I took these last night before we closed. i started to shut the doors down when i just had to sit back and look, man i have a bad ass shop. i no it is not much for size but me being in buisness for 4 years and only 25 years old i think it is pretty awsome having cars like this that we are working on. just thought i would share a few with you. i now most of them are high dollar high tech cars but we have a few low buck retro rods going too. these are mostly pics of the same thing but i just could stop shoot'n pics. btw we are hiring techs.
damn, why do all the cool jobs have to be so far away? Anyways thats an awesome shop. congrats on your success.
Hey K-rods... What size IS your shop? Are you having to do a frame-up build out of one shop? Do you have any room outside to store dismantled stuff? Also, how are you handling your bookkeeping/accounting (what computer program)? Maybe we could share some stuff between us and other shop owners here. Even though we are all in the same biz, we are not really competitors. Does this make sense??
hey guys, im glad this thread was started cuz i have a few questions myself. i like to consider myself well versed and pretty damn knowledgable when it comes to biz, but after reading this thread i realized that i do have some issues that arent getting solved right now. we are in the process of moving into a 18k sq ft building. we have a full body shop with a heated down draft booth frame machine 2 body guys and 2 custom painters. we just passed all our inspections so now i can move my equipment in. we are a traditional motorcycle/hot rod shop. we have a staff of 11 and we build rodz-customs-sleds-lowriders-ratrodz/ new and old school bikes. our show room (after the remodel ) will be a 50's diner theme and will be 2k sq ft in size. ok on to my question for you other guys. i have designated a little over 2500 sq ft to stock/inventory. my goal here is to stock as much as possible so the customer doesnt have to "wait" for simple shit to be ordered when it should be in stock to begin with..lol...so my question being do any of you guys know a good inventory program out there that isnt 15k bucks? im looking for something that automatically deducts items out of the system and "redflags" when stock is getting low on that item. i have a similar program for my salvage yard biz, but its a generic parts inventory and it list car parts 67-newer , and the maker of that program doesnt offer one like i need. i also have another similar program for my towing company, but no such luck with them making anything for me. i have tried to ask other friends in the biz here in town but they dont really know, quite honestly there isnt a shop like mine here, and they dont stock too much. got any ideas?
Greasemonkey,Sounds to me like you've got a typical little back yard operation just like everyone else here. How about we call you if WE need help? One thing for sure, you've made everyone aware of the size and scope of your business and that's what is important, right? Frank
HEY FRANK, not sure if your being complimentory or ribbing me, but the point of me explaining was so the other guys who were talking about "programs" could help me in my search for a good inventory program as well. if my last post came off the wrong way i apologize, just looking for help too
there is a company called cam-commerce you might look them up on the web they were working on programs like this a few years ago i bought one of there programs that they already had because i needed it then "so i thought" but it ended up being for a clothing shop which didn't work out. but anyways i would see what they have available now.
Look at quick books. It is the most common program going,it is user friendly, does inventory, and most accountants like it.You are not going to find a rod shop specific program. I used quick books when I had my shop, and we use it at the shop I work at now, and it works well.
