Ratchet+Wrench - March 2021

03.21

STRATEGIES & INSPIRATION FOR AUTO CARE SUCCESS

MARCONI:

PREPARE TO FACE THE FUTURE

PAGE 25

DEFEND YOUR SHOP DATA

PAGE 37

5STEPS TO GROW YOUR GROSS PROFIT PAGE 43

BEST WORKPLACES THE 2nd ANNUAL

Meet the shops building brag-worthy cultures PAGE 28

Putting People First At Foreign Affairs Auto, co-owner Jonathan Ortiz is creating a culture built on more than perks.

Every business needs some extra attention now and then.

When you join the NAPA AutoCare network, you get access to 70+ support programs to help your business grow.

Speak with your NAPA Sales Representative to learn more or visit www.Member.NAPAAutoCare.com 2 / R + W / 0 3 . 21

GENUINE MITSUBISHI PARTS

THE RIGHT PART FROM THE START Keep it original. Insist on Genuine Mitsubishi parts and have confidence in your repairs.

2020 MITSUBISHI MOTORS NORTH AMERICA, INC. ALL RIGHTS RESERVED

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03.21 VO L . 0 9 N O. 0 3

M A R C H In Good Spirits At Foreign Affairs Auto, celebrating wins big and small is a key component to the shop's solid workplace culture.

F E AT U R E

C A S E

28

46

The second annual Best Workplaces highlights shops building strong bonds and impressive staff buy-in.

Warren Parr, owner of Complete Car Care, is building a high school curriculum to change the way the auto industry operates.

THE AWARD GOES TO...

BY MEGAN GOSCH

S T U DY

BRIDGING THE EDUCATION GAP

RODNEY HUSBANDS

B Y A B B Y PAT T E R S O N

PRINTED IN THE U.S.A. COPYRIGHT ©2021 BY 10 MISSIONS MEDIA LLC. All rights reserved. Ratchet+Wrench (ISSN 2167-0056) is published monthly by 10 Missions Media, LLC, 571 Snelling Avenue North, St. Paul, MN 55104. Ratchet+Wrench content may not be photocopied, reproduced or redistributed without the consent of the publisher. Periodicals postage paid at St. Paul, MN, and additional mailing offices. POSTMASTERS Send address changes to: Ratchet+Wrench, 571 Snelling Avenue North, St. Paul, MN 55104.

ON THE COVER: JONATHAN ORTIZ PHOTOGRAPHED BY RODNEY HUSBANDS

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TA B L E O F C O N T E N T S

J U M P

12 ONLINE

Gear up for ADAS and EVs

15 EDITOR'S LETTER

Why sharing your story matters to everyone you reach

S TA R T

T O O L B OX

17 BREAKDOWN

37 SHOP ADVICE

21 ADAPT

39 SALES+ MARKETING

22 SHOP VIEW

43 FINANCE+ OPERATIONS

Get the facts on the rule changes for PPP round 2 What does “selfdriving” really mean?

B&B Auto Repair Inc. in Mansfield, Ohio

25 STRAIGHT TALK

Get ready to build tomorrow's workfoce JOE MARCONI

Prepare to protect your shop's data

Should you co-brand or go it alone?

Shift your mindest to boost gross profit

56 THE FIXER

Find your best season for growth A ARON STOKES

39

ETE_RW_Feb_BetterOEM - Proof 2.pdf

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With Rotary, there’s nothing your techs can’t do.

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O N L I N E

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CLICK ON THE LOGO BELOW FOR PRODUCT INFORMATION

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EDITORIAL VICE PRESIDENT, CONTENT AND EVENTS Bryce Evans EDITORIAL DIRECTOR Anna Zeck ASSOCIATE EDITOR Megan Gosch STAFF WRITER Paul Hodowanic SPECIAL PROJECTS EDITOR Nora Johnson SPECIAL PROJECTS EDITOR Jordan Wiklund CONTRIBUTING WRITERS Joe Marconi, Abby Patterson, Aaron Stokes, Rissy Sutherland PRODUCTION ART DIRECTOR Zach Pate GRAPHIC DESIGNER Lily Risken GRAPHIC DESIGNER Morgan Glisczinski PRODUCTION ARTIST Lauren Coleman SALES VICE PRESIDENT AND PUBLISHER Chris Messer 651.846.9462 / cmesser@10missions.com ASSOCIATE PUBLISHER Andrew Johnson 651.846.9459 / ajohnson@10missions.com MARKETING STRATEGIST Matt Walz 651.846.9463 / mwalz@10missions.com INSIDE SALES MANAGER Matt Harper 651.846.9551 / mharper@10missions.com CUSTOMER SUCCESS REPRESENTATIVE Shayna Smith 651.846.9460 / ssmith@10missions.com CLIENT SERVICE SPECIALIST Jen George 651.846.9465 / jgeorge@10missions.com 10 MISSIONS MEDIA PRESIDENT Jay DeWitt GENERAL MANAGER AND PRODUCTION MANAGER Mariah Straub BOOKKEEPER AND CLIENT SERVICE SPECIALIST Meghann Moore EVENT PRODUCER Kate Fahlen SENIOR DIGITAL MEDIA STRATEGIST Tiffany Fowler DIGITAL MEDIA ASSISTANT Nina Kayfes MARKETING COMMUNICATIONS SPECIALIST Kasey Lanenberg ADMINISTRATIVE ASSISTANT Corey Steinhoff EDITORIAL ADVISORY BOARD Jimmy Alauria, 3A Automotive & Diesel Repair Ryan Hillebrand, Urb's Garage Dwayne Myers, Dynamic Automotive John Miller, Fifth Gear Automotive Bryan Gossel, BG Automotive Rob Choisser, Choisser Import Auto Services HOW TO REACH US 10 MISSIONS MEDIA 571 Snelling Avenue North, St. Paul, MN 55104 tel 651.224.6207 fax 651.224.6212 web 10missions.com The annual subscription rate is $72 (U.S.A. only) for companies not qualified to receive complimentary copies of Ratchet+Wrench.

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Opinions expressed in Ratchet+Wrench are not necessarily those of 10 Missions Media, and 10 Missions Media does not accept responsibility for advertising content.

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AUTOMOTIVE GROUP

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“FAILURE IS NOT AN OPTION. WE’VE GOT TO GET IT RIGHT THE FIRST TIME AND EVERY TIME. I NEED MY CUSTOMERS SAFE AND SATISFIED. ” DONNIE M. | TECHNICIAN | 24 YEARS OF EXPERIENCE

DURALAST OFFERS OE OR BETTER QUALITY IN OVER 20 PART CATEGORIES

More Technicians Choose Duralast Parts* See Why At DURALASTPARTS.COM * Source: Proprietary Consumer Study of Automotive Aftermarket Parts Conducted by The NPD Group, 2020. ©2021 AutoZone, Inc. All rights reserved. AutoZone, AutoZone & Design and Duralast are registered marks of AutoZone IP LLC or one of its affiliates.

0 3 . 21 / R + W / 11

ONLINE 03.21 COMMENTS, DISCUSSIONS, FEEDBACK AND MORE FROM AROUND THE WEB VISIT

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DATA DIVE

INVESTING IN ADAS

—

As vehicles become more technologically advanced, it’s no surprise that ADAS work—including scanning, calibrations and diagnostics—is becoming more popular.

Although only a small percentage of 2020 Ratchet+Wrench Industry Survey respondents indicated they are currently equipped for the technical work, close to half of the survey respondents say they have plans to invest in the tools and equipment needed for ADAS work in

the next five years. And not far behind, a group of nearly equal size is also preparing for the future with plans to invest in Electric Vehicle (EVs) repair. To read more on investing in ADAS head to ratchetandwrench.com/adas-invest

CURRENTLY EQUIPPED FOR ADAS WORK

PLANS TO INVEST IN THE NEXT FIVE YEARS

84%

16%

No

Yes

For more aftermarket industry updates, head to ratchetandwrench.com/news

40%

ADAS

39%

EVs

TUNE IN:

RATCHET+WRENCH INTERVIEW SERIES

—

For shop owners considering expansion, there’s a seemingly endless list of factors to consider.

But what could be better than tips from a shop owner who’s done it successfully?

In a recent Ratchet+Wrench Interview Series episode, Dwayne Myers of Dynamic Automotive distills some of the most critical lessons he and his team learned while growing the shop’s operations.

Find the full convo at ratchetandwrench.com/ expansion-lessons.

“BECAUSE I’M A TECH...

I PUSH THE LIMITS AND DO WHAT I LOVE.

”

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®

. ed services d n e m m o c e ur r f behind yo o o r p e th to winning ing our awardmers’ eyes to s u age of 39% us c er r av u an o by y s O AR Open increase their helped shops e from s ded, in real-tim u can, too.

CHNOLOGY ha ing recommen s. And now yo , BOLT ON TE be ol de to es ca ic ns de rv io a at se ic e an mun ting th For more th customer com idence suppor inspection and photographic ev rs ne ow e digital vehicle cl hi you send ve at ly software lets e for yourself.

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Ready.

Set. Nominate.

The 2021 All-Star Award nominations open on March 1.

For more information regarding Ratchet+Wrench’s 2021 All-Star Award, visit ratchetandwrench.com/awards

s p o n s o r e d

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b y

:

EDITOR'S LETTER

Everyone Has a Story

WHY SHARING YOURS MATTERS TO EVERYONE YOU REACH Most of the stories start the same way. The person telling it begins

slowly and somewhat guarded. They explain their “entry point” into the industry. Maybe their parents owned the shop before them—their grandparents even. Maybe it was the push of a vo-tech instructor.

