15 Critical Daily Functions to be Successful in Your Shop | PT 1
Most of the world’s population would agree that humans are creatures of habit, and that once we fall into a habitual routine, it is quite often very difficult for us to make a change, even if it would lead to significantly less business stress, smoother operations, and more profitability.
Recent observations in our industry indicate that a significantly large number of the industry’s independent auto repair shop owners are rapidly becoming more uncertain of their business future. Most are experiencing fierce competition from all segments of the industry leading to reduced car counts and lower invoice totals, while cost of sales and operating expenses continue to rise—resulting in meager profits, and in some instances—significant losses.
Let’s face it — technology improvements in motor vehicles produced within the last several years, combined with increased consumer education, have reduced the flow of repair business as it existed in prior years. As a result, the repair business is rapidly moving into a maintenance business. The more the industry focuses on maintenance, the more the need for repair will decline.
So, what immediate changes does the average shop owner need to make in order to improve operations and profitability? Changes required will vary from business to business, however, observations indicate the majority of today’s shop owners need to establish a methodology of monitoring and improving various aspects of their businesses on a daily basis.
There are 15 aspects of your business that should be routinely monitored on a daily basis in order to be successful in your shop. We’re dividing this list into three parts over the next few weeks, and the first 5 aspects are listed below. And of course, monitoring them daily is twenty times better than monitoring them on a monthly basis or not at all!
Successful shop management begins with great shop leadership. Quite often, with the intense pressures that accompany business ownership and management, owners find themselves frequently relating their personal discomforts and negative outlooks to their employees and customers.
Great shop leadership begins with shop owners demonstrating (to both their internal and external customers) a positive business attitude and outlook for the industry regardless of how they feel about it internally. By starting each day with upbeat comments about business, and presentation of the positive opportunities existing for the day, everyone should begin the day with a bounce in their step and a smile on their face.
Each day after the day has begun, shop owners should take a few minutes and walk through the entire facility greeting each of the staff with a smile and enthusiasm. They should share some positive comments with them and demonstrate a sincere interest in them. If employees approach you with concerns, avoid assigning blame, and be solution driven. Listen intently and then work diligently to assist them with sourcing a solution. This daily routine will bring you closer to your employees and build a stronger team atmosphere.
The way your facility appears to both your employees and customers has a profound impact on their perception of the business. Each day, when you are walking the premises greeting your staff, you should make sure to be inspecting the condition of the building, interior and exterior lighting, equipment, landscaping, lot asphalt, fencing, signage, as well as what vehicles are parked in sight in the front of the business. Keeping all of these items in good condition will provide the business with a competitive advantage.
Often when business slows down, shop owners immediately begin to cut operating expenses, usually not really understanding the difference between an operating expense and an investment. Several of the items listed in financial statements under operating expenses are actually investments.
Marketing and advertising expenditures should be considered investments, and successful shop management requires that shop owners monitor the return on these investments. Shop owners who lack the time and/or skills to implement their own marketing plans should consider outsourcing competent assistance in the development and implementation of an aggressive marketing plan. They should also set up methods to track the results on a daily basis, making changes when the desired results are not achieved in the anticipated time period.
5. PRODUCTION SCHEDULE
Constant review of your production schedule throughout each day will enable you to assist your staff in making critical decisions in an effort to maximize opportunities and production.
Production efficiency can be substantially affected by too many or too few vehicles scheduled and/or taken in for the day. Considerations should be made for each of these circumstances with company policies and procedures in place to achieve daily production projections.
For instance, if too few vehicles are scheduled in order to meet projected sales figures for the day (a slow day), you must answer the question, “what is required of each member of the team to immediately improve the situation?” Each shop should have a “slow day plan” which describes what each person is to do to improve the sales for the day. The point is that a slow day is unacceptable and there needs to be daily monitoring in place. One slow day could make the difference between experiencing a business profit or loss for the month!
Check back with us next time for the rest of the list of 15 Critical Daily Functions to be Successful in Your Shop. In the meantime, have a wonderful Independence Day!