Shop tools..who's responsible?

[joe r]

A couple months ago we put our shop parts
advisor on a bonus plan based on tech efficiency. For the summer we hired a high school kid to deliver parts to the techs and
pick up parts requisitions.
In most dealerships the service department accounts for about 70% of the parts business. At our dealer a 2% increase
in efficiency along with corresponding parts
equals about $12,000 gross profit.
Which would you want? The additional profit or the techs running around looking for tools making you nothing? It's a no brainer.

joe r


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[cwalden]

We are a small shop so we have more time to
attend to the techs.If they want to wait for
the parts they can and most do,and if they
want to go get another RO we will bring the parts to them.It works at our shop!

[Chuck Hartle]

This thread is a strong case for "joint" pay plans! gman110 started to say it, but pulled up short of getting right to it. You will work twice as hard and sell for less to any customer other than the one who is in your shop for customer pay (i.e. the technician).

Nothing, I repeat, nothing, can replace the gross profit generated by technicians in your shop. I am a firm believer that you should have tools, nuts and bolts, and anything else under control.

Where I see the service manager and the parts manager on a joint pay plan that pays off the bottom line of the entire "fixed operations", I see team work solve these problems.

How can you blame a parts manager for not wanting to spend his/her time or their employee's time on something that makes them absolutely no profit? Service and Parts go hand in hand. One cannot survive or work effectively without the other. The way to break down the walls of division is to build a pay plan of the bottom line result of both.

Imagine, a parts manager is now being paid off the amount of labor sales and a service manager is paid off of a percentage of wholesale sales? And the only way GM could muster a solution was to come up with gross profit transfer!

Let's face it. We basically chase our pay plan. In this day of customer satisfaction and demand, it is time to re-define the pay plans and the overall business plan strategies of the dealership fixed operation.

Chuck Hartle'

[ladihawke]

Chuck, I total understand and believe that the two departments should work together, but unfortunately for alot of dealerships there is maybe only a onesided effert if that. You and gman are right that we should work together but for at least my dealership it doesn't happen, so I do my best to do what I can. To 'baby' my techs as I call it, I will personally as a manager take them their parts or have someone do it when we have the time and have found that a few little treats go a long way. Because I am only allowed 2 other employees I have a few tricks to keep customers and techs happy when they have to wait a few minutes. One is that there is always a bowl of sweets on both my counters. It cost only a few pennies from the dollar store but my techs and customers have no problem waiting a few minutes when there are free eats. Maybe if I had more staff or better cooperation from the service manager this question of tools would not be such a problem but when all the cooperation is one sided sooner or later you have to draw the line and say the one sentence I HATE to hear..."That isn't my job!"

[gman110]

Chuck, you were right! Joint pay plans were exactly where my thinking was leading. I pulled up short because my experience has been that it gets the same reception as mentioning a "true team" production system to a group of techs. While both can truly lead to outstanding results, the personnel dynamics and management must be just right for them to work. I realize that I am outside the scope of the forum question - maybe we should get another going on this topic.

ladihawke, thanks for sharing your ideas. I have been in your shoes and know that it feels like a losing battle. It sounds like your heart and mind are going in the right direction...Keep up the good work!! Never, Never give up when you know you are doing the right thing, even if it is unpopular. Change begins with one person...

[Chuck Hartle]

ladihawke,

I should qualify why I say it the way I do. Gman put if perfectly. Change starts with one person. My dealer thought I was on "Serious Drugs" when I suggested a joint pay plan between fixed operations managers at our dealership. We had two service managers, a parts manager, and a body shop manager between our two locations side-by-side.

I actually wanted to put all parts, service, and body shop personnel off a performance based salary from the gross profit of the entire fixed operation. This is where the dealer drew the line. However, I was able to accomplish the joint plan for the managers off the net profit of the entire fixed operations and with incredible results.

We were able to eliminate four jobs in just 6 months time as jobs that were traditionally either service or parts related became a joint effort. The service and parts managers came to me with the idea instead of me doing it. Our net profit increased 41% in 18 months time. This equated to $486,000 in net.

Ladihawke, print out this thread and take it to your dealer. Maybe this would get the dealer to start thinking out of the typical box when it comes to separate 'profit center' pay plans?

I think every parts manager can just about sympathize with your plight. I was just lucky enough to have a dealer who was willing to try something new and it worked.

Let me know how it goes....

Chuck Hartle'