Maybe it was an entrepreneurial itch that they couldn’t shake. Maybe it was all of it.

Then the timeline progresses: They decided to take it on themselves, open up their own business, buy out their uncle—whatever it is, this is when it launched. They talk about the struggles, the early failures, the starts and stops. You can feel the blood, sweat and tears in every word as they walk through it.

And suddenly, they’re rolling into their story. The “aha” moment comes in their career. Their turning point brings them to the next level. And this story, that sounds so much like so many others (maybe yours?) feels fresh, it feels unique, like it could’ve only happened to them.

One of the things I love most about my job is hearing these stories, no matter how many times I hear them and no matter how similar one might think they are. And, sure, there are similarities.

The vague description I just gave could likely mimic your own version. But let’s not confuse anything here; these stories aren’t the same.

You can hear just how unique and personal each and every one of these stories are through the level of emotion and connection the owner has in telling it. You feel it. What they’re describing is not just their business, it’s their life’s work and something they’ve put every ounce of energy into for years. It’s a part of them, and you instantly know just how much it means to them.

When I read through our winners for our Best Workplaces program (pg. 32) this year, this was what I felt. And it wasn’t just about the people we profiled—even though their unique stories follow that same pattern above. More so, I thought about

BRYCE E VA NS, VICE PRESIDENT, CONTENT A ND E VENT S BE VA NS@10MISSIONS.COM

the years’ worth of stories I’ve heard, each one as personal and important as the next. I instantly flashed back to sitting in a room full of shop owners just a month or so ago, while the host of our meeting broke down his own story.

His story was touching and revealing, and it demonstrated just how invested he was in his business. He cared for his team like it was his family, and he was proud.

When you read this month’s content, especially our Best Workplaces features, I hope you’re left with the same feeling I always get in hearing these types of stories: rooting for them to succeed, but also hopeful and inspired to put the same passion and focus into my own work. Please keep telling your stories; we’ll keep working to share them.

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J U M P S TA R T

What You Should Know About PPP Round 2

A second round of Paycheck Protection Loans has opened and the rules are a bit different this time around

GETTY IMAGES

BY PAUL HODOWANIC

In the first round of the Paycheck Protection Program (PPP), the federal government allocated $350 billion to businesses across the country, including many in the automotive service industry.

In late December, a new coronavirus relief bill was signed into law that allocated an additional $284 billion in PPP loans specifically for small businesses.

The goal of the second round of loans is to allocate aid to businesses that were passed up by larger corporations on the first go-around, and to continue helping small businesses who need a second round of assistance, says Charles Abell,

public affairs specialist for the Small Business Administration (SBA) “The concern was minorities, Native Americans, underserved, underprivileged communities, and small banks were all stepped on by bigger banks, by bigger businesses,” he says. “That’s why a lot of changes were made.”

The Biden administration announced it will identify navigators to ensure small businesses in communities of color and underserved communities can better access the PPP. There is also $15 billion set aside for community financial institutions.

There are also new restrictions in place that

tighten which businesses can apply.

Businesses that did not apply or receive funds in the first round should apply for first draw PPP loans. These applications will be given preference over those that already received funds. Businesses that received funds in the first round are not eligible for first draw loans, but can apply for what is called a “second draw” loan, which gives them second priority.

Who is eligible for the second round of PPP loans?

Eligibility has been tightened from the first round of PPP. Businesses must have 300 or 0 3 . 21 / R + W / 17

fewer employees to be eligible for the loan, down from 500 in the previous round.

Businesses must also demonstrate a 25 percent reduction in revenue in at least one quarter of 2020 compared to 2019.

Businesses who applied for loan forgiveness on their first PPP loans are eligible for second-draw loans as long as they meet the general requirements (fewer than 300 employees, 25 percent reduction in revenue).

Loan forgiveness was one of the biggest draws of the first round of PPP. From April 2020 to early January 2021, the SBA paid over $7.1 billion across more than 1.8 million loans.

To qualify, borrowers had to show employee and compensation levels were maintained, that at least 60 percent of loan proceeds were spent on payroll costs, and that the remaining proceeds were spent on eligible expenses. The SBA is currently reviewing plans for loan forgiveness for the second round of PPP.

How can businesses apply?

To assist those small businesses without an existing banking relationship with a PPP-participated lender, the SBA offers Lender Match, a free, online tool that pairs borrowers with lenders in their community based on their needs.

Once they’ve identified a lender, businesses should make sure to have the necessary paperwork. Businesses should have a copy of their driver’s license or an official ID and have the business’s most recent IRS form showcasing the business’s payroll, like Form 941, 1099, or a 1040, for example.

Business owners should also establish basic company contact information, like a preferred phone number, email address, and preferred person to be contacted regarding financial matters.

More or less information may be needed depending on the lender.

When is the deadline to apply?

The deadline to apply for both first and second draw loans is March 31.

However, the SBA recommends not waiting until the last minute. Because you are applying to a lender first, they need to time, approximately five days, to process the application. Then it goes to the SBA for approval.

“We strongly recommend if anybody is doing first or second draw that they try to get their applications, or at least work with their lender, before the last week in March,” Abell says.

The sooner you apply the better.

Applications opened for first draw loans on January 11 and funds are being approved every day. As of January 24, 400,000 loans were approved for roughly $35 billion in 2021.

Unlike the first round of PPP, which exhausted its funds in the first two weeks of the program, the second round of PPP is expected to have enough money to last through the March deadline, Abell says.

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K E Y I N S I G H T S , T R E N D S A N D S T R AT E G I E S F O R T O M O R R O W ’ S I N D U S T R Y—T O D AY A D A P TA U T O M O T I V E . C O M

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FIND OUT EVEN MORE

WHERE IS AUTOMATION RIGHT NOW?

Have you checked out the stepby-step ADAS calibration guide?

ADAPT has a series of slides that will guide techs through the basics of calibrations. Process is important, and here’s your guide to developing one.

Head to adaptautomotive. com/12steps to read the story and get the 12-step slideshow.

It seems as though autonomous vehicles are just around the corner, but what does that actually entail? Automakers have no shortage of buzzwords when it comes to advertising the latest “self-driving” or “fully autonomous” vehicle, but what do the varying levels of autonomy include? Better yet—what do they leave out?

ADAPT has developed a guide for the levels of autonomy, their advantages and drawbacks, and which automakers are leading the charge.

Level One, Driver Assistance Level one autonomy is primarily designed for crash avoidance. This is the first level in which the car can take control of the vehicle in addition to the driver, but still requires the vehicle be monitored by the driver. Level one automation is also used to fight driver fatigue, reports TrueCar, with features such as adaptive cruise control and lane keep warnings.

Almost all newer cars on the road today have level one autonomy including Toyota models outfitted with Toyota Safety Sense and BMW models with driver assistance systems.

To get the full rundown of levels 0-5, read the entire article at adaptautomotive.com/levels.

M AY 9 - 11 NASHVILLE, TENN.

ADAPT TREND REPORT Want the latest automotive technology stories sent right to your inbox? Get the newsletter that will help you prepare for the future of automotive service. Sign up at adaptautomotive.com/newsletter.

Registration and hotel accommodations are now open for The ADAPT: Automotive Technology Summit. The full two-and-ahalf-day schedule is available at adaptsummit.com.

0 3 . 21 / R + W / 21

J U M P S TA R T

B&B Auto Repair Inc.

BY MEGAN GOSCH PHOTOGRAPHY THE TOLEDO PHOTO GUY

1 SHOP S TAT S Owner: Bob Blanton Location: Mansfield, Ohio Staff Size: 7 (5 technicians, 1 receptionist, 1 floater) Average Monthly Car Count: 100 Annual Revenue: $1 million to $1.5 million

1 / Growth Spurt After years of exponential business growth, B&B Auto Repair owner Bob Blanton knew it was time to move. After nearly 25 years in his original shop space, Blanton wasn’t able to reach his full potential.

“Honestly my biggest problem was keeping up. We were always booked two or three weeks out,” says Blanton.

In 2019 he made moves to expand, buying the building and parking lot next door to his original shop. Now, with a full line of racks against one wall for optimal workflow and the space to hire an additional tech, business has nearly doubled.

2 / A Complete Overhaul Blanton's new space was originally built as a state-of-the-art facility in the 1950s and previously housed one of the county’s oldest businesses. After buying the space, Blanton immediately got to work with major renovations.

“I had to completely redo just everything—all new electrical, plumbing, heating, air conditioning, concrete work, a new roof, new gutters. Just the whole nine yards,” says Blanton.

But it was the replacement of the shop's steel-framed windows that spurred an entirely different project.

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2

4

3 HAVE AN OUTSTANDING SHOP? Send a few photos and a brief description to submissions@ratchetandwrench.com and we might feature it here.

3 / Curb Appeal After installing a wall of glass block windows, Blanton realized he'd created a blank canvas, and hired a local artist to paint nine autoand historically-inspired panels on the shop’s west side.

Each panel pays homage to classic cars from decades past, including the ’53 Corvette, the Trans Am, the IROC Z-28 and the Dodge Viper, and local landmarks.

4 / Past to Present Blanton embraced the shop’s history by preserving original elements of the building’s bones and incorporating vintage pieces in the customer waiting area.

