An Unconventional Approach to Fixing Conventional Shop Problems

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Welcome everybody to your Friday drive by where we answer your questions. We want to help you work through whatever it is that is troubling you, that has you stuck or you're just curious about. Get a pen, piece of paper, open notes on your phone and write down this number. 8333-ask-SDR. That's the hotlines. One more time. 8333, ask SDR. Now, if we do answer your question on the show and we don't answer all of them because some of them are inappropriate, super inappropriate. But if we do, we will send you some swag. So you'll get a sdr T shirt, hat, coffee mug or a mug, notebook. Whatever it is, whatever we have, we're sending it to you. So today we have two great questions. One about a toxic work environment and the other one, how many stalls should a technician have? Kind of a fun question, great questions. So let's get to it right now on Service Drive Revolution.

Good afternoon, Chris. My name's Travis. I left the independent world and got back into a dealership in the role of essentially a shop foreman, lead technician. My question for you is the dealership I work at has a bit of a toxic environment. It's got very low shop morale. Pretty much all of your signs of having an issue not related to the technicians. This has actually become such an issue that over the last week and a half, two weeks, we've lost eight of our 15 technicians and we're actually losing two service advisors as well, which is leaving us down to two advisors and five technicians that are full fledged techs. My question is the dealership I work for refuses to see any issue with the morale or the toxicity of the work environment, which is pushing these technicians out. Is there any way that you can think of to get the management to actually see what's causing all these technicians and advisors to leave short of what they believe, which is just, oh, these technicians are just leaving. So that's my question for you if you have a chance to answer it. I really appreciate it and look forward to hearing from you. Have a good day.

That's a great question, Travis, and I commend you and I'm very impressed with the fact that you're, you know, you want to fix it and you're taking ownership of it even from your, your position. So I love the spirit of the, of the question. Do you have any thoughts?

The ship is on fire and he's trying to get a fire extinguisher instead of jumping overboard. So I like that too.

Wow, you like that? Metaphor a little bit.

So the, the first thing is, I think that we have to understand that if management isn't aware of the toxic work environment, we have to first go back to why do people leave jobs? They leave jobs because of poor leadership in almost all cases. So I think that that's the first start of it, is that we have to be aware that there's something that's causing everybody to go. The other thing I would say too is that we've seen this happen before where one or two people start to leave and then everybody jumps on that bandwagon. And don't be surprised if it keeps going, if there's people worthy of plucking out of that, out of that group. But I think the big thing is, is that you have an open discussion, just try to identify what's going on with the group that you still have. And then obviously you got to replace some people in the shop because losing eight technicians. Doing quick math on that, my goodness, it's, you know, $120,000 a month in gross profit. Like it's a huge, a huge, huge dent to the business.

Yeah.

Travis, one thing that happens with us that I think is similar, but hopefully this inspires you to. The next thing that I'm going to advise that you do in this situation is we will get.

You know, service department leadership, general managers, dealers, call us and say, we need more traffic, we need more ros. And we're stuck at 200 grand a month in gross and we want to get to 275,000 in gross. And so we need more customers. We need you to help us with, with marketing. Makes no sense really whatsoever. Like you're, you're, you know, oftentimes they're booked out five to 10 days.

Yeah.

And they want more traffic, but they have pent up traffic that they can't get in. And they're not making the connection that it's all driven by production in the, in the shop. Right. And so Christian kind of alluded to it, but the way that I handle that situation on the call is I, I try to go to logic, but in a way that they usually don't think about it. So we're kind of teaching them something from a different point of view. But then we're making the point. And the way that I do that is, is I say, well, okay, do me a Favor, take your 150,000 or two, whatever they're doing in gross. So let's say they're doing.

200,000 in gross and they have 20 technicians. What is your average technician producing in gross. And so easy math, but it's usually not easy. On the call they will, they'll say, oh well, $10,000. And I'm like, okay, well if we're booked out 10 days and whatever it looks like, you know, in my experience, we probably need to add 7 techs. And so what would the 7 techs add in gross profit? 70,000 if they're current.

Yeah.

