring at a blank television screen.  During all of this he is thinking to himself, "Why did I go into this business in the first place?"

Symptom: 
The shop owner is basically acting insane and is in total overwhelm.

Real Problem: 
The owner lacks organizational skills and employee handling skills.  He is running a "Hey, you!" organization.  This means that he is telling everyone what to do verbally.

Solution: 
The shop owner needs to start organizing his operation.  He needs to develop a method of routing work, where the employees don't have to come to him to find out what to do next.  He needs to develop a system that will make finding the status of a customer's car easy for any employee in the shop.  This also means without having to interrupt everyone.
In the next chapter, MACH TWO will enter the advertising jungle and try to figure out where he is.

Management Success!

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Growing Pains by Mike Lee

Mike Lee
co-founder
Management Success!

A majority of shop owners in the auto repair industry find taking the shop to the next level is their main problem. Their shops have either grown to a certain size in gross monthly sales and have then flattened off, or they can’t seem to take home enough money. It does not matter how big a shop has grown, when it comes to the owner’s checkbook, you should hear him groan.

The Four Stages of Business

The average business goes through four stages of development. These stages reflect the development of the shop owner’s business and management skills. Unfortunately some shops seem to get stuck in one stage of development and are unable to expand beyond it. Other shops are able to grow fairly quickly but can’t seem to make any money.

Stage One

In this stage we have the technician that has opened his first shop. In most cases, he is doing most of the work on the cars and handling the customers as best he can, along with doing all of the paperwork. Basically he is doing everything himself. This is the normal startup procedure.

Some shop owners get stuck in stage one and never really grow out of this condition. They hit a certain level of monthly sales and that is it.

Stage Two

In stage two we have a shop owner who has decided to go primarily into the front office to handle the customers or hire someone to do this for him so he can work on the cars. If he is the service writer he still helps out with fixing the cars in the shop.

Stage Three

In stage three the shop owner has expanded to the point that he has delegated the primary jobs to others. He has a service writer running the front office and other people fixing the cars in the shop. He helps out in the front with the customers in the morning and then will go into the shop to help solve the problems of his technicians. Delegating responsibility successfully gives him an opportunity to do other things to help the business grow.

Stage Four

Here we have a shop that has successfully expanded to high levels of volume. The owner is not required to be there to run the day-to-day operations. Profits are high and relatively stable. He is at a level where 80% of the shop owners in the country would love to be.

We Work Hard, So Why Don’t More of Us Arrive at Stage Four?

There is a rule of management that you will always expand up to the level of confusion that you can handle. When you get confused you go slow and make mistakes. This means that over time a shop owner may develop a big operation, but unless he really understands all the key areas of his business — personnel, marketing, finance, production, quality control, public relations, sales and management — his bottom line will suffer.

But I Don’t Have Any Dough!

Some shops do a million dollars in sales a year and aren’t making any money! If they are making money it isn’t a good return for the amount of business they have or the amount of effort they put into their business. Time and time again I have found shops doing more than $750,000 a year and not making any real profit.

The Real Problem

If you want to narrow all of these conditions down to one broad statement that defines the problem in the auto repair indus­try, it would be that the owners of these shops are very good at FIXING CARS. They can solve any problem with the cars in their shops if given enough time.

But the problem that is beating them up is that they don’t know how to FIX THE BUSINESS. They lack management skills and knowledge. Their lack of management skills is the primary reason they are not making enough money in the business.

Solution

In each of the four stages of a business, the solution is for the owner to quit being a mechanic and start being a businessman. He needs to learn to run his business. Running the business and making a profit is what a businessman is supposed to do. If the owner does this right he can slowly move up stage by stage.

Eventually he will move out of the hectic, overworked stages one and two until he arrives stably at stage three or four and is making DOUGH. That is my wish for you!

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Management Success! Debuts Shop Management Innovations at Fall Convention

Management Success!
2013 Fall Convention

LOS ANGELES, CA – October 4th, 2013 – Premier auto industry consulting firm Management Success! introduced several new, more efficient tools for shop organization and flow at its Fall Convention—the company’s largest convention ever at nearly 200 people. The convention took place at the Glendale Hilton from September 20th to September 22nd. Attendees included auto shops from all over the country and Canada as well as representatives from DemandForce, the leader in small business emarketing solutions, and 10 Missions Media, which publishes Fender Bender and Ratchet & Wrench.

