LAS VEGAS — Why do tool carts have wheels? So automotive technicians can roll their tools, and their skills, from one shop to another, according to Dan Gilley, director of RLO Training.
"The difference between 30 years ago, when I was turning wrenches, is that I could roll (a tool box) out of one shop and have three or four shops to choose from. Today, (techs) have 23 or 24 shops to choose from," he told an audience at a seminar he conducted at the Automotive Aftermarket Products Expo in Las Vegas last fall.
Despite the technician shortage in the industry, Mr. Gilley claimed that if a repair shop owner can't find a good technician in a short period of time, he/she should look in the mirror.
"What is your reputation as a place to work? Is it, 'If you get a job there, it's great! Because they pay really well. They got great benefits. It's a fun place. The boss is OK?'
"Please remember people don't quit jobs. They quit bosses," he said.
"Are you trying to make yourself the place to work at? What are you doing so people want to come work for you?"
With the low U.S. unemployment and the shortage of technicians to fill job vacancies, repair shops should be recruiting constantly, regardless of whether they have a job opening. So when a job opening does occur, the owner has someone in mind to call and hire.
"How many of you are spending a whole lot of money to get new customers every month?" he asked. "So how many are spending a bundle of money to get new employees every month?
"When you think about it, which is more important? If you don't have any employees, can you fix any customers' cars? So should you have a marketing budget for employees?
"We've got to market for talent like we market for customers. We need to be doing it all the time," Mr. Gilley said.
He suggested that shops should develop a list of reasons why they are a great place to work, such as offering paid training, a good culture, a clean and well-kept facility, amenities, benefits, etc. And they should make changes/updates to their businesses where they have deficiencies.
For example, an experienced technician would not want to leave a well-kept repair facility to work at one that looks rundown and unkempt.
He recommended shops survey their competition to see what pay rate and benefits they offer.
"If you have to pay more, then charge more," Mr. Gilley said, adding, "Less than a third of the shops in this country offer paid training. Tell everyone, if you do. When you're looking for techs, that's huge."
Hiring young techs
Mr. Gilley said the automotive aftermarket needs to do a better job of encouraging young people to become automotive technicians.
"Let's see, we want them to go to two years of school that they pay for. Then we want them to buy several thousand dollars worth of tools that they pay for. Then we want to hire them for $10 or $12 an hour, and then we expect them to be happy about it," Mr. Gilley said.
"The math doesn't work there, folks. What does it take to be a livable wage? You say, 'Well, she or he doesn't know anything. Why should I pay them $20 an hour?'
"You pay them $20 an hour because they gotta eat. And if you don't pay them $20 an hour, what are they going to do? They are going to go to another industry that does pay them $20 an hour."
He claimed that even though vocational-education schools are producing automotive technicians, the graduates are not necessarily staying in the automotive industry.
"The question is, 'Three years after they graduate, what are they doing?' Are they still in our industry? Because our industry does not nurture its young — it eats its young.
"Either we put them on a lube rack and have them changing oil for two years and thinking, 'Eventually you'll become a technician.' Or we put them with some old, grumpy technician who doesn't want to teach them anything, and they follow them around for two years and then we say, 'Well, he's not making me any money, I better get rid of him.' Or he quits out of boredom," Mr. Gilley said.
"What are you going to change about what you're doing to make things different? Because that's really what it comes down to. We've got to change the way we do business and the way we look at things.
"We've got to retain our current staff, and we got to be able to answer the question: 'Why should I work for you?' "
Retaining current staff
If employees are happy, the customers will get treated well, Mr. Gilley said.
He suggested that shop owners survey their current employees to find out what is important to them in the workplace.
"How about appreciate them? As shop owners, we often think that money is the big thing, but usually it's about fourth or fifth on the list. ... Usually appreciation, especially with automotive technicians, is higher on the list than other things," he said.
"The big question for all of you is how often do you say 'thank you' to your people? There's old-school people out there that say, 'Well, I give them a paycheck. That's all they need.'
"No, that's not all they need," he said, adding, "Your attitude toward your employees is the number one factor in whether they'll stay and be happy or whether they're always looking for a better place to go."
Are you a fun place to work? Mr. Gilley suggested that shop owners could add a little fun to the work day by celebrating employee birthdays or offering ice cream on a hot day.
Does your shop ensure efficiency? Technicians should only work on cars, Mr. Gilley said, so the owner should put systems in place to keep techs efficient.
He estimated that a technician is worth about $4/minute based on a $100/hour labor rate and the parts they sell.
