Why you need to charge for all of a tech’s time

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A customer walks through the doors of your shop, gives you their key, tells the service advisor their car isn’t running the way it normally does, they can feel it’s different and the check engine light is on. They want the car fixed.

So the advisor writes up a ticket, which includes the standard diagnosis fee of one hour. The customer leaves and the tech starts working on the car.

Next thing you know, the tech’s been working on it for three hours trying to solve the problem. And when everything’s resolved, that customer is still being charged for only one hour.

Why?

“So that’s the problem here. If you don’t have a process to address this, then you’re going to lose [money],” said Fred Hules, a former shop owner and now industry coach with the Institute for Automotive Business Excellence.

Speaking during a recent webinar, he acknowledged that he always gets pushback for charging for diag time. It’s not something to be afraid of.

“You have to charge for your time,” he urged. “Think about your technicians, the investment they have in [their] time — schooling, education, and the time of learning and learning and learning. If you’re not charging for that, then they’re losing in their investment, the shop is losing out on its investment — paying that technician for three hours of lost revenue. And everybody loses.”

It comes down to the bottom line. If the technician is doing three hours of work but only making money on one, that hits the profitability of the shop.

“You’re not going to be able to do a good job and survive,” Hules added in the webinar 7 Keys to Productivity. “So that’s what this is all about.”

He also called out book time — the book might say a job takes an hour. But your tech takes one look at the car and sees that it’s rusty or there are other issues in the way of getting the job done in an hour. Maybe it will take two or three.

The tech should be able to communicate to the service advisor that the job is going to take longer than the book says.

And don’t forget about the time it takes to verify the repair was done correctly, test drives and other quality checks.

“It’s important to get capture all that time and bill for it,” Hules said. “So you’re actually going to add value to the customer ensuring a good proper repair and it’s done right the first time.”