How to Start an Auto Repair Shop: Part 2, Marketing
Dealing With People Is the Key Skill
Self knowledge and self worth are vital personal attributes when starting a workshop or auto repair shop. You need to enjoy dealing with people in general. If you enjoy the mechanical work that is great, but if you intend to grow, you will need to spend time learning the best way to market your business.
The first thing to consider once you have customers is to have someone with people talent at the front of your shop, and it doesn't have to be your mechanic.
The best mechanic I ever had was not allowed near a customer!
He was a highly skilled fast and fastidious New Zealand mechanic trained in Japan who loved anything mechanical, but he did not show so much love towards customers if their vehicle was dirty or poorly serviced! He had plenty of attitude and little tolerance for people who did foolish things, like not looking after their ride!
In one of my past businesses selling automotive workshop equipment and running my own workshops I have seen the inside of literally hundreds of workshops every year and the ones that are very successful are always the ones who handle people the best.
You may be a great mechanic, but whoever deals with your customers will make or break you in this competitive business.
It's Not About How Much You Charge for Major Work
If you have passion for your work and enjoy doing high quality repairs, your hourly rate should reflect this.
I have charged DOUBLE the hourly rate of my opposition and still got all the work I could handle.
If you have the right attitude people expect to pay. It is about trusting you with their car first of all, and then trusting you with their money. People don't object to paying, they object to being badly treated and fleeced. Rightly so, it has been a feature of our industry for far too long.
An Example: The Dealer Versus the Word-of-Mouth Guy
I will give you a quick example of how a market really works when it comes to making money and never being short of customers.
A short story will paint the picture.
I was tuning my immaculate 220SEB and blew the torque converter in half, dumping all its oil on my floor. I rang the local Mercedes Benz agent who was a friend of my fathers who I knew quite well so I would not get steered in the wrong direction.
He laughed at my naivety in revving my Benz motor 3 times to over 3,600 rpm in park, as there is no pressure bypass valve. I told him my local GM product had a relief valve, and Benz should be horsewhipped for their stupidity!
The dealer verdict? $600 for parts and an unknown labor charge, as being an SEB, the motor had to be removed along with the gearbox to replace the torque converter. Time to do the job including waiting for parts? 6 weeks!
Like on the TV show, I dialled a friend. This Mercedes-wise friend gave me a number to call.
I rang the workshop and the owner asked about access to the car, then came down with a truck, loaded it on the back and took it away within hours of my call. The next day he rang and politely asked if I would like to pick up my car.
Total cost? $150 including picking it up on a truck and transporting it 20 miles. It was a long time ago, but even then it looked like a gift alongside what the dealer had offered me.
It turned out that he had a special jig for removing the torque converter without disturbing the rest of the car, and replaced my torque converter with a perfectly good used one he already had in stock in an hour. He already knew that despite my considerable knowledge I would have happily paid hundreds more, but he just did what he does every day and did not overcharge me. He also adjusted all my doors to exact MB factory specs resulting in them closing with a light push like never before.
I have sent every Benz owner I know to him for repairs ever since resulting in many thousands of dollars in repair income from one job alone. He doesn't have to pay for advertising........ people won't shut up about how good he is!
So the smart Mercedes Benz owners in my major city do not go to their Mercedes Benz Distributor for anything but warranty claims.
Experienced workshop owners have all their difficult work done by him as well as private owners in the know.
They wait in turn for one man, way out in the foothills in an outer outer suburb to fit them in to his busy schedule. Why? he does not lie or cheat, he is highly skilled and he cares about you and your car. Ya can't buy that!
This is How I Do it!
- The walk around. This has worked for me for 35 years without fail. Your customer needs to know that you care. The best way to demonstrate your interest is to show it. When a customer pulls up out the front, the first thing I do after greeting the customer is walk around the car and inspect it for tire wear, disc wear, oil leaks that can be seen from outside. I then drive the car, preferably with the owner in the car. I explain problems to the customer as I find them.
- I keep my hourly rate at the top, and make my high workshop hourly rate a feature.
I spend a little time gaining the customers trust by volunteering something I know about his or her model of auto, then I explain why it is still cheaper and better for the customer to pay a higher hourly rate to ensure that the work carried out will be diligent and complete the first time
You also need to explain to the customer that you will probably be as cheap or cheaper than your competition because you don't use apprentices on major work, or waste time on investigations or parts that aren't needed.
I inform the customer that all the old parts that are replaced will be available for their inspection along with an explanation of why it was replaced.
If the job needs to be quoted, ensure you have an upper limit that is agreed to, and if anything is found to cause the price to increase, you will ring the customer before starting the job.
Never take on a job without ensuring availability of parts. You do not want a car left on your hoist for three days waiting on parts. Nevertheless, this will happen to you occasionally no matter what you plan, so be sure to have an alternative to leaving it on the hoist stopping you from doing other work.
Find a small job that is highly visible, even if it is just cleaning the inside of the windscreen. Some little things can make a customer take a second look at how he sees customer loyalty. The trick is to do it without charge and never mention it.
Give a full report on future work and preventative maintenance along with a time frame and estimated mileage before it must be done, and explain why it will save them money to have any timely preventative maintenance carried out.
Have your mechanics fill out a report on a proper workshop sheet in triplicate that includes all the work carried out in detail and the cost of parts along with an explanation if non OEM parts were used. For example specify one make of filter that is always better than the original.
Do not use your apprentice as a mechanic on jobs beyond their scope!
Inspect and test the car yourself or teach your head mechanic or workshop manager how to do it.
Check the car all over for any dirty hand marks, mud or dirt left inside the car, fluid or oily marks left on fenders or on paint under the bonnet. I often see coolant "burns" on the paint in the engine bay on relatively new cars because mechanics forget to clean it off with water.
This last point may seem obvious but is important to understand that to get and keep a good reputation takes attention to detail.
I have found that paying attention to details leads to customers doing all the advertising work for you, bringing in new customers without needing further advertising.
Naturally you need to advertise until your business is established. Advertising needs to be very focused when getting attention for your business.
I like to be unique with automotive workshop promotion, so if my auto shop was located in a place that was hard to get to, I would mention my lousy location in an ad, then inject a positive statement about how my auto shop is going to provide a better customer experience than the others.