Running a Shop Leadership How To Lead

Know Your Business

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At a recent conference for auto service shops, I sat in on a management training session tailored for shop operators who have fallen out of love, so to speak, with their businesses. The seminar was meant to restore the passion that they might have had for their shop when they entered the industry years, maybe decades ago.

A big part of the session was focused on how important it is for owners to have a basic understanding of their business, which means knowing where it stands as far as finances, productivity, efficiency, etc. What I gleaned is that knowing a business is as important as knowing a spouse—a lack of understanding can lead to problems, disillusionment, and a breakdown of the relationship.    

In a room of about 40 shop operators (these were owners and managers of mechanical facilities, but the lesson is the same), I was surprised to find that only one managed to achieve double-digit net profit margins. Many were unaware of what their net profit was, in addition to not understanding a laundry list of other key performance indicators (KPIs). I wondered how shop operators who don’t know how they are performing could possibly improve, or even keep their doors open.

I learned later, through the results of the KPI Survey featured in this issue, that a large portion of collision shops also don’t routinely track performance indicators. What’s not surprising, however, is that those shops generally don’t generate the revenues of their counterparts that do track. We found a clear correlation between total sales and KPI tracking, and among shops that do track, net profit margins are commonly greater than 10 percent. I’m willing to bet that the operators of those shops are still in love with their businesses, and in it for the long haul.

Perhaps you are one of those operators. Does your shop align with some of our survey findings? I’d like to hear from other shops on this topic.

Switching gears a bit, you might notice a couple of promotions for our annual FenderBender Awards program in this issue. Nominations are once again open for the awards, now in their sixth year.

If you’re unfamiliar with these prestigious awards, here’s a quick rundown: They were created to honor the finest professionals in the collision repair industry, spanning every position. We’re looking for inspirational people who have made a positive impact on the lives of their colleagues, businesses, communities, and the industry at large.    

Nominations are reviewed by our editorial staff and winners are carefully selected in the fall. Honorees are interviewed and photographed for profile stories that run in the October issue, and they also receive a physical award during a ceremony that month.

To find out more about the FenderBender Awards, or to nominate someone, visit I look forward to reviewing nominations each year, as the outpouring of gratitude for this industry’s superstars is truly remarkable. Be sure to nominate by July 1.

Jake Weyer

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