Posts by Carm Capriotto, AAP

I’ve been listening to stories about getting the courage to charge enough. Be it labor rate or proper margins on parts, including effective labor rate.

 If you did an inventory of what our investment has been over the last 10 years, you might just be astonished to see what your investment is. From tools, equipment, and facility. Also, you can put a value for every hour worked growing and building your business (a priceless number, no doubt).

Also, the investment you make in your people and what you invest in them. Equipping their bays, tablets, cell phones, computers, subscriptions, and list list goes on.

What about the investment in your learning curve? What did you pay, and what did you learn from comebacks? This is an investment that brings us no value, yet it makes us smarter if you learn from it and attempt not to repeat it. Did you journal what you learned so you can prevent costly repeats?

So as you ‘brainstorm’ your investment, think of everything you’ve done, from a money investment to all the time you invested because you are building your dream, your vision.

When setting your labor rate from the ground up, working with a coach, and using a spreadsheet as you consider your net profit and production, don’t be afraid to charge the number you come up with. Have no fear and find the courage. The customers you lose aren’t your customers.

If you see your six or seven-figure investment from the exercise above, you will know that what you need to charge must cover your costs in order to make a profit so you can continue to invest in equipment, training, tools, and most importantly, your people. You want to bring value to your customers, and what better way than to be profitable and provide a great living to yourself and your people.

It is not all about you it is about your work family, and they are a big part of your investment. 

If you’ve taken any individual evaluation, you can learn much about yourself and how and why you do things.

There was a moment when I was podcasting for one year, and I pulled my Strengths Finder results off the shelf and re-read them. I discovered I was doing precisely what I was the most gifted at. 

Many ultimately ask themselves if they are ‘built’ for their job. In our industry, technicians became owners and company leaders without training in leadership, money management or finance, hire/fire, or customer marketing. Assessments will let you discover your strengths, communication, personality style, and preferences. Knowing this information, your tendencies, and your gifts, you will find the talent you are good at. Knowing this lets you make decisions on people, processes, and products(services) to lead and grow your organization.

To expand your gifts, you must educate yourself in all areas to learn your responsibilities. When you discover what you are not good at, you’ll need to find your WHO; the person who can do the job you are not good at better than you. If, after years of wrenching, you also find that you have a gift to be a marketer, then be a marketer and replace yourself in the bay. Many owners have their spouses do the bookkeeping because they pay the bills at home, but they also have the higher conformity that lends itself to managing numbers and finances.

You can cultivate a sense of self-worth and confidence by acknowledging and nurturing your gifts. Your gifts are not just limited to specific skills or abilities; they can also include qualities such as empathy, creativity, resilience, or the ability to inspire others; yes, building the culture and love inside your company.

It is important to remember that embracing our gifts does not mean ignoring areas for improvement. Rather, it means recognizing that focusing on your strengths can propel you forward while acknowledging areas where growth is needed. It is being a perpetual student.

So shift your perspective from constantly trying to fix yourself to embracing the unique talents and qualities that make you good at what you do and hire your who.

There is a misconception by many team members that every dollar you take in goes into the owner’s pocket. The reality that most business owners know is that revenue does not equate to or become profit.  Some who work for us don’t understand the reality of running a business, and some business owners don’t understand how to run a business or create a real profit.

We must teach our people ‘Where the Money Goes’. There is a great podcast episode with shop owner Patrick McHugh, HERE. You will find a four-page download handout that you can use in presentations to your people, or go to our DOWNLOADS page to find it along with other important documents.  Many misconceptions exist among employees that all the money earned flows directly into the owner’s pocket.

Patrick and I shared our passion for teaching our people/team about the profit or loss statement or ‘Where the Money Goes.’ Costs like wages, real estate taxes, lease/mortgage, utilities, benefits, fees, insurance, maintenance, training, marketing, subscriptions, and systems, among others, absorb the gross profit made on the sale. The net result is profit before Uncle Sam’s taxes.

Sharing the fundamentals of managing Net Profit is vital. Profit is not a dirty word. Every business must make a profit; if not, you’ve just got a hobby. To the degree that owners make a strong profit, the company can survive or strive. It should be something everyone strives for. It allows new equipment, wage increases, business expansion, emergency funds, and security.

I think of Business by the Numbers Podcast with CPA Hunt Demarest. Hunt is on our Aftermarket Radio Network, and he helps shop owners better grasp their finances and money disciplines.

Please learn as much as you can to manage your expenses, know industry benchmarks, and review your gross profit margins because all costs are paid from the gross profit you generate.

Don’t forget to go to our classroom page on the website to see a group of episodes on this specific topic.