WORKING TOO MUCH
....no money, no leisure time?

It is the beginning of a new week, you crawl out of bed and wonder if your employees are going to show up, or how many appointments will fail to show even though you called them on Saturday night to confirm.

Or, it is Wednesday and things have been going well all week. Then you get that "call." Mr. Smith is livid, he just found a burn spot on the paint of his 2 year old Porche you detailed on Saturday.

You run out to the mail box looking for that check from Honest Abe's Auto Dealership you needed to cover the bills, but it was not there so you call and he is out for the rest of the week. How are you going to make it?

You are driving home and going to be late. Your wife has prepared a great dinner tonight, but by the time you get there you kid will have eaten and your wife angry.

Things were not all that good in general, then September 11 and the bottom has fallen out. The economic news is not good. You are afraid to ask yourself if things could be any worse, because the last time you did, your pressure washer failed and you had to purchase a new one.

Life just does not seem to be fair. You are working as hard as you can and still struggling to make ends meet. If you weren't a macho-man you would be tempted to sit down and cry.

The Plight of the Self-Employed

Welcome to the world of the self-employed and the dream of being your own boss and owning your own business. Has that promising dream of financial independence and personal independence that you had two years ago when you started your detail business gone sour and is resembling like day-to-day slavery?

Maybe it is not as bad as I have stated, but it can be pretty tough and lonely owning a business, any business. Even if you are a good detailer and a good business person, there are days where you just get overwhelmed and it can get to you. As they say, when you are "knee-deep in alligators, it is difficult to remember that you came to drain the swamp."

While I thought I had a good feel for the plight of many detailers I did not realize how isolated many of them really are until I started participating on some of the detailing forums on the internet. They, like all business owners have problems, problems that must be dealt with or fail.

What can one do?Well, the first thing you have to do is change. Oh, God that awful word, CHANAGE. It is however that simple. Just look in the mirror and then make a decision to change. If you are not happy with your business and your personal life, only you can change that.

Changing Things

No new ideas: everyday I talk with detailers who like the idea part or entrepreneurial part of self-employment but the that discipline that is requiredt to be successful. Great athletics have talent, but they also have discipline. They practice, practice and exhibit discipline to be great. Potential is a great thing but no one has made it to the Hall of Fame on potential alone. You make the Hall of Fame because of performance, not potential.

To many detailers, I am sorry to say, are unfocused and go from one detail to another, really never being successful at the basics.

You don't have to be smart to be successful at detailing, but you have to have the basics down. It is as simple as slowing down and getting it right. Finish what you are doing now before starting something else.

As basic as it sounds you must be able to determine the profitable vs the unprofitable work. Dealer work make keep you busy, but it may be costing you money to do. What you have to do is look at your records and see where you consistently make money and where you might be loosing money. This assumes that you have worked with your accountant or bookkeeper and know what your hourly shop rate should be for performing detail services. You cannot be pricing services if you do not know what it costs you to operate your business. Know how low you can price your services and still make money and then decide if you want to do lower paying dealer work to keep you and your employees busy.

Figure out what part of your business is price sensitive and what is not. I talk with detailers all the time that tell me they charge the highest prices for detailing in their area, yet they are not making any money.

Let's take a look at the logic. Do you think is it wise to let your competition set your prices? I don't think so, yet many detailers do base their prices on what the compeition charges. You must know what your prices have to be in order for you to make money.

I have said this for years and frankly it is a subject that you must discuss with your account/bookkeeper, and do it fast. I will talk about the importance of a detail shop owner knowing their numbers and charging what they need to until I am blue in the face because that is what will determine your success or failure in the detail business.

Let us look at some real world answers. Suppose you sell 80% of the customers who stop in or call you for an estimate. Maybe you should up the price just 5%. Why? Simple, your customers really want first and foremost a good job, not a cheap price. If the additional 5% allows you to slow down and take some of the pressure off your employees and eliminate redos or unhappy customers that won't come back or refer your shop to others then that 5% is worth it to the customer and certainly to you.

However, you may not increase the price by 5% because you do not want to overcharge your customers. OK, then sit down and figure out why you are not making any money, and then charge more on those jobs that will take more. Like a black paint finish or a flithy SUV or van.

Ask yourself this question. How come you will not charge more to your customers, yet you will steal time from yourself; your family; your friends? You work hard. Don't you think that most of your customers want you to be successful? If they don't maybe you should be doing work for someone else. They have a stake in your success.

Take time to sell the detail job correctly. Walk around the entire car with the customer, in and out, show them what the vehicle needs and why. Explain what you will do and why. Explain what they will receive. When they return, walk around the vehicle again to insure that what you promised, what they expected was done. When they are a part of the final inspection there will be less complaints because they were a part of the inspection and may have missed something themselves. And, of course, tell them to always come back if anything is not right.

You ask, "where do I get the time to do all this with each and every customer that comes in?" Start by qualifying the potential customer. Over the phone avoid quoting pricing until you see the car. If they demand a price, give them only ranges and again tell them you need to see the car. YOu need to separate the price shoppers from the real serious buyers.

In person this is much easier. Before going into your pitch make sure they are really interested in getting a quality job. We call it the ABC of sales:

A. ASK relevant questions
B. BUILD the sales invoice
C. CLOSE the sale

What if you need the work and have to make a price concession on a given day? Don't quote everything cheaper. Tell the customer that at the moment you have time in your schedule and you can offer them either a price break, or better yet some addtional service like a Fabric Protectant; Paint Sealant or Ozone Deodorizing of the Interior, if they will leave the car today.

When things are tough the first thought is too cut price right away. This is a foolish approach that quickly creates a mathematical equation that is tough to reach. Look at the math. If you have sales of $200,000 per year, and your profit is 10% you have a gross profit of $20,000. But if you had sales of $150,000 and your profit is 15% your gross profit would be $22,000. However, if you have no work for the next week, it might make sense to offer a lower price.

Just get your numbers right. Track some basic facts and hold yourself accountable.

Now let us play this game by just looking at your own efficiency. Last week you quoted 40 customers that took 10 minutes. That means you spent just over 6 hours selling. Some were from your yellow page ad; some from referrals and some from advertising.

Out of those quotes you sold 20 detail jobs. So you closed 50% What does this tell you?

Several things. First, you had a lot of downtime last week. You only spent 6 hours selling, less than one day. That gave you about 5 days to do other things (assuming you are open 6 days a week). What then were you doing? At the supplier picking up chemicals and supplies; playing on the internet; micro-managing your detailers? What does this say about your efficiency and your operational systems, if you have any? Maybe that your time could be better spent working.

And, what about your overall sales skills? Can you improve your closing techniques? When I owned my shop I could close 90% of the customers who stopped in. Maybe you need to work on your sales skills, or have someone else in the shop who might be a better sales person handle the customers. Just because you are a good detailer does not make you a good sales person.

It is possible you are just getting the "gimmies." Many of the sales you made probably did not even stop at, or call another detail shop.

Many detail shops will go out of business in 2002. Most of those who fail are those who have not been paying attention to the basics of operating a business. The last 9 years of "good times" has created some very sloppy detail businesses. Weeding a few out this year will not necessarily be a bad thing for the industry. Just make sure you are not one of those who gets weeded out.

Summary

Know your numbers, get things right the first time, and above all, sell your jobs at profitable prices. There are many detailers who gross up to $400,000 a year or more with only 3 or 4 employees. Do not think you cannot make money in a small detail operation. For years detailers have complained about poor employees. Well take what is left and make some money. You don't have to be big to be successful, but to succeed you have to be a business person who gets things right the first time.