The shop’s coffee bar was originally an old gas stove, a turn-of-the-century cash register adds character, and the past tenant’s solid oak service desk is back in action. Plants, rugs, and vintage auto-inspired art have helped create a cozy, industrial chic retreat where customers can wait while their repairs are completed.

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Columns

STRAIGHT TALK Joe Marconi

THE FUTURE IS IN OUR HANDS As independent shop owners, we have a responsibility to help build tomorrow’s workforce

GETTY IMAGES, MICHAEL HOEWELER

There is so much talk these days about the technician shortage. But

the reality is, we need to work on building our entire future workforce, not just technicians. Our industry will need service advisors, managers, bookkeepers, and other support staff.

Let’s face it, if we don’t act on this issue ourselves, it’s not going to happen. Thankfully, there are many organizations, trainers and industry leaders that are taking a proactive approach to address this issue. We just need to do more; and it has to be a collective effort from the independent shop owners.

By far, the most demanding position in our industry today is the position of technician. The amount of training, tools and equipment needed today is staggering and will only become even more so in the coming years.

Technicians need the same structured educational approach as any other highly skilled or academic profession, if not more. Shop owners will also need to equip their shops with the right tools and equipment. Of course, this will require money, which I will address last.

We need to attract quality people to our side of the industry, the independent aftermarket. Many graduates from

Joe Marconi has more than three decades of experience in the automotive repair industry. He is the owner of Osceola Garage in Baldwin Place, N.Y., a business development coach for Elite Worldwide and co-founder of autoshopowner.com. j.marconi@eliteworldwide.com ratchetandwrench.com/marconi 0 3 . 21 / R + W / 2 5

STR AIGHT TALK / JOE MARCONI

S P O N SO R E D C O N T E N T

Inside the Consumer Mind With UpSwell

A DATA-DRIVEN LOOK INTO HOW CONSUMERS CHOOSE WHICH REPAIR SHOP THEY VISIT. There is nothing more that business owners wish they could do than get inside the minds of consumers.

As a way to dig deeper and provide vital consumer information to shop owners, UpSwell Marketing has performed two comprehensive surveys to uncover crucial demographics, buying habits, and overall industry thoughts.

The power of word of mouth.

An overwhelming 59 percent of survey participants stated that they typically rely on “word of mouth” when deciding which auto repair shop to visit.

The largest way to take advantage of this information is by focusing on reputation management. Ensure that each individual is given top customer service every visit, and that happy customers leave positive reviews online.

Optimize the online space.

Trailing behind “word of mouth” are the 41 percent of respondents who answered that they turn to Google when choosing their repair shop.

“Search engine optimization is so important, make sure that you know you're ranking as high as you possibly can,” Nelson Rodenmayer, SVP of sales and marketing at UpSwell says. “You should also be investing in PPC, or paid search marketing.”

Target your customers through direct mail.

Following “Google” on the survey is promotional/direct mail at 11 percent— making it one of the most effective methods of attracting customers. Behind direct mail is radio/TV at 7 percent, billboards at 5 percent, and magazine/ newspaper at 4 percent.

These other factors are dependent on how specific you want to get with your targeting,” Rodenmayer explains.

According to the consumer survey, Upswell discovered that 24–29 year olds actually rely on direct mail more than other age ranges, making it a prime method to attract younger customers.

For more tips with UpSwell Marketing on how to take advantage of the consumer survey data, visit ratchetandwrench.com for the full, unabridged article. To learn more about UpSwell, visit upswellmarketing.com/ ratchetwrench or call 888.838.3779.

2 6 / R + W / 0 3 . 21 0321_UpSwell_CustomContent_Print.indd 1

technical schools and colleges end up in dealerships, where too many of them get stuck on the Lube Line with no true career path. It takes a tremendous amount of initiative and persistence for an entry-level hire to stick it out and become a seasoned technician. Far too many get disillusioned and end up in a different line of work.

Shop owners; get more involved with your local high schools, vocational schools, and technical colleges.

Find or help create apprentice and shadow programs where young people can get a feel for what’s it like to work at a professional independent shop. Get involved with your local community too. Take part in local fund raisers, youth associations, business groups, career days, and more. Let’s show the world who we are and demonstrate that we are a profession that cares about the future of our youth.

Shop owners need to create career paths for their employees. It’s not enough to hire someone and put them out on the floor to perform. Help your employees with their personal and career development.

Create a plan that will help map their future. Part of that means offering benefits such as health insurance, retirement planning, paid training, financial planning and mentorship programs that have real take-home value. All this will help to anchor your employees to your shop, and keep them looking over the fence at the so-called “greener” grass. We talk so much about hiring employees, what about keeping them once they are hired?

Payroll needs a boost as well, even for entry-level employees. Employees

3/1/21 4:19 PM

need a wage that makes them feel proud and allows them to attain the things they want from life. To attract the best of the best, shops must be willing to pay higher wages and create pay plans that show employees how they can earn more through increased training, improved efficiency and with commitment to their profession. I know, this takes money. As stated earlier, I will address that last.

After spending a lot of time, money and effort, some employees may venture out on their own. If we did our jobs right, we should be OK with this. After all, how did we start out? The people we hire today are our future shop owners, trainers, educators, and industry leaders.

Now, let’s address the elephant in the room. Money. There is no simple way to put this. We need to raise shop profits and owner salaries across the board. If not, the typical independent repair shop will not have the financial horsepower to build for the future. I urge all shop owners to spend more time in the office and study their current business model. Big changes are coming to our industry and you must be ready. There has never been a more critical time to understand the numbers of your business. Work on improving efficiency, gross profit, and net profit. Labor profit dollars will be a key deciding factor between success and failure.

The responsibility is ours. Our future is literally in our hands. Let’s all work together and build an industry that will attract top talent. And once hired, we need to coach and mentor them. We, the independent shop owners, have a lot to offer. We should be proud of what we do each and every day. Together, let’s ensure that our legacies, and future legacies, live on.

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Ratchet+Wrench’s second annual look at the shops setting new standards with their workplace cultures

BY MEG A N G OSC H PH OTO GR APH Y BY JEREM Y ERICKS O N, R O D NE Y H USBA N DS A N D ALYS O N M CCL AR A N

Long Arm

Under 10 Employees

Foreign Affairs

10-25 Employees

Aspen Auto

26+ Employees

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hese days, culture is more than a buzzword, and the numbers prove it.

Businesses that have gone above and beyond to build a culture where employees feel valued and respected see their efforts pay off.

According to a recent Gallup report, only 35 percent of the American workforce reported feeling enthusiastic and committed to their work and workplace, but businesses with engaged employees saw better results across key performance outcomes.

So, what are the keys to a thriving workplace culture? Respondents to Ratchet+Wrench’s second annual Best Workplaces query shared shining examples of shops across the country making impressive investments in training, community involvement, employee benefits, and professional development.

This year’s winners, Long Arm Mechanics, Foreign Affairs Auto, and Aspen Auto Clinic, have made it their mission to create companies where culture and success is built around their all-star teams.

Under 10 Employees

LONG ARM MECHANICS Owner: Levon Arnold

Teamwork: The Ultimate Asset The location may have changed, but the vision hasn’t.

Ten years ago, when Levon Arnold started Long Arm Mechanics out of his home’s garage, his goal was always to do his best work. Now, with a team of five by his side, business is busier, but those homegrown values haven’t changed.

“I honestly haven’t worked anywhere like this where culture is the business’ biggest driving force, not the bottom line,” says Jeanette Wright, Long Arm’s finance manager.

With mottos like “every car counts, not more cars count” and “slow is smooth, and smooth is fast,” Arnold has built the shop’s culture around a focus on quality over quantity.

In turn, as new customers pour in, Arnold has seized the opportunity to invest back into his team. Wright says it guides decisions.

“The first question is always, how can we make this or that better for the

Location: Garden City, Idaho Staff Size: 8 Shop Size: 3,800 square feet Average Monthly Car Count: 66 Annual Revenue: $450,000

employees? How can we help get them where they want to be?” she says.

Get personal.

At Long Arm, individual growth is a top priority, so Arnold often meets employees with on a personal level.

When someone has an off day—personally or professionally—it has the power to influence the entire team and impact the shop’s performance, Arnold says.

As new employees come on board, Arnold identifies their personal goals and a plan is put into action to reach them—a first for many of the team members.

Arnold meets regularly with each

employee to talk progress, even going so far as to take emotional intelligence and leadership training and becoming a coach through the same program.

“The biggest asset they bring in to work is themselves, so if we can help them get to a place where they feel more confident, more effective, where they’re embracing a vision for themselves and seeing how that connects to their day-to-day life, why wouldn’t we?” Arnold says.

Look past logistics.

After working to cultivate an tight-knit team, new employees aren’t picked just to fill a position.

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Under 10 Employees

All-Star Team At Long Arm Mechanics, owner Levon Arnold has curated a tightknit team.

“I always look at hiring as a chance to ask, what’s my opportunity here?” Arnold says.

The ability to be a team player is a must, as is desire to learn.

Long Arm works with each employee to offer the support needed to make the match sustainable—including health insurance.

“Most [shops] stay away from it, because it’s such a tremendous expense for a small business, but there are alternatives out there and when it comes to putting in that sweat equity, it’s always worth it if it means you can build your best team,” Levon says.

Think outside the shop.

With a mission centered on working together, helping the community at large is a natural extension of the shop’s culture.

As president of the Garden City Chamber of Commerce and the Boise Development Group, Arnold is an active community leader. Through the shop’s Green Light Outreach Program, a 501 C3 that helps those who can’t afford costly repairs, the entire team pitches in, boosting team morale and pride in the work they do best.

