Bumper-to-Bumper Efficiency

Our industry first heard about the concept of bumper-to-bumper as a marketing concept developed to describe—in quite a literal way—the full coverage nature of a car warranty. The reassurance that this concept provided to the consumer allowed many manufacturers to make many sales, with the confidence that customers would not have to worry about their new vehicle’s repairs for years to come.

Applying the concept of efficiency to the shop setting can create challenges, but the proper end-to-end (or bumper-to-bumper) application can have many, even unexpected, benefits. The obvious one is the bottom line, but happier employees, a smoother-run operation, and better supplier relations, are just the beginning. A good start can be focusing on the jobs you do most of, on the throughput, and on putting systems in place.

Scheduling

According to the 2024 Ratchet+Wrench Industry Survey, 60% of auto repair shop customers in the U.S. schedule their appointments online. Shop owners specify that younger customers not only prefer to book online, but also make the booking after regular business hours. The survey also points out that 33% of customers make their appointments using mobile devices, and that 29% of shops that use automated reminders experience a reduction in the frequency of no-shows. Choosing the correct CRM system for your shop becomes even more relevant. A proper scheduling process utilizing the correct tools will help the shop run smoother.

David Askwith, managing director of Autostream Car Care, a multi-store company with 10 shops based out of Maryland, notes: “You have to have a CRM platform and make sure that your team is checking that throughout the day, and fully utilizing the tools these platforms offer as a way to communicate with your clients.” This becomes even more necessary when it comes to weekend scheduling requests, “over the weekend clients are putting in appointment requests when we're not working. On Monday morning we need to be able to confirm those appointment requests or to reach out to the client and find a suitable scheduled time.”

Working with the right system and software providers and adjusting the system as much as possible to the needs of the shop will result in a more streamlined booking process. Askwith also reiterates the known idea of morning scheduling, “you want to schedule as much as you can before 10:00 in the morning. The more that you can schedule on the front load, and understand that you're going to get these vehicles checked out ahead of time, the better you're going to be able to manage your day.” This heavy-loaded morning scheduling strategy will allow a shop to evaluate, in that moment, whether they can take walk-ins, afternoon appointments or just forward-schedule to another day.

Reception and DVI

The auto repair shop industry grapples with finding a balance between the car count and a high enough ARO. Increasing one of these measurements can often lead to decreasing the other, and vice versa. When it comes to car count, the emphasis should be on the speed of service. According to Askwith, “We see that speed of service is a highly pressing issue. We benchmark ourselves versus other shops, and there are shops out there in which there just isn’t that sense of urgency to get a car in and out. We aim for one hour and 10 minutes from the time the car is handed to us until it’s decided what service will happen, and it’s in the hands of the tech for the work to be performed.” Autostream Car Care has the advantage of having one of their ten locations generate enough volume to support hiring an estimator, who is working alongside the technician and service advisor, with the latter being the one in charge of selling. As Askwith refers to this: “We call it the rotting banana, the longer the car is in our hands without communication with the clients, the less like you are to have a win.”

Service Advisors and Writing up Estimates

Preparing the estimate, making the sale, and doing so in a timely manner is one of the main challenges of a smaller shop. Reaching a sale conversion rate equitable to the industry standard while keeping up the car count can be difficult for smaller shops. Service advisors need to be more and more independent as shops aim to operate at a higher level. When service advisors require authorization for lowering certain estimates, or other procedures, the process is slowed down, it can affect them in making the sale, and ultimately, this affects the rest of the shop’s workflow.

Kathleen Callahan, owner of Xpertech Auto Repair in Englewood, Florida, has a different approach, “my service advisors and technicians work together to prepare the most accurate estimates possible.” Of course, this depends on each shop and the way in which they maximize the time of their employees. In a recent column for Ratchet+Wrench, “Budget, Effective Labor Rate, and Cost Savings,” Callahan emphasizes the calculation of the effective labor rate as an important KPI for technician productivity and efficiency. These KPIs can sometimes be affected by their role in assisting the service manager. According to the 2024 Rathcet+Wrench Industry Survey, 42% of auto repair shops hit an efficiency rate between 80% to 100%, and 37% hit productivity in the same range. According to Askwith, there’s not a single set way to approach this: “The challenge that you have is that there are different philosophies out there. Some shops are concentrating on fixing what’s broken, then coming back for a second swing to talk about safety, and lastly coming back again to talk about maintenance, and trying to forward schedule that. The way that we operate at Autostream, and I have firm belief in this operating concept, is that we understand that the client needs to make an educated decision, and that educated decision cannot be made by piece mail. For example, If I told the client that we're going to take care of a starter, and it's only going to cost $750. The client agrees, and after that, when we perform the DVI and find that it actually needs $5,000 worth of work, then that client may not have made the decision to spend the $750 knowing that he would need to spend an extra $4,250. We make sure the client is presented with 100% of the information.” The fact that this process takes more time is the reason why some shops may “cherry-pick” the items they present to the client, leaving them open to having undiagnosed or unreported issues.

