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Ep 17 - Coaching Call #3 | Matt Lofton w/ Elite Worldwide
208 Plays1 month ago
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Today it's coaching call number 3. And you get to hear Matt call me out! I thought I was doing well to complete 4 of 6 goals, but Matt reminded me that if I'm serious about where I want to be in 5 years, then I have to be serious about completing my goals each month. So that was fun to hear. But I'm thankful I have a coach who can say what I need to hear.
Sorry for the audio issues!
04:14 Technician Audit Reveals DVI Issue
09:23 Guiding Employees in Goal Setting
10:10 Accelerated Debt Repayment Strategy
15:46 Beyond Ad Spend: Key Marketing Factors
18:48 Weekly KPI Spreadsheet Discussion
21:54 "Advisor Strategy and Solutions"
25:50 Labor vs Parts: Profit Discrepancy
29:02 Missed Goal: Hiring Advisor Assistant
31:16 Tire Sales Strategy Shift
36:15 "Significant AWRO/ARO Improvement"
40:09 Employee Transfer and New Hire
42:48 Establish Store Culture Standards
46:37 Comprehensive Advisor Training Program
48:00 Owner's Accountability and Education Kit
Recommended
Transcript
Mike's Recording Challenges
00:00:00
Speaker
OK, so I have a confession. I have a lot of trouble executing on an effective ah recording whenever I record with Matt Lofton. For whatever reason, the gods are fighting against these coaching calls.
00:00:14
Speaker
And in this one, video tracks came through okay, but the audio tracks were badly corrupted. So I ended up having to use the audio tracks that were recorded by the cameras themselves.
00:00:25
Speaker
So it sounds like we're talking to you through a string with a couple of soup cans because I'm an amateur when it comes to this stuff. So moving forward, Braxton is going to have to drive down from Asheville to sit with us and control everything when we do our recordings, because otherwise it's a disaster.
00:00:41
Speaker
So I apologize. But here comes Matt Lofton with coaching call number three, where he tells me that I'm an absolute absolute failure, um as expected.
Podcast Introduction
00:00:52
Speaker
The following program features a bunch of doofuses talking about the automotive aftermarket. The stuff we, or our guests may say, do not necessarily reflect the beliefs of our peers, our sponsors, or any other associations we may have.
00:01:07
Speaker
There may be some spicy language in this show, so if you get your feelings hurt easily, you should probably just move along. So without further ado, it's time for Confessions of a Shop Owner with your host, Mike Gallum.
Homework Review with Matt
00:01:27
Speaker
Alright dude, we're back.
00:01:30
Speaker
It is, what's the date? It's March 3rd, March 4th, but we're recording an episode that's going to be released on March 14th, and we're talking about January's numbers, actually, because we didn't get them until halfway through February. Sure. This is when we could chat, so...
00:01:49
Speaker
I'm going to pull up my phone, the list of homework that you gave me on our last meeting. It's a short list. It was a short list and I still didn't complete it all. Let's see if I can find it.
Employee Transfer Success
00:02:03
Speaker
Do you have that list of my to-dos? So I do. Okay. So we have the why statements for your counter processes. Yes. Or at least as it pertains to discovered services. Okay.
00:02:16
Speaker
And I have started using why coaching when I'm having corrective conversations, which has been well received for the most part. Okay, awesome. And then we had your MLAP conversation with your Vortman lead tech.
00:02:29
Speaker
had the conversation, went really well, put it in writing, he got a copy, we got a copy signed and everything. and then he transferred to my Garner store, from my big store, because he lives closer to there. So actually today,
00:02:44
Speaker
his ah new technician started at the shop who is a flat rate guy with a minimum guarantee. okay And call structure is better. And we'll see.
00:02:57
Speaker
how the performance is. But in the weeks since we had that conversation, he was like, we ended up setting a 45 hour in lap and he was like three tenths short on the first week and he was like, oh, and I said, don't, you know, it's gonna be all right.
00:03:14
Speaker
And then he hit it every week after that until he transferred. And so it's a different environment and different set of circumstances in Garner now. So we probably need to reformat that.
Service Process Improvements
00:03:26
Speaker
Yep, so we need to recircle to in lap for the newest technician.
00:03:33
Speaker
He's got more leadership responsibilities and more oversight responsibilities in the Garner store than he had at the Ellsberg Street store, which is the one that we talked about. Okay.
00:03:46
Speaker
So the other thing that I know that we were talking about was just discovered services as a whole. and trying to figure out whether We identified the discovery services was below our goal. Did we have an estimating issue? Did we have a discovery issue?
00:04:05
Speaker
We spent a little bit of time kicking that back and forth and we talked about doing a some sort of an our audit to determine So we did. we we audited five repair orders a week from each technician, actually between both Raleigh stores because my senior technician over both Raleigh stores is doing that. He says, he's just going to for both stores.
00:04:29
Speaker
And we found that it was a DVI process. issue on the technician level. yeah And you know the store that we talk about is not the one that he is typically at.
00:04:39
Speaker
And so, you know, the cats away, mice will play type deal. And he ended up spending ah an increased amount of time over there. we had some meetings about the why of thorough DVI and write up.
00:04:54
Speaker
And happy to say that we were over $2,000 for the month. So yeah you I did see in the performance report there as we were coming along that the last three weeks really really made a big shift there. And that's awesome.
Team Meetings & Goal Setting
00:05:10
Speaker
So I know I asked this question the last time, I can't remember what your answer was. Do you have a standardized
00:05:18
Speaker
tolerance for red, yellow, green that all the technicians follow, communication is the same between the service advisors and the technicians? Well, we have the policy written, whether or not it's followed religiously is a different conversation. or But yes, the the standardization kind of hesitate to reference MAP standards, but it it is not far off of MAP standards.
00:05:39
Speaker
But we have a two-page document that can print in front and back for everybody, and then they also have access to it online that is essentially our DVI with what qualifies for green, what's yellow, what's red, what requires a picture, what requires a video, that kind of stuff.
