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I-CAR instructor, Autobody News columnist, and shop consultant Toby Chess, AAM, entertained and taught a small crowd at SEMA about how to make more and spend less within the normal daily operations of a collision repair shop.
In the industry since 1969, Chess’ background includes wrecking, restoration and collision.
Falling asleep in Chess’ class wasn’t an option as he kept the presentation lively, heckling those attendees who were sitting in the back of the room and pulling out the ‘ladder of success’ from his attaché bag to kick off the talk.
Make More Money Without Spending an Arm and a Leg focused on how businesses can cultivate positive changes without spending a huge amount that many shops can’t justify in the current economy. Chess presented simple, straightforward tips to help shop owners and managers streamline operations and increase profits by reducing waste and expenses.
“For collision repair businesses, there is a ton of opportunity to improve your business with very little investment if you know where to look,” said Chess. “This session offers a number of proven ideas that will decrease cycle time, reduce comebacks and increase quality; and the investment costs will be under $500. Forget about learning fancy buzzwords associated with process improvement. This session will give time-tested examples of ways to improve your business and make more money for very little, if any, up front expense.”
And with that promise, Chess was off to the races, touching on several topics including time wasters, setting goals and developing SOPs.
To set the tone, Chess re-defined the industry by saying, “You do not fix or repair cars. You re-manufacture cars.”
Chess got the audience involved by asking the question, “How much is spent on a supplement?” Most of the shop owners and managers thought the cost of adding a supplement to an estimate was $40 or $50. Some said $100. One brave soul said $300 and Chess zeroed in on him wanting a firm commitment to his answer and the gentleman didn’t waver. Chess then turned the classroom into a spontaneous live production, getting audience members to role play a scenario where a supplement is needed. Turns out, according to Chess and his theater demonstration, that chasing down a supplement wastes a lot of time and takes people away from work, thereby costing the shop about $288 per supplement.
Chess also touched on the importance of Standard Operating Procedures, or SOPs.
SOPs are not needed for every operation, he explained, but for those areas where there are problems. “Look at what obstacles are blocking production,” he said. He stressed the importance of creating the SOPs with shop employees so they have a buy-in to the new procedure.
“The number one thing an employee wants is to be treated with respect, and the best way to do that is to ask for their input,” Chess said. He went on to give an example of how he helped a shop in Gardenia, CA, go from $88,000 in the red to more than $100,000 in profit and one of the things he did was implement an Employee Appreciation Month.
The benefits of creating Standard Operating Procedures include:
• reducing system variations
• facilitating training
• facilitating cross training
• reducing waste
• creating regular evaluation of work
• improving work activity
As an example of a SOP, Chess shared what information he marks on a windshield when a car comes into the shop:
• Repair order number
• Customer last name
• Insurance information or COD
• Date of arrival
• Target date of repair completion
• Name of estimator
• Name of technician
• Any sublets needed (such as alignment)
• Note whether pictures have been taken.