How to Retain Technicians

by | Oct 19, 2020 | Auto, Podcasts, Service Department, Service Drive Revolution | 0 comments

Christian and I had an interesting exchange yesterday. He thought I was trying to “open a loop” on him, which is an NLP thing. That’s like if I said, “Christian, I know how you can make a million dollars, but first…” and then we talk about something else, so then that loop is still in his mind.

So I’m going to open a loop for everybody right now: the show today is about the 5 Ways to Retain Your Technicians. Is that really what today’s show is about or am I just using it as an example of opening loops? Either way, you’ll have to stick around to find out, and if it does end up being today’s topic, then you’ll stick around to see if you agree with the list or hate it, but that right there is an open loop.

And now, we’re going to do things a little different and start with questions. We announced this last week that the Voice of God has been retired. I know a lot of people are sad, but now we have a hotline at (833) 3-ASK-SDR. For those who are too lazy, that’s (833) 327-5737, but if you have a question, call that number and leave a voicemail. Just ask your question on the voicemail, and if we play it on the show, you get some of this beautiful swag; SDR coffee mugs, a T-shirt like the one Christian is wearing on the show, a notebook, a hat. I don’t know, if the question’s really good, maybe we’ll put in a bottle of tequila or something.

Hey, Chris, I have two techs that complain that they never get any maintenance service work for me. I upsell all those off of oil changes, but neither of these two techs performed oil changes; they think it’s beneath them! How do I deal with these guys? They’re great techs, but I can’t get them to do these upsells. My lube tech is also a regular tech; he’s on the flag right? I have no clue what to do, thanks a lot.

So far, knock on wood, I have never sat down with a technician of this personality and not been able to explain to them how business models work and get them to buy in. But you’ve got to step back a little bit. If it was me, I would call him in or take him for a cup of coffee, something that’s non-confrontational and easy and a neutral ground, right? I would talk to them about how business works and I would tell them, “So let’s say you’re Hewlitt Packard and you’re selling copy machines or printers. How do you make money? Well, you make the money on buying ink.” And then I would just go through different business models and say, “Okay, and so our business model in the service department is we have loss leaders, the loss leaders, like an oil change, is to drive traffic.”

Then I would just explain how the business works and how those loss leaders are an opportunity to inspect the car and make an impression on the customer, and I would just change their point of view so they understand how the business works. It’s not about your feelings or their feelings, it’s the business model. You guys are all in the model, the way that it functions, and oil changes drive traffic, and the traffic is an opportunity. And do we want the opportunity or do we have a better way? Does that technician have a better idea for a model? Chances are that he doesn’t; he just doesn’t understand the system and how much we lose. I often like to explain to them how much money we actually lose on an oil change, to get that lead in for them.

We’re doing it just as much for the techs to get that traffic in, right? So I think treating them like an adult and like somebody who’s running a business inside of a business, and talking about strategy and marketing and business models, has always elevated that conversation to something very constructive. I also wouldn’t expect when you have that conversation for the first time, for them to completely flip around. You’re going to say it, you’re going to be friendly, and you’re going to let them sleep on it. Then, they’ll come back a little different and then you’ll talk about it again, and then it just might be that the person isn’t meant to be a technician and then they’re in the wrong industry. But I always like to start by elevating the conversation because people are smarter than you give them credit for. And when you start talking about it in those terms, they’ll often have good ideas and when their ideas are implemented, they own the system.

One thing, too, is that when you actually reach out to them and you start to talk to them about the business, that no one’s ever talked to them about it before, they get a little bit of gratitude and loyalty as well. At times, when we’ll go into stores and we’ll talk about financials and financial training, and Christian has had a couple technicians sit in on those classes and they’re just blown away because they’ve never seen it before; they didn’t understand how it worked!

We have a course in our On-Demand for technicians that does just that. It talks about best practices, how to be efficient, maximize flat rate and all of that. My real goal with that course was to explain to the technicians what the advisors are doing, and then explain to them the law of averages like baseball. 

The closing ratios most of the time are 30%, so if you’re doing a multi-point on every car and you find something on half of the cars, and then half of those end up being 10%, three of those are going to sell, right? So, of the opportunities created in a day if you’re a technician, you might touch some cars that don’t need anything but if you filled out, you added something, or recommended something on 10 cars, most of the time with how terrible service advisors are trained, it’s going to be a closing ratio of 30% of those 10 cars. The whole thing breaks down if you’re not consistently doing it because that throws the ratios out. That was the whole purpose of that course and we’ve had great feedback on it. 

