auto shop flat rate labour guide
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auto shop flat rate labour guideThis method has been around since the 1920’s and is used by both independent shops and dealers alike. Recently in the last few years there have been a lot of criticism by both shops and consumers about the use of flat rate times. How does the flat rate charge work For any given repair on any vehicle there is a flat rate labor charge associated with that repair. The charge is based on the amount of time it should take to make the repair. When someone calls a shop and asks for a price to do a job the service advisor will use a labor guide to estimate the time to perform the repair. Flat rate labor guides are available for just about any vehicle. And I do not know of a shop that does not use one. Most of the labor guides out there are based on the manufacturer’s recommendation for repair times. On a newer car, (a car between 10 to 15 years old), they are usually pretty fair to both the shop and the consumer. Example of a flat rate labor guide Older cars and the flat rate labor guide Where things can become interesting is when working on older cars. As a vehicle begins to get older multiple systems can begin to fail. This can be made especially worse if the car’s maintenance has not been kept up. This can mean that a simple brake pad job can turn into a major brake overhaul. This makes it harder to estimate a repair on an older vehicle, but not impossible. Most independent shops today will work on cars that are between 5 and 12 years old. This is because they are old enough to be out of warranty with the selling dealer but not so old that it is time for them to be retired. The flat rate labor guide on these cars will still be a good fit. A rusted assembly is going to take a lot more to overhaul than a newer and better maintained component. How the mechanic gets paid The flat rate guide is not just for estimating a price to the owner. Most mechanics are paid based on the flat rate labor charge.http://www.delta-relay.be/userfiles/electrolux-polisher-manual.xml
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Usually, as an added bonus if the mechanic can finish the job in less time than the flat rate labor guide calls for, they will usually still be paid the entire amount of time. For example, if a particular job has a book time of 2.5 hours and the mechanic does it in 2.0 hours, he will still get paid 2.5 hours. This is because the shop is being paid 2.5 hours for the job. However, if the mechanic is too slow and the job takes him 3.0 hours, he will still only get paid for 2.5 hours. Criticizing the Flat rate guide So, in the last few years there have been serval attacks on the use of the flat rate guide. Some have come from the consumer and some have come from mechanics and shops. Some consumers feel that the flat rate labor guides are ripping them off. They feel that if the mechanic can do the job faster then they should pay less for it. I understand that the cost of any repair is always a concern for anyone. However just because a mechanic can do the job faster than the book says, why would you want to penalize them for that. They have invested in high quality tools and the training to know how to use them. Often, they have done the same job so many times that they can do it in their sleep. This is the kind of mechanic that I want working on my car. The mechanic Sometimes the mechanic will complain that there is not enough time to complete the job. This can be for a lot of reasons. If the shop does not have all the equipment or the information required to perform the repair, then this can be an issue. If the mechanic does not have all of the basic tools required or lacks the proper training it will affect the repair time. The other issue can be on older cars. Just like I mentioned earlier on an older car a basic job can turn into a major overhaul. Just because a price has been quoted on a specific repair, that does not mean that it cannot change.http://elrey-uslugi.ru/media/electrolux-plmv169dcd-manual.xml If when doing a job, the mechanic finds something that is seized or a bolt that is rounded off, does not mean that he has to eat the extra time to repair it. What a good socket selection shoud look like What should happen is he should notify the service adviser or the customer of the issue. That way the job can be re-quoted and then proceed after getting an approval for the increased cost. This is usually a training issue and in my experience most customers will understand when a job price goes up because of unforeseen issues. The shop Shop owners tend to complain that mechanics can be pre-Madonna’s when it comes to taking some jobs. A mechanic that struggles with a type of repair is not going to take a job