How Auto Shop Management Software Can Help You Safeguard Your Business

Begin Protecting Your Business With Auto Shop Management Software

One of the best tools to add to your arsenal for protecting your business is auto repair shop software.

First, a disclaimer. Auto shop management software isn’t the only tool you should rely on when it comes to protecting your business from different angles; and as such, this isn’t legal or tax advice. For example, you also need a solid understanding of your area’s laws for auto repair shops, and a good lawyer can help you navigate that. And, a CPA might be a good person to turn to when it’s time to do your taxes. The financial data from your auto shop management software makes it easier for a CPA to do their job.

Auto shop management software is one of the best ways you can gain awareness into what’s going on in your shop. With auto repair shop software, you can keep track of different parts of your business, help your team shine their brightest, impress your customers, and more. Some key areas automotive repair shop software can help you with include:

• Digital transactions, receipts, and records
• Digital inspections and estimates
• Repair tracking and records
• Employee management
• Centralized customer communication
• Estimates
• Parts reconciliation
• Healthy margins
• Business decisions
  

1. Digital Transactions, Receipts, and Records

Let’s start with arguably the most obvious way of safeguarding your business: keeping track of the transactions between your shop and customers, the receipts your shop gives customers, and the records of those completed transactions.

Taking the Phrase “Paper Trail” Too Literally: A Logistical Nightmare

Chances are, you have some form of keeping track of your customers’ transactions and giving them receipts. Perhaps you print out receipts for your customers, and also print a copy for your shop, storing it in a box somewhere behind the front desk. You might have started out with one box, but that box quickly grew to two, then three, then four… you get the picture.

You have a paper trail stuffed into multiple boxes. Service advisors might keep track of daily transactions by jotting them down on a notepad. This pen-and-paper process can quickly become disorganized.

Or, you might hand customers paper receipts (or email them their receipts as attachments), and then store digital photos of those receipts in a folder (or two, or three) on your desktop. You might even have a spreadsheet where service advisors log your shop’s daily transactions.

This is known as a partially digitized process.

It’s more organized than just sticking to pen and paper, but it can get clunky fast. Not to mention disorganized, as well. For example, a service advisor might accidentally forget to log some transaction details, and then your financial calculations will be inaccurate.

The reality is that without digital, easily-accessible receipts and transaction history, things at your shop could quickly go haywire. Here are some ways things can take a turn for the worse:

• A customer can claim a repair never happened. Of course, your team remembers that repair happened, but you have to dig through stacks of paper receipts to find your copy. If the receipt got lost or crumpled up to the point where it’s illegible, you won’t have evidence to disprove the customer.
• A customer can dispute their payment to their credit card company for a chargeback. If a service advisor forgot to log that transaction in your shop’s spreadsheet and can’t find the paper copy of the receipt, you won’t be able to make a convincing argument to defend your shop.
  

Without an easily accessible, digital transaction history, there’s a higher likelihood of the customer experience at your shop taking a hit. If you can’t quickly access your side of the story, it’ll be harder for you to have calm conversations with customers where you get to the bottom of things. Customers might end up feeling burned, and may not return to your shop.

A Pathway to Better Accountability

When you have digital records of transactions and receipts, you’ll be able to quickly solve problems that arise. Accountability will get a whole lot easier.

Think about it this way: the receipts you hand over to customers, and the associated copies and transaction histories you keep, are there so that if either party has a dispute after a repair has been paid for, they can reference the evidence of which repairs occurred, when those repairs occurred, and how much was paid for those repairs.

Sometimes, customers don’t voice a problem until days or even weeks after the repair has been completed. They might go home, then look over their receipt during the weekend and start questioning a line item. They call your shop the following Monday looking for an answer. If your shop has digital records that are easily accessible by looking up a customer’s profile, the service advisor who picks up the call will be able to quickly get to the heart of the issue, maximizing the chances that the customer will be happy with the interaction and will come back to your shop for future repairs.

