Auto Shop Coaching Blog

The Biggest Mistake Shop Owners Make

“The root cause of all anxiety is the unmade decision.”Kain Ramsey

“Mike” is a shop owner who works in instead of on his business. His business has him in bondage to the point, that when he needs to speak with his ‘A’ tech, he doesn’t look out in the bays, he looks in the mirror!

I suggested that he contact a certain “headhunter” recruitment company that sources, screens, and selects, technician prospects for the owner to interview and consider for hire.

He loved the idea of having someone find technicians for him. He loved the fact that the technicians would be prescreened before he interviewed them. He lost that loving feeling when I told him that the total fee for this service was $1,500.

“But Eric, $1,500 is a lot of money!” Mike said. I responded with the following question: “How much money is your current strategy costing you?”

Suddenlythere was the sound of awkward silence. As I was reaching for my cell phone to call Verizon to complain about the phone line, he interrupted the silence with the following words: “It’s costing me more than $1500 a day!” 

Mike had made the biggest mistake that shop owners make: He failed to account for the hidden cost of inaction. In other words, he didn’t factor in the opportunity cost.

Ideas to grow your businessNon-ATI Members: Discover more valuable tips and strategies for how to take action, improve your bottom-line, and grow your business in ATI’s shop owner events. Register at www.atievent.com.

Opportunity Cost

Dictionary.com defines opportunity cost as the loss of potential gain from other alternatives when one alternative is chosen. Initially, Mike believed that he would save himself $1500 by not taking the recommended alternative of using the head hunter service.

Based on the ATI technician efficiency model, bringing on a good technician to an understaffed shop can add an additional 15 cars a week to that location.

If Mike maintains a $400 average repair order on the 15 additional cars, he would gross an extra $6,000 per week in sales. ($400 X 15 = $6,000) The alternative of inaction is costing Mike at least $6,000 per week.

The right technician would free him up to attend networking events and build relationships with fleet accounts, so his failure to act could be costing him more than calculated!

How much is your failure to act costing you? Keep reading to learn what you can do to avoid the biggest mistake that shop owners make.

Think Like a Master

If I were to go to the park and challenge a chess grandmaster to a game, I would be at a disadvantage, because he and I would be looking at the same board in a different way. Since I’m a novice, I would be focused on which chess piece to use and what the next move would be.

The master would win because he would be thinking two to three moves ahead. When it comes to playing the game of automotive service, are you a novice or a master?

The novice in the automotive service game is only focused on fixing the cars in the bay that day. The master is focused on scheduling the next appointment for 90 days later.

The novice stops recruiting once the position has been filled. The master is always recruiting regardless of the current staffing levels.

The novice blames low car count on the winter season. The master completed a marketing calendar and has a winter special that has already launched.

The master doesn’t have to pay the opportunity cost since she anticipated her needs before they became needs. If you commit to thinking like a master, you can avoid the hidden cost that comes with inaction.  

Ask the Hard Questions

In his book To Sell Is Human: The Surprising Truth About Moving Others, Daniel Pink explains the difference between positive and interrogative self-talk. Pink points out that the purpose of positive self-talk is to encourage yourself. “You can do it!” is an example of a positive statement you can make to yourself.

Interrogative self-talk happens when you ask yourself questions. An example of this would be, “Can I do it?” Positive self-talk is good, but interrogative self-talk is better because it helps you to plan and prepare. The key is to ask yourself the hard questions.

When you talk to yourself today, ask the following questions:

  1. What would happen to my business if I were involved in an accident and suddenly became unavailable to work in it every day?”
  2. How much business would I lose if my best technician quit tomorrow?
  3. How much business am I losing because I don’t have enough bays to satisfy the increasing demand for my service?

Your direction is determined by the answer to the questions you ask yourself. Asking the hard questions can keep you moving in the direction of becoming the master of avoiding opportunity costs!

Conclusion

So, there you have it. Mike’s story has a happy ending. He is taking action by using the head hunter service and has several promising prospects to choose from.

If you think like a master and ask the hard questions, your story can have a happy ending as well!

Non-ATI Members: For more tips on how to take action and run a productive, profitable shop, check out our shop owner events at www.atievent.com.

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Author
Eric, the Accountability Coach, is an Executive Coach at ATI and has been coaching since 2009. Eric came to ATI having managed over 60 different automotive repair facilities and having supervised over 500 employees at a given time. He loves seeing members progress beyond what they thought was possible for them and seeing members improve their shop to the point where they can leave for weeks at a time, and come back to a business that's better than when they left.