Technician Efficiency

Efficient shops are profitable shops. As reported by survey respondents, shops that have a car count of over 300 have 51% of their AROs at over $600. Under the hood, 58% of technicians spend between 2 to 3 hours on a repair.

Some of the most efficient technicians in the industry apply simple organizational principals. As Askwith states in regard to one the most efficient at his shops: “This technician treats his work as if he were a doctor. He has every single tool, machine, and piece of equipment ready before he gets into the actual job.” But that’s just the beginning, according Askwith: “This technician walked twice as fast as any other technician in the shop, and he could bill up to 150 hours per week.” Askwith acknowledges that most of the technicians that he sees don’t operate at this level of efficiency or apply that thought process. Autostream is not immune to the industry-wide technician shortage issue. In fact, the Maryland-based company has an apprenticeship program. “Within our apprenticeship program we have a lead technician that creates flat rate technicians for us at a very high rate. This process has to start young, and as this industry has talked about, we do need to grow our own technicians. When these technicians see what right is from the beginning, it’s easy for them to parlay that into normal process when they are on their own,” says Askwith.

Technicians are likely to be passionate about cars, but they too can suffer from the fatigue of working on the same vehicles, and doing the same jobs over and over again. Being able to incentivize them can help their day-to-day workload and improve overall job satisfaction. In addition, proper training, especially within the current wave of new EV and hybrids in the market, is an asset to their ability to perform their jobs in a more efficient manner.

Parts Supplier(s)

The relationship with your parts supplier(s) is often overlooked in terms of efficiency. The availability of parts within a reasonable amount of time will influence both the amount of time that a car spends occupying a bay, and the space within the shop that could be occupied by another vehicle. Some shop owners have the expectation of parts delivery under 20 mintues, but that can often be impossible depending on the location of the shop. Forging a strong working partnership with part suppliers can help improve time and supply. Callhan takes an additional step in assisting Xperech’s parts suppliers to become better. She shares, on a monthly basis, her parts spend with other their other suppliers so that they can better complement their offering to Xpertech. This kind of communication transparency helps parts suppliers understand the shops core and secondary lines of business to better serve them in the future.

With a much larger operation at Autostream, the bargaining power with suppliers is much stronger, however Askwith requests, on a monthly basis, that his managers inform him of any parts supplier issues: “Without getting too much in the weeds on our part suppliers specifically, we have we have a 1 and 1A. So because we have the 1 and the 1A, it allows us to create accountability on multiple aspects. The first one is pricing, in which we run a quarterly analysis on ten random items. The second, also very important, is the speed of service. We want to create that accountability and make sure that we are getting parts in timely manner.”

“If I have one parts source that’s delivering in 45 minutes, and another parts source that takes one hour and 15 minutes, this time split allows me to put pressure on the second source. You just have to be able to discern where the information's coming from and what's driving it, and if you have valid information then it's really a partnership with your parts vendors. Whether you’re a single operator or a multi-store operator, most people are not putting enough pressure on their parts supplier. However, I do think there's some organizations that do a nice job of partnering.” When it comes to speed of service, partnering with your supplier is a two-way road, as the benefits of being more efficient affect both parties. Askwith implements systems that make sure there’s a steady and consistent monitoring process so that it can constantly improve the partnership, and maintain accountability: “Every week I send out what our spend is with our primary and our secondary parts house, and then I encourage my team. I need to know; are there any delivery time issues? Are there availability issues? Is there anything that I need to know? And then I'm pressing that button with those relationships to make sure they're delivering on the promise.”