And also, when I go into shops, technicians on a couple occasions say, “Hey, I really liked that thing you guys did but I want to know more.” So then we made How Financials Work for Technicians so they would understand what discounting does to the bottom line and lots of fun stuff like that. Elevate the conversation and educate them, and treat them like somebody in a business and you’ll get away from the attitude and all that. Even with the most difficult of personalities, that usually is a good path to chip away.

Hey, Chris, awesome show. Just wanted to say, ‘Glad I found you guys.’ I listen to the podcast on the way to work every day, it’s great. I’ve got to vent: we’ve lost four techs since March. A competitor dealership offered to pay them 40% more an hour on a flat rate, so now we only have five techs. And we’ve been busy and I can’t find certified techs with experience, the shop is still producing the same amount of hours a month after those techs left, and the advisors are going crazy buying time or putting customers in rentals for days because of it. Upper management doesn’t want to pay to get experienced techs and when they do hire techs, they are entry-level techs and after a couple months, they leave for more money. 

So how can I convince them not to do that? I feel like we’re losing customers because we can’t get to them faster. We’re booked a week in advance! I’ve been with the same brand for 20 years. It’s been 16 years with this dealership, but I’m thinking it’s time to jump ship, maybe for a better organization that’s willing to spend money to make money. And our parts department also sucks, but mostly just because of the parts manager. Even the fixed ops manager likes to keep the inventory thin and thinks it’s better to order everything once the job is sold, with next day delivery. The good news is that COVID hasn’t affected our sales. We’re up every month from the previous year by about 8% to 12%, depending on the month, but any help would be appreciated, thank you.”

This is a lot of a question, and it kind of contradicts itself… We lost techs but we’re doing the same hours; business is the best it’s ever been, but it sucks?

Listen, the industry is losing tons and tons of technicians. I was talking to somebody from Toyota corporate a couple of days ago, and he gave me the stats. 78,000 technicians quit or retire a year and only 33,000 are coming in, graduating from vocational school. We hear it everywhere we go, “You can’t hire technicians,” but we’ve never not been able to hire technicians and I’ll tell you beyond the shadow of a doubt that the way we hire technicians isn’t one thing; there isn’t one magic pill! The first thing you need to have is an effective labor rate to afford the technicians that are good. The good technicians are worth money and they don’t want to leave where they’re at. The good ones aren’t out looking, and the people that have them know what they have. So if you’re just running an ad, most of the people you’re going to get are the people nobody else wants. It’s rare, unless somebody is relocating, that a technician is out looking for a job that’s really good. Nobody’s letting good technicians go.

They’d almost rather be miserable where they’re working than move their toolbox. It’s not so easy to get them to move so it’s a good thing when we actually do get them to move because that says something about the sense of security they have about moving to a new place. We have to recognize the value of the technician and that we all play a part in keeping techs and making sure we retain them.

It’s a big part of the future because if you don’t have good techs, you’re going to have a rough time in the next 5-10 years for sure. The focus of our industry is going to become fixed ops and whoever has the best technicians is going to win. So you’ve got to have an effective labor rate to afford the best technicians, then you got to have a culture and a system where they want to stay (which is something we’re going to talk about here coming up), and then you’ve got to be good at recruiting them. If it’s not one reason, it’s the culture, it’s what we’ll pay them, the environment, it’s all going to matter. 

Then I think the big question in all that is: should he leave? That’s always an odd question. How do we decide that for somebody, especially after they’ve been there 16 years?

I worked as an advisor for a dealership where, to be frank, the ownership and managers were morons and the dispatch was a moron and the technicians weren’t managed. There was no pride for the service department. They would just assume and let it underperform, and if you’re somebody who really cares about customers, it does get to the point where you can’t take care of customers anymore if all of your failing is comebacks. I literally used to have to start calling at two o’clock to tell everybody who’d made an appointment two weeks ago that their car wouldn’t get in the shop. The funny thing with that job was I left and I made almost twice as much money somewhere else with way less headache. So if you’re a good advisor and you’ve got clientele, go! Take them! That’s why it’s important to collect customers more than anything. They’ll follow you anywhere.

But you might have noticed that we’ve been talking about retaining technicians, so I did open up that loop after all… So here are the 5 ways to retain them:

1. Be able to achieve a high effective labor rate.

It’s in your pricing strategy, it’s in the customer experience, systems, consistency, accountability, all of that. Our experience has never had anything to do with the market. It’s the ability to create a customer experience, consistency, and a pricing strategy.

