The Adventures of MACH TWO – Chapter 5 by Mike Lee

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 Five:
I CAN'T Stand Prosperity
or
I Am Making Money, So I Need To EXPAND

After  being in business for over a year, MACH TWO runs into a limited space problem.  Because of his great reputation for being able to fix the cars, fix them right and treat customers honestly and fairly, he has outgrown his facilities.  He has cars and customers all over the place.

He is making good money and his checkbook actually has a POSTIVE balance.  His bills are all paid ON TIME for the first time since he started the business.  He feels wonderful and is proud of his business ability.  His head and chest are swelling.  He thinks to himself, "Wow, if I am making this much money on two bays, imagine how much I could make in a 10 bay shop.  He makes a decision to expand.  He is now entering the Blunder Zone.

The Blunder Zone

After looking around he finds a nice seven bay shop that is available for leasing.  Of course, it needs a little fixing up, and he will have to buy some more equipment and hire a couple more technicians, but he is doing so well now, he thinks no problem, what can go wrong?!

He signs the lease and starts the process of getting the new facilities into shape.  He buys a couple of hoists that the new facilities are going to need.  Also, there are lots of little things that he really didn't anticipate, like air hoses, pipe, storage shelves, fluorescent lights, etc.  It is amazing how much all of this little stuff costs.  He has used almost all of the reserve money that he had put aside.  He thinks, "No problem, when I open this new shop I will get it all back."

At this point he is just about to open the place.  All he has to do is move all of the stuff out of the old shop into the new one.  He and his two technicians spend the weekend moving everything and getting the new shop totally ready for their grand opening on Monday.

Grand Opening

Monday morning, the shop is pretty busy, except there is one small problem.  His lead technician hurt his back over the weekend doing all of that moving and doesn't show up to work.  He finds out later that the technician has strained his back and will probably be out for six months.  Of course, that means he is going to hit MACH TWO's workman compensation for a ton.

That is okay, because MACH TWO needed to hire a couple more guys anyway to handle the new big volume that he was going to be doing in this new shop.  So he runs an ad in the newspaper for technicians.  After a week of running the ad, he has two guys (actually zombies) show up and neither seems to be alive.

Now panic is starting to set in.  He decides that he needs help desperately or he is going to run out of money quickly.  It is amazing how much more the monthly nut is at this new shop than it was at the old one.

He decides to try to hire some of the good technicians that are working for some of the other shops in town.  He puts out the word to several technicians that he has heard that are really good and offers them outrageous wages to come to work for him.  He has no choice.  He has lots of work and no real help.  He is working day and night and seems to be falling behind in his bills and he has no reserves left.

Three months later, he has five technicians and himself and he is doing $15,000 more a month than he was doing in the old shop.  He should be making a ton more money, but he seems to be going the other way.  He can't figure it out.  He is doing more volume so he figures he should be making more money.  He is now starting to fall way behind in his business and he is going to have to borrow some money from his mother (he hates to do that) to pay the taxes.  It doesn't make sense, why isn't he making any money?

Symptom:  He is doing more volume, but making less money.

Real Problem:  He lacks management skills.  He is in confusion.  He doesn't know where he stands.  He has no indicators to tell him where the real problem in his shop is, so that he can't go about fixing it.

Solution:  Manage by Statistics.  If he had been tracking the major areas of his business and knew certain industry standards on production and what to pay, he would know that he has low production in his shop and he is greatly overpaying the new guys for the amount of production they are doing.

Also, he would know that his monthly overhead has tripled since moving into the new shop and he needs to either increase his production or raise his prices some or do a combination of both.  If he knew how to manage by statistics, he would at least know where his problem areas are and be able to come up with a plan to fix them.

Management Success!

