The automotive shop industry has grown tremendously between 2018 and 2023. It reached $59.1 billion in revenue, the result of a compound annual growth rate of .5%. Vehicle ownership drives a considerable amount of this growth, and it will increase through 2028.
This exciting, growing field offers tremendous potential for new auto repair shop owners. However, competition is fierce. Nurturing successful business growth comes down to running it optimally. In this guide, you’ll discover what you need to know about building an auto shop and how to thrive in this industry.
How Do You Run an Auto Repair Shop?
Running a profitable auto repair shop long-term revolves around establishing solid relationships with your customers. Over 60% of customers say that they like to get their work done at the same shop, and 96% go to three or fewer locations when they need to get work done on their car. Gaining customer satisfaction through expertise and communication plays an important role in keeping your customers happy so that they return.
Proper auto shop management and best practices, such as improving productivity and rewarding loyal customers, keep your business competitive. Many strategies that strengthen your business will also incentivize customers and encourage them to return. Since customers do not want to go to numerous auto repair businesses, proving that your business is one they can rely on encourages this loyalty which strengthens your ROI.
To build a quality business, a business plan that emphasizes customer service and retention will take you far. You can incorporate a few central strategies into your plan to keep your customers happy.
1. Increase Technician Productivity
Having high technician productivity is a top priority when building a flourishing auto repair business. When technicians work efficiently, they improve customer service. These technicians get cars back to customers faster, reducing wait times. Shop owners and service advisors should collaborate to create an environment that inspires technicians to do their best work. Here are a few tips to boost productivity at your shop:
- Make sure the environment is comfortable in your shop. One that is too hot or too cold will make technicians and customers uncomfortable and hinder productivity. Have tools available to adjust the temperature, such as fans and heaters. Make sure water is also easily accessible for your workers.
- Let your technicians and employees know how much you appreciate their work. Thanking them for a job well done can improve their motivation and encourage them to work efficiently. In fact, effective employee recognition can result in workers who are 5x as likely to see a path to grow with your organization and 4x as engaged with their work when compared to those who don’t receive regular recognition.
- Embrace the potential of technology. Auto shop management software can help employees track their projects and jobs. This makes it easier for them to submit invoices and reports so they can focus more on the cars in the shop and less on organizational factors. It makes employees’ work more straightforward, further increasing
their productivity.
As you create a healthier work environment, you also gain stability within your business.
2. Promote Employee Retention
Employees who feel appreciated are more likely to stay with an organization. Since your technicians form the backbone of your organization, increasing this stability helps your business in all areas.
Keeping your technicians satisfied and reducing employee turnover allows your business to maintain consistency and reliability. When your customers return, they see a familiar face they have already worked with and from whom they received good results. Customers know that they will receive the same level of attention and care. This relationship between technicians and customers can only grow if your employees work with you long enough to keep seeing the same repeat customers.
You also want to factor in the cost of replacing employees, as it can cost up to 1.5 times an employee's salary to train a replacement. It’s important to factor in training costs as well as recruiting costs and the price of lost productivity while the new employee trains for the role. This can quickly become a significant expense for businesses, so it’s beneficial to maintain an environment that facilitates happy, long-term employment.
If your business becomes known for high turnover rates, it becomes a challenge to maintain the consistency and reliability that you want to offer your customers.
To keep your employees satisfied and reduce turnover, consider the following:
- Treat your employees well. This includes policies like maintaining a positive atmosphere and encouraging open communication with management.
- Provide your employees with excellent benefits. Investing in your employees means investing in the future of your business. Offering a comprehensive benefits package helps you attract and keep the best talent.
- Offer perks and incentives for a job well done. Let them know their hard work is noticed and appreciated while encouraging them to reach new heights.
- Make sure they are well-paid. Keep your employees interested in working for you rather than being inspired to look for a better job elsewhere.
While it’s important to show your employees you care for them, you may also consider finding ways to let your customers know how much you appreciate them.
3. Reward Customers for Their Loyalty
Incentives to encourage repeat business can be highly effective. More than two-thirds of customers report that they adjust their spending so they can maximize their rewards points earnings.
From an auto body shop perspective, rewards can take a variety of different forms. For example, you can offer a voucher after a certain number of services that offers a discount the next time the customer comes to the shop. You might also provide perks like free oil changes after a certain number of oil changes are completed by your technicians.
Some businesses may struggle with the idea of setting up a rewards program. It may seem counterintuitive, as shops have to sacrifice some of their earnings, such as the service discount or the value of an oil change, to get the program running. However, remember the number of customers who prefer to come back to their preferred auto body repair shop. When you establish a path to encourage customer loyalty, you can become the preferred shop for a growing number of customers and see your overall value increase.
