How I Did It: Gerry Frank's Blueprint for Success
Gerry Frank is the founder of Repair Shop Coach and owner of Auto Repair Technology, both located in Brook Park, Ohio. According to a recent Ratchet+Wrench article, Frank is a “prophet with numbers,” one who took his shop to more than $1 million in revenue in the first year.
During the podcast, we discuss a formula to help shop owners succeed. In Frank’s own words, the formula is below. Good luck!
Gerry Frank's Formula to Success
Most shops are really good at the technical side of the business of repairing today’s complex vehicles. We invest an enormous amount of time and money perfecting our skill; no one, however, really teaches us how to fix our business.
Could there be a scan tool to diagnose your business? I say yes!
Most shop’s profit strategy is this: Sales - Expenses = Profit
Yet often you pay your expenses and there is little to nothing left.
By following a specific formula, you can easily fix your shop’s profitability challenges. We teach our Repair Shop Coach members this simple formula as it relates to a percentage of sales:
100% = Sales
25% = Parts Cost
20% = Technician Cost
10% = Service Advisor Cost
25% = Fixed Expenses
20% = Net Profit
With the goal of 20% net profit, your business must operate on the remaining 80%.
Next time you are reviewing your Profit & Loss Statement, see how your shop compares to the formula discussed here. If you’re not happy with the bottom line, the answer lies above.