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Management Success! Spring Convention 2014

Management Success! Teaches Clients How to Stay Profitable and Happy at Spring Convention in Las Vegas

LAS VEGAS, NV - April 10, 2014 - From March 28 to 30, Management Success!, the premier auto industry consulting firm, held its Spring Convention at the luxurious Red Rock Casino Resort Spa in Las Vegas. The convention was the largest destination convention in Management Success! history. Entitled “Stable, Profitable & Loving It!,” the Spring Convention focused on reducing auto shop owner stress and increasing overall happiness by teaching clients how to operate a smoothly running shop for the long-term.

Happiness was a recurring theme throughout the convention. In addition to covering basics like how to use pipelines and dashboards to track production, two concurrently occurring workshops taught how to create harmony within management and the employees: Mastering Your Shop by Consultant Ari Cohen, and Owner’s Team Building Boot camp by Consultant Wency Severi. The workshops took place throughout Saturday and Sunday.

“We created these workshops based on common client problems, like how to operate a master shop with a master team and how to overcome employee situations that impair production,” said Robert Spitz, Senior Vice President of Business Development at Management Success!.

The workshops were well-received by clients. Regarding the Owner’s Team Building Boot camp, Kevin Crowell from Crowell Automotive affirmed, “The workshop really brought home the issues we need to confront. It gave us the tools to go home and implement. It gave us a new zeal to continue with Management Success! and try for Master of Shop Management.”

To give attendees a real-life model of effective shop management, Management Success! held a Masters Panel on Saturday, which featured a Q&A panel of shops that hold the prestigious titles of Master of Shop Management or Master Elite of Shop Management. On Sunday, the open Top 20 Meeting allowed all interested shop owners to see how the top shops in the US and Canada manage, from tackling employee issues to marketing.

While classes were the main event, the company found exciting ways to make the most of the convention’s simultaneously glitzy and rugged location.

The Thursday before the convention was a social day that saw clients exploring Red Rock Canyon in a wild dune buggy chase, followed by touring the Hoover Dam and taking a relaxing cruise on Lake Mead. The fun day capped off with a Meet & Greet at the Red Rock Bowling VIP Lanes, where clients, their families, and Management Success! staff got together for an evening of friendly competition.

And in true Las Vegas fashion, the 007 Casino Royale themed dinner on Saturday night was all about rolling the dice - whether it was at roulette, Poker, or Blackjack. When clients weren’t faux gambling, they were dancing or taking photos in the photo booth. Clients dressed up as Bond girls, villains, and of course, James Bond himself.

Several clients had especially good reasons to celebrate, as they had received awards at Friday night’s Awards Dinner. The Awards Dinner recognizes shop owners who have gone above and beyond expectations. Notable awards included Sustained Masters of Shop Management, given to David Saline and Lynnetta Rogers of 2nd-to-None Service; Master of Shop Management, given to Dave Schroeder of Schroeder Sales & Service; Top HOST, given to Shawn and Melissa Maine of Midwest Rod & Restoration; and Effective Shop Manager, given to Peggy Lawless of Professional Fleet Services.

“Dave Schroeder was an inspiration to the entire group. He achieved the honor of Master of Shop Management in just one year,” Spitz said. “He took a very unprofitable business that had been losing money for years and turned it into a thriving shop, and I know Dave is loving it!”

The 2014 Fall Convention will be held in Glendale, California and will concentrate on achieving something many clients desire: Master of Shop Management, one of the highest levels of shop management.

For more information about Management Success!’ training and consulting services, please visit www.managementsuccess.com.

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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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Management Success! Joins Forces with Body Best of Sonoma and Hawley’s Paint to Tackle Collision Shop Profitability Problems

SANTA ROSA, CA - February 27, 2014 - On Wednesday, February 19 from 9 AM to 3 PM at the Windsor Gold Club in Santa Rosa, Management Success!, the United States’ premier auto industry consulting firm, helped present a collision shop efficiency class along with Management Success! client Body Best of Sonoma and Hawley’s Paint Store. The class was delivered by Management Success!’ Senior Instructor, Jim Saeli, and Public Relations Representative, Athena Severi. Fifteen collision shops attended, in addition to members of the California Autobody Association (CAA), which Management Success! sponsors.