00:05:56
Speaker
That's perfect. Thank you for sharing that. So the the other action item that we had was making sure that we had a meeting with the team, both at the counter and in the back, and talking about what our Discovered Services goals were.
00:06:10
Speaker
You know what your Discovered Services goals so were pre, you had them identified pretty well. when we talk, but the question was if if i picked up the phone and called the team and I said, hey service advisor, what's your discovered, what's your AWRO goal, would they know what it is and do the technicians have any idea what their goal posts are for a good discovery on average?
00:06:31
Speaker
So I was very intentional about having a
00:06:36
Speaker
We had a team meeting shortly after we got back from Dallas. Is there pizza? There was not pizza. I don't buy pizza anymore. It's it's got to be secret pizza now. um But we had a team meeting, and then I met with everyone individually. We did the dream sheets for everyone individually. They're actually on my desk over here. And, you know, 30 days ago, they all knew what those goals were.
00:06:59
Speaker
Whether or not they could tell me what those goals are today, um i would i would guess probably not because it's not something where I've been there beating the drum on a regular basis. I touched it a few times in the first two weeks after that meeting, and then I got distracted with other stuff. and Right.
00:07:15
Speaker
Yeah, that store is doing fine, so it doesn't get a lot of my attention because it's not run off the rails, right? Yeah. Negligence on my part. So one thing to think about there, take a little sheet, a postcard, laminate it, put the goals on it put it on there put it at their workstation, that way they kind of keep them front and center as far as what it is.
Keeping Goals Visible
00:07:34
Speaker
Technicians, we do the same thing with that. Put it on the toolbox, laminate it. And anything that's a that's a focus at the moment, you can change those out.
00:07:45
Speaker
So I mean, sometimes it's Sometimes we're focusing on answering in the third ring. Sometimes we're focusing on saying yes on the phone call. Sometimes we're focusing on AWRO.
00:07:56
Speaker
So one thing that might help, because I know you're not there every single day, is come in the day that you're there before you leave, print out something, laminate it put it on their workstation, and then next time you come in, you can and rotate it out to something else.
00:08:12
Speaker
You just like carry a lamination machine around with you? We have one in the shop. Actually, I think we we do at the Garner store, so I could make that happen. So, no, I think ah index cards laminated with their personal goals that they gave me in the dream sheet yeah and then some corollary company targets to help them get to those goals would be, would that make sense? Yeah, I think that'd be a great idea.
00:08:36
Speaker
So, I want to circle back to the dream sheet. So, I know you you said you were able to get everything filled out. and Did you have any revelationary? um Not really, honestly. um I didn't have any that couldn't be addressed or motivated with income. They were mostly things that you've got to have money to do. Sure.
00:09:01
Speaker
you know There was some pay off the house type stuff. There was some water truck type stuff. Especially materialistic stuff, which is the easiest to manage. in she Yeah, that's ideal.
00:09:14
Speaker
So with that, have we done anything with it yet or have we just had it and then had a conversation
Employee Personal Goals Support
00:09:19
Speaker
with them? I've just had it and had the conversation. Perfect. So the next step of that, obviously, is helping them...
00:09:27
Speaker
So the same way that you sit down and you're really good at this, obviously, you understand what your target numbers are, you understand how to set goals, and you understand how to you know walk a path of you know achieving that goal.
00:09:39
Speaker
A lot of times, from an employee standpoint, they don't possess that same skill set. So making sure if we do have a monetary goal like paying off a truck, right? There's a disciplinary action that has to take place. We have to save money each month outside of what the payment is to be able to pay the truck off. So we need a date.
00:09:57
Speaker
We need a, you know, we need to back into that number for them. We need to try to figure out what the pay plan, what they could do on top of what they're doing now. So let's say you've got a guy turning 42 hours a week hey, if you turn 45, we would be able to take those extra three hours of compensation each week and apply towards paying the truck down.
00:10:18
Speaker
And now we Here's how much faster you pay it off. Here's how much faster we pay it off. So that's, that would be the value of the dream sheet is you can say, hey here's your current standard.
00:10:30
Speaker
If you raise your current standard from x to y this is what the monetary value would be to you. And this is how we could take that money. You wouldn't have to make, you wouldn't You would still have the exact same amount of disposable income that you have now, but we would be able to achieve this dream or this goal of paying off a truck, buying a house, sending little Johnny to private school, whatever it is, buying a bass boat bigger than the bosses. The classic thing. I'm just going to dingy out back.
00:11:00
Speaker
Here's
Outsourcing Marketing Benefits
00:11:01
Speaker
the deal. i I like to think that I'm pretty good at running an auto repair shop. It's what I've done for 20 plus years, but I'm not good at managing a marketing budget and all the different facets of a truly well-rounded marketing plan.
00:11:13
Speaker
There's mail, there's local advertising, there's website, there's Google AdWords, there's you know all the different things that go into that. And it's just not what I'm good at. So what I've chosen to do is to buy myself the time to focus on what I am good at while having someone else execute on all of those things at a way higher level than anything I could ever do.
00:11:37
Speaker
That's what turnkey auto marketing does for me. So if you feel like you could use some of that same magic, I'm going to recommend that you go to turnkeyautomarketing.com, get a free consultation. Tell them that I sent you.
00:11:50
Speaker
ah Tell them that Confessions of a Shop Owner sent you. You won't be disappointed. But that's where, you know, that's where your next step with the dream sheet is. And it is slightly labor intensive. And I do understand that. But again, if we're trying to work on, you know,
00:12:06
Speaker
We don't want somebody that's money motivated, that solely motivated by the money itself because they'll always, there's three things you can never have enough of. You'll never have enough time. You'll never have enough money. You'll never have enough space.
00:12:17
Speaker
I don't care what you have for all three of those. We'll burn through it. Um, so you can give them a raise tomorrow. Their life, their lifestyle is going to change and they'll be just as broke by two Fridays from now as they are today.