The theme of the Fall Convention was Cutting-Edge Solutions for Today’s Shop, and the company’s dynamic partnership announcements certainly fit the bill. Management Success’ statistics system now auto populates with statistics from the NAPATracs interface to save shop owners time and to eliminate human error. While this partnership was originally announced at the Spring Convention in Destin, FL, the stats system is now in place and available for all Management Success! clients.

“A business cannot make correct management decisions without accurate and timely data. These new interfaces will provide our clients with this kind of information,” said Robert Spitz, Vice President of Production at Management Success!

Management Success! also announced its new partnership with DemandForce, with more details to emerge at the next convention.

The theme of innovative solutions extended to the two new courses offered at the convention—The Art of Diagnosing Your Shop, taught by Senior Consultant Wency Severi, and Hiring in the New Age, taught by Consultant Ari Cohen. The Art of Diagnosing Your Shop showed clients how to determine the real problem and find real solutions, while Hiring in the New Age explained how to employ online techniques to recruit a new generation of employees.

Though the convention played stage to Management Success’ new developments, it was also a time to recognize the hard work put in by clients who had gone above and beyond.

During the Awards Dinner on Friday, September 20th, Dino Di Giulio of Body Best of Sonoma became the third person ever in Management Success’ 20-year history to receive the Master Elite of Shop Management Award. Coming to the stage to accept his award, Di Giulio gave a rousing speech about his journey, which was met with a standing ovation.

“Twice a year Management Success! awards shops that have done the necessary training and have demonstrated competence at the various levels of shop management. They have passed through a rigorous battery of performance benchmarks and shop inspections,” Spitz affirmed. “The Master Elite of Shop Management is the highest honor an owner of an auto repair facility can achieve. We are all very proud of Dino,” Spitz added.

Other highlights of the night included the Master of Shop Management Award, given to Brian Small of Doc’s Auto Clinic; Competent Shop Owner was awarded to Joe & Lori Fenski of Fenski Automotive Center; the Effective Shop Management Award, given to Amanda Pederson of B & D Industrial Service and Curtis & Tracy D’Addario of D’Addario’s Auto Service Inc.; and the new Sustaining the Masters of Shop Management Award, given to David Saline & Lynnetta Rogers of 2nd-to-None Service and PJ & Jackie Robert of Roberts Automotive.

Saturday night took a turn for the jubilant, with a roaring ‘20s-themed dinner. Clients went undercover as zoot suit-clad mobsters and flashy flappers, competing for fun costume prizes, playing table games, and dancing into the night to ‘20s and ‘80s tunes.

The sparkle and glamour of the event alluded to the ritzy location of the next convention—Las Vegas. The Spring 2014 convention will be called Stable, Profitable, and Loving It! and will take place over the course of five days. Clients can expect a convention filled with hard work and a brand of fun only Las Vegas can offer.

About Management Success!
Management Success! is an auto industry training and consulting firm that specializes in elevating the quality of life of shop owners all over the US and Canada. Founded in 1993 and headquartered in Glendale, CA, Management Success! helps shop owners become effective managers in order to increase profits. The Management Success! team believes shop owners deserve to be well-compensated for their hard work. Management Success! fully arms shop owners with every executive ability needed to win.

###

Please contact Management Success’ Marketing Department at Morgan.Scott@managementsuccess.com or (818) 500-9631 for more information regarding Management Success! conventions and training programs.

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Keeping Your Eye on the Ball By Mike Lee Management Success!

Mike Lee
Co-Founder
Management Success

In the typical automotive shop, you will find that the owner has red hair and the nickname of ‘MOCK TWO’.  This is because he is going Mach Two with his hair on fire.

A good observer would notice that a high percentage of the time, while appearing to be in rapid motion, he is really on a treadmill, trying to do 12 things at the same time.

Most shops grow to a level of volume just above the level of confusion that the shop owner can handle.  Once the shop has reached this level, it quits growing because the owner lacks management and organizational skills.  The shop will tend to stay at this level for years unable to burst through to the next level.  It never seems to get better, only worse, because gradually the owner takes home less and less money.

