Creating a Training Budget
SHOP STATS: World Wide Automotive Location: Bloomington, Ind. Operator: Don and Melinda Seader Average Monthly Car Count: 375 Staff Size: 11 Shop Size: 12,000 sq. ft. Annual Revenue: $1.8 million
Like any business, having a budget in place for each category of expenses is essential in any financial platform.
Since opening his shop in May 1995, Don Seader, owner of World Wide Automotive Service in Bloomington, Ind., has always had a training budget in place. He graduated with a B.S. in Mathematics, so planning everything out, down to the last detail, has always been ingrained in how he does business.
“We need to think about things people don’t usually think about, like building maintenance, equipment, and changing light bulbs,” he says. “That way, you aren’t in a defensive posture for things to happen.”
This also means having some money reserved for training his staff.
With automotive technology constantly changing at the drop of a hat, training staff on the new-and-improved way of doing things is not only important, but essential.
Because Seader is a mathematically driven person, he created a budget to ensure his staff gets training, and beyond that, that it’s the type of training that will be most beneficial.
For his regular employees, he has a budget in place of $10,000 per year, on average, for all of his staff. Within that budget, Seader factors in the cost of food, lodging, travel along with the training itself. He even pays out employee's wages if the training lands on a weekday. With all that considered, $10,000 can go pretty quickly, which is why Seader needs to make sure he’s sending his staff to the training that they will collectively get the most value.
Unlike his own shop, Seader believes most shops are just flying by the seat of their pants and will only send someone if an opportunity arises, if they think it would be useful, and if there is money available to do so. And, with most shops not looking through their P&Ls, he believes the shops can’t see where they are lacking and where they can do better.
“Automotive technology is increasing at a high rate,” says Seader. “With that said, as technology comes out, the only way we are going to learn about it is to send somebody to the class for it.”
The problem is that a lot of training out there is a review of what his staff already knows.
“It’s tough because of the travel and to find one to see if it’s worth time and money,” Seader says. “If I had younger techs with less experience, it would be a lot of opportunity for them.”
But Seader’s staff is made up of veterans—two of them have been there for 24 years—so basic training isn’t useful to them.
Because his staff has been with him for at least a decade or two, Seader tries to find some sort of training for each of his employees. He tries to include at least a two- to three-day, ‘far-away’ training session per year for staff, online training for all of his staff and even has some extra room in the budget for random classes that come up that he sees a need for.
Seader’s staff attends annual conferences, including the Worldpac Expo, VISION HiTech Training and Expo, and, yes, the Ratchet+Wrench Management Conference. For these, they try to have at least one employee attend each event, spending on average $5,000-$8,000 per year.
For his three technicians that work specifically on European cars, Seader will frequently send them to random training classes supplied by Worldpac, SSF Imported Auto Parts and Autologic. Typically, he says he spends around $3,000 per year total for this training.
But how does Seader decide who to send and what to spend the budget on? It all depends on the time of year and the training needs of the shop. To figure this out, he talks with his employees, gets their feedback, and sends the staff members that he feels would most benefit from it. One year, he even closed the shop for the VISION conference in Kansas City, Mo., so everyone was able to attend. He had the money in his budget, and he felt everyone could get something useful out of it.
When schedules make it hard to travel and the budget is tight, Seader has another option for his staff to get the training they need. He implemented an in-house, online training program to have easily available access to information that they do not know. The technicians can complete this online training on their own terms, while Seader also suggests classes to his techs he feels fit their skillset. But even with this, it’s sometimes difficult to get employees to complete the training.
“People have so much going on in their lives that it’s harder and harder to get employees to want to educate themselves on their own time,” Seader says.
There is already one incentive program in place based on technician’s ASE certifications—the more certifications you have, the more money a person makes. But for technicians to improve their individual skillsets, Seader and his general manager, Paul Miller, have been working on a pay-to-learn program to start paying technicians to train online—or in other words, make it worthwhile to take a course, says Seader. The program would identify online classes that will benefit the techs, looking at how long each online instruction is to figure out the class’s price tag.
“This is a way to have a carrot and make it worth their while,” Seader says.
Not only does Seader look for opportunities for the shop on-site and online, but some auto repair shop networks have subscription programs to help keep up with new technology. Seader’s repair shop subscribes to MotoSKILL for $100 per month, providing online training from Bosch and AVI. Companies like these have certain requirements for their technicians—Bosch recently updated their training requirements to 40 hours per year for lead technicians and 20 hours for the other technicians.
By selecting the most rewarding courses, incentivizing independent, online training and utilizing available resources, Seader has been able to make the most out of his training budget.
Because Seader has made sure his staff is constantly growing, his staff has minimized costly mistakes when it comes to training, says Seader. Training not only pays off for his shop, but it also is something his employees appreciate.
“I have long-term employees and it makes them feel valuable and shows that I care about their education and what they know,” Seader says. “As an owner, I take pride in my staff’s professionalism and expertise.”
Making room for a training budget has shown the staff that he’s invested in their education, it gives staff an opportunity to talk to other technicians from all over the country, which facilitates a discussion with the rest of the staff when they come back.
“People will come back inspired and ready to make changes,” Seader says. “If people are coming back and not talking about it, I would question if it was worth-while to them—you can tell right away.”
With new technology on the rise, having a budget in place will make certain that your staff is getting the proper training, while constantly growing in the process. And when they are growing, your shop does too.
“For all of the employees—when they participate in training—they are around other people that do their job and suffer from the same frustrations and have the same questions,” Seader says. “If you don’t keep going, you don’t know what you are missing out on.”