00:12:31
Speaker
So that's a never-ending cycle of having to, so the the goal there is to try to be a better leader and try to help them identify how they can have a better life with the compensation plan that that you have in place for them.
00:12:42
Speaker
And then also try to nudge them to one step above the standard. yeah One step above the standard. sun growth justs a little bit of growth yeah So that would be that would be the next step there. Sit down, think about their goals like they were you know what they were your personal goals and how you would achieve them. Take a look at their pay plan, what their compensation is on the incentive side, and look at their standard and see how we could nudge it that's the standard forward a little bit to make it coincide with what they want to get done.
00:13:10
Speaker
Super. Okay. All righty. So I know I sent you the performance report. Mm-hmm. And you did a great job of filling that out. I appreciate that. I didn't fill it out last week. I'm sorry. That's okay. I got it up on the computer.
AI Tools for Phone Conversions
00:13:22
Speaker
Did you have any... i don't You didn't have any issues or questions or anything like that in the process of filling it out? There were a couple of ah columns on the far right side of the sheet that I just don't track. I think it was maybe opportunities or or leads or something like that, lead conversion. yep I'm exploring some tools, some AI-driven phone tools that will...
00:13:46
Speaker
analyze calls and tell me how many leads I had versus how many I converted to cars. But that's still in its infancy, so we'll see if that works. So the only way that I know to do it accurately is manually track it.
00:13:59
Speaker
And it is a it's a discretionary item that's on the performance report at the moment. The way that we would track that is we have a manual sheet with the elite, we call it the average discovered services sheet or ADS sheet. And the service advisor would actually tally mark how many lead opportunities they took or how many calls that came in with a a customer concern that could have generated to an in-store visit.
00:14:20
Speaker
And then we track how many of those did not convert into an in-store visit or a scheduled appointment. What's your target conversion rate there? Company-wide, the target conversion is around 80 to 90%. It's obviously market-driven and it's obviously volume-driven.
00:14:37
Speaker
I would say What I'm looking for when I look for conversions of phone calls, because that's really what I try to track seriously is total number of phone calls and what our conversion rate is off of that.
00:14:48
Speaker
I shoot for 25%, but that's total inbound phone calls. and if And every car is three or four phone calls, right? Yeah, it could be the NAPA vendor calling 16 times to let you know the oil filter's on the way. yeah could see It could be the wrong number. So what was what was my number like on that? We were 24%, so but you guys were doing very good on that.
00:15:08
Speaker
Now anything, if we actually are tracking, you know, leads and conversions, i want to see them somewhere around 50, 60%. Okay. Well, I've got one week of data so far with this tool that I'm using.
00:15:21
Speaker
And it is ai listening to the phone call. So it's only 85 or 80% accurate as it is. Sure. But what it showed was that last week we converted 72% of our opportunities. Okay.
00:15:36
Speaker
um So I pulled the report for, you know, failed to convert. And I just listened to a couple of them and it's like, you know, hey, I got a nail on my tire. Can you can you fix it?
00:15:50
Speaker
And they said, you know, one of them listened to was, I know we got a lot going on today, but you can go to Mr. Tire. more And come on, bro, do better.
00:16:01
Speaker
But that's ah an opportunity for improvement. So one thing... I'm glad you brought that up because that's one of those things that obviously bothers me as well. I'm sure it bothers a lot of other shop owners.
00:16:13
Speaker
um do you Have you identified what your cost of a phone call is? How would you quantify that? So we take total marketing expense and divide that by total inbound phone calls.
00:16:29
Speaker
I could determine that relatively quickly, but no, I have not. My marketing budget's really small at this store. So it's probably pretty low. So, there's other things that there's other things that factor into marketing and car count other than just ad spend, right? So you're paying for the premium location that has a lot drive-by traffic.
00:16:51
Speaker
So in your store, I would probably add a lot of... A portion of the rent? Yeah, a portion of the rent in there for it as well. It's not so much a huge trackable number for yourself, it it is a but it's an impactful number for the service advisors to know.
00:17:06
Speaker
My conversation with them is, hey, it cost me $55 for you to blow that phone call off. You know, do we want I'm going start. They understand it in the moment when you're talking to them about it. Sure. But when they're in the heat of battle and it's four o'clock and they're busy as shit and they got five cars to finish and.
00:17:23
Speaker
And I get that. It's going to happen. It's hard to remember to say, yes, we can help with that. Yeah. Let's get it in. So it's frustrating for me, but I also understand.
00:17:34
Speaker
and i And I share that. I just found that. them having a quantifiable cost into that, and then also you know making sure that they understand that, again, we talked about that eub so that that flat repair, right?
Saying Yes to Small Jobs
00:17:48
Speaker
It's not a $40 flat repair. We talked about this on the last hours. It's a $2,000 AWRO opportunity. ARO opportunity, it's a it's a file your're at your aro for the last reported week on the performance report was $1,000. That's a potential $1,000 sale.
00:18:04
Speaker
It's also a potential new customer that you had an opportunity to win over that's going to have, you know, an LTV. It's the lifetime value, right? Yeah, it's going to have an LTV of whatever it is. So I think once we have that, I think it makes it easier for them, again, we go back to those why statements as far as why is it important that we do say yes and we make ourselves available even for the inconvenient opportunities for like a flat repair. And that doesn't,
00:18:30
Speaker
It doesn't mean we're going to push a $2,000 job out of the way to put a flat repair in first. We can still say yes. We can still bring it in. We can still assess what what we can do to to help them out. And maybe it is subletting it out to Mr. Tire down the street for the moment.
00:18:45
Speaker
Right. But I tell my guys, I'd rather be in control of that. Right. Well, Mr. Tire is going to take the low hanging fruit and, you know, leave the less profitable intermittent drivability concern to us. And,
00:18:58
Speaker
We've got to be able to do those jobs too, but we don't make of as much money on those. That's right. That's exactly right. Okay. So I know we talked about the performance report. Do
Setting Realistic Store Goals
00:19:09
Speaker
you have ability to have it in front of you? or um Yeah, we can pause and I'll and i'll run and get my laptop and so and I can have it right here if that's right.