he does not like. Especially if he is not going to get paid as much for doing it compared to a different service. This is my opinion boils down to the shop. If they accept a job knowing what is involved in the repair, then they should already have a mechanic on staff to deal with that type of job. If not, then the shop should not accept the job in the first place. Another way to deal with the issue is training. If you are going to be doing more of these types of repairs, then you need to get your staff up to speed. Training will benefit both the shop and the mechanic in the long run with both making more money. The other way to deal with a job that is not easy to do is to charge more for it. The flat rate labor guide is just that, a guide. Just because it says a job should take a certain amount of time that does not mean that you have to stick by it. Take for example 1970 911 engine, the flat rate labor guide on that engine says that it should take 44 hours to overhaul. However, on a 50-year-old engine that has suffered years of neglect and poor repairs, there is just no way to get it done in that time. So why would you charge only 44 hours. Repair Shop Library, The shop should have available all of the information required to work on the cars they advertise for. Rushing to get the job done The other big complaint that some shops and consumers can have is the mechanic rushes to complete a job. This is a problem, but not with the labor guide or the time allotted for the repair. This kind of issue in my experience comes from just a bad mechanic. Short cuts will rarely lead to a quality job. Often the level of training is also a major issue. The mechanic does not know how to perform the repair correctly. A shop needs to have good quality control protocols and inspect the work that the staff are doing. Warranty One of the draw backs of a mechanic who is paid only on commission is warranty work. If job comes back as a result of a mechanics mistake or bad work, then they should be responsible repair the faulty work. Where the issue comes in is if a part fails and it is not the fault of the mechanic or vehicle owner. The part is usually covered by a warranty, but rarely is any labor covered. This usually leads to the shop and the mechanic taking a hit to repair the issue again. This is also why the parts used in a repair can make a big difference. Using knock offs or poor quality parts can lead to comebacks. Come backs will cost the shop and mechanic time, money, and lost customer confidence. Truth in Advertising Lately I have seen a number of shops saying how bad the flat rate labor guide is for the customer. They advertise that they do not use it and they pay their mechanics in a different method. This is supposed to make the customer feel better that the mechanic is not going to rush to get the job done. Yet they are not being completely truthful. They may not be using a commercial flat rate labor guide. However, you can be assured that they have their own repair times figured out. There is no way any customer is going to take a vehicle into a shop with out some idea of how much it will cost. Image how you would feel dropping the car off for service and asking how much will it cost. The answer you get is “ I don’t know and well have to let you know after its done ”. So, you ask when it will be done and get the answer, “ We don’t know, we’ll just call you ”. Very few customers would leave a vehicle under those circumstances. What they are doing is still using a flat labor guide, but it is just their own. If they are a specialist in a particular make, then they are going to have years of data on how long each repair takes. Sure, prices can change due to unforeseen issues but its no different then any other shop. You can also bet that if a mechanic that is being paid by the hour or on a salary and takes too long to do a job they will hear about from the boss. It also means incorporating some type of bonus system to keep good mechanics otherwise the shop will lose them. My experience I have worked in shops that pay by the hour, salary, and commission. In my opinion the commission option is really the only way to go. It incentives the mechanic to be better, and have the tools to do the job. Or it at least it did for me. I have hired a lot of mechanics in my time and not all have done well on commission. Some of the mechanics that I hired were good mechanics with low come back numbers, but they were just slow. I also had others that turned out to not be good mechanics and when working on a commission basis it will show that up very quickly. All in all, the flat rate labor system when used correctly can be fair to the consumer, the shop, and the mechanic doing the job. Sure, it will have its draw backs for all parties concerned but it