Dino DiGiulio, owner of Body Best of Sonoma, hosted the event. As a collision shop owner, DiGiulio knew that many collision shops struggled with profitability problems. So he contacted paint supplier, Hawley’s Paint, and Management Success! to create the training session.

Hawley’s Paint has been serving the community since 1906 and was happy to jump at the chance to help its customers. “When our customers do better, we do better. That is why we sponsor training like the one we did on Efficiency with Management Success,” said Tom Gamber, general manager of Hawley’s Paint.

As part of Management Success!’ HOST (Helping Others’ Succeed Today) program, in which clients help other shops in the industry succeed with Management Success! training and consulting, DiGiulio wanted to bring quality management training to collision shops in Northern California. “I put this class together to help shop owners and managers live a better life. I knew Management Success! was the company I could trust to put on a one-day class that would be very powerful and helpful in many ways,” DiGiulio said.

Always willing to support clients who want to help others in the industry have less stressful businesses and become successful, Management Success! was glad to help. 

“Part of our commitment to our HOST members is to assist them in any way possible with training, talks, or webinars on the subject of management,” said Robert Spitz, Senior Vice President of Business Development.

The class focus was how to improve profitability by getting standard procedures in place. Topics covered included how to work as a team and how to set up standard operating procedures to control cycle times.

What made the class truly enlightening for attendees was that the material was not only informative, but also tangible and applicable to the situations many shop owners were experiencing in their shops.

“I have been in business 30 years and I can see that I needed this. I needed to see where I can improve and not stick to the same routine,” Ken Lazzini of Lazzini’s Auto body affirmed. “I am excited to go and implement the data with my staff. I have a fresh outlook on my business.”

For more information about Management Success!’ training and consulting services, please visit www.managementsuccess.com. For more information regarding Body Best of Sonoma, visit www.bodybestofsonoma.com. For further information about Hawley’s Paint Store, please see www.hawleyspaint.com. For more information on the California Autobody Association (CAA) please visit www.calautobody.com.

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.

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The Adventures of MACH TWO – Chapter 2 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 now confronts the fact that while he seems to have developed a stable business with a bright future, he can't seem to find employees that will do the work on the car with the same thoroughness that he does.

Every time MACH TWO asks an employee to do a job, it is not up to the standard that he sets for the shop.  Also, he can't seem to find anyone that is willing to go get the training necessary to stay up to date on the new cars, even if he pays for them to do this.

Chapter Two:Handling Employee Problems

MACH TWO finds that when he tries to train his people they don't seem motivated enough to learn and don't seem to be able to do the jobs the way that he wants the jobs done.  Eventually, he ends up doing most of the complicated work himself.

It is very important to him that everything that is worked on in his shop be done to his standards.  He is unwilling to settle for less than perfection.

The Effect of Not Being Able To
Adequately Train Employees

Because MACH TWO cannot depend on his employees to complete a quality job he is sometimes forced into hitting Mach Three.  To his credit, MACH TWO is a super technician that insists that the jobs be done right in his shop.  But because he can't seem to get his guys to do the work the way that he wants, it is negatively affecting himself, his personal life and his ability to run his business successfully.

For example:

1.  It is a good thing MACH TWO is young or he would be a good candidate for:

A.  "I am forty-five and I have just had my first heart attack."  OR
B.  "I am getting married for the third time, gee!  I hope this works."

So how do you know if you are having these problems or if you meet the MACH TWO status?  Here are some of the major qualifications and/or symptoms.  These are all qualities that our MACH TWO hero in the story possesses.

1.  Your business has grown to about $10,000 to $25,000 a month.  You have two or three technicians working for you.  You have been at this level of sales for one or more years.