00:19:19
Speaker
If you want to do that, you can or we can. I'll read out the numbers to you. yeah that's why You can read he read out the numbers. i look that eyes side You can see it over there the big six-inch screen. Right. That's why I've got a screen that big.
00:19:31
Speaker
I can probably pull it off. It's a shared Google Sheet, right? What's it called? Performance. It's okay. You can tell me what you're looking at. Yeah, so at the top, I know that i know that the the viewers can't see what we're looking at here, but that's fine. It's pretty much a spreadsheet that's covering some of the important KPIs that we track.
00:19:51
Speaker
on a weekly basis and our very first deal here is discovered services or total discovered services and that's the total sales potential of the business so we would take everything that was estimated for a week whether it was sold or not we would put it in this column and so one of the things that I wanted to try to do today this sheet comes kind of pretty loaded with goals that are at the top and I wanted to ask you did you have a chance to go through and fit the goals to your store yeah I shouldn't not do that. I'm sorry.
00:20:20
Speaker
No, you're fine. So I did it as well, and I just wanted to see, i wanted to get you to back into those numbers for me so so we were on the same page as far as why you picked the numbers that you picked. Absolutely.
00:20:33
Speaker
So here's the thing. Outdated SMS, just they don't just slow you down, they cost you money. And I learned at the hardware. Before TechMetric, I was wasting time on inefficient processes, manual updates, back and forth calls with customers.
00:20:46
Speaker
Now I handle everything in one place. DVI, customer communications, payments, real-time reporting. It's all in one page. Since making the switch, my average repair order has jumped from $293 to And it's not just me.
00:21:01
Speaker
TechMetric powers almost 10,000 shops nationwide. By the time you're hearing this, it probably will be 10,000 shops, helping them grow and operate smarter. If you're tired of losing time and money to outdated systems, tap the link in the show notes and see what TechMetric can do for you. So the very first one there, we have a $75,000 goal for weekly discovered services.
00:21:23
Speaker
Can you help me Give me your rationale as far as backing into that 70,000 number. It's our desired sales per week divided by our desired closing rate. Okay. What is your desired closing rate?
00:21:35
Speaker
I'm going to call my goal sheet. I think it's 40%. Okay. 40% with the $2,000 tech average quote. Okay. And so we had $75,000 of discovered sales and 40% closing rate,
00:21:47
Speaker
so if we had seventy five thousand dollars of discovered sales before percent closing rate That would equal out to
00:21:58
Speaker
to whatever that equals out to is 1.6 million divided by 52. Yeah. Okay. Perfect. And so I'm just asking, are you dividing it by 52 or do you want to be safer and divide it by 50 and see what that number is? 52.
00:22:11
Speaker
Okay. I think close in two weeks. They might have two weeks of vacation, but I'll still be open while they're on vacation. I got you. Okay.
00:22:25
Speaker
That's fine. All right, so we're going to going left to right here. We have an effective hourly rate goal 130. Looks like we're smashing that. Mm-hmm. I'm killing it.
00:22:37
Speaker
So no issues there. Hours per RO, we have a three hour per RO. Production hours per RO, we have a goal for that. Mm-hmm. And the real question that i have is your car count goal is 37.5 cars.
Factors Affecting Car Count
00:22:56
Speaker
I understand how we're backing into that number. My question though is if I take a look at our last four weeks,
00:23:05
Speaker
I know we talked about you kind of had what your car count goal was for the time. Is that 37.5 a future car count goal when you're fully staffed or is it a possibility now? They had 44 last week.
00:23:18
Speaker
so and It's highly variable based on are the students in town, right, because this is a right off of a major university campus. yeah um And we had the weather, right, did not crack our countdown a little bit, but at the same time, it's advisor mentality and advisor capacity.
00:23:40
Speaker
We've got... really trying to hammer home the let's be helpful, let's find a solution, let's get them let's sell the needed services and then put them in a longer car, rental car, get them in an Uber home or whatever it needs to be.
00:23:55
Speaker
you Two weeks ago, and we're talking about February numbers, we're talking about this, and I know you're looking January numbers, two weeks ago it was, $26,000 with a $1,000 ARO.
00:24:08
Speaker
Last week it was $26,000 with a $500 ARO, right? So like, I get it that, you know, it doesn't matter how we get there, as long get there, but it's easier to do it with half the number of cars, right? So we definitely fell short of our revenue goal But we exceeded our net profit goal.
00:24:34
Speaker
So the guys are crushing it on GP and they're not letting emotional selling get in the way. They're just, this is what the computer says it is, this is what it is, and and the customers are buying.
00:24:48
Speaker
Yeah, you're and you shared the P&L with me as well, and you're you're on target with every single... Yeah, I wish I could get the other stores to be like that. um yeah So yeah, your GP numbers look phenomenal, your individual P&L KPI targets look great as far as your total expenses.
00:25:11
Speaker
All that looks in line, your payroll expenses are in line.
Parts-to-Labor Ratio Improvement
00:25:14
Speaker
I don't have anything to complain about nitpick or pull apart as far as that goes. I did take a look, well I say that, I did nitpick really, really hard on a few things. Okay.
00:25:26
Speaker
I think that store, and you tell me if you think that I'm wrong, has the potential to be closer to one-to-one parts-to-labor ratio? um Our labor rate's really high.
00:25:38
Speaker
Yep. And our parts margin is a little bit low. So I could bring that down by lowering my labor rate, but I'm not sure. i feel like I'm pressing up against the the top of what I can price in the market.
00:25:49
Speaker
Yeah.
00:25:52
Speaker
I might be wrong. I'm not talking about GP percentage necessarily. I'm trying to think about how do we add more parts to a ticket. Yeah. and And when I say that, so just going through and picking some some repair order audits to do on either larger repairs to make sure that we're doing full system stuff.
