By Jeff Stankard
Back in July of 2005, I wrote the following:
“I’ll never forget the shop owner who told me that he raises his prices two percent every quarter. He realizes that his costs are on the rise, and knows that he would like a little extra in his pocket, too. Profitability is his top concern, and he’s doing something about it.”
I talked with that shop owner again this past October and, to say the least, he has stopped the practice of raising prices every quarter. Business is tough and he’s been doing a lot of soul searching, looking for ways to change his approach to the market.
While there is a lot of news about a recession, home foreclosures, budget deficits, record-high oil prices, and the like, there is still good news for our market.
Take a look at this industry snapshot:
- There are more vehicles on the road than ever before.
- The average age of cars continues to increase.
- Research tells us that high gas prices raise consumer awareness about the benefits of proper vehicle maintenance.
- The Department of Transportation reports that the total number of miles driven continues to increase.
- New car sales are predicted to be lower in 2008, so motorists are driving that “old” car a little longer.
- Vehicle technology and complexity continue to accelerate, reducing the opportunity for the DIYer to fix his/her own car.
So what are you going to do to make 2008 a profitable year? Are you going to rely on the same old approach and expect different results?
Look for resources that can help reinvigorate your business. There are a lot of companies and people depending on you to be successful and, as a result, they want to help you. Have you turned to your suppliers for advice and support? There are warehouse distributors, jobbers, retailers, program groups, parts manufacturers, training companies, suppliers of technical repair information, ASA (The Automotive Service Association, CCPN (the Car Care Professionals Network) and local associations that are willing to help.
Again, many of the major indices are pointed in a positive direction for the automotive service industry. Since you’re the one who throws away the box, everyone involved in creating the part in the box and delivering it to you has a vested interest in your success. Network among your industry contacts, leverage available resources and create a strategy to give your shop an advantage in the market, and you’ll build your business every step of the way.