Automotive & HD Business Management Articles.
Bob Greenwood. January 3, 2013. ( over 5 years ago ) 716 views
Part one of this ‘blog’ is about the Jobber and the second half, about the shop owner, will appear next week.
Let’s row together to get to safer shores.
By now most shop owners and jobbers must have recognized that the business environment has changed dramatically. In this new year, it’s time to put aside petty differences and learn to work together for our mutual benefit.
More now than ever, a shop requires a competent jobber who knows how an auto service facility must be operated and measured in order to ensure that it’s profitable. At the same time, a jobber needs to sell parts in sufficient volume, and with timely payment, to shops who understand how to move their businesses forward.
Each has a clear responsibility to ensure the success of their own operation.
Jobbers must slow down and recognize who their shop clients are, and how to enhance those businesses.
Defining a shop client is pretty straight forward these days. A client is one who calls them first whenever they need parts. A client is one that pays their account in full each month. A client is one with whose owner and staff the jobber has a positive business relationship. A client is one whose owner understands the reciprocal nature of their relationship, and the importance of working together in these fast paced changing times
Jobbers must ask their clients “How can I help you in your business?” In most cases, the first answer should be “Get me the right part fast.” This means the jobber has to stock properly to their clients’ needs to ensure the inventory is on hand for the shop.
Jobbers must stop dealing with shop owners whose first and only question is, “Can I get a cheaper price?” It’s time to recognize those shops are most likely under severe financial stress. Those shop owners don’t get it. Those owners believe the important money is made through better parts pricing, not through shop productivity. Those owners don’t know the important numbers in the business, nor how they’re measured, nor what they mean to the bottom line.
Jobbers must adjust their internal business processes to address the unique challenges of today’s economic reality. They need to keep these cash-strapped shops on a very tight leash. When monthly bills are not paid, they need to move instantly from monthly billing to weekly billing. This is the new reality. Cash is king. If the weekly payment is missed, then instant COD status must be implemented. The jobber needs the cash to survive… margins are becoming tighter each year and operating expenses are rising. One shop going down can wipe out the profitability of a jobber for months or even a year. No jobber can survive with losses month over month. Jobbers are not banks. It also must be recognized that “no sale is worth making if it cannot be collected.” Too many jobbers are focused on sales for the sake of making a sale, rather than using good business common sense.
Jobbers must also work with shops to seek out the right technical and business training required. Training must be paid in full by the shops. Subsidizing training courses on behalf of a shop in order to earn their parts business just doesn’t cut it these days. It’s the same as marketing your business on price. You attract only price-conscience people. Training courses take time and effort to put together. That should be recognized as the jobber’s contribution to the relationship. The shop owner must recognize training represents an investment in the business; and they needn’t be worried about getting poor value for their money… the best courses always come with a money-back guarantee by the instructor.
Jobbers must aggressively move to reformat their businesses, addressing the above issues with shop owners in order to get through 2013 and start developing consistent bottom-line profitability.