00:26:13
Speaker
In other words, if we did the radiator, did we do the hose? Did we do the, you know, that we get all the fluid added onto the ticket, just little stuff like that. Oil change tickets, making sure that, because your higher car count weeks, I'm assuming you're doing more quick service type work.
00:26:30
Speaker
Well, just by definition, right? That's where it turns in into. You know, your 10 extra cars a week are going to be 10 extra oil changes, right? So that's why you're seeing drastic fluctuation there between your ARO, because we brought in less customer-concerned cars, more maintenance-driven ROs. So put in your RO audit from this part, want bring the price labor ratio in line with expectation.
00:26:53
Speaker
Yeah, and I don't think that you're you're not out of stack on your expectation. I just think you have an opportunity, just given what that store and you know what the market is and in the area, and your GP per hour always goes up.
00:27:04
Speaker
Yeah, as a as there's more downward pressure on parts, and parts are more heavily commoditized, and there's a press to maintain overall GP through increasing your labor rates, right?
00:27:18
Speaker
How is that affecting the way that elite coaches... partial labor ratio.
00:27:26
Speaker
So elite's always been lot of our clients are always going to be heavier on the parts, mean on the labor side they are on parts side. We typically see a lot of clients in the 60, 40, 55, 45 range.
00:27:38
Speaker
And I think that's a symptom of a lot of what you just described there. The problem that I see with that is as we give away parts, and I don't mean giveaways and like give them away for free, as we give up some of that percentage there,
00:27:51
Speaker
Labor is great. I love I love some labor but labor doesn't have the associated profit that comes along with the part right?
00:28:00
Speaker
So you know if I look at my GP per hour on a labor-only ticket it's always going to be lower than my GP per hour on a labor labor-plus party. Yeah, so and a catalytic converter is a great you great example of that we have ah a four thousand dollar converter that we sell for five hundred dollars over cost the margins on that are terrible But the guy's going to put it on in an hour. We're going to make $650 a GP in an hour, and I'll do that all day, every day, regardless of what the percentage is, right?
00:28:30
Speaker
Tires are another very good, you know. So I think ah think we miss, when we're shooting for high AROs and we're shooting for high discovery, I think it's easy for us to find you know, the big things like tires and struts and brakes and belts and fluids and all that good stuff.
00:28:49
Speaker
I think that we miss out on things like wiper blades. I think we miss out on things like batteries that on those oil change tickets can add parts to a ticket that doesn't have a ton of labor and a ton of parts on it to begin with.
00:29:03
Speaker
Makes sense. And you're not, you're like, when we add your tires into it, you're like 54% heavy on the labor, so it's not like you're 60, 65.
00:29:15
Speaker
But I think your your GP per hour right now is running about 180 from what I can see, which is fairly strong. But I think there's room to get that a little bit higher. And I'd like it to be at 200 if possible. Yeah.
00:29:27
Speaker
And I don't think you're going to see that in your, don't think you have much room to go in your labor. Got it. All right. And then the only other thing that I saw was tires.
00:29:38
Speaker
I would have expected you to be 10% or above on that store. and I'd like it to be, but it's just not. So is do you think that it's just, you think it's not possible with the area or do you think it's just something that you have to do from a... i think we're just not good at it. We're not finding the tires that are in the building already and we're not advertising for tires.
00:29:58
Speaker
um Now I don't advertise much at all at that shop anyway, but...
Strategies for Increasing Tire Sales
00:30:01
Speaker
you know I feel like if i put a couple of rolling tire racks out there with tires on put up some flutter signs that said tires or something and took them down every night, the city couldn't really argue about temporary signage. right And that would probably drive some tire traffic just by of itself. I don't need a ton of tires to make a to move the needle there, right? no No. and that's So you're you're averaging about 7% right now total sales in tires.
00:30:29
Speaker
My thought is, and again, if we go to GP per hour and trying to push that to 200, one of the easiest ways to push that to 200 is tire sales. one one One of the goals that I failed to meet that you gave me at the last meeting was to hire an advisor assistant slash GS yeah by the end of last month. And I did not, we're actively interviewing for that role, but we still haven't found the right person.
00:30:54
Speaker
When that person is in house, that it's going to be easier to do more tires, right? Because it's hard to get, pull a dude off a timing chain job to slunk some rubber.
00:31:04
Speaker
Especially a a high wage guy, you know, I'd much rather installs be happening from ah a lower wage individual. Sure. So I'm going put that back on my action item list.
00:31:15
Speaker
Okay.
00:31:18
Speaker
That leads me to another question. Your intake process at the moment.
00:31:25
Speaker
ah know I assuming we still have not implemented speed of service at this store other than the foundational understanding that speed matters. Is that correct? Yeah, the goal is to begin the process of implementing RACATAC at that store by the end of this month marks that we're reporting in.
00:31:43
Speaker
Okay. So in the meantime, if I pull up my my pull up for my appointment for an oil change, what does my intake process look like at the moment?
00:31:55
Speaker
Not ton of waiters there, so it's, you know, great take keys, review everything that's being done, set the expectation that, you know, we're going to give a call with an update later today.
00:32:07
Speaker
by what time do you need the car back? We will have the oil change done by then. right With the plan internally that if we find something that it needs and they authorize that need, then we can move the goalpost that finish time or we can arrange for alternate transportation. okay And you have one advisor, no advisor assistant.
00:32:29
Speaker
Correct. Now, Steven, the manager over both Raleigh stores, has been spending a fair amount of time there because that advisor needs an advisor assistant. okay Very good at relationships, very good at selling, not great on estimate building and parts.
00:32:47
Speaker
So we need that assistant there. So i know I know you know how to sell tires, and I know you're a big tire guy, but One of the things that we found, because I am terrible selling tires, we started putting tires at the front end of our intake.
00:33:06
Speaker
So, you know, the advisor goes or the advisor assistant goes to check in the the vehicle outside. and part of their check-in process is to just to measure tire tread wear while the client is still there.
