Industry pricing, just a thought..A must read thread Industry pricing, just a thought..A must read thread I saw the article and thought it GREAT! He gets right to the point and makes valid points about the industry. This has woken me up and I am going to run our place of this mentality and direction. Others should take heed and listen. Written by Mark Kline of Lakewood, Colorado. Mr Kline owns a ScandiaTek repair shop in Lakewood Co. He holds a Master ASE certified Technician and master automotive machinest certifications. He was also the president of Saab Rocky Mountain dealership Service and Parts in 1978 For the past five years , I have been trying to buy an additional shop. Each time I have found one , its been the same old story. The shop is run by an excellent, well meaning techincian and is jammed with loyal happy customers. Why shouldnt they be, with cheap prices and great work? So I get the paperwork, and learn the truth about the shops financial health: little or no profit, and the IRS is their prime lender. The shop is doomed because the tired owner" is the business and the low price is its main product. If I bought it and brought the pricing up to where it should be, Id lose most of the customers. Once again, it is too late. So I pass on the deal and sure enough, it soon goes of buisness with a parking lot full of cars. Several years ago, a new shop opened near me .number 6, I believe. As usual, it has damaged my new customer business because the owner thinks hes a marketing genius by setting his prices so low that no one can beat it. No one would want to!!! I dont even know who he is competing with as it is so far below everyone elses. So once again I must wait, and once again another of my competitorsover time will join the rest of these low ball marketing wizards in the unemployment line. But not until hes made the public think the other well run shops are Ripping them off ! ( HOW TRUE IS THIS?) If I could make a dream law, it would be that automotive shop owners must take a buisness course before being licensed to run a shop. Why is it so many of us refuse to VALUE our work? I even see this with long lived shops. Somehow they have managed to survived on miniscule profits, being afraid, or to lazy, to price their work at a professional quality level. I could see if they did poor work, But these are often good technicians! Now I have been preaching this for 21 years, and I have been called a number of unpleasent things by what I deem confused other shop owners. I have never understood what is wrong with charging top dollar for TOP QUALITY WORK:; or what is off base about making a decent return on the risk and immense effort it takes to run a shop. Finally, I would love to know what is amiss in having the resources to hire and pay for the BEST personnel, being honest with the IRS, and having enough saved to retire on. If you think about it, you will find you DO NOT set the price of your work, the cost of doing a good buisness does. So stop guessing and stop belittling our line of work. Throw out those pointless flat rate books. Pay your people salaries, including you. Forget about what the other shop is charging. Who say he knows what he is doing? Just because he is busy does not mean he is making money. Sit down with your accountant and figure out what it takes to run your buisness and meet your goals. Be brave, and actually make an honest profit. MY DREAM SEES A DAY WHEN ALL COMPETE ON WHO IS BETTER ..NOT ON WHO IS CHEAPER!!!!!!! You want cheap work, pay a cheap price. Mark Kline Bruce... WE4 comment:, I truly believe in this and the smart people will see this and respond accordingly. What good is paying a cheap price if the shop will not be there 3 years from that day? Honestly, Think about this . our disease flows through all service type companies!!!