2.  You suffer from the DAD SYNDROME.  You, like our hero MACH TWO, are the only one that can really solve the tough problems in the shop.  You are so busy handling everybody else's problems that you don't have time to run the business.

3.  It used to be fun fixing cars, but lately it has become more and more frustrating because you never have time to do all of the things that you want to do.  So you have become MACH TWO with your hair on FIRE and with a SHORT FUSE.

At this point you and our mild mannered MACH TWO shop owner are no longer mild mannered.  You become known as "A TICKING TIME BOMB ON THE MOVE".  Customers, employees, wives, children notice that you have become a "GRUMPY BEAR."

If you meet some or all of the qualifications of being MACH TWO, here is the PROBLEM:
MACH TWO knows how to fix cars.  He is the best at fixing cars, but he doesn't know how to fix his business and handle his employees.

1.  The only business school that he has attended is the school of HARDKNOCKS.  Of course, he graduated CUM SUMA HEADACHE and is now working on his MASTERS DEGREE in MIGRAINES.

2.  MACH TWO lacks management skill on how to train employees.  He gets frustrated because he cannot teach his employees what he knows. Mostly the problem is that he tries to teach his employees what took him ten years to learn in just two days and then wonders why his employees don't get it.

3.  He lacks the management skills necessary to get his employees OPERATIONAL.  OPERATIONAL means to work well without attention.  He doesn't know how to effectively deal with employees.

Here is the prognosis for our MACH TWO shop owner and for you if some of the above scenarios sound familiar:

A MACH TWO shop owner has got himself stuck in the Stage One of a business.  This is a common problem in the automotive industry.

In Stage One, the owner is doing every job in the shop.  He is the service writer, bookkeeper, legal department, advertising executive, employee director, quality control.  But he spends most of his time fixing cars.

As long as he continues to run his shop this way, he will never grow big and he will not make lots of money and will not have lots of time off.  He has 60 to 70 hour a week job.  He doesn't know it, but he is just an employee of all his customers.  They get great service and a super technician and he gets all the headaches.

SOLUTION:

MACH TWO needs to learn how to run an automotive business.  It is just like fixing cars.  If you know what you are doing, it doesn't take long to find and fix the problem.  If our mild mannered MACH TWO shop owner doesn't change his way of doing business, he will still be doing it the same way twenty years from  now.

Management Success!

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The Adventures of MACH TWO – The Mild Mannered Automotive Shop Owner By Mike Lee

Mike Lee
co-founder
Management Success!

Background

This is a story about a guy who is in the automotive business.  His nickname is MACH TWO.  He has red hair.  The reason for his nickname is that he works hard in his shop all day and always seems to be going MACH TWO with his hair on fire.  But, I am getting ahead of myself.  Let me start at the beginning.

A number of years ago, MACH TWO was a technician at somebody else's shop.  He had been working as a mechanic for about seven years and was considered to be a pretty sharp technician.  He was a good guy who worked hard and seemed to get along with everyone.

MACH TWO had always dreamed of opening his own shop.  Over the years he had build a pretty good reputation during the day at the shop that he worked for and had developed a small clientele of people who he was doing work for out his garage at night and on the weekends.  He had put away quite a bit of money, so when the time was right he decided to open his own business.

Chapter One:
The Beginning

In this first chapter of the continuing adventures of MACH TWO, the mild mannered technician, he has decided to open his own shop.  He has found a nice two-bay shop that he can rent cheaply enough to start his new business. 

The first nine months pass by quickly and MACH TWO is doing well.  Of course, there are many things that he has to deal with that he had never thought about before, like all of that government red tape.

I Am From the Government – Give Me Your Money

It all started with the phone call from the City which indicated that he was not allowed to run a business without a business license.  So MACH TWO went down to the City offices and was asked to fill out all kinds of paperwork that he did not understand.  Although, he was beginning to understand, after paying for his business license, that this being in business was going to cost him some money.