But, let’s say your shop only has paper copies of what took place. The receipts are all stored in a box, and the record of the transaction was scribbled down in a notepad. So when the customer calls, the service advisor who picks up suddenly has to scramble through pages and pages of paper to resolve the problem. Meanwhile, the unhappy customer is getting impatient on the line, and the interaction might not end well. That’s a potential lifelong customer that your shop could lose.

Tek-Tip: Digital Transactions, Receipts, and Records Made Easy

Tekmetric makes it easy to digitize, sort, and access your transactions and receipts. How? Thanks to the Sales Details Report, Tekmessage True Two-Way Texting, and Text-To-Pay.

Let’s start with the Sales Details Report. When you access this report in Tekmetric, you can see all of your transactions—and filter those transactions within specific time periods. You can also search transactions by customer name, vehicle, or invoice number.

With Tekmessage, service advisors can send inspections, estimates, and invoices directly to customers’ phones. As for the payment step, Tekmerchant gives customers the ability to pay their invoices directly from their phones—no need to stand in line at the shop! What’s more, every transaction will be stored within Tekmetric’s Payments Reports and customer profiles, so you can access your shop’s transaction history in a flash when you need to.

2. Digital Inspection and Estimate Process

Because the inspection and estimate process is such a pivotal part of the repair process, it’s important to have a seamless, ironclad approach.

Tackling Inspections and Estimates Manually: Potential for Miscommunication

When you tackle inspections and estimates by hand, such as by having technicians write down inspection findings and repair suggestions on paper, you run a higher risk of miscommunication between your team members and between your shop and customers.

For example, if a technician’s handwriting is difficult to read, the service advisor might interpret a repair suggestion the wrong way. The customer then gets that wrong suggestion, and after the repair is complete, they might become upset that the original issue was seemingly overlooked.

Or, let’s say the technician neatly types out all of their inspection findings in an email and sends it to the service advisor, who then shares those findings with the customer. The customer emails the service advisor back about what they do and don’t want to be done on their vehicle, but there’s a typo or the service advisor misreads something. The result is the same as in the first scenario—an unhappy customer.

A Smoother Inspection and Estimate Process

The right auto shop management software helps shops run accurate, easy-to-understand inspections and estimates, minimizing the chances of miscommunication by putting more control in customers’ hands.

Specifically, technicians can take out a tablet or phone to put the inspection together, adding more nuanced details. The service advisors then get those inspection results and can send customers crystal-clear inspection reports and estimates, where everything is completely spelled out, including the severity of each proposed repair.

Tek-Tip: Digital Vehicle Inspections Give Your Shop the Green Light

Tekmetric’s built-in digital vehicle inspections (DVIs) make putting together inspections and estimates a breeze for your team.

Technicians can easily punch in their inspection findings, and then, using Tekmetric’s color-coded system, indicate the severity of each repair. Green would show the customer that everything looks good; yellow would show them the proposed repair isn’t an immediate cause for concern; and red would show them that they need to get that repair taken care of ASAP.

Once the technicians are done with the inspection, the service advisors take the reins, building the estimate and sending it directly to the customer’s phone. The customer can approve or decline individual jobs via digital signature, text message, or email, leaving little-to-no room for miscommunication about permission for repair work. Your shop is better protected from chargebacks and unhappy customers.

Tekmetric’s DVIs also present a great opportunity for selling future repair work. If a customer declines a job marked in “yellow,” the service advisor can call up that customer a month or so down the line (or whenever the repair is slated to move into “red” territory) to remind the customer to come to the shop. Voilà, that’s a sale!

3. Repair Tracking and Records: Team Collaboration

Once the customer has given their authorization for repair work, it’s time for your team to start tackling the repair. There’s a lot your team has to keep track of during each repair to ensure that everything goes smoothly and the customer gets their vehicle back on time and in good shape. And after the repair work has finished, it’s a good idea to have a record of the repair work that was completed in case you need to reference it in the future.