00:33:17
Speaker
And then we present the opportunity to do, you know, sell tires at the right. I don't know what your thoughts are on that. That makes sense. I can tell you that the advisor I have right now, I don't think they'll do that. Sure. But with Steven there, you have the advisor assistant. Yeah. And then you know you're going to push towards the advisor assistant role.
00:33:40
Speaker
I don't know if it would be... hear that, Steven? You're just a tired bitch. Sorry. so He 100% listens to
00:33:50
Speaker
Sorry. So I think it might be valuable to have him perform that. Yeah. process maybe once or twice. because two ways He's a formal former dealership service manager. That's right at his alley. he's totally on you know selling tires on the way. Right at the service drive, yeah. yeah And so...
00:34:08
Speaker
I'm thinking more down the road from when you do have that advisor assistant. The problem is you're going to hire your advisor assistant, you're going to put him at the counter, and we all do this, right? The lead advisor trains the advisor assistant, and if the lead advisor is not going to do it, then the advisor assistant not going to do it either.
00:34:25
Speaker
So at least you can get the el lead advisor bought into the fact that he likes it when somebody else does that because he sees the fact that he makes him money and he just sells some extra tires and he didn't have to go out there and do it, right?
00:34:36
Speaker
So maybe that... maybe that Greases the wheel a little bit for when the advisor assistant comes in. what What's your methodology for putting together tire quotes quickly? Because I mean, time is of the essence if you're doing it during the check-in process.
00:34:51
Speaker
I'm not necessarily going to put a quote in. What I'm going to do is going to plant the seed that, hey, I see that we're at 3.30 seconds on trade wear here. North Carolina state law says at 2.30 seconds, you know, the tire has, you know, lived its legal life.
00:35:04
Speaker
We would like to go ahead and replace those tires to extend your stopping power, bla blapo yeah All the good stuff, right? um Hey, what going to do going to talk to your advisor. if They're going put together three options for you. You know, good, better, best. They'll send it to you in a text message or an email.
00:35:17
Speaker
Or if they're a waiter, they'll come over when the estimate is completed and they'll share share what we can do. so And I do that because it's my porter that goes out there and does the check-in. So he has no idea how to build an estimate.
00:35:31
Speaker
But he can take a tread gauge out there and measure tires. And so we just go ahead and get that out of the way right out the gate. Perfect. So I'm in my intake process and this is just me personally, I'm just looking at we're talking about adding, you know, smaller part things that are going to be outside of tech fines, right?
00:35:51
Speaker
Windshield wipe. I mean, you know, i have a technician but that's... Well, that's great time to find sublet class jobs. That's right And, you know, PDR stuff. That's exactly right. wirlins like you said yeah you know fiber blades self selfate inspections because The tags expired. The tags expired. If you don't have oil, if it's not oil change ticket, like it's there for breaks, and we look at the oil change sticker and the oil changes do, you add oil change to the ticket, that intake inspection is typically what we're looking for in all that stuff.
00:36:22
Speaker
Okay, making a note. All right.
Summary of Action Items
00:36:26
Speaker
So just a real quick real quick recap. I've got index cards laminated with goals per employee.
00:36:35
Speaker
link it to their dream sheet and what marginal performance improvements can help them achieve those goals potentially. Our audit it for missed parts opportunities, trying to bring our parts labor ratio a little bit closer to one to one than where we are.
00:36:52
Speaker
Still need to hire an advisor assistant or GS role, maybe both. um Once the GS role has somebody in place, consider a press to increase tire sales.
00:37:07
Speaker
I really believe that the stupid flutter flag signs along the road and a rolling rack with a bunch of tires on it will sell because it's low-speed, heavy traffic drive-by. think you're 100% right. yeah now The key there is we'll have to take them in every night and take them out every morning.
00:37:21
Speaker
And then implementing an intake inspection to check for things that we can upsell at the point write-up. Yep.
00:37:33
Speaker
What else you got
00:37:38
Speaker
brother? Well, let's keep going down the performance report real quick. Okay.
00:37:51
Speaker
Again, just looking at your January February numbers already had a massive improvement in your AWRO or ADS.
00:37:59
Speaker
January numbers were fluttering somewhere around 1500-1600. We're last four weeks we're looking at about 1850 to 1900 on discovered services.
00:38:10
Speaker
ARO has seen a similar increase as well. So pat the advisor on the back doing a good job again going back to you know making sure that we find things that we're doing right as well. Absolutely. Because you guys are guys are going through a lot of change.
00:38:27
Speaker
Yeah. and and And they're doing a great job. Yeah. yeah and So I would agree with that.
00:38:35
Speaker
Labor GP is doing good at 72%. That's about a 10% increase from what we were seeing inside of January as well. So those those numbers are doing good.
00:38:47
Speaker
I know you said you're Why do you start smirking like that? You about to cut me you ready cut me deep, Shrek? All right, well, I got two things. One, i do see an issue on the performance report.
00:38:59
Speaker
I would like you to go back to week one in January and audit your part GP. Okay, what does it say? Well, you have $1. Oh, so that's probably an error.
00:39:11
Speaker
Of part GP, so we probably have a fat finger in there. Yeah, yeah. So we're looking at a parts cost. of forty six eighty five ninety one per a week which seems pretty average for your week but you're showing part sales of 46, 86, 91 so I think you put your costs in the sales column on there. Yeah, that's what that sounds like. So that's, I know when you originally did that you reached out and had some blank numbers that were in there that would have been the cause of those blank numbers.
00:39:45
Speaker
So the reason that I bring that up is because you have You have a really low GP for that week, obviously. You're showing 33% GP for the week, which is... Let me go ahead. So what what are the dates of that week?
00:39:57
Speaker
It would have been the week of January, first week of January, so the third. So, okay, do you want... That Monday through Friday was actually December thirtieth through January 3rd. Is that what you want? Yep.