So having an effective labor rate that lets you pay the best technicians, whatever it takes. We’ve paid technicians $60+ in Northern Canada where you couldn’t find technicians. In Texas, it’s always like, “Oh, we’re losing all our techs to the oil fields.” All of a sudden, we’re paying more than the oil fields and we had all the technicians we could handle, so it’s a mindset more than anything else. But you got to have the effective labor rate to be able to afford the technicians. If your effective labor rate is $80 and you need to pay $35 for this technician, it doesn’t work.

2. The way the break room looks shows how you feel about technicians.

Anywhere that struggles to retain technicians, you can walk into the break room or where the technicians eat lunch and see how they feel about technicians. Go to where salespeople eat lunch and tell me the difference.

If it hasn’t been painted in 20 years, there’s stuff in the fridge that smells like death, the microwave doesn’t work, that says something, right? How much does it take to put in a coat of paint, clean out a fridge, get a good microwave, or put a Nintendo in there, right?

We’re not just saying, “Hey, if you fix the break room, that fixes everything and technicians will want to stay there.” What we’re saying is that the way your break room looks tells me how much value and importance you put on technicians. You don’t want to think about the shop as mushrooms where you just keep them in the dark and feed them.

3. Train your advisors.

There’s nothing that runs technicians away quicker than advisors that don’t know what they’re doing, that are disorganized, confused, and writing 40 tickets a day, barely staying above water.

Put a system in place and have a plan for how many cars or truck we’re bringing in every day, and train your advisors how to process customers, time management, all of that. Well-trained advisors will retain your technicians. You’ve got to keep the good advisors and train the ones that you have.

4. Get good at recruiting.

What I was mentioning before is that the good technicians don’t want to leave where they’re at, so you’ve got to be better. You’ve got to have a better story, a better plan, and a better opportunity for them to jump. And so you’ve got to go deep into the psychology of it. In our course, the Technician Tree, there’s maybe 20 ideas on how to get to recruit technicians that aren’t exactly looking to jump yet. You’ve got to go to where they eat lunch, you’ve got to have events, you’re always recruiting, and the worst thing you can do is only recruit when you need techs. It’s a 365-a-year job.

I think a lot of old time managers expect that it’s like 20 years ago, and the kids are going to come in and try to sell them. Any more than that, for good technicians, you’ve got to sell us. The power struggle’s flipped. Now, it’s a buyer’s market.

5. Fix your parts department.

No joke. Have a hierarchy of performance and look at your shop as a production facility. So many times, we go into a shop and the culture’s terrible, the technicians are inefficient and nobody is talking about the thing that’s important, which is production. If you’re posting the numbers in the shop all the time, you’re talking about production every day, you’re having little huddles with your technicians, giving accolades and praise to fire up your high performers, but the culture in the shop isn’t about production, then that technician won’t even last two weeks because they get bored.Everything about your parts department, your warranty department, they don’t get flagged on time and it’s a disaster. So you’ve got to make production a priority. You’ve got to flag the numbers quick, don’t have a month’s worth of warranty that hasn’t been processed. They need to get flagged the next day, right away; you need to be on top of that stuff. It’s a production facility and all of those things add up to their mindset and their thoughts on production, and what they’re there to do.

So let’s go over all of those again: 1. You’ve got to have an effective labor rate, and that’s only going to get harder over time. 2. The break room tells me how you feel about your shop, how much you care; it’s very clear. 3. You’ve got to have good advisors and train them. 4. Get good at recruiting; it’s a skill you’ve got to develop. 5. Make sure your shop is a production facility, and there’s a hierarchy of performance; you’re posting a hierarchy of who’s flagging the most hours and who’s winning, but think of it as a production facility.

That was fun, you guys. We’re going to start brainstorming TikTok, and maybe some of you can give us suggestions. We could do that as an exercise for our elite group. Wouldn’t that be great?

Just reminding everybody that Service Drive Revolution is the #1 show in automotive by a mile thanks to all of you listeners! Make sure that you hit the subscribe button so you automatically get each episode, and also an angel in heaven gets their wings so you’re doing God’s work. Get your friends, everybody in your shop to subscribe, spread the word: it’s a revolution revolution, and we’ll see you next time on Service Drive Revolutiooooooooooooooooooooon!

 

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