Manually Keeping Track of Repairs: Too Many Moving Parts

Currently, your shop might be manually keeping track of repairs. Maybe your technicians and service advisors write down repair updates on a whiteboard throughout the day. Or, maybe service advisors periodically call technicians to get repair updates. Both of these methods can quickly become complicated.

If your team uses a whiteboard, the biggest problem is that they repeatedly have to get up from their work area to write down updates. If service advisors are periodically calling technicians, both are getting disrupted from the task at hand longer than necessary. In both scenarios, your technicians and service advisors are experiencing more barriers to creating and staying in a flow state. It’s hard to return back to a task when you’re consistently interrupted by someone else, or by having to do something else.

And that doesn’t even get into the problems that come up with keeping records. If the whiteboard gets erased at the end of each day, or if there’s no record of what the service advisor told the technician, how will you be able to review what happened if a customer complains, or if one of your team members needs to review an old repair order?

The right auto shop management software solves these problems by giving your team an easy way to keep each other in the loop, and for your shop to store repair records.

Creating a Flow State for Your Team

With the right auto shop management software—meaning, a solution that has the necessary repairs management workflow tools—your team can work with less interruptions, and your shop can keep better track of repair histories.

Specifically, you want to find an auto repair shop software solution that has repair workflow boards for your service advisors and your technicians. The repair workflow boards will show both sides of your team exactly where in the repair process each vehicle is. So, instead of dialing a technician or leaving their work stations to check a whiteboard or ask a technician in person, service advisors can glance at the workflow board and see how each repair is humming along. As for the technicians, they can run a time clock, update the status of the repair order, and add repair notes as they go along, without having to leave their work areas. As the timer runs and technicians mark jobs as complete, the blue progress bar in each repair order card on the Job Board moves forward and the percentage rises, showing the service advisors how far along a job is in real time.

In addition to safeguarding your team members from miscommunicating between themselves and customers, these workflow tools enhance communication and collaboration, closing the communication gaps that can spell long-term disaster for your business. For example, a service advisor is less likely to miss a critical repair update that they were supposed to communicate to a customer—a critical repair update that could make a customer upset if they weren’t informed and found out about after driving down the road from your shop.

And after repairs are completed, the auto shop management software will store that repair history for future reference. So, if a customer carries out a chargeback on a repair or claims something never happened, you can pull up the repair history to make your case.

Tek-Tip: Workflow Tools and Accessible Repair Records for Your Team

Tekmetric has two workflow tools for your team: the Job Board and the Tech Board.

With the Job Board, service advisors can get a detailed overview of repairs at your shop. They can see which repairs are still in the estimates stage, which are in progress, and which have been completed. As repair orders move through the different stages, Tekmetric automatically moves them to the appropriate column. Service advisors can also customize the views on the Job Board to access information by RO status, employee, and appointment type. If they want to see which repairs different technicians are working on, they can filter by employee.

Additionally, service advisors can look at the Job Board to see the progress being made on individual repair orders. As technicians mark jobs as complete in the Work-In-Progress column, the blue progress bar at the bottom of each repair order card will move along and the percentage will get closer to 100%.

And that’s not all! Right from the Job Board, service advisors can easily see if the team is waiting on parts, if the repair order is in progress, or if they’re waiting on a sublet provider.

The Tech Board enables service advisors to dispatch repairs and individual jobs to technicians by helping them further see exactly what each technician has on their plate. So, if they see that Samantha has too many repairs that day but Samuel doesn’t, the service advisor can prioritize giving Samuel repairs. Or, if there is a major repair and there’s not a technician who is available for hours-on-end to complete it, the service advisor can divide up the line items between multiple technicians, so the repair still gets completed, but in a balanced way that doesn’t make the technicians feel overworked.

