Not a lot gets written about auto repair shops’ policies and procedures, but without them, you’ll never get to take a vacation. You could also open yourself up to a liability or a lawsuit.
In the book, the E-myth revisited, Michael E Gerber teaches business owners to think like McDonald’s when approaching their business practices. Everything that gets touched in your business needs a procedure- a way of doing things, that leads to the business product’s consistency and allows the owner to work on the business instead of in the business.
With the McDonald’s business model, everything from customer interaction to where you put the broom has a process and training. The goal is to have the training and process so specific that you can hire for personality only, regardless of skillset, and that employees should be able to do any job once adequately trained. It’s a great system to begin implementing from day one with a new shop or begin implementing once you get a feel for the business if you have just purchased a shop.
There are some policies you will need to put into place on day one. Where procedures are for employees, processes are for customers and vendors. These are the rules you set in place to protect your business, your staff, and your facility and limit risk and liability.
One place to start if with your garage keeper’s insurance policy. In your policy are limitations for your coverage. For example, your policy may not cover you if customers enter the workspace areas of your shop. In that case, you would make it a policy that no customers are allowed in the work bay areas.
You may also put into place policies for how you handle refunds and core charges. What line items are added to every bill, such as shop supplies and how long a customer can leave their car before storage fees begin to accrue. You will also need to have a policy in place for vehicles that get abandoned by owners who refuse to pay their bills.
How will you handle a request for discounts? Prepare your shop for the eventual cost comparison your customers and prospects will challenge you with by having a policy in place. Information is power! For example, if a prospective customer challenges your shop rate, claiming you charge more than a local competitor for the same tune-up and oil change; it would be helpful for you to know if that competitor hides a waste removal fee for discarded fluids until after the service has been completed.
How will you handle when customers bring their vehicles that are still not running right after your service? It’s going to happen. You think you solved the problem only to have it come back shortly after the vehicle was repaired. Will you offer any refunds or discounts? You will not return the parts, so how do you deal with parts costs for parts you sold and installed but didn’t fix the problem? Again it would be best if you considered all these factors and lay them out in your policies.
Inform your customers of your policies on pricing and returns both inside the shop and the estimates you write.
As you can see, a lot goes into opening up a repair shop. Get started early, establishing your policies and procedures, and ensure a smooth-running business from the day you open your doors.