MOCK TWO is suffering from lack of focus and lack of a simple game plan.  The shop owner comes to work with the intention to make things better but it never seems to happen.  He then wonders why he is unhappy and why he doesn't have a sense of accomplishment.

The problem is focus.  He is trying to do too many things at once.  When he hits the door of the shop, all of the problems seem to come directly to him and stick to him.  He tries to handle them all and usually doesn't get any of them done.

Most shops didn't get to this level of confusion overnight.  The shop owners have worked for years to get to this level of overwhelm.  Unfortunately, MOCK TWO never seems to have enough time to start fixing the problem.

The key thing here is that it is never going to get better unless MOCK TWO decides to fix it permanently.  While in a coping condition, he (and you) MUST start organizing or it is only going to get worse.

The solution to the problem is to sit down after work and list some of the things that you need to accomplish that will make you more money.  Decide which one you can do with the least amount of effort (and/or money).  You want to choose the project that will give you the best results and get it done first.  Do not focus on any other projects until you have this one done. It might take you three weeks to finish it, but it doesn't matter.  You have taken the first step of getting rid of overwhelm and confusion.

We call this KEEPING YOUR EYE ON THE BALL.  Focus every day on the one thing that you are trying to get done.  Keep your focus on it.  You should try to do the project you can accomplish the quickest and with the least amount of effort.  When you finally finish the project, you will feel good about yourself and have a little more time for other projects.  This will allow you to pick up the next thing on your list and focus on it.  The things that needed to be done in the shop will start to get done and gradually you will improve your whole operation.

Eventually, you will be renamed MOCK ONE and hopefully even renamed SANE in a very short period of time.

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Marketing To Women: A Female Shop Owner’s Perspective By Nancy Knight Management Success!

Nancy Knight
co-owner of Knight’s Automotive
Ledgewood, NJ

As a wife, mother and major decision maker in my family when it comes to purchases of goods and services, I have lots of experience as a consumer.   My past experiences as a female consumer, both good and bad, have helped influence the way I market and manage my own auto repair business.  I make sure that our shop gives the same friendly service and high quality products that I expect from the people I do business with.    In particular, I pay special attention to meeting the needs of my female clients.  

Why do I have so much attention on female clients?  It turns out that I am not alone as the major decision maker on purchases for my family.   Even in what is perceived as a male domain, women request 65% of the service work done on cars (in our shop it’s closer to 75%)  Women spend over $200 billion on new cars and servicing of vehicles each year.  We buy more than half of the new cars in the US and influence up to 80% of all car purchases.  There is power in the female demographic indeed.  It pays to find out what your women customers want and need then deliver it.   To do this successfully you must first understand that men and women—for the most part—communicate and make decisions differently. 

Besides trust, which is important to both male and female consumers, women want a “relationship.”   We all know that being in a relationship requires a higher level of care and communication to nurture and sustain it in the long term.  Women want more information about what is being done to their vehicle and why.  They want you to listen to them, educate them and not talk down to them.   I call this the C.A.R.E. factor:  Completely And Respectfully Explain their car care needs to them in language they can understand.  We like to use visual aids at the counter and walk the customer out to the car when necessary. 

While men tend to communicate less and want a brief explanation of price and function of the repair or service, women want more details.  Female clients also prefer you to take a personal interest in them, their families, jobs and hobbies.  Ask a woman about her kids, her business accomplishments or her hobbies and watch her brighten up immediately.  This increased familiarity, sincere care and concern goes a long way in building long term relationships with your female customers.  Since, happy, long-time female customers are more inclined to refer business to your shop than male customers (in my experience); they are the best customers to have.

Acknowledging birthdays, anniversaries or writing personal thank you cards are successful marketing actions to consider in building relationships with your female client base as well as personal follow-up phone calls after service is performed. Some additional points to ponder when marketing your repair shop to women are:

