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Paying Attention to Inflation [THA 269]

Carm Capriotto, AAP — Thu, 31 Mar 2022 05:15:00 +0000

We’ve all heard inflation is up 8%, as of this broadcast, but when you walk through the grocery stores and sit at a restaurant, it sure seems like it’s a lot higher … don’t you agree? As prices continue to jump, what are we doing as an industry to adjust? And why are so many shop owners worried to raise their labor rates? My panel includes 2 shop owners and an auto shop bookkeeper with a wide-open discussion about labor rates, parts pricing, and even employee retention in the age of rampant inflation.

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Natalie Paris, Three Rivers Bookkeeping, Profit Strategist. Listen to Natalie’s previous episodes HERE

Dave Kusa, owner of AutoTrend Diagnostics in Campbell, CA. Listen to Dave’s other episodes HERE.

Dustin Brown, Brown Auto Experts, 3 Locations in New Mexico, Albuquerque, Village of Los Ranchos and Rio Rancho. Listen to Dustin’s other episodes HERE

Key Talking Points

Parts – While parts costs are rising, our parts GP should take care of itself if we are using an effective parts matrix. 55-60%
Unfounded fear for charging correct amount for parts
Expenses – Expenses, in general, will jump up. We need to monitor our expenses and possibly shop them to get the best value.
Labor Rate Increases: Shop your competitors and monitor how the labor rates in your town are adjusting for inflation.
The dealership suggested retail isn’t always what they’re selling to their customers
“Don’t trip over dollars to make dimes.” when it comes to expenses
Employee Retention- This year all office staff received a raise and some of our technicians. We did not give raises to techs that have been with us for less than 6 months. With raising the labor rate, shops should be able to afford to increase technician pay. A recent Gallup study shows that 50% of all employees are thinking about changing jobs. Do not think your shop will be different. “The great reset” instead of “The great recession” Staying on top of retention to prevent turnover is very important in our current labor market. Wages are not the #1 cause of employees changing jobs, but it is a factor to keep in mind with the rising cost of everything.
The workforce has 5 generations of people working- how you manage each generation is different
Other ways that can make employees feel appreciated and help with retention would include fringe benefits or low monetary benefits. Things like more paid time off, tool purchases match, Friday (or once a month) shop paid for lunch or training opportunities to help them advance their careers can be huge. Another great way is to ask the employees if they have ideas on non-monetary or lower monetary benefits that they would appreciate around the shop.
Be careful of ‘profit leakage’ and be transparent with your employees when you do raise your labor rates
Pay bills with gross profit dollars, not a percentage

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Remodeled Legacy Texaco Station [AW 090]

Carm Capriotto, AAP — Sat, 29 Jan 2022 05:15:00 +0000

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Dustin Brown, Brown Auto Experts, 3 Locations in New Mexico, Albuquerque, Village of Los Ranchos and Rio Rancho. Listen to Dustin’s other episodes HERE

Key Talking Points

Former Texaco Station built in the late 1940’s
Father bought the business from his uncle in 1986, Dustin and his brother Nolan bought the business in 2018
Located on Route 66
Looking to add on 2 more locations
Remodel process- is this the look we want to have for all the future locations?
Logo change- color scheme and updated
Modernize facilities- warm atmosphere, modern equipment, paint refresh
Who is the competition? Dealerships and large chains. What do they look like?
Attract higher-end clientele- curb appeal
Changing trends
Price is not your #1 sales objective

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Do We Earn Enough Respect? Charlie Marcotte and Dustin Brown [THA 250]

Carm Capriotto, AAP — Thu, 18 Nov 2021 05:15:00 +0000

Charlie Marcotte is the owner of American Pride Automotive and Founder of Transportation Matters. After serving in the U.S. Army, Charlie and his wife Diane moved to Virginia in 1988 and started their family in 1992. Putting food on the table was the primary goal that started Charlie working on cars (illegally) from a 10′ by 20′ storage unit. A strong work ethic and love of cars allowed those humble beginnings to flourish into American Pride Automotive, with 4 locations serving the Virginia Peninsula. The family unit has always been Charlie’s driving force, with three successful children and a bouncing baby Grandson: Life is Good. Building a solid business is a point of pride for Charlie, but his true passion is Transportation Matters. The transportation Matters mission drives positive social change while delivering a competitive advantage to the independent automotive repair industry—the same industry which has provided Charlie with so much opportunity.

Listen to Charlie’s other episodes HERE

Dustin Brown, Brown Auto Experts, 3 Locations in New Mexico, Albuquerque, Village of Los Ranchos and Rio Rancho. Dustin and Nolan Brown are brothers that are third-generation mechanics. Their father Donald started Browns Automotive in 1982.

Key Talking Points

Connect your brand to your community
What has your contribution been during your entire career?
Owning a business and supporting your community go hand in hand- hiring, retention, comebacks, customer relationships, word of mouth growth
Transform your reputation in the industry- break the negative stereotype
Charlie Marcotte is 7 years into a 10-year goal of donating $320,000 to local non-profits, he is proud to say that we are ahead of schedule. Success came from the process.
Charlie developed a program called State Inspections for our Community. In VA, they have an annual safety inspection, the cost to the customer is only $20. For each State Inspection they perform, they set aside $5 to be given to a local NPO, they call it “making the mundane, meaningful”.
American Pride is Facilitating the gift of a 2015 Ford Escape to the Williamsburg House of Mercy. One of their great fleet customers, Signature Stone, needed a transmission for their ’15 Escape. It’s an expensive transmission and in the end, it didn’t make sense to repair it but the rest of the car was in great shape. Charlie reached out to WHOM and asked if they had a family who could use reliable transportation, with the ability to maintain it – they did. Charlie reached out to a friend, Matt Lacy who owns Lacy Auto Parts, and suggested he donate a transmission, he did. He had their crew install the transmission at no charge. To make this donation a wise business strategy, Charlie will have a film crew coming to the shop to interview all 4 parties.
Video content- keep it simple with a cell phone, quick and natural. It is real and intimate content. Don’t overthink it.
Dustin’s primary charity is the Albuquerque Christian Children’s Home. In the past, they were involved with many organizations such as Road Runner food bank, Coats for Kids, Toys for Tots, and Breast Cancer awareness foundation. 3 years ago they decided to stay focused on one local charity and provide support to them throughout the year. This has ensured the collections stay in the community. Consumable drive with customers started this month and will go to the end of the year (Paper/Plasticware, toilet paper, dishwashing, and laundry detergent, and so on, Things the home goes through all year long). Don’t just give back during the holidays, it needs to be done throughout the whole year.
Dustin recently completed a training room: The goal is to get involved with local car clinics for new drivers and basic vehicle education such as tire pressure, changing a spare, and checking fluids. With a new training area, they hosted their first tech training event with the help of NAPA. It is also for technicians in the community to do more hands-on training. New driver clinic- changing tire, oil etc.
Inspiration is followed by perspiration
Family Service Day- free automotive care and repair paired with the local church, helped over 1,000 families

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