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LONG ARM'S KEY BENEFITS: • PTO/VACATION TIME • EMPLOYEE HEALTH INSURANCE • PARENTAL LEAVE • TOOL REIMBURSEMENT • UNIFORMS

BY T H E N U M B E R S

44 5 3 34 $16,000 Average employee age

Longest staff tenure in years ASE-certified techs on staff

Average training hours completed each month

Annual investment in tools and tech upgrades

10-25 Employees

Making Connection Count In an industry focused on productivity, it’s no surprise that a self-described “hospitality-based” repair shop would focus on its people, rather than its numbers, when building a workplace culture.

That’s not to say the team at Foreign Affairs Auto isn’t turning out impressive results. The West Palm Beach shop credits the chemistry of its unique culture and strong staff for its ability to surpass $3 million in annual revenue while maintaining an $1,100-plus ARO. “It’s easy to get lost in the numbers and lose track of the humans behind them,” says co-owner Jonathan Ortiz. “Whenever we shift our focus back to the people behind the business, I don’t think it’s a coincidence we actually start to see those numbers go up.”

Make Time to Bond Whether talking through shop operations or catching up over a cup of joe, the Foreign Affairs team makes time to connect.

Draw in top talent.

Over 38 years in business, the Foregin Affairs team has adapted to industry trends, but a focus on workplace culture was ahead of its time.

“We’re in the midst of a tight labor market, but our efforts to create a people-focused culture gave us a head start when it came to attracting quality hires,” Ortiz says.

With perks like PTO, parental leave, paid training and career growth opportunities, the shop’s local reputation for service, creative problem solving, and teamwork has also helped deliver a steady stream of qualified candidates.

The shop’s hiring process has grown to span a collective 45 days of interviewing, assessments, technical testing, reference checks, and more.

“The process is long, but they’re joining a family, and to go through each step with both parties still committed, you know it’s about more than a job,” Ortiz says.

Fresh ideas always welcome.

With a team of smart, passionate, and dedicated individuals, it's a no-brainer to incorporate employee feedback into its workflow.

The shop created a peer evaluation system where each team member is graded by

his or her peers to provide objective feedback as the “voice of the entire shop.” An open door policy also welcomes the team’s unique and out-of-the-box ideas, including a Saturday morning yoga session held for customers in the shop’s lounge while their cars were being serviced, and the introduction of a fiveday workweek.

After an employee brought the idea of closing the shop on the weekends, the Foreign Affairs team crunched the numbers and made the switch.

“We realized it would actually promote efficiency and allow everyone to come back recharged on Mondays, and that lined up with our mission of putting people first in creating a work-life balance,” Ortiz says. “I was hesitant at first but it was a slam dunk.”

Celebrate the big and small.

Each morning, everyone meets in the

FOREIGN AFFAIRS AUTO Owners: Frank, Jonathan and Gloria Ortiz Location: West Palm Beach, Fla. Staff Size: 14 Shop Size: 9,500 square feet Average Monthly Car Count: 275 Annual Revenue: $3 million 0 3 . 21 / R + W / 31

26+ Employees

10-25 Employees

Mindful Meetings A casual daily gathering also doubles as the shop's production meeting.

Propel Pathways for Growth

FOREIGN AFFAIRS' KEY BENEFITS:

• PTO/VACATION TIME • EMPLOYEE HEALTH INSURANCE • PARENTAL LEAVE • TOOL REIMBURSEMENT • UNIFORMS • PAID SICK DAYS • RECOGNITION PROGRAM • TRAINING REIMBURSEMENT

BY THE NUMBERS shop’s customer lounge for “Cars and Coffee.” The gathering doubles as a daily production meeting and it’s also an ideal time to call out a job well done. The group also meets for a happy hour each Friday afternoon before the shop closes.

Every other year the shop goes all out, closing for a three-day retreat so the entire staff can travel to Worldpac’s training conference, fitting in team-bonding experiences like private city tours, celebratory dinners, and a VIP tour of the Cowboys Stadium.

“We’re a family, and it might not be the same as sitting down to dinner, but it’s about fellowship and keeping a bond and taking time to acknowledge the hard work,” Ortiz says.

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39 3 14 2 15 $35,000 Average employee age

Paid sick days earned per year

Longest staff tenure in years

Employee reviews per year

Daily minimum number of minutes to meet as a group

Shop’s staff training budget

With five locations spread across Colorado’s Front Range region, Aspen Auto Clinic founder and CEO Greg Bunch knows that a cookie-cutter mold won’t build a winning workplace culture.

"The culture that makes up a workplace has its own unique DNA and you have to create space for those unique strengths and personalities to shine through," he says. "That’s the first step in building a workplace culture that’s worthwhile.”

Build a baseline.

Clear organization is key to a shop’s daily workflow, allowing staff to work efficiently and maximize their time, creating space for their strengths to shine through, instead of losing valuable hours to avoidable chaos.

“The key is to strike that balance between the baseline systems that give our shops a common language and the flexibility that gives them space to develop their own personality and style,” Bunch says.

“That’s where each culture really thrives.”

Two key factors Bunch has prioritized across all Aspen Auto Clinics are a systematic approach to meetings and staff training.

Bunch and his team are constantly developing the shop’s training systems; each shop holds a 15-minute meeting each morning and managers come together weekly to share updates from their teams.

The entire Aspen Auto Clinic team meets quarterly for a town hall to discuss news, ideas, goals, and achievements.

Create space for initiative.

Bunch notes that a strength in each shop is the ability to create a unique team

ASPEN AUTO CLINIC Owner: Greg Bunch Location: 5 Colorado locations Staff Size: 50 Average Monthly Car Count: 1,600 Annual Revenue: $8.5 million

ASPEN AUTO CLINIC'S KEY BENEFITS:

chemistry, where employees feel comfortable being themselves and believe their ideas are valued.

Part of that dynamic comes from finding the best position for each employee, even occasionally allowing for transfers between shops, as well as strong and clear support from Aspen’s management team.

“The creativity that comes from that organic brainstorming is a real asset and it’s really just about creating support to put them into action," Bunch says.

Aspen Auto Clinic regularly contributes to community efforts For the last two years, the team has adopted a local trail and meets monthly to pick up trash and take care of a park—an initiative conceived and rolled out by executive assistant Karen Maus. And recently, one of the general managers spearheaded a company-wide sales contest, pledging to dress in pink and work as a service advisor for the day in the winning shop.

“I can take zero credit for those ideas,” Bunch says. “Both were complete grassroots efforts within the organization and when you have talented, passionate staff ready to jump on ideas like that, it creates a culture where people are excited to take action.”

Clear pathways for growth.

Conversations on career development begin during a potential new hire’s interview—candidates learn the company’s plan for growth and possible future positions—and never end, with opportunities for personal and professional development incorporated into day-to-day shop flow.

Staff have access to one-on-one professional career counseling, reimbursement for ASE certifications and renewals, and more. Aspen’s educational coordinator and each shop’s foreman coordinate to oversee training.

Aspen is also working to develop an internal apprentice program and invests heavily in the latest tools and technology.

There's also some creative solutions involved. In one case, a technician-turnedservice advisor joined Toastmasters International to improve his communication skills.

“We’re not corporate. We have that family atmosphere and that ability to customize our support for what each person is going to need, and with that commitment to education and discovery, their growth is our growth,” Bunch says.

• PTO/VACATION TIME • EMPLOYEE HEALTH INSURANCE • HSA PROGRAM • 401(K) • TOOL REIMBURSEMENT • UNIFORMS • PAID SICK DAYS • RECOGNITION PROGRAM • TRAINING REIMBURSEMENT

BY THE NUMBERS

33 18 14 4 22 8

Average employee age Paid sick days earned per year (after 5 years)

Longest staff tenure in years

Employee reviews per year Daily minimum number of minutes to meet as a group

Average training hours per month

$100,000 -$150,000 Annual investment in tool and tech upgrades

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The Keys to a Well-Rounded Workplace

Tips, tricks, and guiding concepts for building an award-winning workplace culture What the employees think:

Words to Live By

Our culture allows brainstorming to be spontaneous. You can run into each other, throw out an idea, and suddenly it’s sparked five more and you’re flowing with a whole new project. It’s not just another task on your to do list.”

What are the core principles guiding this year's winning shops?

Communication / Authenticity / Integrity / Goals / Transparency / Consistency Exceed Expectations

When it comes to meeting the workforce demands— how does the auto repair industry stack up?

Respondents of the Ratchet+Wrench Industry Survey offer these benefits: Here’s the breakdown:

88%

— Jeanette Wright, finance manager, Long Arm Mechanics

VACATION DAYS

63% 58% 56%

Leaders Read

Looking for inspiration? Check out these recommended reads from our winners:

SICK DAYS

TRAINING REIMBURSEMENT

HEALTH INSURANCE

Speed of Trust: The One Thing That Changes Everything By Stephen M .R. Covey

Pygmalion in Management

By J Sterling Livingston

Leaders Eat Last

By Simon Sinek

The Go-Giver: A Little Story About a Powerful Business Idea By John David Mann and Bob Burg

Attitude 101: What Every Leader Needs to Know

By John C. Maxwell

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43% 35% 22%

RETIREMENT PLAN/401(K)

DISABILITY INSURANCE

LIFE INSURANCE

Build the Best in Class

This year’s winning shops share their top tips for hiring with culture in mind.

• Clarify your team's vision for success and revisit it often.