• Make sure that your shop is clean and neat both on the inside and the outside. Do not confuse this with fancy. The reception area should be scrubbed and fresh smelling.  Include comfortable seating where possible. Female-friendly magazines, coffee, bottled water and fresh baked cookies are nice touches. 
• Pleasant music playing is preferred over a television blaring bad news.
• Insure that your bathroom is sparkling clean and smells good. 
• Just as your physical location should be scrubbed, so should your online reputation.  Women are more likely to engage in social networking sites such as Twitter and Facebook as well as check review sites such as Google, Yelp or Insiderpages before deciding who to do business with. Respond to your reviews and engage your customers on these sites.  Happy customers will share your information with their friends and family members online.
• Make certain that your website is fresh and attractive. Including personal information about yourself and your employees makes you real to potential customers. Pictures and education points are also helpful.
• Set up regular maintenance schedules and send reminders. Utilize all the current technologies such as text messaging and email as well as direct mail according to the individual preferences of your customers. 
• Leave your customer’s cars clean and smudge-free. Besides making a good first impression, making a good last impression is also important especially to the more discerning female customer. Use floor mats, seat covers or steering wheel covers to prevent any dirt or grease from damaging the interior. Do not change the radio station. Offering a complimentary car wash or interior vacuum for large jobs are also welcome treatments.
 
These are just a few female friendly ideas to get you started.  Of course the best way to find out what your female customers want and need is ask them!  Survey your female customers.  They will love that you care enough to ask their opinion.  This is another action which builds long term relationships. 

At the very least, ask your wife, mother, girlfriend or daughter her opinion of your shop.  They will tell you like it is, both the good and the bad.  Adjust accordingly.  It is helpful to ask yourself: how would I want my wife, mother, girlfriend or daughter to be treated? Go over this viewpoint with everyone at your shop from service writers, managers to technicians.

Though I have addressed the female customer base, many of these points are good practice when dealing with your male customers as well.   Make the women happy and the men will certainly follow.    It takes a little effort, but it will pay off in the long run, with repeat business, future referrals and an increased viable customer base.  That is a huge return for just “making Mama happy.”

I learned ALL this and so much more with Management Success’s amazing and knowledgeable staff. I very highly recommend that you attend the How To Increase Your Profits seminar—don’t wait! Let their staff show you just how successful your shop can be!

Get help with your marketing and other management tools—join us at a Seminar near you!

Visit www.managementsuccess.com

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Are You Suffering from the "Dad Syndrome" in Your Shop? - by Mike Lee, Management Success!

Mike Lee
Co-Founder
Management Success!

It is very common for auto shop owners to become overwhelmed. They try to do too many things at once; unfortunately, they do not get most of them done, or if they do, they are done poorly.

These owners are suffering from the "Dad syndrome." The reason they are unable to finish their tasks is because they are helping others or solving everyone else's problems. All of their employees treat them as a Dad.

All day long, whenever the employees have a problem, they come to the owner for answers or help with their problems. This leaves no time for the owner to finish what needs to get done.

"Dad! Can you help me with this problem?" "Dad! What do you want me to do with this?" "Dad! What should I do next?" Oftentimes, an owner leaves the shop for ten minutes and comes back to find three of the highest production people standing around waiting for him or her to solve their problems. The owner barely gets out of the car before they all start yelling, "Dad!"

It is like nobody can do anything or think for themselves. Dad has to make every decision and handle every problem. Is it any wonder that the shop owner goes home tired and overwhelmed?

The effects of the Dad syndrome are many. The biggest effect is it costs the shop lots of money. Because of the Dad syndrome, the shop grows to a certain volume level and quits growing. Dad can only handle so much.

It affects the ability of the shop to get into the profitable mode. It affects the ability of the employees to produce. It causes a great deal of confusion resulting in lost time, lost production, and lots of lost money.

So, what is the solution? The first step is to recognize that it is a problem in the shop.
Next, the owner must get employees to start doing their jobs without his or her help. Part of this is done by defining exactly what their job is and what is expected of them. Next, the owner should put the employees on an incentive program where they get paid based on the following: 

1) The volume of work they can do, and
2) The level of expertise they can handle. 

Owners must learn to train employees so they are just as prepared to solve problems they face. They should teach employees how to handle problems as they come up, and their pay should be based on this.

Eventually, owners should refuse to handle the employees' jobs, so the employees will learn not to constantly rely on the owners. At our company, the owner used to say, "Manage, Manager! I pay you to handle the problems, so handle them!"

The key to solving the Dad syndrome is for owners to recognize that they have to quit solving employees' problems and, instead, teach them how to do it.

Management Success!

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A Shop Owner’s Guide to the Basics of Success, by Robert Spitz, Management Success!

