It’s all too common to have a fleet of dormant cars taking up space at the shop. They are usually comprised of personal project cars, delinquent customer cars, and long-term never-ending builds.
High car count typically means excessive storage fees, long lead times, and headaches resulting from trying to remember every last detail about the cars. You are probably saying “Yes” to too many projects and also not charging enough for your services. You may be bringing in projects before they are actually ready to be worked on and accepting projects that exceed your skill set. Plus, you probably hate pushing dead cars in and out of the shop that you may not be working on for quite some time.
Luckily, all of these issues can be addressed! If you find yourself being a master at providing space for dust to settle, read below for some ways to correct the problem.
Increase your prices
If every person who calls the shop for a quote agrees to have you work on their car, you are probably not charging enough. You can actually adjust your hourly rate to influence the backlog of vehicles. Most shop owners are very scared to turn away work (which is a perfectly legitimate concern) but you need to make sure that everything you do returns a profit.
Another benefit of raising your prices is that it weeds out the tire kickers and those who can’t actually afford your services. These are usually the people who ask the most questions and take up the most of your time. If you can price yourself out of the bottom 20% of the market, you will probably save yourself 80% of the headaches.
Ensure all parts are received before you begin the work
We built a specific feature in My Shop Assist to help keep track of which parts are Need to Order, Ordered, and Received. The main purpose of this feature is to ensure that work doesn’t begin until all the parts are at the shop.
As mentioned in our Workflow Steps blog post, you should get a deposit for all the parts and order them immediately. Once they arrive, you can schedule the car to be dropped off for work. It’s much easier to store a shelf full of parts versus a car AND a shelf full of parts.
You can also think about stocking the most common parts that are needed for jobs at the last minute. Things like T-Bolt Clamps, silicone hoses, fuel pumps, and common gaskets & bolts can all be stored very easily and made available if needed. There is nothing worse than having to halt a $15,000 build from completion because it needed an additional silicone hose.
Don’t overschedule your week
Consider only scheduling cars Monday through Thursday. Then, you can leave Friday to catch up if needed, clean the shop, or prepare for that weekend’s race. It’s inevitable that some projects will go over their scheduled time. If you have a full schedule already planned out, you will never be able to get ahead.
You can also leave this open day for the quick in-and-out appointments like oil changes or track inspections. That way, you can better plan to have a lift open if needed to gets those cars finished quickly.
Get customers to sign storage fee notice
Every customer who drops their car off at your shop needs to sign the waiver that contains fees for storage. If you didn’t have them sign the form because they are your buddy or you were in a hurry, you may be left with no legal recourse to get rid of the car. So, no matter who the customer is, have them sign the form.
And you should always assume that they didn’t read it. Take some time to explain to each customer your policies about storage fees and late/non-payment.
Get rid of the “Shop Car” that will never be worked on
We all have these. You know, that super awesome race car build that you will get done…eventually. As car enthusiasts, we love to acquire vehicle shells with lofty goals of one day turning them into race cars. But, if it hasn’t been running in the last month and you aren’t planning to race it within the next month, you will never finish it. So, swallow your pride, tuck your tail between your legs, and sell it.
This applies to your technicians as well. They probably got smoking deals on cars but now they just sit at the shop. These cars just take up space and provide no value to you as a company. Plus, it looks rather bad if you give a shop tour to a customer and they see 2 or 3 (or 10) dead cars in the back of the shop.
Don’t take in mystery work
This specific issue often arises from the worry that not enough work will come in the future. So, you agree to do work that you are not familiar with or is above your skill set.
A good case in point would be an Evo shop agreeing to work on a DSM. If that customer comes flashing a bunch of cash, a half-assembled engine, and a box full of parts & bolts, you may say “How much different can it be?” Well, it’s very different. You are now stuck working around a vehicle that you are not familiar with and may not actually be able to assemble properly. Chances are, you will not be able to finish the project by yourself so you either have to bring somebody else in or return the car unfinished.
It’s best to just avoid this scenario all together. It’s in your best interest and the best interest of the customer to send them somewhere else.
Don’t get caught up in scope creep
Scope creep occurs when the customer’s final vision of the project is not materialized before the work begins. They just pile on more and more work as you progress through the build. This makes it very difficult for you to schedule and work on other customer’s cars.
Oddly enough, a big cause of scope creep is your initial build taking longer than expected. While they wait for weeks to have their engine installed, the customer scours the internet and finds a “smoking deal” on a used turbo kit (which probably won't fit or will need modification/parts). So, they buy it and drop it off to be installed. But, their injectors aren’t big enough, so you order those as well. Then they purchase a bigger fuel pump. Oh, and they want you to store and then install some new wheels they bought on Craigslist. Sound familiar?
It is best to not let the customer keep piling on work to their build. Even though it may cost them less to install a bunch of parts at once, it costs you more because you now have to squeeze in the work somewhere. If you can just get the car completed to the original plan, you can provide the customer a quote for the future upgrades and have them schedule another appointment.
Finish the work you don’t want to do
There will always be that one project that you just dread working on. It’s either because it’s not a good money maker, you don’t particularly like the customer, or you got in over your head. You need to get rid of these projects no matter how much you hate it.
This can mean finishing the work yourself, bringing in a knowledgeable person to finish the work, or communicating with the customer that you are unable to finish the work and have them get the car.
Having them get the car may be your best option. It is most certainly the quickest way to alleviate yourself from the stress of finishing it. This may come about because of scope creep, you may not be able to handle that type of workload, or you may have downsized and no longer have the capability or space to finish the job.
No matter what caused the scenario, both you and the customer will be happier if the car goes somewhere else to be completed.
Consider having offsite storage
Offsite storage can be a great way to clear up some space from your shop. It can be the local storage place down the street or you may rent a bay next to your shop. The idea with offsite storage is to relocate the dormant projects out of sight and out of the way.
Charging for this service covers your expenses and discourages people from abandoning cars. If the customer needs a new engine and you know it will take a couple months, you can build in a monthly storage fee into the build price. Once you take the engine out, you spend 30 minutes relocating the car and you don’t have to worry about it until the engine is ready to go back in.
Or, you can try to sell the customer on one of your short blocks that is already assembled at the shop. This option is more expensive for the engine (because it’s already done) but it will save you and the customer a lot of time and avoid the need for car storage altogether! Either way, the car spends very little time sitting idle at your shop.
This offsite storage also deters your employees (and yourself) from keeping cars at the shop. If a monthly charge must be paid to keep the car, it may incentivize the owner to just sell it.
You should consider trying to generate revenue from every square foot of your shop. If you are storing personal, employee, or customer cars for free, that space isn’t making you money.
Your goal as a manager is to treat the shop like a business, not a hobby. Increasing throughput and reducing the time a car spends at your shop is a surefire way to increase your profits. You may have to make some hard decisions up front, but it will pay off in the long run to get rid of toxic projects.
If you want information on how to better manage the cars at the shop and delegate tasks to the technicians, please check out our My Shop Assist software.