The Tech Board also has a built-in timer feature for technicians. Instead of using their phones or a stopwatch to time their repairs, technicians can click on the timer button in Tekmetric to run time while they work, and stop it once they’re done. Meanwhile, services advisors can see exactly where in the repair process each vehicle is by glancing at the Job Board. Service advisors no longer have to disturb technicians while they’re working. And after repair orders are completed, service advisors can access them later in Tekmetric if they need to refer back to them.

4. Employee Management

Think back to one of your old jobs. Perhaps you used to be a technician at a dealership, but you saw the light and opened up your own shop. If you worked at a dealership, you likely saw that some of their employee management processes were valuable.

For example, as a dealership technician, you might have had annual performance reviews or received promotions based on your work quality and productivity. These were all forms of employee management the dealership was implementing. Now, some of these management techniques might have been effective, and some of them might have seemed like micromanaging, and were the reason you decided to start your own shop. While some management styles might actually weigh your team down, it’s important to find effective, positive ways to reinforce best practices at your shop so that you can have a highly effective team.

Helping Employees Shine Their Brightest

How do you keep track of your team’s productivity?

We’re not advocating micromanaging your team. But, it’s good to have insights into how efficient different members of your team are. Monitoring productivity can help you see if there’s one technician doing the most work (prompting you to ask your service advisors to spread out the work better), if there’s a service advisor making the most sales (prompting you to pair up new service advisors with that sales extraordinaire for training), and more.

Of course, there’s also the less happy side of employee management. As much as we like to imagine that we live in a perfect world where every employee gets along, you might hire someone and things might take a downturn. Maybe the employee ends up slacking off at work, or is just isn’t cooperating with the rest of the team. Or, maybe one of your employees has developed bad habits due to a lack of oversight, resulting in declined productivity that’s cutting into your revenue goals (bad habits, even if they seem small at first, add up over time). When you hire, you want to screen for competent people who will add value, and it’s a frustrating situation to be in when reality ends up not lining up with your expectations.

There are many factors that go into good employee management, like having empathy, clearly communicating expectations, and demonstrating good leadership. So, not every form of employee management comes down to using auto shop management software, but auto shop management software can streamline how you evaluate, manage, and train your employees. Auto shop management software can also help provide another layer of protection to your shop if you run into difficult situations with your team.

Without employee management tools, it’ll be harder for you to gain a clear view into your employees’ productivity and activity.

For example, you might have to pull out a calculator and manually determine how many sales each service advisor has made in a given month. Or, you might have to get your technicians to clock in and out of repairs on their own, then type that data in a word processor. That’s a lot of extra steps!

These time-consuming processes aren’t the only issue, either. You or a team member might mistype or miscalculate something. And it might be tougher for you to gain an understanding of how your employees are progressing over time, for the purposes of training, promoting, and—as a last resort—firing.

A Simpler Approach to Employee Management

With automotive repair shop software, you can gain valuable data into how your employees are doing at the shop. With that data, it’ll be easier for you to find opportunities for encouragement and constructive criticism. You can train your employees who need some extra help, create a “service advisor of the month” program to motivate service advisors to make more sales, pair up less efficient technicians with senior technicians to help them speed up, give bonuses to the highest performers, and more.

Let’s say you want to revamp the commission program you have for service advisors. You may want to bump up the commission by a certain percentage for service advisors who make sales above a certain threshold in a given time period.

Having searchable commission reporting and easy-to-use digital records of the sales your service advisors have made in a given time range will make it easier for you to hand out those sweet commissions. If a service advisor tells you they didn’t get their commission, you can quickly go and check the system and see that they didn’t meet the requirements that particular month. Showing them the hard evidence makes for easier, more understanding conversations.

Here’s a distressing example. First, we know this is a last-ditch thing to do. Finding new talent is hard, especially given the current technician shortage in the United States. That’s why we advocate you do everything you can to help your employees succeed before even considering letting them go due to poor performance.