Robert Spitz
Snr VP Business Dev
Management Success!

A while back, I called a shop, knowing it was way past closing time, but betting I would get the owner. Sadly, I was right. It was 8:00 pm in his timezone, and he gave me the usual line, "I was just wrapping things up." He had missed his son’s ball game and was feeling a little low since this had become a pattern in his life: missed opportunities to spend time with his family.

George (the owner) told me he had spent a fair amount of time wondering how to juggle all of his business, family, and personal obligations and how to keep everyone, including himself, happy - all while maintaining his sanity. George was stuck in a rut and did not know how to get out. Everything seemed bleak. Having worked and helped hundreds of "Georges" in my time, I knew what was going on and that it was fixable. I just had to get George to agree to let me give him a hand. 

The first thing I had him do was sit back, take a deep breath, and answer a few questions:

1. What is your goal here? 
2. Who are you doing all this for?
3. What are you really trying to accomplish?

Once he started thinking about this, he realized there is no single answer. As we get older, our priorities change. Things that were vitally important to us when we were in our 20s are not all that important now. I had him ask himself, "What is important to me, and how do I get there?"

Your business has more than one purpose. It has a purpose for you, your customers, your employees, and your family. By identifying these purposes, you can align your goals and priorities more easily. Take a moment to sit back, relax, and imagine what your business and your life would be like if everything was ideal.

If you can imagine what it could be like, then you are well on your way to setting goals that you can work toward achieving. The ability to imagine is extremely important for a business owner. Once you have a vision of your ideal business, how do you get from where you are now to where you wish to be? 

The answer is simple: you need a plan. It cannot be the old “work harder and longer” plan. Most shop owners have tried that, and it has just made them more tired, not more successful. Still keep in mind that, while any plan is better than no plan, your plan must be something you are willing and able to do. What good is a 50-page detailed plan if you are unwilling to do it?


To create a better plan, first ask yourself if you merely need a “tune-up” or if a “major overhaul” is in order. Also, look at what is right about the business. What do you want to change? What are your strengths and weaknesses? Make some lists.

Management Skills
The top item on the list of things that you need to improve should be your own knowledge of business. Many owners are highly skilled and trained in the area of repair, but woefully lack in the area of business management. It is the business management skill that will take you from where you are to where you want to be. What if you were as skilled and confident in your ability to run your business as you are in diagnosing and correctly repairing a vehicle? Most likely, your business would be in a very different place.

Once an owner is no longer just a technician, he or she needs to have a new and different set of skills. To the degree you do not have them, the business will suffer. For an owner, technical skills are not enough. Here is a list of the areas in which a successful business owner must have confidence and expertise. It can give you an idea of where to begin improving your ability to run your business.

• Planning
• Marketing
• Sales
• Organizing
• Employee management
• Finance
• Training
• Public relations

Planning
The problem with planning is if you do not know where you are going, you cannot come up with a plan. It is like jumping into your car and starting to drive with no destination in mind. If your goal is to wander around until you run out of gas, that might be fine. Otherwise, you are just wasting your time and energy! To come up with a good plan, you have to figure out your goals and be certain of what you are trying to accomplish.

Marketing and Sales
Have you ever heard the old expression, Build a better mousetrap, and the world will beat a path to your door? This is not entirely true because if you fail to tell anyone about this new whiz-bang mousetrap, no one will ever know about it! You have to market your business. You have to let people know you are there and show them what you can do for them.

Marketing gets the phone to ring and gets new and old customers to show up. You also have to make sure you have someone who can sell them the needed services once they are on the phone or at your door. I have seen some great marketing completely wasted by an inability to sell once the prospect inquired. Your service writer should be able to convert 70% of all inquiries into appointments.

Organization
Your shop only grows to the extent that you can handle confusion. Once things get too confusing, you stop selling, which severely limits your profits and growth. A common solution to confusion is hiring more people for the front; on the downside, this hurts your bottom line and may not even solve the problem. The correct course of action is to look for ways to streamline the operation and to figure out how you can be more efficient. You have to organize the various activities of the shop into a workable sequence.

