Posted By: Bob Greenwood.
Heavy Duty shop owners are not spending at least 2 hours a day of uninterrupted time working in their office “on” the business. The main reason for this is because they are understaffed and owners are forced to work “in” the business. Management should prioritize to obtain the right staffing levels so the right amount of time each day can be spent “managing” the business in order to move it forward. The fact is you cannot maximize shop productivity and net profit of the shop when it is understaffed.
The question arises as to “what” the owner or manager should be doing in that office each day. Here are some guidelines for you to follow:
- Calculate the average billed hours per invoice each day, each week and each month and compare to the objective. Come up with a plan to resolve any issues.
- Calculate what the right labour rates that should be in place for maintenance, diagnostic, re-flash, and fluid servicing. Check that the time is being captured properly on each job and it is billed accurately.
- Calculate the total “site” efficiency number each day, week and month. Determine exactly what the issue is if the right site efficiency number is not a minimum of 75% with a target of 80% and draw up a plan to resolve this issue.
- Calculate what the right HD vehicle count each day should be that is required for your operation to achieve the correct site efficiency percentage and the billed hour objectives.
- Calculate the potential diagnostic hours available in your shop and review that the objective is being achieved and if not find out why.
- Calculate weekly each technician’s hourly wages paid based on actual hours that were billed out on that technicians behalf. Draw up a plan to resolve any issues.
These are a few of the things that the HD shop owner or manager is responsible to measure and guide their team to achieve. All the items listed affect net income.
Are you working “on” the business or “in” the business?