5 Ways to Increase Your Shop's Profits

     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.

Use technology

Use today's advances in technology to help keep your shop profitable. From software programs to sophisticated repair equipment, technology can improve the efficiency and the profits of your business. Consider these ideas for integrating technology into your shop operations.

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Inspection software – Rather than technicians manually writing down their findings, inspection software guides loaded on a tablet or laptop helps them through the process of recording their report on a vehicle. Designed to streamline a time-consuming process, you get the added benefit of no longer having to decipher sloppy handwriting.

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Scheduling software – Manage your shop’s appointments with the help of scheduling software. Depending on what program you select, your customers may be able to book appointments from a website or mobile app. This can cut down on the time that your staff spends on the phone booking appointments and gives customers who are accustomed to conducting business online an easy way to book your services.

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Advanced repair equipment – Incorporating advanced equipment like alignment benches and diagnostic scanners can help you repair your customers’ vehicles quickly, meaning you can get on to the next repair. While these modern tools of the trade can be pricey, they can pay for themselves over time with the ability to do more repairs.

Look for quick wins

Take a look around your shop: are there some easy-to-implement strategies that could improve efficiency and profits?

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Special delivery – Have parts department personnel deliver parts to the technicians rather than having high-paid techs spend their time tracking down the parts they need to complete a repair. This keeps your techs working on repair jobs and not walking back and forth to the parts department.

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Price check – Review your pricing at least once a year. Make sure that the rate you’re charging not only covers your expenses but leaves you a tidy profit. Adjust your prices as necessary. Take the exercise a step further and research your competition to see how your shop compares. Ideally you don’t want to be charging significantly more or less than your rivals for a repair. 

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Review time – Add a little extra time to each service appointment to give technicians the opportunity to inspect the vehicle for additional issues that may need to be addressed. Customers will appreciate getting everything taken care of in one appointment rather than having to come back, and you’ll like increasing your profits with one easy step.

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Add-on services – Consider suggesting add-on services such as wipers, light bulbs, air filters and cabin air filters when you see that these parts need replacing; offer battery checks to ensure that customers don’t get stranded on the side of the road. Be sure to explain the benefit of changing out any needed parts so they don’t feel like you are trying to inflate the bill.

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