Employee Management
Employee management is a tough area for a lot of shop owners, but it does not have to be.  Establish your goals, and communicate these goals to your crew. Then, make sure the shop is well-organized and everyone knows how to get their job done. Set up a bonus plan or a production-based incentive program. Track each employee’s production, and evaluate only on that basis. You will quickly see who is on your team and who is not.

Finance
Finance, which includes pricing your goods and services, has to be very well-understood by a shop owner. Knowing how to set up your finances for your own benefit - and not for the benefit of the bookkeeper or accountant - is a must.

Training
Ongoing training programs that keep everyone in the shop sharp are critical. The shop owner must provide them, and the employees must be willing to participate. Watch out for employees who are not interested in receiving training.

Public Relations
Shop owners must have some knowledge of public relations, especially as their shops grow and become successful. Not everyone you deal with is a sweetheart! You do not have to hire a PR firm, but make sure you get your good work well-known in your community so the shop is held in high regard.

I called George at the shop the other day. It was 3:30 pm his time, and his service writer informed me he was gone for the day. I smiled, thanked him, and said I would call him tomorrow morning.

Before another day passes, take the time to envision your ideal scene and establish your goals. Then, make sure you have the business knowledge you need to carry out the plans that will help you reach your goals. Good luck on your road to success!

Management Success!

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The Size of the Problem by Mike Lee Management Success!

Mike Lee
Co-founder
Management Success!

It is an interesting phenomenon to talk to a shop owner whose statistics are downtrending, whether it is a small shop without enough work or a big shop that is still doing a good volume of cars but isn’t making enough money.    Whatever the situation, the owner doesn’t seem to be able to fix it.

The manifestations of confusion are varied, depending on the problem.   Let’s start by first identifying the problem, which can usually be described as “they are not making what they need to be in order for them to be happy and winning in the business.”  (Translation: They are not making money!) 

It Is The Economy

When a shop is not doing well, there are many reasons that create the problem.  Normally, the shop owner picks out the one that seems to be the most obvious.  There is not enough work, or customers are not spending like they normally do.  

Whatever the shop owners have been doing to solve the problem has not worked and they go into apathy!   Oh! Talking to them about solutions is like talking to a stone wall.  They aren’t listening and they are sure there is nothing that can be done about it.

But, I never let that stop me!   So I start attacking the problem.   When I ask what the problem is, they start bringing up vague generalities in which there appears to be no possible solution.

1. “Its the economy”
2. “The customers are not spending money on their cars”
3. “Everyone is slow”

You can’t solve any of those problems, because they are a generality and it is not the real problem in terms of the business.   The first step of solving their problem is to move the owner out of apathy!  (Translation:  Moving him from “there is nothing that can be done about it” to “well maybe something might be able to be done about it.”)

The Size Of The Problem

We start by defining the size of the problem.   I first ask what their gross monthly sales have been on average.  Let’s say 40,000 a month.   Next, I ask how much their monthly breakeven is.   Let’s say that is about 43,000 a month.    Obviously, he is losing about 3,000 a month!   If he wants to make at least an additional $1000.00 that means about $4,000 more a month is really the size of the problem.

Ok!  We are at least recognizing the real problem (not enough money) and the size of the problem ($4,000 more a month).  First step in handling a problem is to clearly define what the real problem is.   If you do not identify the real problem, then every solution to the problem will not work.

There is no solution to the economy being bad other than to ignore it and concentrate on the problem the bad economy created for you and your shop.   The real problem that a bad economy created for you is the fact that you are not making enough money to break even or heaven forbid, make some money.   

So if you don’t find the size of your problem, then it is unlikely that you will come up with a solution that will fix the real problem.   Everything is dependent on identifying your real problem and then confronting and handling the real issue.

Next we want to break down the real problem (not enough money) to a size that can be confronted, and then come up with a real solution to handle it.   So in this case, I would ask the guy how many cars he does a month.   Let’s say 200 tickets a month.  If we divided the $4,000 more he needs to make, by the current amount of cars that he is doing, then it turns out that he needs to average $20.00 more per ticket on the work that he already has in order to go from total apathy to where there “might be something he can do about it.”

Or since he is averaging about $200.00 per ticket now, he would need just one more car a day.

Let’s look at a possible solution to getting the $20.00 more per car or getting one more car a day to come to his shop and buy the normal services he offers.

