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Labor Rates
- Thread starter Darrickw
- Start date
That New Guy
New member
It is critical service advisor cost as well as service manager cost is included in the calculation 'cause if it ain't you're going to become history!
Long and complicated story short: a service department must run with a 70% to 75% gross profit or your dead in the water. Salaries of all folks working in the service department (techs', advisors, manager, shop foreman) cannot exceed 25% to 30%. A service department will readily consume the vast majority of the balance. A truly good tech, with the appropriate investment in tools, should be looking to make a minimum of $60k and $70k to $80k are obtainable in a well run department.
Something very few customers realize as well is the sea of red ink that springs forth in the winter. You simply cannot, should not get rid of your truly qualified staff members. We're not selling ice cream here. You need trained individuals to do the work correctly. It is a requirement you charge enough to make sure you take in more than enough in the season in order to pay for the winter.
Customers are entitled to competent help. Most competent help needs to be employed full time on a year 'round basis. After all how many of us can afford to work part-time and pay our bills? Your customer needs to pay the tab because if they do not and their chosen dealer doesn't follow the above principals, they will quite simply go out of business. Plain and simple.
It is the stores obligation to be profitable in order to be around tomorrow for the customer. Given that fact of life it is the stores obligation to take in enough revenue in order to give the customer what they deserve. And that takes money. As others have alluded to no one is getting rich in the motorcycle business.
Sometimes it is incredible to hear the comments that come from the public that obviously have no clue as to what their saying but their convinced their getting ripped off. Selling price does not determine a rip off. Getting what you were told you would get for a given price and a follow through on that implied promise does not mean someone is getting ripped off. In fact, if you're able to maintain a competent workforce, provide a reasonable middle class living for the area of the country your located in, and provide a customer with quality work, and back-up your mistakes you're doing exactly what a business is supposed to do.
Quality dealerships do not need customers that have problems with the above concepts. Quality customers don't need stores that are incapable of maintaining a stable, well educated, and caring workforce. I would advise customers who fail to see the logic of any of the above to attend a few business and accounting classes. They may be shocked at how little a store ends up with on an annualized basis.
Long and complicated story short: a service department must run with a 70% to 75% gross profit or your dead in the water. Salaries of all folks working in the service department (techs', advisors, manager, shop foreman) cannot exceed 25% to 30%. A service department will readily consume the vast majority of the balance. A truly good tech, with the appropriate investment in tools, should be looking to make a minimum of $60k and $70k to $80k are obtainable in a well run department.
Something very few customers realize as well is the sea of red ink that springs forth in the winter. You simply cannot, should not get rid of your truly qualified staff members. We're not selling ice cream here. You need trained individuals to do the work correctly. It is a requirement you charge enough to make sure you take in more than enough in the season in order to pay for the winter.
Customers are entitled to competent help. Most competent help needs to be employed full time on a year 'round basis. After all how many of us can afford to work part-time and pay our bills? Your customer needs to pay the tab because if they do not and their chosen dealer doesn't follow the above principals, they will quite simply go out of business. Plain and simple.
It is the stores obligation to be profitable in order to be around tomorrow for the customer. Given that fact of life it is the stores obligation to take in enough revenue in order to give the customer what they deserve. And that takes money. As others have alluded to no one is getting rich in the motorcycle business.
Sometimes it is incredible to hear the comments that come from the public that obviously have no clue as to what their saying but their convinced their getting ripped off. Selling price does not determine a rip off. Getting what you were told you would get for a given price and a follow through on that implied promise does not mean someone is getting ripped off. In fact, if you're able to maintain a competent workforce, provide a reasonable middle class living for the area of the country your located in, and provide a customer with quality work, and back-up your mistakes you're doing exactly what a business is supposed to do.
Quality dealerships do not need customers that have problems with the above concepts. Quality customers don't need stores that are incapable of maintaining a stable, well educated, and caring workforce. I would advise customers who fail to see the logic of any of the above to attend a few business and accounting classes. They may be shocked at how little a store ends up with on an annualized basis.
Mars Turrez
New member
+1. a professional technician's tool box alone starts at 5k.
macoroni and melons
New member
I have over 3 500 in tools myself..
A while ago a customer of mine had snap on cabinets, the long one.. what, about 4 - 5 foot long plus the top box set..
At least 3 of all the common spanners, sockets and hand tools.. and a half 20 gallon drum with kero in it... he'd work on a car, finish and drop all those tools in the kero. bring in the next car and start again.. wiped off his tools and put them away at smoko, lunch and knock off.. he was pretty anal about being clean and claimed over 25 grand in stuff. one man mechanical shop in a servo.
A while ago a customer of mine had snap on cabinets, the long one.. what, about 4 - 5 foot long plus the top box set..
At least 3 of all the common spanners, sockets and hand tools.. and a half 20 gallon drum with kero in it... he'd work on a car, finish and drop all those tools in the kero. bring in the next car and start again.. wiped off his tools and put them away at smoko, lunch and knock off.. he was pretty anal about being clean and claimed over 25 grand in stuff. one man mechanical shop in a servo.
i have over that myself sorry,i only have 2 of everything,one set for when i had the car business and one set at home because you can guarantee it was never in the right place when i wanted it..always have trouble trying to get tradesman to come out here[carpentry/plumbers/electrician etc,so you end up buying the gear yourself and having a go,never been one to borrow shit[i got lots and lots of boys power toys]. ..but the question was more answered towards a dealership situation,and what the tech may actually leave at his place of employment,really would not have seen what they had at home[likely half my stuff that had walked}.SnapOn,made a motsa out of the apprentices etc with their accounts for them,basically called in everyweek..hj
Pony.Girl15
New member
Yep it's nice to complain about the the costs but hard to cop from the other side when you're pretty sure the customer is earning 100+ grand a year[/quote]
wouldnt get out of bed for that
wouldnt get out of bed for that
livinloudon215s
New member
hah, the things I'd do to make 100K a year...
vballchick14
New member
So it's okay to over charge someone because they make good money?
Does that make an oil change worth $250 just because I make over $100K?
I do feel bad that the "mechanics" don't get the money that the dealer is charging for there hard work but it was there choice to become a mechanic. They could have chosen a different path in life.
The reality is that dealers are going to put themselves out of business if they don't change there ways. Times are tough and people aren't going to cough up $$$ for a simple job any more.
Not to mention the majority of them (that I have dealt with) cannot be trusted to do the job correctly or charge fair labor rates.
If you want to charge $90 an hour fine, but don't tell me it's going to be 2 hours at that rate to do an oil change.
.
Does that make an oil change worth $250 just because I make over $100K?
I do feel bad that the "mechanics" don't get the money that the dealer is charging for there hard work but it was there choice to become a mechanic. They could have chosen a different path in life.
The reality is that dealers are going to put themselves out of business if they don't change there ways. Times are tough and people aren't going to cough up $$$ for a simple job any more.
Not to mention the majority of them (that I have dealt with) cannot be trusted to do the job correctly or charge fair labor rates.
If you want to charge $90 an hour fine, but don't tell me it's going to be 2 hours at that rate to do an oil change.
.