Running a Shop Hiring Human Resources

The Hiring Mistake

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The Hiring Mistake
Why you’re letting $250,000 walk right out your door.

Stay with me on this one: I’m visiting a shop and talking with the owner. We’re having a good conversation about his goals and ambitions, and he says, “I’ve been stuck at $80,000 per month in sales; how do I get to $100,000?”

Before I can answer, someone walks in—it’s a technician, looking for work. And this is a good technician, a potential $300,000-per-year guy; great at diagnostics and has a track record of turning incredible hours. (I’ll explain how to know this later.)

Our shop owner hears this guy out. Then he takes a look at his shop floor. He sees the full bays, his team plugging away. He looks at the tech standing in front of him. He looks back at the shop floor. He can feel the pull in both directions, but he wants to invest in his team, he wants to give them the opportunity, he wants to make sure the hours are there.

He shakes the tech’s hand.

“Sorry, we don’t have any work at the moment.”

Let’s speed up how the next few months go: Our loyal shop owner hits a slow stretch two months later. He was booked out days before, and kept setting appointments for down the road. We all know how great people are at showing up for week-out appointments, right? Well, when the walk-in business dried up for a stretch, those no-show appointments hit him hard.

And where did those people go? Down the street, because your competitor took in that tech who came to your door and suddenly had additional capacity. Those people who you turned away became customers down the road. Your attrition starts to inch above your growth.

Saying “no” to your customers played a factor here, but the real cause? Our shop owner friend armed his competition with what should’ve been his stepping stone to growth: That highly qualified tech who came to him.

He let a quarter million dollars in growth walk down the street.

It’s not that easy, though, right? It’s not that simple to see that opportunity in front of you, is it? Well, actually, it is.

And before we move on, let’s get this out of the way: The “shortage” of qualified technicians that many of us moan about has more to do with us, as owners, not rewarding our technicians as anything else. We’re the ones who let them walk. We’re the ones who fail to help them grow. We’re the ones who are afraid to pull the trigger and hire that guy who walked in asking for work.

Here’s the simple way to solve this problem: If there’s a good, quality technician available, hire that technician. Not down the road, not in a couple months, do it now. Hire that person on the spot. It doesn’t matter if you have a bay for them. It doesn’t matter if you have the hours stacked up for them. Hire that person.

Sometimes, that means letting go of a current tech and improving your team. That’s not a popular thing to say, so I won’t harp on it too much, but we can’t be afraid to make that leap. If that makes you squirm a little too much, the other option is to simply add the technician to your staff; take on another tech. Wait … did that make you squirm, too? Are you thinking, If I don’t have the work, I can’t afford another tech! Well, I’ll say this once, and I hope you commit this to memory forever:

Technicians are always free.

Don’t believe me? It’s simple math.

Let’s say you hire that tech who can turn 300 hours in a month, and he asks for an $8,000-per-month guarantee. Well, if he turns just 60 hours per month at an effective labor rate of $100, that already puts us at $6,000. Add in the $6,000 in parts on those jobs, and, accounting for 50 percent gross profit on parts, that’s $3,000 in gross profit just on parts. We’re at $9,000. Sixty hours in each month comes out to 13.95 hours per week (60 hours divided by 4.3 weeks in a month).

To be able to pay the salary for a potential $300,000-per-year tech, all you’d have to do is bring in 13.95 hours each week. Anyone can come up with 13.95 hours of work, right?

So many people are clamoring for growth, but we’re worried about being able to add a minimum of 13.95 hours per week for the potential to add 25 percent or more to our business? That doesn’t add up to me.

As a smart shop owner, you should know a good tech when he’s standing in front of you—he’s asking good questions, he has knowledge of tools, he has the ability to communicate, etc. (One big tip: Ask for a W-2 from his last business, or his previous pay stubs; that’ll tell you what he truly made and the work he turned.) While we’re sitting around wondering where our growth will come from, sometimes, you simply need to look right in front of you and seize that opportunity. The tech shortage, the lack of hours, no open bays—don’t use excuses as a crutch. Go out and seize that growth.

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