works. Search for: Archives June 2021 May 2021 April 2021 March 2021 February 2021 January 2021 December 2020 November 2020 October 2020 September 2020 August 2020 June 2020 May 2020 April 2020 March 2020 February 2020 January 2020 December 2019 November 2019 October 2019 September 2019 Share on facebook Facebook Share on twitter Twitter Share on linkedin LinkedIn Share on pinterest Pinterest Share on email Email KURT DONOHOE Kurt Donohoe has had over thirty years’ experience in the automotive field. Starting in 1988 working for a BMW dealership, shortly before securing an apprenticeship with a Porsche Dealership. Kurt completed the Porsche apprentice training program and was awarded Porsche 2nd year apprentice of the year out of all the Porsche dealers in Australia in 1990. Kurt has founded two automotive repair shops specializing in German automobiles, specifically Porsche. He also founded a Porsche online parts warehouse and has designed and engineered several replacement parts for Porsche vehicles. Kurt is currently working on his latest venture for training mechanics and owners on how to repair vintage cars. Prev Previous Why Auto Repair Shops don’t want you to bring your own parts. Next How to calculate Engine Compression Next Leave a Reply Cancel reply Your email address will not be published. Notify me via e-mail if anyone answers my comment. Privacy Policy Terms and conditions Links to other sites you might enjoy About Menu Privacy Policy Terms and conditions Links to other sites you might enjoy About Share Share on facebook Share on twitter Share on linkedin Share on pinterest Share on reddit Share on email Copyright Klassik ATS 2020. Manufacturer-Paid Programs Catalogs Find out more in our resources. Two of the most popular forms of auto mechanic payment are flat rate and hourly rate. There’s a debate about which rate is better for mechanic work: flat or hourly. It helps to know the pros and cons of each when you’re considering auto technician jobs. What works for you will depend on the level of stability and security you crave, how competent and experienced you are, and what type of work style you have. Learn about the advantages and disadvantages of hourly rate pay and flat rate pay as you’reWhat is Hourly Rate Pay. Hourly rate pay is a salary based on the number of hours worked. What is Flat Rate Pay. Flat rate pay is payment based on each job that’s completed. An employer or manufacturer estimates the amount of time a job should take. The employer pays the technician a predetermined amount for that job, based on the expected time. For example, say the flat rate of a job is based on two hours. If the employee takes one hour to complete the job, he or she will be paid for two hours’ worth of work. If the technician takes three hours, the rate still is based on two hours. Flat rate may also be called “book time.” The times that are set for each job may be based on a variety of factors. These could include the average time it takes for that shop to complete similar jobs, how long a manufacturer says a warrantyTypically, most automotive businesses charge flat fees to customers for most jobs. A mechanic paid a flat rate gets a percentage of the flat fee charge. The Advantages of Hourly Rate Pay Hourly pay is predictable, which is appealing to technicians who have others relying on them for income. With hourly pay based on a certain number of hours a week, you know the amount of money you earn each pay period is going to be the same. Another advantage to hourly rate pay is that auto technician jobs can be unpredictable. Complex diagnoses can take extra time. Some jobs may be misestimated because unexpected issues pop up. If a job estimated to take one hour to complete ends up takingIn some cases, hourly rate pay may increase the quality of work. Technicians can take the time needed to be thorough without worrying about rushing against the clock. If you like working methodically, an hourly system may be a better fit compared to a flat rate system. And if you enjoy solving complex auto problems, flat rate might not be for you. Some employers will combine hourly pay with rewards for above-average productivity. That way, technicians have a set expectation for a salary but they may also earn more by completing more work. The Disadvantages of Hourly Rate Pay With hourly rate pay, the amount of money you can make in a pay period is limited. If you’re highly efficient and complete more jobs than other technicians, you’re still going to be paid the same amount of hours, regardless of how productiveCompared to a flat rate pay system, hourly rate pay may not motivate technicians to produce as much work. The Advantages of Flat Rate Pay A flat rate pay system can be a great fit for highly motivated and productive technicians who work