But let’s say you’ve tried everything to help one of your technicians. You’ve repeatedly sat down with them to see how you can help, paired them with a senior technician for mentorship, given them extra training, etc. But, their efficiency hasn’t improved over a long span of time, and it’s impacting the rest of your team.

If you have a clear record of that technician’s declining productivity within your auto shop management system, you’ll be better able to make the case that you terminated them for the cause of poor performance. Having this digital record isn’t a guarantee that you will win any potential legal battles a former employee might spring on you, but it is good evidence to have in your arsenal. We hope that this never happens, but sometimes, things can take a turn for the worse, and it’s good to be as prepared as possible.

Tek-Tip: Data-Driven Employee Management

Tekmetric offers several Employee Reports that help you keep an eye on how your employees are performing:

• The Realtime Service Writer Report: breaks down the hours and sales associated with each service advisor in a given time range of your choosing; you can view the average written repair order versus the average repair order of each service advisor to help determine gaps.
• The Realtime Technician Report: breaks down the hours and sales associated with each technician in a given time range of your choosing, as well as the status of where each technician is at progress-wise in this timeframe.
• Technician Hours Report: calculates the total efficiency of each technician in a given time range for you.
• Employee Timesheets Reports: provides you with the clocked time and break time of your employees; can be used for both technicians and service advisors.
• Employee Commissions: tracks the amount of pay in commissions you’ve given to different members of your team; can include both technicians and service advisors.
  

With these individual reports, you can identify bottlenecks at your shop. For example, maybe you look at the Realtime Service Writer Report and see that a lot of money is sitting in the “pending” column. In that case, you might determine that your service advisors need more help getting jobs authorized, and you decide to train them on follow-up tactics to ensure those jobs get authorized more quickly moving forward.

Additionally, you can use these reports to help employees perform their best at work. Let’s say you notice that one of your service advisors has a high average written repair order but their average repair order is lower than it should be. This might be a cue for you to help that service advisor with their selling tactics.

You can also use these Employee Reports with other data in Tekmetric to make good decisions for your team. For example, if your shop’s car count has almost doubled within a certain time range, but your technicians’ efficiency has plummeted, that may be a sign that your technicians are burned out, and that it’s time to start looking into expanding your team.

Tekmetric also offers commission tracking tools that make it a breeze to set up commission-based pay plans for your team. You can build individual pay structures down to individual job categories based on:

• Hours sold
• Gross profit
• Percentage of parts
• Percentage of labor
• Fixed commission
  

With Tekmetric’s commission tracking tools, motivating your team gets even easier. When employees know that what they’re doing is benefitting the shop and themselves, they’ll be more willing to go above and beyond to sell more repairs. And with Tekmetric’s commission tracking tools, you won’t forget who has what commission structure! No more guesswork or flipping through your notepad to remember which employee has which commission arrangement.

5. Centralized Customer Communication

How do you and your team communicate with customers? How do you all keep track of customer notes?

The Chaos of Not Having Centralized Customer Communication

Maybe your service advisors get on the phone with customers to give them repair updates, and then write down any feedback from the customer on a notepad. Maybe you refer to those sheets of paper or spreadsheet to keep track of customers’ repair histories. Or, maybe service advisors throw away those papers at the end of each day, and you all have to rely on your memory when it comes to recalling what prior work a customer has had done on their vehicle at your shop.

It’s an obvious thing to say, but every auto repair shop has to effectively communicate with its customers to reach maximum success. Some of the elements of good customer communication include timeliness, friendliness, and empathy. Another element is centralization.

When your shop’s customer communication is centralized—meaning, your team members can all log into one system to see and respond to customer texts, instead of texting customers from their personal phones—life just gets a lot easier. Why? There’s more accountability. Your team will know exactly what a customer texted and when they texted it, and there’s a record of which service advisor responded to that customer.

