Chris Collins and a co-host examine why service shops fire technicians over small raises. A technician asked for $2 more per hour and was terminated. The hosts show how a technician's labor cost is negligible compared to what customers pay, and how commission-based techs generate millions in revenue, making modest raises insignificant.
All right, number 3: The tech wanted a $2 an hour raise. I had to let him go.
Okay, everybody, I want, I want you to, uh, answer this. You can put it in the comments or just answer it out loud. I'm going to ask you a question. Who pays for the technician, you or somebody else? Somebody else, the customer pays for the technician. $2, $4, $8, whatever it is, the customer is the one paying for the technician. It's relative. It's your cost of sale. And yeah, it's that. It's just simple math. You would never lose a technician over $2.
I think where people get lost on this now, if you're, if your effective labor rate is 50% of your door rate.
That's, you know, raise your door rate.
This, this part comes into the conversation, but that effective labor rate, uh, can, can be 90% of your door rate, and then these things just aren't even a, you know, aren't even a, a thing. But we see this sometimes too, just like, uh, publicly traded stores. I've had that happen where— and during COVID uh, they said, you know, go and let half of the techs go, or, you know, you got to get the headcount down or whatever, because they just looked at a number.
They had a count looking at a number and they're like, oh, this guy's making $150 grand, we'll cut that expense. And they don't understand that techs aren't making $150 grand, they're getting paid a commission on the millions of dollars in gross that they're creating, producing. Yeah, doesn't, doesn't make any sense.
Yeah, yeah.
And, um, so another thing there too, Hoagie, that happens is there's managers that were techs, and the thing that happens is they get upset that these techs to them come off entitled. And so they're like, you know, when I was a tech, I made $18 an hour and I worked hard and I was happy, you know, and these guys, they just want this and that and they're entitled. And it has just as much to do with that is the $2, right?
Yeah, yeah, yeah.
Because most of the time, the guy, the guy saying that was a tech.
Mhm, that is true. That does happen for sure.
It's a good one.
Yeah. And if you just kind of take a step back and look at what they're producing, you don't, you know, and, and you understand the financials, you don't make that, don't fall into that trick bag. All