• Make time for working interviews.

• Trust your gut.

• Hire for emotional intelligence.

The hard skills and training are teachable.

Ready.

Set. Nominate.

The 2021 All-Star Award nominations open on March 1.

For more information regarding Ratchet+Wrench’s 2021 All-Star Award, visit ratchetandwrench.com/awards

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Blast Your ARO Skyward with KUKUI Text Connect Text Customers to Galvanize CRM

After over 25 years of serving customers, Mike DeFino has a clear idea of what customer relationship management (CRM) means to him and to his business, Fox Run Automotive.

“The reason we’ve been successful is because the team always takes care of the customer first,” he says. "Fox Run is not just me—we’re a team.

We pride ourselves on customer satisfaction because it impacts our reputation via word-ofmouth and online.”

Fox Run Automotive is a neighborhood 12-bay shop at the northern tip of Delaware.

Defino and his team did not achieve an average annual revenue in excess of $2 million through just flyers and postcards; they achieved it by deliberately upgrading the ways in which they reached customers. Connecting with customers on their terms was a revolutionary step in the right direction for Fox Run Auto’s CRM—at least as they knew it—with a little help from KUKUI and its texting program.

“Right now, my active customer list is thousands of customers deep and we do everything we can to wow them,” he says. “COVID has challenged us to look at things differently because people were not driving as much. We switched gears and put good offers out there through texting. We offered new services such as detailing and cleaning/ disinfecting. Using this platform to drive customers has been effective to get them in the door.”

DeFino shared that texting is very cost effective compared to other CRM efforts. For example, a blast of 5,000 postcards at $0.43 per costs several thousand dollars for a break-even return ($2,150, to be exact). Texting has been cheaper, more targeted, and a solid supplement to current CRM efforts for his team and his shop.

CHOOSE TO GO MOBILE DeFino has never been afraid to take a calculated risk (especially when there is a bit of fun involved).

It is easy to see when browsing his shop’s site and social media. The Fox Run team is portrayed as a 3 6 / R + W / 0 3 . 21

wide variety of cartoonish, seasonal figures like elves, pilgrims, race car drivers, leprechauns and even doctors. Some may think it silly but to DeFino it is all part of sound customer management.

“I just always thought it’s best to do something a little different to connect with people. For years we have leveraged radio, mailers, and even a billboard to get attention. We put ourselves out there and most do not see us. But now when we text customers, we are right in their hands, right where we want to be,” DeFino says.

“What makes KUKUI work for us is the platform is simple,” he says. “I didn’t grow up with a computer, but I manage it pretty well. I get a monthly coaching call from a dedicated rep at KUKUI, and Ronni is amazing! During my coaching calls we review our Google AdWords, our email blasts, my text offers and ideas and where we stand with everything.”

“KUKUI has shown me another way to connect with our customers. They helped my team grow comfortable with the program, and when you achieve trust in a new process, you’ve really got something.”

Looking ahead, DeFino continues to evolve and learn with the business model. He knows he may have to pursue some type of electric car repairs if Fox Run Auto is to keep up with the speed of business.

“Electric may be next,” he says, “like KUKUI, we will listen, learn, then lead the way until it becomes second nature. I didn’t expect this platform to be as easy as it is, but with a little help and a solid crew it’s been very successful for us.”

After that, who knows? Possibly the moon.

The rovers are still up there, after all.

When Kennedy said, “We choose to go to the moon,” in 1960, many Americans saw it as nothing but a flashy pipe dream. That dream was realized just nine years later, and for many of today’s shop owners, the idea of texting customers may seem much the same. The moon, however, is closer than you think.

“We have Text Connect configured to automatically send out service reminders. The team also uses Text Connect during slow times to send custom messages regarding customers’ vehicles and offer targeted discounts, whether it is general maintenance or a substantial repair. I was always traditionally marketing my business, but I could never imagine anything like Text Connect.”

To learn more, check out bit.ly/KUKUI_CRM

T O O L B OX / S H O P A D V I C E

Protecting Your Shop Data How to prepare for data liability issues that could be on the horizon Say it’s an average day at your shop when a customer lounges in the lobby as they wait for their car. Nothing seems out of place, until days or weeks later when you realize your network’s been hacked using the shop’s Wi-Fi, and countless customer data points have been compromised.

Even worse? The moment you realize you’ve accidentally shared privileged information with a customer’s estranged and soon-to-be ex husband or wife, revealing potentially personal data points like a new home address in the process.

These scenarios may seem extreme for most repair shops, but as vehicles become more technologically advanced, shops are slowly gaining access to more personal data than ever before (especially with the passage and eventual deployment of the Right to Repair bill). And with all of that much coveted data could come much more responsibility to protect the information a shop has gathered.

For more insight on the changing legal landscape of data liability and tips owners can use to prepare, Ratchet+Wrench spoke with William Ferreira, lead attorney for the California-based Automotive Defense Specialists.

AS TOLD TO MEGAN GOSCH

Use this time to get ahead.

Right now, shops are mostly grabbing personal and mechanical data points from customers and through access to specific diagnostic information, but there really are no major nationwide laws for how businesses like repair shops need to protect the data they have.

Any rules in place that shop owners need to abide by are being set individually on the state and local levels and they’re across the map as to what they cover, but once manufacturers are eventually required to share their mechanical data through Right to Repair, I expect we’ll see some sort of nationwide legislation created to set a consistent standard. Until we know what data will be disclosed by the manufacturer or that the vehicle has to offer, I don’t expect national requirements will be set in stone, and we won’t know what data will be disclosed until the cases brought against Right to Repair finished.

Honestly, the whole thing could take years and, even then, once they hand over the data, it’s likely be a raw data dump that’ll overwhelm shops with so much info they won’t know how to analyze it, so we’ll see delays in actual shop use of this data while they try to figure out how to make sense of it all.

Brush up on the basics.

The good news is that in the meantime, shops are generally being held to a reasonable standard, meaning they’re being evaluated on the question of ‘what’s a reasonable level of accommodation a repair shop can be expected to make to protect its data with the information available to them.

Is it reasonably foreseeable that a shop is sued because an ex-husband was able to access the shop’s files and use data points from the car’s GPS to track down his ex wife? Probably not, but it could be a reality with the data that could be in a shop’s hands once this data opens up.

That being said, a reasonable standard would include covering the basics we’ve all been hearing about for years when it comes to avoiding a potential breach: secure Wi-Fi, secure networks, password encryption on important files, management of server redundancies and possibly moving data from a general server to an offline server, etc.

Limit your share points.

No matter the level of security you’re required to uphold based on the state you live and operate in, you want to keep access to any personal data on a need-to-know basis. For instance,

it makes sense to give your mechanic access to someone’s data in order to analyze what’s going on with the car and potentially any issues it’s had in the past, but should the guy who sweeps the floor have the same login access to shop systems? I’d say no. You want to limit that access to staff you trust to use that data reasonably and with care.

With customers you also want to be safe in confirming your authorization to disclose information to anyone outside the shop. A good practice to put in place is creating some form of written authorization, maybe a signature on the invoice, to confirm who you’re able to share details with.

Be transparent.

Remember when Target had its big breach back in 2013 and wasn’t the first to break the news to customers?

You want to be checking for a breach regularly and have a plan in place if you need to let a customer know his or her information’s been compromised.

Right now, for smaller companies, there’s generally not a ton of blowback legally when a breach happens but I’d expect to see requirements down the line with the data Right to Repair might unleash.

Cover your bases.

When clients come to me and ask if they really need that data liability insurance piece of their policy I always say “Look, what is it? Five dollars per month?” It’s worth it to have that rider and protection under weird circumstances like a breach.

Unfortunately, we live in a world where even if there aren’t significant damages and no one’s been physically harmed, there's always going to be some plaintiff 's attorney that will help sue a repair shop for something like an unauthorized data breach—even if the shop did nothing wrong and had strong security measures in place. Without insurance there may be enough there for an attorney to make your life miserable and bleed you dry.

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T O O L B OX / S A L E S + M A R K E T I N G

Considering the Co-Brand These key factors can help decide when to co-brand or go it alone

BY MEGAN GOSCH

bound to spy some sort of brand-name logo inside or out.

From fully branded front-and-center digital displays to minimal window clings, most independent shops have vendors and suppliers they’re proud to work with and promote as a part of their shop’s quality service.

Whether they’ll commit to a full brand alignment—sporting a branded awning or the signature stripes of a top corporate enterprise—is another story altogether.

These days vendors and suppliers of all shapes and sizes are offering independent shops a variety of partnership options, often with ways to customize the vendor’s level of support and the shop’s core commitments.

The influx gives owners more avenues to team up with established brands, but having so many options can muddy the waters and make it harder for shops to determine if the co-brand concept is right for them.

For more insight, Ratchet+Wrench checked in with two top shops for the key considerations that have helped them find the best fit for their businesses.

core priorities for the business can be the defining factor.

For Mike and Jennifer Baggett, owners of Pro Automotive Services in Wood River, Ill., a nationwide warranty was the initial draw, but access to an ever-expanding range of resources was the reason to stay.

Mike Baggett was looking for a way to offer the amenity to his customers, considering programs with suppliers like Midas and Meineke, before ultimately choosing to co-brand with NAPA Auto Parts in 2003. In the years since, the Baggetts have taken full advantage of tools and programs like shop management software system NAPA TRACS, a NAPA partnership with AutoVitals for digital vehicle inspections, NAPA Service Assistant, and NAPA Autotech for industry education and training.

