DealersEdge Professional Forums

Help, I am looking to get our body shop out of red ink. What I need is a good pay plan for the body techs that will motivate them to produce more work, we seem to have a back log of vehicles waiting to get in the shop but cannot get enough through put. Also a managers pay plan that will focus on the same. Does anyone have a plan or production bonuses that have worked for them?

This problem is really not a problem, but a great opportunity. Set your manager up on a payplan that rewards increases in Gross Profit and Technician Flagged hours. Assuming that your expenses are in line the first area to consentrate on would be sales. Using the past 12 months as a reference, figure the average weekly flagged hours for each technician, then figure your "break even" amount required. If you find a tech is averaging below the minimum,,,, Educate him. They need to understand the basics of productivity versus profit. Your nest step is to calculate where you want to be. Offer each technician an incremental increase based on the hours produced.
For Example: If you have a tech producing 70 hours per week average, give him a goal of 80 hours per week. If he achieves it, increase his hourly rate by $1.00 retro back to hour one. This would be $80.00 per week in his pocket and an additional 10 hours billed for you! At $36.00 per hour times ten = $360.00 additional revenue weekly per tech.
Be careful, do your homework regarding the "break even" point before you offer a plan to your employees. If you're upside down in expenses, this could hurt you even more. The bottom line is, do your homework first, calculate your break even and make sure you are properly staffed! Good Luck