THA 150: Three Financial Challenges – Coaches Perspective
David Justice has been an auto care professional for over 30 years. He grew up in the family business working for his father. At, a young age David purchased his father’s business and went on his own. Over the years David had multiple Shell Gas stations. Find David’s other episodes HERE.
Cecil Bullard is President of the Institute for Automotive Business Excellence. He is a trainer and business coach in the automotive aftermarket working closely with service professionals. Previous episodes featuring or mentioning Cecil, click HERE.
Maylan Newton from ESI – Educational Seminars is a business coach, trainer and industry speaker. Maylan is no stranger to the podcast having paid it forward on two episodes … 108 and 140. He is a much sought our speaker at industry events in the US and Maylan will speak at this year’s Automechanika among others. Find Maylan’s other episodes HERE.
Key Talking Points:
Labor rates will make the biggest impact on the shop
This can be the hardest to understand and manage
Understand the KPIs behind productivity
You’ve got to understand your labor costs
Like effective labor rate
Shop owner has to overcome the emotional part of the money to raise the hourly rate
Customers are not affected by this
Only the shop down the street who is trying to stay under you by $10
Attorney’s charge $700 an hour. We do things as difficult as they do
Become a businessman and stop making emotional decisions
We need to get paid for what we know
If you had a slow week it is not because you have a high labor rate. It usually has nothing to do with what you charge.
Too many shop owners manage their cash from a general fund
A high percent of Profit and Loss statements are incorrect
Managing the business through the numbers are foreign to many shop owners
It is dramatic to see what real earnings can do for a shop
Implementation is the key. Accountability drives change and success
Money is not made by fixing cars. It is made by the pencil.
Understand your self-worth
The appliance repair person charges $300/hour with no scan tools. We pay the bill because we don’t have the time
If you understand your business (have business sense) automotive repair is a great industry to be in
How many owners have not cashed a paycheck. That is a signal that you don’t even have a job but a hobby.
Being productive and profitable does not necessarily equate to labor rate. There is so much more to improved profitability
Go to classes and learn about the financial side of your business
If you don’t actually implement what you learn you’ll have wasted your time and money
Average $700K sized shop is leaving $140K on the table
Consider twenty groups and the knowledge sharing through peers
When your business runs well it is life-changing. When you’re struggling the stress is terrible and life is not good.
99% of the coaches teach the same thing. It is the implementation that differentiates.
We work on high tech vehicles and run our business in a low tech fashion
The power in observing other businesses and attempt to understand how they run and make money. YOu will learn something that makes you and your business better.
Many shop owners are prideful and keep digging a deeper hole
You must admit you don’t know it all and that is OK. It is time to learn a new way to do things. Change must be implemented. Stop struggling and get help.
Hire someone to hit you over the head and push you into a more profitable business and therefore a happier life. It is fun to WIN
Why do some shop owners excel?
Pride put on the shelf. Learned.
Ego is killing the majority of shop owners. They do not want to share their failures because they pretend they don’t have them
Fear makes you stupid.
Farmer are rich in their harvest time and poor when the crops are growing
They make better decisions when they are harvesting and bad decisions during lean times
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