Facing the bottom line
As a business owner, you have a moment of reckoning at the end of each month. You hold your breath as you look at the balance sheet – what will it reveal? Will your hard work be rewarded with a profit or will you be staring at a loss?
Want to take the worry out of this monthly ritual? Read on to discover five things you can do that may increase your shop’s profit margin. Implementing one or more of these strategies could be just what your business needs to improve its bottom line.
Master the art of scheduling
Scheduling repairs that make efficient use of your technicians’ time can be a challenge. Book too many repair jobs in a day and your techs will be overwhelmed and lose focus, all while worrying about getting everything done on time. Schedule too lightly and your technicians will be sitting around waiting for the next job to come in. Creating a schedule that gives your techs the time they need to get each repair done right is truly an art form. Start by tracking the work your shop does so you know how many repairs your shop can perform in a day. Once you have an idea of how much work your shop can handle on a daily basis, you’ll be able to effectively build a schedule that maximizes profits for your shop.
Pick the right person for the job
An easy way to build your shop’s profits is to assign the right technician to each repair job that comes in. Kick off the process by doing an honest assessment of your personnel, noting each technician’s experience level and their strengths and weaknesses. As repair jobs come in to your shop, don’t just assign the job to whichever technician is free at that moment. Be strategic with your assignments – do your best to assign each repair to the technician who is best qualified to complete the task. This gives you the best return on your money. For example, have junior level technicians or techs with less experience handle routine maintenance jobs like oil changes. This frees up your A-level technicians to tackle those higher profit jobs that require a seasoned tech. The beauty of this tip is that it doesn’t require additional capital investment – it falls under the work smarter category.
Don’t focus solely on price
It’s easy to become fixated on having the lowest prices in town. While it’s true that customers do comparison shop, don’t fall into the trap of thinking that low prices are the only way to attract sales and increase profit margins. Customers are willing to pay a fair price for quality work, proving that you don’t have to charge the lowest prices to have a full appointment book. In fact, charging bargain-basement prices can mislead your customers into thinking that they aren’t getting quality work. Remember that you need to charge enough to make enough. While you do want to help people, your shop isn’t a charity. Make sure your service exceeds the competition; don’t compete on price, compete on quality. When you deliver quality – quality customer service, quality parts and quality service – you give your clients a good value proposition, and sales are sure to follow.