The road to a successful auto body shop doesn’t have to be bumpy.
There are 253 millions cars on the road in the United States, and people are spending an estimated $1,186 per year on maintenance and repairs. Unlike many brick-and-mortar businesses, there’s no chance that the 228,400 auto shops in the U.S. will get replaced by internet businesses anytime soon. That doesn’t mean they’re the easiest businesses to operate, however.
Bogi Lateiner, owner of 180 Degrees Automotive in Phoenix, Arizona, knows that it takes more than a little elbow grease to run a successful auto repair shop and stand out from the competition.
Lateiner has been working on cars since high school, because her 1974 Volkswagen Beetle broke down a lot. She went to college with the plan of becoming a lawyer, but she really missed working with her hands. So, she moved to Arizona and went to Universal Technical Institute. After seven years of working for BMW as a master technician, Lateiner decided to go into business for herself.
“I did everything wrong before I learned to do it right,” she said. “I’ve made all the mistakes that one can make. I quit my job with about $200 to my name. I had no business plan. I had no idea what I was doing.”
Lateiner knows what she’s doing now. She owns her own auto repair shop, teaches car care classes for women and hosts the TV show “All Girls Garage” on Velocity. She knows a thing or two about opening and operating an auto repair business.
Below, Lateiner shares five helpful tips and common mistakes to help new auto shop owners avoid roadblocks and get up to speed on operating and marketing their business.
1. Remember, you’re in the driver’s seat.
Many new auto shop owners hit the same speed bump: They’re really good at fixing cars, so they open an auto shop, not realizing that when you become a business owner, you don’t spend much time working on cars.
“You’re a business owner now, and it’s a totally different skill set,” Lateiner said. “You start a bakery because you’re really good at baking, and then you don’t do the baking anymore. You’re just running the business. You’re human resources. You’re marketing. You’re accounting. You’re legal. And you do all the things you have no experience doing.”
Many small businesses fail because the owners got into the business for the wrong reasons. They don’t realize what they’re signing up for.
“You have to be in the mindset of working on your business instead of in your business,” Lateiner said. “You have to be clear with yourself. What do you want to be doing day to day? If what you really want to be doing is working on cars, don’t start your own business. Get a job at a place where you can work on cars and get paid really well for it. Those places exist. If your dream is to start a business and become a business, then go for it.”
2. Give yourself a brake and don’t try to be a one-person operation
You can’t do everything yourself. It’s difficult to switch gears from working on cars to fine-tuning your finances and answering phone calls. In order to give customers the attention they deserve, you need to have someone dedicated to working with customers and not be in back working on cars. You need to learn to delegate.
“Working in your business during business hours, and working on your business after hours: That’s how you can get to the point where you can hire other people to do the daily stuff — the fixing of cars, the customer intake, the accounting,” Lateiner said. “You have to separate yourself out from doing the daily work.”
And separating yourself from the daily grind is important so you don’t lose track of your finances.
“I think the biggest mistake people make in businesses in general is they don’t know their numbers,” Lateiner continued. They don’t know what their bare minimum per week or per month is. They don’t know their profit margins. They need to know how to plan and forecast. It’s impossible to be out in the shop wrenching, and keeping your eye on numbers and profit margins.”
3. Earning your customers’ trust is key
Auto shops and auto mechanics have a bad reputation. The nasty stereotype is that auto mechanics are often unintelligent grease monkeys who exploit drivers’ ignorance to inflate prices or sell unnecessary repairs. The only profession less trusted than auto mechanics is politicians.
Lateiner said that putting potential customers at ease starts before they even set foot in your shop. A friendly voice on the phone that reassures a customer that they have called the correct place is a great start.
And when customers do come to your shop, are they greeted with a smile? How does your shop look? A clean, organized shop goes a long way, because customers assume that how you treat your shop is the way you will treat their car.
“Most people do not understand the technology of what you’re doing to repair their car. They just understand their experience — the sights, the sounds, the smells,” said Lateiner. “Doctors and mechanics are very similar. A good bedside manner increases a patient’s belief in the doctor’s abilities and competencies. It’s the same for auto repair. Don’t treat them like they’re just another number.”
And, most importantly, make sure you do a full inspection of your customer’s car.
“If you’re not doing a full inspection, and someone comes in for their brakes, and a month later their radiator blows, they will blame you for not catching that,” Lateiner said. “You lose the trust, and you lose the sale.”
4. Don’t let customer satisfaction take a backseat
Part of building that trust with customers is going above and beyond to give them a positive experience.
Lateiner and her team at 180 Degrees Automotive go into overdrive to give their customers a warm, fuzzy feeling about doing business with them, including homemade snacks in the lobby, a referral program, and community projects and fundraisers. They even put little gifts in all the cars they service.
“They’re all things that let customers know we really care. These are the things that people go home and tell people, ‘I went to this auto repair shop. It was so cool. You have to see it,’” Lateiner said. “Nobody gets excited about car repair. What gets them excited is how you treat them and how you make them feel.”
If you want your auto shop, or any business for that matter, to stand out, being average is not going to cut it. You’ll be a beige car in a parking lot full of beige cars. Be a shiny, sporty red car in a parking lot of beige cars.
“The places that get reviews are the places that suck and the places that are exceptional. Nobody writes about average. We need to be exceptional,” said Lateiner.
“I know a lot of repair shops say what makes them special is that they take the time to fix cars right the first time. That’s awesome, but would you go to a restaurant that says, ‘Our food won’t make you sick?’ Saying we will fix your car right is the same as saying our food won’t make you sick,” Lateiner said. “That’s the bare minimum. That’s what they expect of you. You’re an auto repair shop, you should fix their car right the first time! What else are you going to do for them? Why should they drive by five other shops to go to you?”
5. Running an auto shop is a windy road: Be flexible.
Just like your car needs maintenance, your business plan needs constant fine-tuning. Lateiner said auto shop owners need to stay educated when it comes to new technology for cars and car repair, and on new ways to improve and streamline their business if they want to hold on to customers’ loyalty.
“Things change, and what worked 20 years ago doesn’t necessarily work now. You have to be willing to change, grow and adapt,” Lateiner said. “You have to constantly be rewriting your business. People are not as loyal as they used to be. It’s easier to find another place. People are researching your advice while you’re giving it to them, while they’re sitting in your lobby. You have to do more to earn their trust and keep their loyalty.”
It takes more than a skilled mechanic behind the wheel to run a thriving auto repair shop. A business-minded owner will steer clear of financial potholes and let customer experience ride shotgun to achieve success.