“We’re a smaller shop with a small team, and to have that network we can rely on helps us keep up with the day to day and ahead of the curve on industry trends,” says Jennifer.

“I just don’t know how we’d navigate everything that’s changing in the industry and find time to service the cars otherswise.”

Identify your top priorities.

To Co-brand?

No two partnerships are the same, just as each repair shop is sure to have its own unique set of goals and needs. Those

Or Not? And for the team at Fifth Gear Automotive in Lewisville, Texas, deciding against cobranding programs has been steered by a focus on keeping the business nimble and

Visit most auto repair shops and you’re

ready to pivot, choosing vendors, tools, and services that will work best for the shop and its customers a la carte instead.

The shop has built strong connections with its regular suppliers, but, “we’re fairly fluid in our relationships with vendors and we don’t want to get locked into anything,” says marketing director John Miller.

“If we can find something new that’s going to work best for a particular customer, we want the freedom to do that,” he says.

“I know some partnerships offer better discounts and rebates, and not every cobrand program requires you to go to them for everything, but for us that legwork to stay on top of the market is what keeps us sharp.”

Hone your shop identity.

Strike a balance As a NAPA Auto Care Center, the Baggetts find the name brand recognition in their partnership to be an asset in bringing in new customers and boosting customer confidence overall.

“Our shop isn’t relevant anywhere else in the country, but when you align with a consistent, stable brand, it gives you that instant loyalty,” says Mike. “It takes down a lot of barriers.”

Pro Automotive sports NAPA’s signature blue and yellow awning, branded lobby signage and includes the company’s logo on various marketing pieces, but Jennifer says the team is strategic in its promotion.

“You have to make sure your identity isn’t lost in the mix,” she says. Customers occasionally inquire about the partnership, “but we make sure to put Pro Automotive front and center. We’re not going to put the NAPA logo on something unless it 0 3 . 21 / R + W / 3 9

T O O L B OX / S A L E S + M A R K E T I N G

makes sense and we’re intentional when we’re interacting with customers or out participating in the community so that people know us as the family at Pro Automotive.”

Grassroots Growth “When you co-brand, you’re sharing your billboard with somebody else,” says Miller.

“And after working to build a strong identity in our community for 17 years, we just don’t want to share.”

When it comes to building the shop’s brand recognition, the Fifth Gear team has focused its efforts on a deep commitment to community engagement with participation in chambers of commerce, local business associations, community events, school booster clubs, and shop-hosted appreciation programs for teachers, first responders and hometown heroes.

“We know that even if you co-brand, you still need to be out there telling your story and connecting face to face, so we’ve opted to cut out any confusion and keep that identity clear,” Miller says. “When

we’re building these relationships, there’s no question as to who we are.”

Evaluate your expertise.

Take it Outside In their day-to-day marketing efforts, the Baggetts have tapped outside experts to boost the shop’s content strategies with the help of some of NAPA’s heavily vetted endorsed vendors.

After connecting with auto-focused social media and marketing firms Repair Shop of Tomorrow and Optimize Social Media (OSM) through NAPA programs, Pro Automotive now builds the shop’s marketing strategies with help from web and social media pros. And while the companies do help to roll out occasional NAPA promotions, Jennifer oversees and approves the shop’s final marketing decisions.

“If there’s something we don’t like, they’ll create something else so we can build in what works for us with the help of people who actually know what they’re doing,” she says.

Keep it in-house At the time, Fifth Gear bucked an industry trend when the shop brought its marketing support in-house and hired Miller as its marketing director in 2017.

These days more and more shops are starting to follow suit.

“Whether you hire a consultant or have a dedicated staff member managing your marketing, to create a marketing strategy that’s any good you’re going to have to commit time and money,” says Miller. “It’s just too complex now to have your general manager or receptionist take it on as an afterthought.”

With Miller working inside the shop with Fifth Gear’s team each day, he’s able to carry the team’s character and core goals through the shop’s campaigns and strategies.

“Having that role covered by a professional in-house brings a level of control and familiarity that we’ve seen bring in results,” says Miller. “It might not be doable for every shop, but for Fifth Gear it’s made the most sense and brought the most value.”

Ready. Set. Nominate.

The 2021 All-Star Award nominations open on March 1.

For more information regarding Ratchet+Wrench’s 2021 All-Star Award, visit ratchetandwrench.com/awards s p o n s o r e d

4 0 / R + W / 0 3 . 21

b y

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Auto care news

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T O O L B OX / F I N A N C E + O P E R AT I O N S

5 Ways to Improve Gross Profit Adjust your mindset to achieve maximum profit

BY R AT C H E T+ W R E N C H S TA F F

Gross profit may be one of the more basic key performance indicators for any

business, not just auto repair, but that doesn’t mean it’s immune from being misunderstood.

In fact, from the work that Dave Schedin has done with shops across the country with his company, Computrek Consulting, it remains a source of ire for shop owners.

“A lot of people have a misunderstanding of gross profit,” he says. “It all comes down to a personal belief system.”

That personal belief system just might be holding you back from achieving maximum profitability, which Schedin steadfastly believes every shop owner deserves to achieve. He breaks down five ways to improve this all-too-important metric, from your mindset to your software tracking.

1) Re-examine your belief system.

Many shop owners have a misunderstanding of gross profit because of what Schedin refers to as “money programs.”

“Anytime you talk profit, any of that is all related to someone’s understanding of money,” he says. “Is it OK to be profitable? How much is OK or not OK to be profitable? It all comes down to your personal belief system.”

And that’s exactly where Schedin believes that all shop owners need to start. You must get clear with yourself

about what is legitimate to charge: what’s a good profit, what’s gouging, and what’s underpricing.

“It’s most tied to fear than anything else,” he says. “That’d be stealing from the customer or ripping them off.’ That’s not necessarily true; that’s just their own belief system.”

Schedin doesn’t blame shop owners for this line of thinking; in some ways, it’s shaped by society and how we talk about money. But regardless, he firmly believes that you won’t get anywhere raising your profits if you don’t have the self-confidence to do so.

“Here’s my experience with every shop that reaches its glass ceiling: every glass ceiling is someone else’s ground floor,” he says. “Our industry is just now starting to understand it’s not just how to make a shop profitable. It’s the personal development to charge accordingly.”

2) Strengthen your value proposition.

It doesn’t just come down to our own personal beliefs about pricing, however, Schedin says; it also comes down to the customers’.

“There’s a misunderstanding that when a customer complains about price, most shop owners think it’s about price.

In reality, it’s not,” he says. “When you talk about price, it should be about your value reasoning.”

Tough as it may be to hear, if a

customer complains about price, they don’t believe they’re receiving enough value for that price. So, take a look at your value proposition. Did you articulate well—in the customer’s language—in a way that made sense to them?

“You express that quality and value; the value is that you have the best peace of mind possible,” Schedin says.

“Whether it’s preventative maintenance or an A-level repair, did they get the quality they assume they are paying for?

Customers always expect A-level quality, no matter what they pay.”

You may very well lose customers if you focus on a good gross profit, but the customers you weed out will be those price-shopper customers that aren’t a good fit. Don’t be scared of losing customers, Schedin says.

“There are a lot of customers shop owners have that they should let go because it takes so much effort to sell the simplest thing,” he says. “They always want it lower. It upsets the advisor because they're entering a relationship with a lower-echelon customer.”

3) Streamline your verbal interface.

The No. 1 system that turns on longstanding cash flow is your verbal interface. Everything else is a system around what was sold, Schedin says. So, consider how your systems are supporting your value expression. Are you using 0 3 . 21 / R + W / 4 3

T O O L B OX / F I N A N C E + O P E R AT I O N S

the right verbiage? Do you use a digital vehicle inspection that sends photos and videos? Do you have a customer service representative? Are you relying too heavily on technology to do the selling for you?

That last point is actually an increasing concern for Schedin. Technology supports an effective verbal interface, to be sure, but it shouldn’t replace human interaction.

“I love the digital inspections for speed and expertise,” he says. “What I don’t like about it is it’s relied on too much to do the selling for you.”

4) Create multiple labor rates.

Here we go, the ultimate secret to improving your gross profit: Raise your prices to get the gross profit you want. Sound too easy?

Well, if you’ve followed the first three steps, it shouldn’t be, Schedin says.

“Most shops should have a labor rate closer to $250 rate. It’s hard to do that at less than $150, $175 per hour. You’re always playing catch-up,” he says. “If you’re playing catch-up on technology, you’re going to lose customers because you’re learning on the job.”

He readily acknowledges $250 per hour isn’t realistic for every shop, but that’s why you need multiple labor rates (namely, Schedin says you absolutely need a diagnostic labor rate if you want to be competitive in 2021, but he also suggests a variable labor rate), and why you need to track all the smaller aspects of gross profit to ensure those benchmarks are hit, all of which affects your overall gross profit. Those include: Labor gross profit: 75-80 percent Parts gross profit: 55 percent Sublet gross profit, except for towing: 55 percent 5) Track on a per technician and advisor basis.

For those looking to hone in even more closely on their gross profit, Schedin recommends tracking the KPI on a per advisor and then later per technician basis, as well. In fact, you can even do this through most point of sale software reports, he says.

“It’s all around gross profit volume on the repair order,” he says. “I’ve had some people that are at benchmarks but they’re

still not that profitable. Why? Their car count is low.”

Maybe that means the marketing plan was bad. Or it could be as simple as putting out a cheap coupon and bringing in the wrong type of customers. Marketing affects gross profit, and without looking at it from this perspective, you may miss an issue.