in busy shops. As work comes in, flat rate technicians can complete and take on more work. Technicians may work just 40 hours in a shop but may be compensatedA flat rate pay system can be highly motivating for technicians to finish as many jobs as possible, which benefits employers. If you can complete jobs quickly and accurately, you may have the potential to greatly increase your income in a flat rate shop. For the shop, an advantage to a flat rate pay system is that they don’t have to overpay slower mechanics. Another advantage of flat rate pay for shops is that the shop can use average flat rates for jobs to estimate its income. Flat rate work can also motivate technicians to stay focused on the task at hand, instead of wasting time on non-work activities. Shops don’t have to pay for things like socializing. A flat rate system also can increase the motivation to upsellThe Disadvantages of Flat Rate Pay A disadvantage of a flat rate pay system for technicians is its unpredictability. If a shop is slow and jobs aren’t coming in, a paycheck won’t be as steady. If you’re waiting on parts to get the job done, that can also stall flat rateTechnicians won’t be paid for the extra time it takes to complete the work. Some employers do offer a base salary guarantee in case issues like these pop up. For an employer, flat rate pay may mean that employees rush through work, which can create sloppy jobs. Employers will need to closely monitor work to make sure it’s completed satisfactorily to avoid repeat visits. Another disadvantage of flat rateIn a flat rate system, newer mechanics may take longer on jobs and may be paid less overall than if they were in an hourly rate pay system. For technicians who have extensive experience and certifications, the value of flat rate pay may also be lowerAnother disadvantage of flat rate pay is the estimated time of warranty repairs (discussed below). Manufacturers determine the estimated times, which typically are less valuable than the work shops will estimate for similar flat rate jobs. Another disadvantage to a flat rate system is there may be less focus on mentoring young technicians or providing customer service because technicians are concentrating on completing their jobs and moving on to new work. How Do Flat Rate Employees Get Paid for Non-Repair Work. Besides their assigned jobs, flat rate employees do other work, like cleaning. It’s up to the employee and the employer to be in agreement ahead of time on how they’ll be compensated for work like that. A flat rate technician employment policy outlines how projects are compensated. The shop may decide that extra work like cleaning is included in the preset flat rates or the work may be separately compensated. An employment policy should clearly defineCan Flat Rate Employees Earn Overtime. According to the U.S. Department of Labor, employees covered by the Fair Labor Standards Act are entitled to receive overtime pay when an employer requires or permitsFlat rate employees will need to discuss overtime with their employer to determine if they’re allowed to work overtime. It’s up to the employerWarranty Repairs Warranty repair flat rates are usually set by the manufacturer and are typically less than what flat rate employees are paid for comparable shop repairs. The manufacturer estimates how much time a job should take, which often results in less pay for aRelated Question How much do automotive service technicians make.Independent shop or big dealership. These are the types of employment questions Universal Technical Institute’s (UTI) Employment Assistance specialists are here to help answer. Our team provides guidance to students and graduates who want to find meaningful careers in the auto technician industry. We’re here for any questions you have. Call (800) 834-7308 or contact us online. Becoming a technician in the automotive field might be right for you. The need for qualified technicians has continued to grow, but don't take our word for it. Learn about how long it takes to become an automotive technician, salary, job outlook and more. We try to settle the debate. This rate excludes graduates not availableThe rate includes graduates who completed manufacturer-specific advanced training programs and those employed in positionsUTI is an educational institution and cannot guarantee employment or salary. 5) UTI programs prepare graduates for careers in industries using the provided training, primarily as automotive, diesel, collision repair, motorcycle and marine technicians. Some UTI graduates get jobs within their field of study in positions other than. UTI is an educational institution and cannot guarantee employment or salary. 