8 ways to make cost savings and increase profitability in your workshop

You’re busy everyday, there are always cars on your ramps, and the diary is full. But that doesn't necessarily mean your auto repair workshop is as profitable as it could be. Like household budgets, workshop budget can get out of hand while your busy working, and a review of spend could result in the discovery of several cost saving opportunities and ideas that will expand your profit margins.

Here’s a list of issues and ideas that you could look to make sure you’re using your budget and your valuable time most effectively.

1. Scheduling

Make sure your schedule allows enough time for work to be carried out thoroughly on vehicles. You can do this by tracking work previously done and gauging the number of repairs your mechanics can perform in one day, and then schedule accordingly. Being more profitable doesn't mean trying to shave off time and add more bookings; if you have too much work booked then errors can creep in and you can find that customers are returning unhappy, which means the job will take twice as long as it should have done.

2. Inspect Vehicles

Add a little time to each booking so that the mechanic can inspect each vehicle for additional problems. If any are found, you can present your findings to customers who often will give you the go-ahead to make the repair there and then. Generally, customers will not feel they are being ‘upsold’ an unnecessary service, especially if you have established a good and trusted reputation (see our Customer Service blog on ‘10 tips for creating customer loyalty and repeat workshop customers’), and will often feel that getting the additional repair done there and then will save them money and time in the long run. It’s easier to add additional work when you already have the vehicle on the ramp, so this is a good way to increase profitability in a way that benefits everyone concerned.

3. Unplug Appliances

According to Energy Star, up to 75 percent of electricity used is while devices are not being used. Switch your plug sockets / power strips off when not in use and make sure everything possible is switched off when you leave for the day.

4. Use OEM Quality Products

Shop around for the best quality OEM products that are comparable to the original. With TRW Aftermarket you can offer your customers performance and safety enhancing parts that are made to original equipment quality standard. Quickly and efficiently fitting the best quality parts will keep your customers satisfied and will help establish a quality reputation for your garage.

5. Shop Around for Electricity

A huge cost for any shop, especially an auto repair workshop, is electricity. Nowadays power supply is a competitive marketplace, so making a note to review costs and compare prices on an internet comparison site is a good idea. Look around for the best deals and you could potentially save hundreds, if not thousands of pounds.

6. Do Your Own Advertising

With a little time, and no cost, you can increase profitability by promoting your workshop on social media. Posting on social media is a great way to keep your customers engaged with your workshop and remind them that they may need to come in for a service or to have a nagging problem with their vehicle sorted. If you can build a social media presence that’s casual and engaging, you’ll be developing something that’s highly valuable – an everyday relationship between your workshop and your customers. Next time they need a repair, the first workshop they think of will be yours. (See our Digital Marketing blog ‘12 tips for building and managing your social media marketing’ for more detail).

7. Target Local Businesses

If you’ve scheduled and found that you could fit in more work (or if you’re able to expand your space and add more mechanics and ramps) why not approach local businesses to promote your services? You could market yourself to a captive audience of people who work in your area, for whom it would be very convenient to travel to work, leave their vehicle with you for the day, and return home in it with the work complete. You could offer an introductory discount to new customers, or even an on-going discount to local businesses, which may be enough for them to commit long-term to your workshop.

8. Diversify

Consider offering repair services for higher end services like classic car restoration; or perhaps consider if you could stand apart from competitors by leading the way in servicing hybrid and electric vehicles. The automotive world is changing, and electric vehicles are here to stay – over the coming years you’ll see increasing numbers of them rolling into your garage. Embrace the future and get ready to service them now. It’s your opportunity to build a strong workshop business for the future. (See our Sourcing Parts blog ‘How auto parts manufacturers help you prepare for the future’ and also TRW’s new range of electric vehicle brake pads).

By reviewing how you use your time and your budget, you can make savings and come up with ideas that will increase your profitability and help build an ongoing successful business.