Now also, we're going to probably increase their sales per customer, their effective labor rate, all these other things. So that gross per tech is actually going to go up. But on that call, we try to under promise, understanding that there's, there's more there, there's plus. Plus, plus. Yeah, but making the point of thinking about technicians as an amount of gross profit. And so my suggestion to you, Travis, is to look up online the industry stats for how many technicians are leaving our industry and then doing your gross per text. So whatever you guys average in gross divided by how many texts and say, you know, I would write a letter to them and copy everybody in leadership on the letter. So I would give each one of them a copy of the letter. The tone of the letter would be educational, not condemning, just, hey, I have some ideas and I know you're busy. That's how I would start the letter. Like, I know you're busy, but I have some ideas and I just wanted to share them in a way that you can think about it. But I wouldn't, I wouldn't go at them saying the environment is toxic. I would do it through guided discovery in a different way. So what I would do is I'd say, hey, I know, I know you're busy, but I have some ideas. And you know, as we currently sit, our production in the shop is less than the potential that we have for customers coming in. And our, you know, the industry stats and you can quote wherever you find it, there'll be ones from nada different places that the industry's losing five technicians for every new one coming in. And it's getting harder and harder to recruit technicians. Our average technician is, you know, producing this much in gross profit per tech. As we sit here, I think we need to, to come up with a plan together as a team. One, to make this an attractive place for technicians to work. We need to take a hard look at that. And then second is how do we recruit techs and get more technicians in here? So see, I'm not saying like, hey, it's a toxic environment, whatever. I'm saying we should take a Look at how we make it attractive, then the toxic environment will be the discussion and it'll be natural because it's kind of guided discovery in that sense. So that's, that's kind of the approach that I would take is I'd write a very constructive informational letter to everybody in the spirit of getting better and you wanting to be a step ahead and some ideas that you want to share. But, you know, you. You just want them to consider it and they'll come, they'll call a meeting and they'll come to you and you guys will talk about it. That's what will be the outcome, and it'll be positive. And you, you know, if you, if you tell them that the environment's toxic, they don't understand that it's not something they can put their. Their hands around. If you say that the industry's losing five texts for everyone coming in, that's a fact that they understand and is very easy to put your mind around. And now the solution is to come up with some sort of strategy to get ahead of that. And that's a natural thing that doesn't put anybody on the defensive. That's great. And I'm sorry, Travis, Christian doesn't have a joke. Yeah, you tried, but my bad, Travis. Nothing there.

But I will say good luck, Travis.

Let's do the next one.

Hey, Chris, question for you. I know you talk about always finding more techs or getting more techs in the building, which obviously everybody has an issue doing, and I don't. I've never worked in a shop that has done it this way. But I'm just curious as to what your thoughts are. In my shops, I've always worked with, you know, most of the techs have two hoists to work off and they have to, you know, are two hoist too solid to work off of. But I have heard of shops and I, I mean, I. Last shop I was at, some techs only had one. But what's your preference? Is it, you know, one hoist or one stall per tack or two stalls per tack?

And if one, why? Because I don't see how that could be really efficient if they're waiting on the parts hold to get them parts or whatnot or US advisors to sell the work?

Just a question on that part.

Sold parts hold. It's catching on. I love it that you worked. Worked it in there. Remember, Paul, if you want to come to Top Dog, if you're not already, if you use the coupon code parts hold, you can bring your parts Manager with you.

And get a T shirt.

And get a T shirt. Parts hold. Limited edition parts hold.

Just, just as important as bringing your.

Parts manager T shirt, which is so funny. So this, this is a question, Paul, that you, we have to, in answering this, take into consideration the market, the brand, how busy the shop is.

So the size of the shop, how many stalls you have, that sort of thing. So let's say you have a shop with 24 stalls and you have 12 technicians and as we currently sit, you're running out of work every day. There's no reason why the techs can't have two stalls. It's very much predicated by the circumstances that we find ourselves in. Now. Let's say we have a shop with 24 stalls, we have 12 techs and we're booked out 10 days and customers are dying to get in. The truth is that it is very possible for a stall with one technician in it to run 100% efficient. So that means in an eight hour day they can flag eight hours. They don't need two stalls to flag eight hours. They can push the car out. Right. Just most of the time. Just because they don't have a part doesn't mean the car doesn't drive or can't be pushed out. So it really depends on supply and demand more than anything else. But oftentimes that just doesn't make financial sense for a technician to have two stalls. I, I mean I have shops where technicians have three stalls. Honestly, that you give them five stalls, they'll use five stalls. It's, it's possible, but it doesn't make financial sense that if we have 24 stalls and we could keep 24 techs busy, that we would make more money having technicians having two stalls running at 100% efficient versus having one stall running at 100% efficient. They have to run at 200% efficient in order to have two stalls or to make that math work if the demand is there.