6) UTI graduates' achievements may vary. Individual circumstances and wages depend on personal credentials and economic factors. Work experience, industry certifications, the location of the employer and their compensation programs affect wages. UTI isAwards vary due to specific conditions, criteria and state. 11) See program details for eligibility requirements and conditions that may apply. 12) Based on data compiled from the U.S. Bureau of Labor Statistics, Employment Projections (2016-2026), www.bls.gov, viewed October 24, 2017. The projected number of annualJob openings include openings due to growthSpecial conditions may apply. Talk to potential employers to learn more about the programs available in your area. 15) Manufacturer-paid advanced training programs are conducted by UTI on behalf of manufacturers who determine acceptance criteria and conditions. More information about education benefits offered by VA is available at the official U.S. government website. 22) Salute to Service Grant is available to all eligible veterans at all campus locations. Graduates who take NASCAR-specific electives also may have job opportunities in racing-related industries. Of those 2019 graduates who took electives,NASCAR Tech’s overall employment rate for 2019 was 84. 25) Estimated annual median salary for Automotive Service Technicians and Mechanics in the U.S. Bureau of Labor Statistics’ Occupational Employment and Wages, May 2019.Some UTI graduates get jobs within their field of study in positions other than as a technician, such as service writer, smogSalary information for the Commonwealth of Massachusetts: The average annual entry-level salary range for persons employed as Automotive Service Technicians and Mechanics in the Commonwealth of Massachusetts (49-3023). Automotive Service TechniciansSome UTI graduates get jobs within their field of study in positions other than as a technician, such as certified inspector andNorth Carolina salary. However, the 25th. Welders, Cutters, Solderers, and Brazers, viewed SeptemberSome UTI graduates get jobs within their field of study in positions other than as a technician, such as appraiser, estimatorNorth Carolina salary. Automotive Body and Related Repairers, viewedUTI programs prepare graduates for careers in industries using the provided training, primarily as diesel technicians. Some UTI graduates get jobs within their field of study in positions other than as a dieselSalary information for the Commonwealth of Massachusetts: The average annual entry-level salary range for persons employed as Bus and Truck MechanicsSome MMI graduates get jobs within their field of study in positions other than as a technician, such as service writer, equipmentNorth Carolina salary information: The U.S. Department of Labor estimate of hourly earnings of the middle 50 forMotorcycle Mechanics, viewed September 14, 2020.) MMI is an educational institution and cannot guarantee employment or salary. 31) Estimated annual median salary for Motorboat Mechanics and Service Technicians in the U.S. Bureau of Labor Statistics’ Occupational Employment and Wages, May 2019.Some MMI graduates get jobs within their field of study in positions other than as a technician, such as equipment maintenance,Salary information for the Commonwealth of Massachusetts: The average annual entry-level salary range for persons employed as Motorboat Mechanics and Service Technicians (49-3051) in the Commonwealth of Massachusetts. Motorboat Mechanics andSome UTI graduates get jobs within their field of study in positions other than as a technician, such as CNC operator, apprenticeSalary information for the Commonwealth of Massachusetts: The average annual entry-level salary for persons employed as Computer-Controlled Machine Tool Operators, Metal and Plastic (51-4011) in the Commonwealth. Computer Numerically Controlled. UTI is an educational institution and cannot guarantee employment or salary.See Table 1.2 Employment by detailed occupation, 2019 and projected 2029,Job openings include openings due to growth and net replacements. See Table 1.10 Occupational separations and openings, projected 2019-29, U.S. Bureau of Labor Statistics, www.bls.gov, viewed June 3, 2021. 42) For Welders, Cutters, Solderers, and Brazers, the U.S. Bureau of Labor Statistics projects an annual average of 43,400 job openings between 2019 and 2029. Job openings include openings due to growth and net replacements. See Table 1.10 Occupational separations and openings, projected 2019-29, U.S. Bureau of Labor Statistics, www.bls.gov, viewed June 3, 2021. 43) For Bus and Truck Mechanics and Diesel Engine Specialists, the U.S. Bureau of Labor Statistics projects an annual average of 24,500 job openings between 2019 and 2029. See Table 1.10 Occupational separations and openings, projected 2019-29, U.S. Bureau of Labor Statistics, www.bls.gov, viewed June 3, 2021. 