When it comes to tracking per technician, it comes down to the inspection.

“You have opportunity from that,” Schedin says. “Some techs don’t call everything. ‘I’m not going to change that fluid until it turns dark.’ Well, they just forced less gross profit on an RO.” A repair order should be looked at as a cash flow unit and reviewed accordingly.

Closely study the gross profit per hour, the blend of parts versus labor, the labor rate on that RO, and finally, of what it consisted.

Preventative maintenance, in particular, should make up three or more lines on roughly 30 percent of all ROs, resulting in a 3-3.5 hours per repair order (HRO) on just preventative maintenance.

“That’s not a sales goal—that’s a vehicle requirement,” Schedin says.

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E M B RAC E T E C H N O LO GY. G R OW YO U R B U S I N E S S . OW N YO U R F U T U R E .

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T O O L B OX / C A S E S T U DY

CURRICULUM CHANGE-UP How a group of shop owners have banded together to solve the tech shortage

BY A B BY PAT T E R S O N PHOTOGRAPHY COURTESY OF GETTY IMAGES AND PICOSCOPE TECHNOLOGY

4 6 / R + W / 0 3 . 21

Hands-on Experience Through the creation of the Pico Club, Warren Parr is helping build new buzz in auto repair careers.

W

hen Warren Parr opened his shop, Complete Car Care, in Fresno, Calif., back in 1985, his son was born around the same time. Throughout his son’s childhood, Parr always hoped his son would become part of his business—he was practically raised in the shop, building his first engine at the age of 13, and became a master technician at just 21. But, two years later, his son decided to go down a different path and work for the government; the role paid much more and required less work. What originally started as a way to get his son back to the shop later became a way to bond local shops together and help close the technician gap.

THE PROBLEM

Soon after learning his son would change careers, Parr realized this same issue is a concern for a majority of the industry, and wanted to find a way to make auto repair appealing again. To do this, he began paying attention to technology and how it could appeal to younger generations. This is when Parr came across PicoScope technology, a diagnostic tool using waveforms (essentially an X-ray machine of automotive diagnostics). This technology would create opportunities to charge more and pay better wages at his own shop and— instead of keeping this knowledge to himself—he wanted to share what he’d learned to make PicoScope technology the new standard in automotive repair.

THE SOLUTIONS

Creating a Common Goal

Parr first started attending career fairs to share the technology with potential students, putting the PicoScope technology on full display with eye-catching activities to demonstrate the technology.

“If you’re going to catch fish, you have to have bait,” Parr says.

While it was a great start to get students interested, he needed to get other shop owners on board. One owner in particular had been running into issues at his shop and asked Parr to help with the PicoScope. After five minutes, Parr had a diagnosis. The owner couldn’t believe it at first, but from then on, he was converted. Parr then told him how it’s always been his dream to start a club, where shop owners could come together to share their case studies and waveforms.

“The next thing I know, he set up a meeting at the shop,” Parr says.

The Pico Club held its first meeting on January 3, 2009, with 13 members.

Now, with over 30 members, the club holds meetings on the first Saturday of every month. The club also has a private Facebook page where members can post questions or updates.

“When they learn something, we can share it with everybody, and when someone has an issue, we can all work together to help them work it out,” Parr says.

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4 8 / R + W / 0 3 . 21

IN V ENTORY MAN AGEMENT

B U S I N ES S I N S IG H T

C U S TOM I Z E D T R A I N I NG

The only thing the club doesn’t discuss is pricing to avoid creating price-fixing issues.

Partnering on Education

Parr’s next step? Getting this technology into public education curricula. Parr called the local high school superintendent and asked if he could be an advisor for the automotive programs—there are only two in the city of a quarter of a million people. Parr has now become the advisor for the entire county’s nine high schools with automotive programs.

The superintendent also confirmed that teachers in the area were interested in learning more about the technology.

Now, the club teaches it to those teachers in order to supply students with a more modern skill set that will allow them to go from the shop back to school and apply what they’ve learned. Parr says there are at least seven in the club that have high school juniors and seniors from the local vocational high school now working in their shops two days per week.

THE AF TERMATH

Back at the beginning of 2020, the Pico Club began its long-term relationship with their county public high schools with its first-ever workshop. Now, small auto repair businesses are partnering with local school districts not just in an advisory role, but as instructors and on the school’s curriculum.

Parr is the president of his NAPA business development group in California, one of 64 NAPA groups around the country.

What the Pico Club is now trying to do is build an education model surrounding Pico Technology and give it to NAPA to share.

“How I see it is, the more minds working on it, the better it will become,” Parr says.

THE TAKEAWAY

Parr says if everything goes well with the PicoScope curriculum, they expect to see more talent in their shops in the next three years.

“We want students to learn this technology so they will get a higher wage when they get out into the working world,” Parr says. “We have to do it faster, we have to do it better, and with this scope, it makes it possible.”

New Ratchet+Wrench Podcasts.

RADIO

4 SERIES WITH NEW EPISODES EVERY MONTH.

HOW I DID IT. Series featuring a rotating guest each month.

Hear about the challenges, opportunities and success stories from shop owners who found a way to thrive.

New episode this month.

GROW. Series featuring a rotating guest each month.

Inside the processes, systems and operational strategies that have allowed the industry’s top shops to thrive.

New episode this month.

LEAD. Series hosted by shop operator Aaron Stokes.

The go-to resource for leadership lessons, philosophies and success stories. New episode this month.

INNOVATE. Series hosted by marketing expert Frank Leutz.

An introspective look at the industry’s most pressing topics from the people who know them best. New episode this month.

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PROMOTION

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CARQUEST PREMIUM CONTROL ARMS AND STRUT ASSEMBLIES

Engineered to match OE performance standards Advance Professional and Carquest Auto Parts are proud to introduce Carquest Premium control arms and strut assemblies to the steering and suspension product family. Engineered for superior performance, the high-quality strut assemblies and control arms match the OE specifications for fit, form and function just like the Carquest Premium chassis parts and hub assemblies. All Carquest Premium steering and suspension parts are built by OE and OES manufacturers to ensure long-lasting repairs for your customers’ vehicles.

Carquest Premium control arms are engineered to match OE performance standards and manufactured to provide a long service life. They are designed with premium components, including bushings, boots, grease and installation hardware that meet or exceed OE performance for safety and durability. A corrosionresistant coating is used on all steel control arms to reduce rust. All Carquest Premium control arms offer a Limited Lifetime Warranty.

Like other Carquest Premium steering and suspension products,

AUTEL’S IA800: INTELLIGENT ADAS OPTICAL POSITIONING SYSTEM

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Expansion package enables vehicle-to-frame placement in as little as 1 minute

Autel’s new IA800, Intelligent ADAS optical positioning system, enables technicians to drastically cut the setup process prior to ADAS component calibration. The IA800, employs six high resolution cameras and ADAS positioning software, to transform Autel’s Standard Calibration frame into a rapid yet precise frame centering and vehicle distancing unit, enabling technicians to accomplish frame to vehicle placement in minutes.

Wheel clamps with camera targets are attached to the rear wheels and a standing target component is placed in the front or to the side of the vehicle, depending on the vehicle make, model and year. The MaxiSYS tablet, now placed securing on the frame, is paired with the cameras.

The system recognizes the positioning targets and calculates the current angle, distance and offset position of the frame to the vehicle. The technician simply follows the onscreen instructions to move the frame or adjust its angel until the current values match the required values. A green check mark displays for each parameter once the required position values are achieved. That’s it, the vehicle is ready for calibration. Compare that setup with one

Carquest Premium strut assemblies are manufactured by OE and OES manufacturers to ensure an OE fit, form and function. Each strut assembly comes preassembled with a premium strut, bearing plate, coil spring, dust cover and spring seat. The struts feature applicationspecific technology with exact strut valving and tuning for a smoother, safer and more stable ride in extreme conditions. Carquest Premium strut assemblies are extensively tested for functionality and durability, and are backed by a Limited Lifetime Warranty.

Carquest Premium control arms and strut assemblies have begun arriving at your local Advance Auto Parts and Carquest Auto Parts locations. For more information on Carquest steering and suspension products visit my.advancepro.com/undercar.

using mechanical tools such as plumb bobs and measuring tape that take 40 minutes on the average.

Added value to the system is its alignment Pre Check capability that uses the IA800’s camera system and targeted wheel clamps attached to all four wheels to determine the vehicle’s current alignment specifications and compare them with the vehicle manufacturer’s allowed tolerances. Ensuring a vehicle is correctly aligned, especially one that has been involved in even a minor collision, is essential to ensuring a correct ADAS component calibration. If within OE-specified tolerances, the technician can proceed to optical positioning of the frame to the vehicle. If the vehicle is shown to be out of the OE’s tolerance range, a 4-wheel alignment is recommended. The IA800 system is incredibly userfriendly with the tablet displaying vehicle- specific, step by step instructions for the technician. It’s a true game-changer for precalibration setup in both speed and accuracy. For more, visit www. maxisysadas.com or call 1.855.288.3587.

0 3 . 21 / R + W / 51

PROMOTION

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SHIFT INTO HIGH GEAR WITH NEXTGEAR

Send detailed inspection reports with photos, videos and tech notes to vehicle owners in real-time BOLT ON TECHNOLOGY, a leader in providing innovative technology solutions for the automotive industry for more than a decade continues to shift even more shops into high gear with NextGear—a product that allows any automotive professional to tap into the game-changing digital vehicle inspection (DVI), customer communication, advanced appointment scheduling and payment tools without the need for a compatible management system.

