Smart Shop Layout Can Produce More Revenue

To have a meaningful discussion regarding how a shop should be layed out, let’s get one thing established: The purpose of a shop is to provide the best possible setting for producing revenue.

The numbers I am about to mention are all made up, but we gotta start somewhere. Let’s assume an average billed hour runs $90 dollars, and parts sales at this hypothetical shop are estimated to be 90 cents for every dollar. That means every billed hour results in 90 bucks labor, 81 bucks parts ($90 times .9 = $81), for a total of $171. $171 divided by 60 minutes means the value of a technician’s time would be $2.85 a minute. Five minutes lost looking for a functioning battery charger just cost the company $14.25. Ten minutes waiting for approval to replace an air filter costs $28.50. Twenty minutes waiting for Jozotto Parts to deliver a $10 set of brake pads sets the company back a cool $57 smackers. Really? Yes, really.

Remove obstacles

When designing your shop layout, leave room for supplies.

So, back to shop layout. The first objective is not to speed up production. What? You read it right. It’s not to speed it up; rather, the real objective is to remove the obstacles that impede production. Eliminate the steps in a process that add cost, but not value.

As an example, spending $57 bucks too much for a set of brake pads can be easily fixed by having the brake pads in stock, on the shelf. Badda bing, badda boom. $57 bucks in your pocket for walking 20 feet.

But, I digress. First, and most important, is arranging the bays so techs have room to work without being crowded. The area in front of the bay should have a workbench with a vise and room for toolboxes. There should be clear and easy access to move cars in and out readily.

Can you see clearly?

It’s important to have the proper lighting to repair cars.

Vision is important. If you have to use auxiliary lighting, you’re in trouble; you can’t work with one hand holding a light. You won’t find additional things that need attention to sell if you don’t have good light. It’s hard on your eyes, and drains your energy to work in low-light situations.

When I set up my shop, I first positioned where the cars would be. Then I opened the hoods and calculated where the lighting would need to be to shine directly down on the engine area. This placed a row of lights nearly up against the outside wall of the building, three feet away, actually. Lighting measurements showed the amount of light in the center of the engine to be 65 foot-candles, exactly the amount required for an office.

I ended up with a large light fixture at each corner of the car when I was done. This means you can see to perform brake repair and provides enough reflective light off of the floor to do under-car work easily. Techs won’t sell what they can’t see, and they’ll resist selling work that’s difficult to do if there’s not enough light.

I also measured the widest piece of moveable equipment in the shop and used that measurement as the required distance between the hoist posts, so equipment could be moved around easily.

Be connected

Make sure each bay has its own electrical outlets and supplies, giving the technician direct access to service information.

I remember watching techs search for an electrical outlet to use, so I had the building wired to provide four outlets for each bay. I plumbed two air outlets to each bay, allowing a tech to use two different air tools without disconnecting air hoses.

There’s room for each tech to have his or her own supply of oil filters, fluids and coolants, without walking to the parts room.

Techs also have their own computer terminal with access to our server, as well as Internet access to acquire factory repair service information. We assign all jobs to the best tech for the job when an appointment is booked. The parts are pulled in advance for those jobs and placed in baskets on shelving right in the tech’s area. A copy of the RO identifies the job. The techs can look up their own work each day and see what’s coming in and when it’s due to be here.

There’s a job rack where the paper ROs are placed, along with the vehicle keys, when the customer arrives. The rack is visible from all over the shop, so the techs can see if there’s work to be done.

When the car arrives, the tech can grab the ticket and the keys, knowing the parts are already in their work area and go straight to work on it.

We also tell every customer the promise time is “end of the day” for every job and that we’ll call them if it’s done sooner. This enables techs to decide the best order in which to attack the pile. This sets production times based on the tech’s efficiency, rather than asking each customer when they want it and setting up a production schedule based on unrealistic expectations.

This one procedure alone increased production by 20 percent and substantially reduced mistakes and comebacks.

I have to stop now, but I hope that this illustrates the concept of building the workplace around how it’s used, first and foremost.

Smart savings for your shop

Every shop needs to have a parts room that is well organized.

Each minute saved is $2.85 in our pockets and believe me, every person in our operation understands the value of that minute. Compare two identical cars that came into a shop at the same time. One goes to one tech and the other goes to another tech and they’re of equal ability. Both cars need front brakes. The pads are in stock for one, have to be delivered for the other. At the end of the day, they sit side by side. One cost you $57 less to produce than the other, because the tech whose parts were on the shelf was able to finish the job and get on to another one, while the other is updating their Facebook account while waiting for parts.

That’s just a single instance, but $57 a day equals $1,197 a month and $14,364 a year. Just for having one set of brake pads on the shelf. When a shop owner tells me they can’t afford to have inventory, I can see they haven’t done the math.