Simplify Your Service Advisor Pay Plan

So we get this a lot about advisor pay plans. Oftentimes it comes up in reference to, I can't hire good advisors.

Yes.

And they don't want to come work for me. Or a manager feels like their pay plan isn't working or it's not effective, it's not driving performance. I think we would all agree that pay plans to one degree or another. Drive behavior.

Yes.

Why the hesitation?

I was trying to think of they encourage bad behavior or what. But either it's driving it.

Yeah.

One way or another.

And so that whenever this subject comes up and I asked to see the pay plan, usually the pay plan is so complicated.

Let me even back up. I'll say, what is the pay plan? So manager will talk about the pay plan. I'll say, what's your advisor pay plan? And then that goes something like, well.

There'S a say, well, you know, you're in for it.

And then they're like, it varies from here to there on this, but that. And. And then I'll go, so you don't even understand the pay plan. And like. Well, you're like, okay, so the first thing that you have to understand is if you want a pay plan that drives behavior, it has to be simple.

I wrote down that you don't need a degree in quantum mathematics.

Well, you do, but not for the pay plan.

Yes.

That's funny. Yeah. No degree in quantum mathematics. And if it can't fit on one page.

That'S a great piece of advice.

If you can't fit it on one page, it's not a pain point. Then the next thing I would say is, I have no idea how this happened or why it happened.

And there's a bunch of people out there that will fight for this like it's fighting for their.

Mother firstborn. Like, seriously, that they pay the advisors on gross. Advisors don't understand gross or control Gross. Really? Yeah.

Oh, that reminds me. What's the difference between in laws and outlaws? What outlaws are wanted?

It's pretty good.

I don't know. I. For a long time, people would come back from a 20 group meeting, and then they would. They would be like, oh, we're going to pay our advisors on gross. But it does. It doesn't make sense. The advisors don't understand it. They can't figure it out. You can make whatever case you want. You're wrong. It doesn't matter. Pay them on sales. It's simple. What we want to do is we want to drive sales and we want to drive effective labor rate. I would Say it's sales less discounts.

So I would deduct the discounts from the sales but I would always them on sales.

No hours per hour, bonus hours pero.

Or a measurement. We have that measurement in our advisor competition software. But it's one of five or six categories. So it's weighted down. It matters but not. It doesn't matter enough that you would walk away from a tire rotation or an oil change.

Yeah. Okay, good.

The other thing to understand about service advisor pay plan is if you have a quick lube and you have a separate quick lube advisor pay plan, chances are that that pay plan is 40%. You're paying 40 to 50% of the gross. I've seen as high as 60%. So a quick lube advisor might produce 20,000 in gross and you got to.

Pay them 7 or 8.

Yeah. To to put up with it. So it never pencils to have dedicated quick lube advisors. We never set it up that way. It makes no sense to run the most people through your least talented, lowest paid advisors. It's better to spread them out and.

Pay everybody you know, make the experience consistent. That's what I would say.

Thanks so much for watching this clip of service driving revolution. 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 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.