With NextGear’s DVI technology and two-way texting capabilities, techs can send detailed inspection reports with photos, videos and tech notes to vehicle owners in real-time right to their tablet or smartphone—with no additional hardware required.

When customers see proof of recommended services, they’re more likely to approve these services quickly, so shops can spend less time waiting to work on vehicles, and more time actually doing the work. The result is an increase in average repair orders, customer trust and shop productivity.

But the experience doesn’t end there. Once repairs are complete, vehicle owners can use BOLT ON’s Text To Pay feature to securely pay

for their services right from their mobile devices—saving time and speeding up the checkout process.

It will even let shops schedule the customer’s next appointment before they leave—including all of a vehicle’s routine maintenance and recommended repairs. So shops will always know what’s on their schedule, and so will their customers— setting both up for success.

NextGear currently has four additional add-ons (or gears) and BOLT ON is gearing up for more. So stay tuned.

For more information, visit NextGearDVI.com or call 610.910.8120.

JASPER ® OFFERS REMANUFACTURED FORD 6.2L ENGINE

Jasper Engines & Transmissions, the nation’s leader in remanufactured drivetrain products, is excited to announce the availability of the Ford 6.2L engine for the following applications: · 2010-2014 Ford F150/Raptor · 2011-2019 Ford F250/F350 · 2017-2020 Ford E350/E450 “Our main objective for the New Product Development Team is to reverse engineer failures in engines. On this Ford 6.2L, we received multiple cores with broken valve springs,” Brad Boeglin, JASPER new product development group leader, says. “The JASPER® update is to install a 100 percent new, shorter design, industry-proven, valve spring with a shim. This spring will maintain OEM spring pressure, reduce spring flex, and will eliminate the root cause for the spring failure, making it more durable for increased engine life.”

“This engine has a JASPER designed piston,” Boeglin says.

“This piston will maintain the original compression ratio after the heads and block are machined. The skirt has been widened to help

5 2 / R + W / 0 3 . 21

stabilize the piston in the bore. The top ring land has been lowered to improve crown strength and, finally, the top ring land has been anodized to reduce the chance of top ring micro-welding.”

“The Ford 6.2L engine has gone through JASPER’s Zero-Defect Launch process,” Boeglin adds. “This process involves a team consisting of new product engineers, the Quality Department, and POD management assigned to the training of a product. Each unit is put through a very meticulous auditing process before it becomes available.”

The Ford 6.2L engine is covered by a nationwide, transferable parts and labor warranty of up to three years, or 100,000 miles.

Full warranty disclosure is available on the JASPER website or upon request.

For more information on the complete line of JASPER remanufactured engines, please call 800.827.7455, or visit jasperengines.com.

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The new engine design will make it more durable for increased engine life

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Increase customer engagement and retention with the KUKUI Text Connect Platform Today everyone is always connected, ready to engage and communicate on their terms. It’s true of our customers, and it’s true of our team members too. Think about how you interact with your friends, your family, and the shop team. Text messaging likely plays a huge part. We don’t pick up the phone and call even our best friends anymore without sending a text to check and see if it's a good time to talk.

The KUKUI Text Connect Platform lets shops send campaignbased text messages to opt-in customers with special offers, announcements, or other messages. This helps increase customer engagement and retention, as well as maintain relevance for the shop.

No matter what the reason is, KUKUI makes communicating with your customers easy and efficient.

KUKUI shops can also use the Text Connect Platform to set up ongoing text campaigns based on a variety of criteria/triggers. You can use any of the preloaded default campaigns or customize your own campaign to get your message in front of the right customers.

MIGHTY’S EXCLUSIVE VS7® ENGINE SHIELD™

Mighty provides comprehensive protection with both products and services to help protect your customer’s vehicle inside and out Mighty is a leader in offering both products and services to ensure the best in preventive maintenance. Now you can take advantage of both a product and service combination that covers the engine oil system, inside and out.

The Product Mighty’s exclusive VS7® Engine SHIELD™ featuring Fluoro-Ceramic Infused Technology, provides engines unprecedented protection above and beyond conventional, synthetic blend and full synthetic engine oils. It treats metal surfaces creating a Fluoro-Ceramic shield providing extreme friction reduction, engine protection and displacement of heat.

The VS7® Engine SHIELD™ is scientifically engineered to: • Reduce oil consumption • Improve and stabilize oil pressure • Eliminate dry starts • Reduce thermal breakdown of engine oil

Once a campaign is set up, texts are automatically sent to customers matching your criteria.

The Text Connect Platform also uses automated texting to generate more reviews for your shop on Google, Facebook, and your website. The KUKUI Reviews Module detects when a customer has concluded a repair, and automatically sends them a text message to leave feedback for your shop.

You can even use the KUKUI Text Connect Platform to easily communicate with customers and prospects directly through your KUKUI website. Using the KUKUI Control Panel or a mobile app, you can manage incoming web chats to answer questions and help book appointments. This particular feature is available as part of the Text Connect Platform or as a stand-alone product to clients with a KUKUI website.

To learn more, visit kukui.com/text-messaging or call 877.695.6008.

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In addition to quality products and the Lifetime Protection Guarantee, Mighty offers business insight, customized training and inventory management services that help service facilities run more efficiently, gain and retain more customers, and increase profits.

Check out the Mighty website, mightyautoparts.com, to see diverse product lines and available services that can unlock your preventive maintenance knowledge and sales potential.

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PROMOTION

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INCREASE PROFITS WITH TRUE BRAND® TRUECOLDº

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Ask about optional installation tool.

Part# CP6011: 12 per case / 1.5 oz For more information, visit www.solidstart.com or call 877.290.3950.

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New Ratchet+Wrench Podcasts.

RADIO

4 SERIES WITH NEW EPISODES EVERY MONTH.

HOW I DID IT. Series featuring a rotating guest each month.

Hear about the challenges, opportunities and success stories from shop owners who found a way to thrive. New episode this month.

GROW.

LEAD.

INNOVATE.

Series featuring a rotating guest each month.

Inside the processes, systems and operational strategies that have allowed the industry’s top shops to thrive. New episode this month.

Series hosted by shop operator Aaron Stokes.

The go-to resource for leadership lessons, philosophies and success stories. New episode this month.

Series hosted by marketing expert Frank Leutz.

An introspective look at the industry’s most pressing topics from the people who know them best. New episode this month.

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Columns

THE FIXER Aaron Stokes

GEAR UP FOR GROWTH Spring is here in—Tennessee, at least. The season’s changing, hopefully

the weather’s warming up, and suddenly everyone seems to have a new energy.

Whether we’re cleaning up the garage or tackling this year’s taxes, the start of the new season always seems to kick things into high gear. And for my shop, it’s time to start focusing on growing the company.

You see, there are seasons for refining the business (times of the year when business predictably slows down and you have time to focus on fine-tuning your operations) and seasons for building the business (times where sales are high and you can put everything you’ve refined into practice as you work to bring in new business with marketing and customer service strategies).

Everyone has their own unique busy and slow season. For my business November through February is a time to refine, while March through October is all about growth. But for shops in Alaska that growth period could land in the fall when you’re busy installing remote starts before the bitter cold sets in, and for shops in Miami that busy period could come in June, July, and August when everyone’s scrambling to get their A/C fixed. Maybe your shop falls somewhere in the middle.

Regardless, as a shop owner you have to be in sync with your shop’s unique flow so 5 6 / R + W / 0 3 . 21

you can be ready to switch gears when the time is right. You should always be asking, “what season am I in?” Because mistaking those cues could mean missing some major opportunities. Chances are, that busy period that’s primed for growth is also going to be when your ideal new customer is on the hunt for services—a moment where you already have your flag waving and you marketing efforts at full blast.

You also want to make sure you’re preparing your team accordingly. That switching of gears between growing and refining may be constantly in flux, but it is a teeter totter. You never want to be in both modes at the same time and at the end of the day, to get the most from both modes, you need to make sure your group is all rowing in the same direction with the same focus.

Trying to do both at once will pull your team in too many directions and ultimately limit your capacity to achieve either.

If you’re like me and getting ready to rev up your growth efforts, you’re focused on attracting new customers, enticing existing customers to come back (and come back more often) and searching for ways to get customers to spend more on each visit.

It’s a great time to be asking “How do we want to take the business to the next level?”

If car count is already high, is there anything you can do to boost your average ticket? If

Aaron Stokes grew his business, AutoFix, into a six-shop operation that is widely regarded as one of the top repair businesses in the country. He is also the founder of Shop Fix Academy. aaron@shopfixacademy.com ratchetandwrench.com/stokes

you already have a high average ticket but they only come once per year, what can you be doing to get them back three or four times per year? If you’re dominating in a two-mile radius, how can you expand that to a three- or four-mile radius? The shops you’re seeing that are bringing in over $5 million per year took the time to ask and work through those questions.

This is a great time to be considering new fleet accounts, looking at new equipment purchases that could help service a particular type of repair you’re seeing come into the shop time and time again. It’s also a great time to make sure your service advisors are performing, and to evaluate whether you’re ready to bring on new staff as a part of that push for growth.

Building your business is done one car at a time, through one technician at a time, with the help of one service advisor at a time.

Only you will know how many additional cars, techs, and advisors your shop can truly handle, but it would be a shame to waste this season filled with potential. It’s time to get moving.

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When it comes to building your business, timing is everything.

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