00:40:14
Speaker
Couldn't have been that bad. 29 cars at 403, that's pretty bad.
00:40:19
Speaker
61 points GP. It wasn't $4,000 of part sales path though. Probably not wrong there. Part sales were $58, $13, and $89 with a
00:40:28
Speaker
sales park sales were fifty eight thirteen and eighty nine cents
00:40:35
Speaker
with a Discounts of 11.2798, that's a huge parts discount. Parts cost that week were 19.34 14 cents. the sales number was right. was 46.85.91 after discounts. And the cost was 19.34.14.
00:40:52
Speaker
So the margin was good that week. It showed 61 points GP that week. discount and the cost was nineteen thirty four or fourteen you know more margin was good that week it showed sixty one point gp that way and you are not tracking free checks or comebacks at the moment?
00:41:10
Speaker
It's just worked into Sure. Yeah. Not effectively. I'm asking, only reason I'm asking is because I know you're not a heavy discount store there, so $1,000 worth of parts discounts is probably a rare thing. That was a warranty problem, I'm sure. Yeah.
00:41:28
Speaker
Alrighty, well outside of the action items, um usually what I'll do is I'll take the last 10 or 15 minutes and discuss whatever kind of pain points you guys are having that are new from from the last conversation.
Staffing Changes & Focus on Small Store
00:41:40
Speaker
anything popped up that, I know you said you had some staffing turnover, Well, it wasn't turnover this time. It was, that yeah, I transferred a guy to the big store because brought him a lot closer to home and that's where he originally wanted to work. We just didn't have a spot for him. yeah And so new hire, again, started today, the day that we're recording.
00:42:00
Speaker
Need to be sure that I go to a dream sheet meeting with him. and that he understands where our average Discovered Services target is and why. And that'd be a good time to revisit it with everybody, just to touch base with him again. And I can do that when I'm handing out my little laminated index cards. there you go So that'll be a good thing.
00:42:22
Speaker
so far as pain points go, Honestly, I've been so focused on the big store with opening on Saturdays that I haven't given this small store the attention it needs to finish off those other action items, like hiring that individual. Okay.
00:42:42
Speaker
And so and know that that's a limiting factor, and I'm holding it back because I'm not giving the attention to find and hire the person that need. And I'm leaning a little bit more on Steven start at least doing some of the initial phone screenings and and and that kind of thing. Yeah. Just because I know that if he waits for me, it's going to be a long way, unfortunately.
00:43:04
Speaker
Well, that was actually, while you were talking, that was one of the things i was going to suggest. What do you think about Steven filling out the performance report for you weekly for that store since he's he's directly responsible for?
00:43:15
Speaker
Yeah, I think that makes sense. he already does a manager's report once a week for the store, so yeah. I think it would be good for him to take a look at those KPIs and you know try to start identifying where he can you see the breakdowns from.
00:43:30
Speaker
So Steven, this is me passing that job off to you if i haven't done it by the time you hear this episode. No, see, this is Mike not holding you up from your earning potential. That's what this is.
00:43:46
Speaker
Awesome. well Thanks, man. This is... and As far as other pain points go, it's mostly me, right? I am the limiting factor almost all the time. Well, i think and I think that that's probably true for think that's probably true for all of us.
00:44:03
Speaker
I think you're because as you grow and you're getting more stores and you're putting more focus on on bigger stores, i don't think there's anything wrong with that, obviously.
Non-Negotiable Cultural Standards
00:44:12
Speaker
it's you know As the owner and the captain, you have to pick and choose which jungle you're going to go cut down every day that's going to have the most...
00:44:18
Speaker
The most benefit with that, though, you're relying on the team like Steven. I think one of the things that would be that would be valuable for you to do is sit down Steven if you haven't done this and then sit down with each one of the different stores because the stores are going to have different, they're going to a little bit different as far as culture is concerned.
00:44:37
Speaker
But by and large, you still want them to run intently the same way that they do if you were there. so think I think I would write down some of your non you know non-negotiables as far as you know what what culture you want to see there, attitude, effort, hustle, whatever it is, right?
00:44:56
Speaker
Maybe come up with some culture standards in place for each one of those stores to make sure that you know we know that whether Mike's here or not, this is the expectation, this gets done, it's an easy thing to tend to keep up with that might be something else think about as well That way, as you're spending less and less time, more and more time on your boat, you need a bigger boat.
00:45:24
Speaker
Real quickly, if we get out the minute two sure we've got got some time.
Elite's Boot Camp Benefits
00:45:30
Speaker
How was the the master's program, Leslie? The Eagle.
00:45:37
Speaker
xx masters this no Eagles, firm so we had a elite hosts a three day shop owner boot camp called Fly with the Eagles. They've been doing it going all way back to the Bob Cooper days, which you're aware of. It was a had a phenomenal event in Los Angeles area, which is you know kind of the breeding grounds for elite as Bob was from the San Diego area. So it was really awesome to see a lot of guys that you know we consider OGs as far as the other pro service guys were there. yeah um
00:46:09
Speaker
But so I got catch yeah know got a chance to catch up with some of those people that I got to see at my very first Eagles when I went out to San Diego. ah But we had 60 different shops. Wow. 60 people in the room, 55 different shops.
00:46:21
Speaker
Wow. So it was pretty big event. And it was it was great. I mean, obviously, joe Joe Marconi is our lead presenter for that, and he does a phenomenal job. Myself and Tom just, you know, stand up and...
00:46:34
Speaker
i know i know you did one in Raleigh last year. You're going be in the Midwest later this year? so we have another one coming up. The next one coming up is in June, and it's going to be in the Detroit area. Okay. So in Grand Rapids, Michigan. Okay.
00:46:46
Speaker
And so we'll be, you go to our events page on EliteWorldwide.com, think it's on our events page now. We're ironing out the details there as far as putting that together with one of the BDG groups there and in Michigan. So we're excited to have another big Big group there and looking to sell out probably in the next three months really. Awesome.