Centralized Customer Communication: Greater Accountability for All

Without centralized customer communication, there’s a greater chance of miscommunication between your shop and your customers. There’s also a greater chance of everyone having less accountability.

For example, let’s say a customer claims they texted your shop about wanting to add a particular repair, but your shop never received that text. If all your shop’s customer communication is not centralized, you won’t be able to easily find out for sure that the customer never sent that text. In fact, you might not be able to find out at all—you’d have to ask the service advisor in charge of that repair to hand over their personal phone, which gets into murky territory.

Or, say a customer texts a service advisor saying they changed their mind about a particular repair; they no longer want it. But the service advisor’s phone was having network connection issues, so they never saw the text. The customer might still pay for the repair work, but they won’t be happy about it. That missed text could paint your business in a bad light in their mind.

Here’s another example of something we hope never happens. Let’s say a service advisor claims they texted a customer back, but they really didn’t. If your customer communication is centralized, you’ll be able to find out whether the service advisor is being honest. If your customer communication isn’t centralized, finding out the truth becomes a much trickier task.

Tek-Tip: Centralized Communication Via True Two-Way Texting

Tekmetric’s built-in true two-way texting feature makes it easier than ever for your team and your customers to communicate. With Tekmessage, service advisors can send customers messages directly from within Tekmetric, and customers will see the messages pop up as regular text messages on their phones.

When customers respond, service advisors will be able to see those responses in Tekmetric. Because that customer communication is in one place, if one service advisor isn’t available to respond to a customer, another can see the text and take the wheel.

Customer communication is no longer disparate with Tekmessage, which means fewer misunderstandings across the board.

6. Parts Reconciliation

Do you know what your parts margins are? Is your shop bleeding money on parts? If you don’t have a parts reconciliation process that you actively use to make sure your parts used and parts purchased are lining up, you risk losing money—money that could be used to progress your business—and you may not even know it.

Money Slipping Through the Cracks: a Shop Without Parts Reconciliation  

At the highest level, a parts reconciliation process involves seeing if the parts your shop paid for and sold match up with the data in your accounting software.

A full-on parts reconciliation isn’t something you should do every day. Instead, you should schedule time for it on a regular basis, like once a quarter. That way, you’re not spending all of you and your team’s time on parts reconciliation, but you’re not neglecting this important exercise, either. However, you should train your team to fill out purchase orders on a daily basis whenever they order parts to make sure the information going into your auto shop management system is as accurate as possible.

An Easier Way to Navigate Parts Reconciliation

Auto shop management software will make it easier to track your parts data, or what your shop spends and makes on parts. If your service advisors are ordering parts through a parts ordering platform that’s integrated into your auto shop management software, and then directly adding those parts to repair orders, you’ll be able to see which parts have been ordered and when, and which parts have been used and when.

From there, you can review the data you have in your accounting software to see if it matches up with what’s in your automotive repair shop software. You might discover that your accounting software says you spent more on parts than what is reflected in your shop management system; that might be a case of a vendor accidentally overcharging you.

At another basic level, you can also ensure that things are lining up between your parts usage and parts purchased. Regularly checking that your parts usage and parts purchased are in alignment can help you make sure you’re buying what you’ll use, and aren’t overspending on parts that end up collecting dust on your shelves. It also helps you catch issues, like theft from a former employee or just someone forgetting to add a part to a repair order.

Tek-Tip: Parts Reconciliation, Simplified

When you use Tekmetric’s Parts Usage and Parts Purchased reports together, you can gain insights on what your shop is spending on parts versus what parts your shop is actually using in a given time range. You might discover, for example, that you’re buying a lot of a particular part, but are not really selling a lot of it. That can be a cue to cut back on ordering that part.