"So I don't want a tech doing anything other than income-producing work. I don't want them answering phones. I don't want them ordering parts. I don't want them looking up labor times, especially because they want to argue with the service adviser about labor times. All I want them to do is to work on vehicles," Mr. Gilley said.
He referred to an industry survey that claimed an average dealership technician spends 48 minutes a day asking the service adviser for clarification about a repair order.
He suggested that a shop should have two technicians assigned to one service adviser who feeds them jobs.
"If you've got good techs, it's actually one-and-a-half (techs)-to-one (advisor). ... The better the tech, the more they demand on the service adviser.
"So if you've got a couple of techs that can produce 12 hours, you better have some rocking advisers or the techs are going to be standing around. Two-to-one is kind of my minimum. But one-and-a-half-to-one as the skill (rises). … If you want to see a grumpy tech, see one that's standing around," Mr. Gilley said.
Pay for skill
Charge by the procedure, not the hour, Mr. Gilley urged.
"We need to recognize the skills and talents and charge accordingly. And that's really our downfall because we think, 'Oh well, by the hour. Took him five minutes.' No, it's not a five-minute job," he said, noting that often a technician spent much more time trying to diagnose a problem the first time he/she came across it. Then the next time the same problem shows up in the bay, he/she recognizes it and solves it faster.
"Do we charge what we should charge, or do we say, 'Well, now we know what it is, so we should just give that away for free for five minutes?' That's what we do too much. ... Isn't the knowledge and skills required the same (each time)?" he asked.
A tech gets better at fixing something so he/she gets penalized for it under the flat-rate plan, he claimed.
"If we want to make this industry attractive, don't we need to make the wages attractive?"
He also suggested that if a shop charged a labor rate of $200/hour so it could pay a top-notch technician $50/hour, "wouldn't you have more technicians coming to work for you? Whose fault is it that we're not $200/hour now?" he asked.
"If you were in business in the '90s and you were about $65/hour (labor rate) … and we just increased our labor rate for inflation each year, we'd be about $210/hour right now," he said, "not the $120 that some of you are, or $125. We'd be about $210.
"So then could we afford $50/hour for a great technician? Actually, we could pay $50/hour for a good technician, we could pay $60/hour for a great technician."
He said offering a salary would be OK if some incentives were tied to it so the shop's production rate doesn't suffer.
"You need to make sure your people are comfortable with their pay. You need to be guaranteeing them some number of hours because it's not their job to bring cars in. It's your job.
"And if you don't supply the cars for them to work on, who's fault is that? Should the technician be penalized because you didn't bring any work in? If you want to do it that way, I just might tell you that there's a guy down the street that will pay more on a salary and you'll lose them soon," Mr. Gilley said.
"What you want to think about is charging by the procedure instead of by the hour. Because if we really want to charge by the hour, we should hire slow techs, get rid of all the air tools and electric tools and charge by the hour — wouldn't that be more profitable?
"But still we hire the fastest guys we can, we buy all kinds of equipment to make them even faster, and all that happens then is the flat-rate manuals get rewritten and the times get shortened. That doesn't sound like a good plan."
He said he uses an internal multiplier to determine the procedure price based on skill level required and the equipment required.
The flat-rate manual is a guide.
"I'm going to suggest that we only use a matrix, and we take the times in the guide and multiply them by some percentage to make them reasonable. But when we present it to the customer, we don't talk about by hour, we talk about by the procedure."
Mr. Gilley suggested several action items for shop owners who want to be recruiting techs constantly in case they suddenly have a job opening:
Review your facility. Is it a place where you'd want to work? Do you need to get out the paint brush and clean some things up?
Conduct a survey of wages and benefits offered by the competition. Are you where you need to be? If you need to raise your pay rate, raise your labor rate.
Look in the mirror. Are you somebody you would want to work for, or are you the guy you quit working for so you could open your own shop?
Develop a recruiting plan on how you are going to attract people.
Join a group of other successful shops to learn their strategies and ideas.
Mr. Gilley noted there is one sacred cow that needs to be slain in the automotive aftermarket: "We don't steal technicians from the guy down the street.
"You can't steal a technician. You can offer them a better opportunity, and they can choose to join your company. And that's the reality," he said.
"Isn't that what you should be doing is giving them a better opportunity? 'Hey, I've got a shop that's clean. It's fun. I've got great wages. I pay benefits. It's a fun place to work. Would you like to work here instead of there?' Am I stealing somebody or am I offering them a better opportunity?
"If you get serious about recruiting, there's a lot of technicians out there looking for a better place to work."