44) For Automotive Body and Related Repairers, the U.S. Bureau of Labor Statistics projects an annual average of 13,600 job openings between 2019 and 2029. See Table 1.10 Occupational separations and openings, projected 2019-29, U.S. Bureau of Labor Statistics, www.bls.gov, viewed June 3, 2021. 45) For Computer Numerically Controlled Tool Operators, the U.S. Bureau of Labor Statistics projects an annual average of 11,800 job openings between 2019 and 2029. See Table 1.10 Occupational separations and openings, projected 2019-29, U.S. Bureau of Labor Statistics, www.bls.gov, viewed June 3, 2021. 46) Students must maintain a minimum 3.5 GPA and 95 attendance rate. 47) The U.S. Bureau of Labor Statistics projects that total employment of Automotive Service Technicians and Mechanics by 2029 will be 728,800. See Table 1.2 Employment by detailed occupation, 2019 and projected 2029,See Table 1.2 Employment by detailed occupation, 2019 and projected 2029,The projected total numberSee Table 1.2 Employment by detailed occupation, 2019 and projected 2029,The projected total number. How to Start a Truck Repair Shop How Can I Know if My PC is 32-Bit or 64-Bit. How to Operate a Used Car Business How to Start a Small Auto Repair Business Determining a final bill for car repair is just as stressful for the mechanic as it is for the customer. Charging too high a price for vehicle repairs can lead to arguments and a loss of future business. Using a flat-rate pay scale can go a long way to assuaging some customer concerns and demystify the process of determining a mechanic's fee for service. Hourly Labor Charges As a small business mechanic, you can set your hourly wage as you see fit. This is your flat-rate fee for service for each hour of work you perform for a customer. The market in your area dictates what consumers can afford to pay hourly as well as your level of skill. The more experienced a mechanic you are, the higher the hourly rate you can successfully charge. It's a smart financial move to openly list your hourly labor cost in plain view of customer's entering your shop so each customer is aware of the potential charges. Flat-Rate Pay System You also have the option of using a flat-rate pay system when determining prices for your repair work. This system uses an industry standard guide for how long repairs for certain vehicle systems should take and charges accordingly. The guide uses multiple factors when determining the hours necessary to repair a vehicle including model year, vehicle make and the damaged component. A guidebook or software using the flat-rate system isn't free and usually requires annual renewal so you can keep up with new model year releases and changes in existing vehicle systems. Diagnostic Fees Determining a problem with any vehicle requires an investigative period known as the diagnostic phase. For modern vehicles, this usually only requires attaching a diagnostic tool to the vehicles' on-board computers and reading the corresponding codes. The entire process can take as little as three minutes. As a mechanic, you are free to charge for your diagnostic services in addition to any flat-rate or hourly pay system you have in place. Always make the customer aware of the diagnostic fee because it usually amounts to one additional hour of labor on the final bill. Pros and Cons Using the flat-rate pay system gives you the ability to quote a customer a price the second you identify the problem with a particular vehicle. This creates an open business relationship and builds a customer's trust in you as a professional. The downside of using the system is some of your employees might rush through a job in an effort to double up on flat-rate pay by working another job while inside the labor hours for the first repair gig. Sloppy work will only lose you business in the long run so it's important to remain vigilant. References Monster; Hourly vs. Flat Rate for Auto Techs; Jim MacPherson AA1 Car: How Much Should it Cost to Fix Your Car. Writer Bio Jonathan Lister has been a writer and content marketer since 2003. He holds a Bachelor of Arts in English from Shippensburg University and a Master of Fine Arts in writing and poetics from Naropa University. Related Articles How Much Should I Charge for Snow Removal. Power Factor Correction in a Manufacturing Facility What Does Flat Rate Pay Mean. How to Determine When XP Was Rebooted Last Accounting Software for Mechanics How to Hook a Credit Card Machine to a Laptop Fleet Management Fuel Conservation Strategies I Forgot the Server Login and Password in Ubuntu How to Download the Android OS What Type of Charger Does the Bose Bluetooth Headset Use. This flat-rate system motivates workers to finish as many jobs as possible, but can lead to sloppy work if the workers sacrifice quality for quantity.