Additionally, Tekmetric offers other ways of gaining insights into how your shop is doing parts-wise. In the Profit Details Report, you can see your average profit and total profit in dollars and profit margins over a given time range, as well as your labor profit, sublet profit, and fees profit. In this report, you can also use the “compare to” function to compare your profit margins from one timeframe to another. In the Sales Details Report, you can see the dollar amount your shop sold in parts (revenue, not profit) over a given time range.

As for a proper parts reconciliation, Tekmetric integrates with the Back Office, which has a tool called Accounting Link that transfers your shop’s sales, payments, and purchases directly into QuickBooks. Thanks to this transfer process, you don’t have to manually enter any numbers, and can avoid accidentally mistyping a number and getting inaccurate data! And of course, you’ll also save a good chunk of time.

Once you’ve transferred your shop’s parts sold and parts purchased data into QuickBooks, you can start seeing how the data stacks up. For example, if your parts profit margin is significantly higher in Tekmetric than in QuickBooks, that’s your sign that something is seriously wrong.

7. Healthy Margins  

In addition to making sure you have healthy parts margins, you need to make sure your business’s overall profit margins are healthy—how much money is going into your business versus how much money is going out of your business?

The Headache of Calculating Margins On Your Own

As a shop owner, you may know all too well how important it is to monitor your shop’s margins so you can set yourself up for growth. Simply put, if you don’t know your margins, you risk putting your business in a bad spot.

Maybe you’re currently calculating your shop’s margins by hand. But, that’s a lot of numbers you have to punch into a calculator… and a lot of hours you have to stay behind at your shop; hours that you could be spending watching a baseball game or grabbing a drink with friends. And, while you’re running the numbers, you might miss one, or mistype one… leaving you with inaccurate final data!

But, auto repair shop software takes the headache and time out of this process.

Easy-to-Access Margins = Happy Shop Owner

While each repair order moves along and eventually gets paid for, auto shop management software is running quietly in the background, pulling the necessary numbers to crunch so it can automatically calculate your margins for you.

Specifically, auto repair shop software divides your RO by your RO sales to get your margins. You don’t need to pick up a calculator at any time. Instead, all you need to do is log into the system and view your automatically-calculated margins.

Tek-Tip: Tekmetric makes viewing your profit margins over a given time range as easy as one, two, three. When you access the End of Day Report within Tekmetric, you’ll see a breakdown of your profit margin over a given time range.

To make things even easier, Tekmetric enables you to view your profit margin percentages in one of two ways:

1. With your tires and batteries factored in
2. Without your tires and batteries factored in
   

With these two options, you can make more targeted business decisions and better find any discrepancies. For example, if your profit margin with your tires and batteries is almost the same as your profit margin without your tires and batteries, it’s time to start digging into the root of the matter.

8. Business Decisions

We’re going to state the obvious: running a business is all about making decisions. You made the leap into becoming a shop owner, and from that moment, you’ve had to make all kinds of calls, including:

• Where your shop should be located
• Who you should hire
• How many people you should hire
• How many bays you should install
• Which marketing strategies to use
• Which types of cars you want to repair
• What kind of tools to get for your team

And that’s just a small sample! Each day, you’re faced with decisions, big and small. On the same day, you might have to evaluate whether or not it’s time to hire an additional technician and what to do about that flickering light in your office. The next day, you might have to determine whether or not you should continue running a particular marketing promotion and figure out which restaurant to take your team to for a “thank you” lunch.

Bad Business Decisions: Going Up In Flames

The truth is that unless you’re Jeff Bezos or Elon Musk, you can only afford to make so many bad business decisions. Depending on your finances, you could make one or two wrong calls and ultimately have things turn out okay. But make one too many wrong calls and suddenly, your business will be going up in flames in front of your eyes.

That’s why when you’re running a business, it’s important that you really take to heart that it’s an art and a science. You have to use your intuition and creativity, but you also need to use your logic and the data you have on hand.

