Opening another shop has been something that I have been thinking about very seriously over the past year and I’ve recently decided to take the plunge.
Truthfully, as a technician, I had never thought that I would ever have my own shop, let alone multiple shops. But over the years, I have grown as a person, as a team leader and as a member of our automotive community. This growth has inspired me to do everything in my power to improve our industry and the careers of the people in it — what better way to do that than multiply?
That being said, multiplying is a daunting task with many variables to think about: Can my city provide enough revenue for another shop? Where will it be located? Would I want to open one in a different city? Will I buy one that is already running or start from scratch? How many staff will I need? Where will I find the staff members?
These are just a few of the questions swirling around in my head, with many more popping up every day. The first question I need to answer is: Am I ready? To answer that question, I need to take a look at my numbers to determine if my current shop is profitable, running efficiently and producing close to capacity, without requiring me to work in the shop on a day-to-day basis.
My numbers indicate that my shop is profitable — it can pay all of its expenses (including a salary for me), while still having a very healthy net profit. To achieve this profit, I have hired coaches to educate me and my staff on how to market to the right clients, price my labour and parts for profitability and strategies to implement systems and processes that streamline our day.
The most important thing that I have learned is that someone must be managing the business. That may not be you — you may want to stay in the bays as a tech — but that means you need to hire a manager.
The most important thing that I have learned is that someone must be managing the business. That may not be you — you may want to stay in the bays as a tech — but that means you need to hire a manager. This manager should understand the business side of operations, be able to lead your team and have the confidence to manage you. Yes, this means giving up control, which I have found challenging at times, but it allows me to focus my energy on what I do best.
My shop is run very efficiently. We are constantly discussing ways to save time without sacrificing the quality of our services or the client’s experience at our shop. In my opinion, a second shop should only be considered when the first shop is no longer capable of increasing productivity; each tech is billing all of their available hours in a day and your building will not support another tech.
To improve productivity, take a look around your building and watch your staff doing their work (both techs and advisors), so you can determine where they are losing time. Is there a process at the counter that could be automated? Do you need to purchase a tool that makes a common repair happen quicker? Is your specialty tool cabinet organized, labelled and in a centralized location? Is your inventory organized? How do you organize incoming parts and outgoing returns?
When you are doing this, take into consideration that your staff do these jobs every day and they probably know what changes will improve their efficiency, so ask them what should be done, they’ll appreciate the fact that you value their opinion.
A profitable and productive first location is necessary to open a second location. But just as important is the ability for the first location to operate without you. In part two, I’ll discuss the steps I’ve taken to remove myself from day-to-day operations.
Erin Vaughan is the owner of Kinetic Auto Service in Regina.
This article originally appeared in the August issue of CARS magazine
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