Of course, he needed someone to help him with his paperwork, he knew that.  So he hired a friend as a part-time bookkeeper to help him keep up with the paperwork.  He quickly found out that there sure was a lot of paperwork involved with running a business.  At the garage, he handled everything out of his pocket, not a problem.

And there was that little matter of not having a resale number.  MACH TWO was surprised to see how excited the people from the state sales tax office got when they found out that he had not been charging sales tax on his work.  Luckily, he had enough cash in the bank to handle their bill.  Gee, those city government people just don't seem to have a sense of humor.

But, they seemed calm compared to those guys from the IRS.  When they found out that he hadn't been paying employee taxes, things were a little tense for a while.  Something about going to jail, taking his house and a bunch of other unpleasant stuff.  After all of this, he decided that this was definitely not a fun group to have to handle.  All of these government people seemed to have graduated from the MORTICIAN SCHOOL OF COMEDY.  They were a group that was absolutely too serious.

Many would have been discouraged by now, but not our mild mannered MACH TWO.  All of his money that he had put away was gone, but his business was thriving and he decided that if he could just be left alone to work on the customers' cars, he would be able to make all of his money back rather quickly.

However, just as things start to look up, he has a meeting with his friend, part-time bookkeeper a week before the April 15th tax deadline.  At this meeting, the bookkeeper informs him that he has done real well in his first year in business and he is going to owe the government about $9,000 in taxes.  Which, of course, is just about $8,900 more than he has in his savings account.

Now MACH TWO is really in confusion.  His accountant is telling him that according to what he had worked up from the paperwork that MACH TWO gave him in a PARTS BOX at the year-end, it shows that he has been very profitable and owes the government $9,000 in taxes.

Now MACH TWO is really confused.  His bookkeeper is telling him that he has had a very profitable year and yet he owes the government $9,000 in taxes that he does not have.
MACH TWO having operated his finances for years on the BIG POCKET THEORY of finance, is totally beside himself.  (For those of you who are wondering about the BIG POCKET THEORY, it is a theory which states that if a shop owner has lots of money in his pocket, he has made money and if he has no money in his pocket, he ain't made any money.)

So, finally the mild mannered MACH TWO begins to lose his patience and demands that his NOW ex-friend and SOON TO BE ex-bookkeeper, explain how it could be that he owes $9,000 in taxes when he has no money in his checkbook.

The accountant takes the financial statements and shows MACH TWO the figures which indicate that he has made lots of profit and explains that the government wants its share.  At this point, MACH TWO goes ballistic.  MACH TWO has his own idea of what the figures should be and they do not match at all the figures that the soon to be ex-accountant has worked out.

After much discussion, about the only thing that MACH TWO understands is that somehow he, supposedly, owes the government $9,000 in taxes that he doesn't have.  The bookkeeper says that he might be able to borrow the money from the bank, because his shop is doing so well.

MACH TWO goes home in total confusion.  He had worked so hard to develop a respectable business.  His business was already doing between $10,000 and $15,000 a month in less than a year.  He has 1 – 2 mechanics helping him.

Even with his one or two mechanics helping him he was still working more hours than he has ever done in his life and felt as though he were going backwards.

Before going into the automotive repair business, MACH TWO had put quite a bit of money away in savings and now it was all gone.  Worse yet was the fact that the government wanted $9,000 in taxes that he did not have.

MACH TWO Solution:  MACH TWO decides that this whole government game is horse feathers.  He is not going to give the government money that he doesn't have, so he decides to get a computer and have the wife do the books and he going to run his business on the industry famous NRU method of accounting.  (NRU stands for NEVER RUNG UP.)

Real Solutions:

1.  MACH TWO needs to get a good accountant.  One that doesn't work for the IRS.
2.  MACH TWO needs to learn to quit fixing cars and start learning how to run his business.

In the next chapter of The Adventures of MACH TWO, MACH TWO runs into employee problems.

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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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