You might make observations by circling around your shop, like noting that hiring a few new technicians would greatly benefit your team, but when you dive into your finances, you realize that you don’t quite have the runway yet to afford a few more technicians. But, by knowing where you stand financially, you can start to create a game plan for raising your profits so you have enough cash for new technicians.

But let’s say you don’t take a data-driven approach, and decide to hire more technicians solely based on your gut instinct. Suddenly, you find your shop in the financial hot seat. You start stressing out about how you’ll pay those new hires and your team members who were there first! Of course, this is an extreme example, but if you don’t keep an eye on your numbers, you’re not fully safeguarding yourself from making bad business decisions.

Safeguarding Yourself from Bad Business Decisions

Knowing your numbers is one of the best ways to safeguard yourself from making bad business decisions. And what’s one of the best ways to know your numbers? Auto shop management software.

With every repair order that your service advisors type into the system, automotive repair shop software runs behind the scenes, pulling the essential numbers and compiling them into neat reports you can access to get instant snapshots of your business’s health. You don’t have to spend hour after hour pouring through spreadsheets and punching numbers into a calculator to arrive at those numbers. Instead, you can quickly look up the stat you need, evaluate it, and start weighing your options.

For example, if you’re thinking about whether or not it’s time to start raising your shop’s labor rates, a good place to start is by looking at your shop’s labor profit, and how it’s changed over time. You might see that your shop’s labor profit has actually been steadily increasing over the months, and you decide to only increase your shop’s labor rates by a very, very low amount. Or, you might decide to hold off on doing anything until you re-evaluate where things stand later.  

Tek-Tip: Making Nuanced Business Decisions With Nuanced Reports

Tekmetric offers a wealth of reports that help shop owners make nuanced business decisions every day. Those reports fall into four buckets:

• Financial Reports: See how your shop is financially performing in a given time range from the lens of different types of data; such as daily profits in the End of Day Report and sales per type of repair work in the Sales by Job Category Report. With that data, you can make savvy business decisions every step of the way.
• Employee Reports: Get an overview of how your service advisors and technicians are performing on the job for training, management, and hiring purposes.
• Customer Reports: Understand how your customers are finding your shop and which jobs they’ve declined, so you can better market your shop and sell more work.
• Parts Reports: Compare the data in the Parts Purchased Report with the Parts Usage report to see what tweaks you need to make when it comes to how much money you spend on parts.
  

Ultimately, the data Tekmetric puts at your fingertips safeguards you from making bad business decisions. Whether you want to install another bay, hire another technician, run a new marketing campaign, or spend less on certain parts, the data Tekmetric provides has you covered. You can evaluate your numbers first before you make any decisions that will affect the long-term health of your business. And when you do make a decision, you can look at your numbers again to see whether or not it’s paid off.

Get the Most Out of Your Auto Shop Management Software

Auto shop management software is a vital tool for your business, but it’s not the only tool you should rely on. If you use auto shop management software in a vacuum, you won’t be able to gain the maximum value from it.  

Auto shop management software is most powerful when you use it with other tools, resources, and insights that help you run a more modern, efficient auto repair shop.

Other activities you can bring to the mix include joining professional associations, signing up for industry webinars and trade shows, reading industry publications, and networking with your peers to exchange the latest and greatest advice and ideas. And of course, it’s important that you actively seek and listen to your team’s feedback along the way. They might be able to give you fresh perspectives that end up transforming your shop even more.

When you combine auto shop management software with your existing business expertise, other activities, and your team’s feedback, you’ll be able to become an even better leader and business owner.

For example, while networking with your peers, you might get a great tip for employee management that you can then incorporate into how you use your auto shop management system. Or, you might stumble upon a webinar put together by the team behind your auto shop management system and walk away with great new sales tips for your service advisors. And perhaps one of your technicians has a great idea for a marketing promotion that ends up bringing more new customers to your shop.

By using auto shop management software alongside the other tools in your toolbox, you’ll be well on your way to continuing to make your shop a true force to be reckoned with.