00:47:05
Speaker
And Masters, where did that happen um where did that happen this week? I believe, i don't know word it so I don't know where it was. I want to say it's in the Atlanta area. Yeah, that's what it was. It was Atlanta. yeah So s Sabrina, who is our lead on the service advisor training, she's in the georgia you know greater Atlanta area there in Georgia.
00:47:26
Speaker
So I know they host a lot of the master's training there just to make it easier for her on the travel side of things. She does an incredible job. i didn't I didn't really know Sabrina that well before I became involved in the internal team because she was kind of newer to the internal staff as well as myself.
Elite Master's Program for Advisors
00:47:43
Speaker
But the more the more and more I get a chance to spend her, man, she is a great, She's incredible. For those that don't know, the master's program is a three-day service advisor program.
00:47:56
Speaker
Intensive, lots of role play. There's homework. there's pre-course work that you have to complete before you attend the class. And then there's six months of follow-up weekly calls. There's a midterm exam. There's a final exam. There's graduation. Or at least it has been in the past. I assume it's very similar.
00:48:13
Speaker
And they also have the graduate program now as well. So after the service advisors graduated from that, they can continue to partake in the virtual meetings after the fact so they can keep those their skills sharp.
00:48:25
Speaker
If you're one of those shop owners that would love to abdicate service advisor training and It's as close to being able to turnkey it to somebody else as you're going to find. can never We never recommend being totally yeah getting totally disconnected from that, obviously, because it's your store, it's your processes. But at the end of the day, there's so much accountability that's built into that training program because it's weekly coaching for the advisor.
00:48:52
Speaker
There's homework that they have to do. There's peer accountability in it as well. it's just It's such a robust... from an owner standpoint, I'll be 100% honest, it's a pain in the butt for the six months because you know usually you're going to work the counter while while the advisor's sitting in class they're sitting in their meeting.
00:49:10
Speaker
But the return on it is going to happen. Over the years, I've sent probably five or six to the master's and it's always worth it. You always see immediate... bump upon return and then it continues and eventually they they reach a new normal that is higher than their old normal. That's right. And as long as you continue to reinforce those new habits and those new processes, they don't drift back down.
00:49:35
Speaker
Yeah. And just if you are an owner that is going to partake in the accountability side of things, you get copies of all of their recordings that they do. You get copies of all of their homework.
00:49:46
Speaker
You have copies of all the books so you can participate in continual education. pat you know Once the program is done, you can revert back to something. You can use that as an accountability standard. Hey, you took the class. You passed the test.
00:49:59
Speaker
Why didn't we do that? yeah you know Here's your example of what a great call sounds like for this particular type of sale. Here's what we said yesterday. yeah tell me what happened. It had an example of that, we have a very clearly defined inbound call script for customers who have a problem.
00:50:19
Speaker
And ultimately it is, yes we can help you with that, is now a good time to bring it in. That's a very truncated version of the script. sure And somebody called and said, hey,
00:50:32
Speaker
I've been coming to you for years and i was on a road trip and my check engine line came on and the shop that stopped at told me that I needed a catalytic converter. you give me a price for that? It was, we don't give prices over the phone.
00:50:45
Speaker
need to bring it in first. mean you can't give me a price? No, I can't give you a price. And that was effectively the end of the conversation other than the customer asking him to speak to the manager. i like my god we practice this every morning more Sure, I can help you out with that. You mind if i ask a few questions for you? I mean, it's so easy, right?
00:51:06
Speaker
And so the advisor was reluctant to pass the message on to the debt manager. The manager got the message at 5.30. 7.30 in the morning, we have the call and say, hey don't forget to call this person. It's now the next morning.
00:51:21
Speaker
Then call them at 8.30. They've already dropped it off in another shop to have the converters replaced.
00:51:29
Speaker
white hot rage of a thousand suns you know yeah so so and i would have the exact same emotion there uh what i really try to focus on in those scenarios is is's going back to the advisor and letting them know that selling is not always connected to dollars right because that customer out of town there's no dollar sale that you can really make in that scenario but it's still important that we sell that we that we're in control of the sale you I'm assuming.
00:51:59
Speaker
To be clear, they had continued on from their trip and they were home ready to get the converters replaced. Oh, well that's even better. Yeah, yeah. So it was absolutely a lost sale. Okay, I'm sorry. Yeah.
00:52:10
Speaker
What I was going to say is at least we could have done was control where they took their vehicle. Yeah, yeah. Reached out to that shop. never mind
00:52:21
Speaker
yeah that's a loss that's a good training opportunity
Customer Apology & Interaction Invitation
00:52:23
Speaker
right there. It's good training. So we send an apology card and a Starbucks gift card to the customer and say, you know, you deserve better than that experience.
00:52:34
Speaker
oh yeah Well, that's my confession for this episode. I had way worse. Oh, yeah. Let's not start trying to one-up each other.
00:52:47
Speaker
Anything else, man? think we're pretty good. We'll keep, you know, I'll send you an updated list of the action items for the coming month. Okay. We'll stay in touch on the performance report throughout the next couple weeks. And if I see anything, I'll chime in and ask questions. the performance report falls off, then just yell at Stephen because he hasn't been keeping up with it?
00:53:05
Speaker
i I'll confiscate a Subaru. Thanks for listening to Confessions of a Shop Owner, where we lay it all out. The good, and the bad, and sometimes the super messed up. I'm your host, Mike Allen, here to remind you that even the pros screw it up sometimes. So why not laugh a little bit, learn a little bit, and maybe have another drink?
00:53:23
Speaker
You got a confession of your own or a topic you'd like me to cover? Or do you just want to let me know what an idiot I am? Email mike at confessionsofashopowner.com or call and leave a message. The number is 704-CONFESS. That's 704-266-7000.
00:53:38
Speaker
three three seven seven If you enjoyed this episode, be sure to like, subscribe, or follow. Join us on this crazy journey that is shop ownership. I'll see you on the next episode.
00:54:17
Speaker
Skip.