Yeah, I think that that's probably one of the things in their head, in a technician's head. They think if they have two stalls they're doubling their productivity.

Well, they could, they, let's just say they're 20% more efficient. So they run at 120%. It's still not as good as two techs running at 80. Yeah, because it's 160% efficient.

Yeah, that's a good point.

So if you, if, let's say that a technician with two stalls runs at 100% and you have two techs running at 60% in those two stalls, you still have 20% more production.

That's right.

And then, you know, consultants and different people tell you to do your, you know, your cost per stall and extent expenses per stall and all that. But I think that those, those equations are interesting, but they don't, they don't ever really tell the full picture because what if you have low, really low overhead, but your potential is huge? What like if you have the demand and every stall can run at 100% and you take 24 stalls times 8 hours, times your effective labor rate, then the number's gonna be huge versus 12 texts times 8 hours, times 120%.

Yeah, I definitely think about that a lot when I do analysis with the clients is like, how many hours could a stall produce per day?

I think, and how complicated could consultants make it super expensive for those that. Right. And it goes back to, you know, our question from Travis right before this is I look at technician as an amount of gross every month. So, you know, in some high line stores, like let's say you have a Mercedes dealership, it would be common that the technicians would be producing 20 to $25,000 in gross a month. You can have a technician doing that with one stall to give them two stalls. Now each stall is producing 12,000 in gross, not 25. So if I have 24 stalls producing $25,000 in gross versus 12 producing 25,000 or 12, five, however you want to do the math. It's, it's half the. Half the gross and dramatically affects your profitability.

Yeah.

So great question, Paul. But you know, just let me reiterate, it's very dependent on your circumstance. And I would say in a situation where I have a Ford, Chevy or Dodge dealership and we're doing a lot of heavy truck, the heavy truck tax need two stalls. A lot of times what I will try to do is go rent a warehouse somewhere to give them two or three stalls. But you, those guys, when they tear an engine down and you know the heads are getting machined or whatever is going on, they can't just push them out. I mean, they can, but really unproductive and, and parts are everywhere and that sort of thing. So I always build into my plan, like diesel techs, they're going to have.

Two stalls, trans techs, if they're doing rebuilds.

But once again, we're getting more per hour usually for those techs. So you get, there's a premium for them and they are more efficient. So they'll run at 150, 170% efficient. So it makes sense also. But you know, one little thing that, that all that I'll share with you guys is like, you can oftentimes in a lot of markets in, in the US and Canada go rent a warehouse with 4,000 square feet. You could put a ton of stalls in there. And you don't, it doesn't have to be customer facing. You can do your fleet work, your heavy duty work. You know, there's like, let's say you have a Ford store and you're doing a lot of retro for police and you're putting sirens and bumpers and all that stuff on there. You can do all that stuff remotely in a warehouse somewhere and you can put in the big lifts and you can, you can get, you know, you can get a lot of lifts in 4,000 square feet.

It's a huge ROI.

You can do internal. But I was gonna say to rent that warehouse oftentimes is like, I've done it for as little as 3,000 and as much as 10,000. But it, you know, if I have, let's just say I have five techs in there producing, you know, 16, $20,000 in gross. It makes perfect sense because then I'm making the gross up in the main shop because I have, I can have more text there too. So oftentimes if you're, if you're having this thought, the heavy duty guys, and I don't know what brand you are, I mean, that information would be helpful here. But if that's your, your scenario, look at renting a warehouse off site too. Excellent, thanks. Remember the numbers 8333-ASK SDR and we'll see you next time on Service Driver Revolution. Thanks for watching this week's Drive By. I hope we gave you something to think about over the weekend. We're uploading new stuff every day, so make sure you subscribe and click the bell icon so you don't miss out. If you have a question you'd like us to, to answer on the show, call 8333 Ask SDR and we'll answer your question on the show. That's 8333 Ask SDR. For special deals on our books and training, head over to offers.chriscollinsinc.com now that's offers.chriscollinsInc.com I'm Chris Collins and I'll see you in the next video.

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