Look, I know about 7 or 8 ways to get $20.00 more per car and probably 3 to 4 ways to get one more car in the shop.  I know how to be more efficient and increase the production of his people.  This doesn’t even count the ways the average shop is just blowing money out the door and doesn’t know it.

Solutions:
1. Do Pre-Service inspections on each car.  This is generally good for $15.00 more per car.

2. Do complete inspections on every car.  Doing it right and selling it right, means easily $20.00 more per car.

3. Get your service writer trained so he does a better job of getting new customers in or handles the current customers properly.   Increasing the Service Writer’s closing rate is good for 2 to 5 more cars a week, which is worth about another $1,600 to $4,000 a month increase.

Body Shops:  Oh!!! Oh!!!  Please, getting your Estimator trained on handling the Insurance Companies if you are part of a DRP program, or increasing the capture rate on estimates if you are not, is good for $1000.00 a week more or the $4,000 a month alone.

Likewise, learning how to increase your shop efficiency in a Body Shop is good for at least one more car a week which is another $4,000 a month.

4. Increasing the production of your technicians 3 or 4 hours week is good for $200.00 per technician.

5. Putting in an effective referral program with your existing customer base is usually good for 2 to 5 cars more a week.

Well like I said, there are about 7 or 8 things you can do to make a change in the overall condition of your operation without costing a ton of dough and changing the bottom line from a negative to a positive.

But, then again, it requires that you want to change and you are willing to change, and that you know how to implement the changes.   

I highly recommend you read the article from Scott Bickley of Little Wolf Automotive in this brochure to see what can happen when you change your mind and start doing something different.

I wish you much success!
Mike Lee

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A Bad Week, by Robert Spitz, Management Success!

Robert Spitz
Snr VP of Business Dev
Management Success!

Recently, a shop owner was venting to me about the “bad week” he was having. He was not really interested in running his shop anymore. He just wanted to coast along until he could sell it, so he could do what he really wanted with the rest of his life.

When I say he was “venting,” it was worse - he was furious! Earlier that week, his lead tech had been into a Ford block and had managed to sheer off the head of a bolt. So, the tech got a bolt remover and sheered the bolt remover as well! That is when the tech ran out of ideas and gave up. The owner, who is an excellent tech, stepped in. He removed it, re-threaded it, and finished the job - bang, bang! Boy, was he ticked off about all this. This incident was not the only thing that had gone wrong during the week, but it was the one that drove him over the edge.

Here is the truth. The entire incident was a direct assault on what he was trying to accomplish. He hired a tech that he thought - in other words, hoped and wished - could do good work. He wanted to slide along as an owner. He definitely did not want to be there, but he had to be there; otherwise, everything would fall apart. Like a ball and chain, he felt he not only had to be at the shop, but he had to have his head under the hood. In his eyes, several things crashed in at once - a very bad week.

This shop owner is a super individual, definitely worthy of the best possible life. So, after I heard this I cut straight to the heart of it all and asked him what he really wanted to do with the years to come. He first apologized for venting and then eloquently outlined some excellent dreams.

He said his time spent thinking about visions of a better future was the only thing helping him get by with a work situation he sometimes hated. But there was an unworkable fantasy in the middle of all this, and I knew it would block his dreams if he did not tackle it. He was sick of sheered bolt removers, but he was even more tired of employees who sheered off bolt removers! He still had a shop and he still had employees, but in his mind, he was done with all of it - and there he sat.

Quite frankly, this adds up to more than a bad week. 

I could not help him with his week, but I could certainly help him with his future.

He needed to learn how to get others to do a good job. An owner’s primary duty is to get others to get the work done. This is easy to say, but it takes tremendous skill. That, alone, would change his life in a big way. Yes, he could do an excellent job himself. That is an exceptional starting point in any activity. If you cannot deliver the goods, then what matters? 

Here’s the bottom line – many shop owners are great techs. They will say (and they are often dead-right about this) that they are the best tech they know. However, they need to be able to say “I make the best techs I know." When they can truthfully say that, from that point forward, their life will change fast. Many things will not change for a repair shop owner until they can make that one thing happen.


It is not the end of all bad weeks, but it is the beginning of a bright new future. Now, here is my question to you: Can you make the best techs you know?

At Management Success! we can show you how. Then, the new game can begin.

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