A rewards program not only entices customers to keep returning but also builds your business’s reputation. This, in turn, can also encourage customers to recommend your shop to their family and friends.
Tekmetric’s integration partners like Royalty Rewards and Wowcards can make it easy to create a rewards program to build your sales and discounts strategy to increase your business.
4. Offer Specials and Incentives to Grow Your Business
When you want to encourage new customers to try out your business, providing them with a little extra boost in the form of a sale or discount can give them just the encouragement
they need.
You can construct these incentives in a few different ways. Consider creating a marketing plan that brings customers to your doorstep after they hear or read your ad across your active channels. In the campaign, for example, you can offer a special spring tune-up that you promote to your customers.
Other businesses might offer unique discounts for first-time customers, paired with loyalty programs, to encourage these customers to keep coming back.
After you build a website, create ads that promote your business and services to potential customers searching online. Using search engine optimization (SEO) helps you create web pages that search engines see as helpful, so you can gain visibility. This can also provide
an excellent means of promoting the deals and discounts you offer to new and
existing customers.
You should also look for opportunities to further develop your online presence through reviews on Google and similar review sites. When satisfied customers leave these reviews, they vouch for your business to others considering patronizing your location.
Some of the most common criteria that customers use when looking for auto repair shops include:
- Reputation
- Online reviews
- Customer service
- Credibility
Building an online presence through a robust website and positive reviews from past customers can help you meet all of these criteria in the eyes of potential customers.
For this to be most successful, however, you want to ensure your online reputation aligns well with the quality service you offer your customers.
5. Guarantee High-Quality and Efficient Service
The best way to ensure your shop attracts customers is to provide high-quality service they can count on. Customers want to know that they can trust you to take care of their vehicles, run a fair business, and provide outstanding service.
To assure customers of the quality of your service, you can offer guarantees. Some shops may elect to promise that their repairs or work will last for a certain amount of time or miles. This assures customers that you do not cut corners with your work.
As you offer this exceptional service, focus on being efficient and convenient for customers. For example, hours that allow them to drop off and pick up their cars around their work schedules will encourage customers to return to your shop. Consider also creating a streamlined operational process that allows you to return cars to customers as quickly as possible while still providing quality work.
According to AutoNetTV, price and expertise also lead the way as factors that influence the autobody shop that customers elect to patronize. These factors remain critical to customers because they want to feel they get a fair price and expert work from their technician, particularly since price and work quality can vary from shop to shop. Emphasizing these factors in your own business can encourage customers to return.
Some strategies to provide convenient service for your customers include:
- Sending text or email appointment reminders
- Pick-up and drop-off services for greater customer convenience
A comfortable waiting area with snacks and beveragesAs you look for ways to improve the level of service you offer customers, using an auto shop management software tool can be the perfect way to take your efforts a step further. You can implement integration partners like Throttle, UpSwell and Tekmetric’s own true two-way texting to create an easy way to communicate with your customers.
6. Use an Auto Shop Software Tool
Auto shop management tools are explicitly designed to help owners manage their garage more efficiently, keeping you a step ahead of the competition. With the help of these tools, you will provide more reliable, quality service for your customers.
For example, auto shop management software provides a variety of features to help your business thrive. You can use it to automate processes, such as:
- Repair estimates
- Invoicing
- Scheduling appointments
- Inventory management
- Inspections
These features from auto shop management software help keep your garage on task, allowing you to provide customers with quick and accurate responses to their schedule and estimate inquiries. Taking care of tedious tasks like invoicing and inventory management automatically frees up time for your staff to focus more on customer service operations. With automated processes, you also reduce the chances of mishaps like inventory shortages.
Furthermore, optimal scheduling helps your technicians work more efficiently and provide better customer service. You will save time and money on the business management end.
As you work to build a successful auto shop business, these areas play a central role in helping you serve your customers.
Manage Your Auto Repair Shop with Tekmetric
Managing an auto body shop is an exciting career field for anyone who loves cars. However, with over 80,000 shops across the United States, competition can be fierce. You want to run your shop optimally so that your business grows.
You’ve explored some key strategies you can use to optimize your shop operation, including reducing employee turnover, rewarding dedicated customers, offering convenience and sales, providing outstanding service, and using auto shop management software. If you’re ready to build your shop, Tekmetric is here to help. With automated reports, machine-learning capabilities, and the data to make informed business decisions, Tekmetric offers you the capabilities you need to thrive.
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