see i have quick books pro 2005 in all 3 of my biz's i just thought there might be a specific program. at first i took for granted there wouldnt be a rod shop specific program like you guys said, but then i wouldnt have thought there was a tow truck specific program either..lol....just trying to find out whats out there. but if you guys think quickbooks is the way to stay then i will, awesome thanks guys
I also use QB 2004 Pro. I guess I will be the "stick-in-the-mud" because I DON'T think QB 'rocks' that much as I would like it to. Personally, it does not give me the information I need and I have had to "trick" it into do things I want it to do that should be normal for it to do IMO. Now if someone knows of a way for it to do these things, I am ALL EARS! There is one other thing I want to make clear here. I would appreciate if no one 'blasts' another poster here for their method of biz because that is not the point of this. Personally I have 7 employees on Payroll and so the Payroll add-on handles this portion very well for us. The Accounting side of the program is more difficult. Let me explain this by writing a short "book" so you see how we do things. My employees start their day by working off of a generalized "punch list" which in essence is what chores need to be done to the vehicle. It can be a broad or very focused list depending on the needs at the time. If on the list it says to * Pull Engine, then common sense tells them they will need to remove the hood, the radiator, and so on. Next, each portion of their operation is logged on a Time Sheet. In other words, if they start on a project at 7:00AM, then they write that down. At 9:55AM if they are still working on the same project, they are supposed to stop and write a short essay on what they have accomplished before they take their 10:00 break. This is supposed to happen again at their lunch, their afternoon break and before they go home. This gives the Office Girl a fairly comprehensive description on what they did to earn their pay from the customer. Next she logs this onto a Q/B invoice set up for the customer. Now here is where things must get creative in Q/B. In a business where you have a labor operation that is basically the same routine over & over, you can set up an item in the list such as Oil Change ...and then list the price. When the labor operation changes from day to day, it would be too difficult to do this so we use a generic Labor operation that is sub-broken down. My item listing is "Labor (labor BT)" followed by a blank description and my hourly shop rate. That way when I write out on my timesheet what all I did, the officer person re-writes it onto the invoice. All material and supplies follow each operation however parts used go to the top of the invoice. Now the problem that happens is when we build a turn-key vehicle, in all likelihood the invoice will reflect between 30-40 pages. In other words, when you read down the invoice after the job is completed, it should read similar to what a "how-to" book would in telling what was done from start to finish. Now while this all sounds great, the problem lies several layers thick here. With this method it is extremely hard to check productivity --especially on repeat operations. Also, we use a Declining Balance method of accounting in which Q/B does not understand --and which I think is stupid on their part!! Declining balance accounting is the same thing as a retainer is to a lawyer, or pre-payment of an ordered item at your local parts store. I will jump in and tell you that this is not a debate about whether or not you should be paid in advance. For my business, on all projects that estimate the parts & labor to be under $1K, we do not charge any upfront retainage however on operations that will go larger than $1K, we secure a deposit to work off of. In essence this means that if a customer brings you his "1957 Essex Taxi-Cab" and wants you to chop the top, he leaves a retainer to get the project started. Let's use a hypothetical amount of $2K. If two technicians start on the project and each log on 8 hours each (and your labor rate is $50 an hour), then at the end of the day the customer's balance is $1200.00 ($50 x 8 = $400 x 2 employees). The next day, if the same time is spent, then the new balance is $400. When the customer's balance approaches near $0.00 we invoice him to replenish his account. What this does is protect you as a shop from having John Doe the customer get started into his project and realize he has $2K invested in a vehicle that is now worth $500.00 and leaving the shop trying to figure out how to re-coop their money. Now, back to Q/B. Q/B Pro allows a customer to pay however you cannot update an invoice and have a credit left outstanding. In other words, if the customer pays $2K but is invoiced at $800, then when the invoice is closed for the day, it will show the customer is paid in full only after you manually must apply any credits towards the invoice. The next day when you log operations on the invoice it will show the customer woes a balance unless you manually go and apply the credit towards the invoice. This is very time consuming and does not show a quick way to tell which customers will be approaching a $0.00 balance soon. It also does not have a way to interface project management programs such a Gantt charts to show where you are in any given project. In a one-man or two-man shop, this is not a big deal but when you have several disciplines in-house then scheduling becomes critical to keep the flow going. You cannot have the bodyshop ready to do a project only to find that the metal shop is saying it will be another week or two before they are ready to send it over. I am not in the same league as a NASCAR team which has staff members that have this as their daily job so I must utilize software that allows me to do this efficiently and as a value to the customer. I will stop there and say that it sure seems like with as many restoration shops and rod shops that are out there, that someone would have taken the time to write a program to assist us. Remember that most of us are craftsmen first and office personnel LAST! Lack of cashflow, and lack of charging what is due is why most people claim you cannot make any money working on old car. Nothing could be further from the truth but organization must be of utmost importance. If some of you out there have any solutions to what I briefly just wrote about, then I am truly open to suggestions on how to become more efficient at what we do.
i have a shop question for you guys. do all of your jobs get charged by the hour or do you have a set rate on certain installes such as AC, wiring, or installing cruise control etc.
I can only speak for myself but I never give a firm price. Too many variables from project to project. If a customer asks how much should he budget, I may give him a cost-by-cost detail on an estimate however my estimate clearly states that an estimate is just an estimate or a best guess. If they need to know a hard fast figure, I will give them a cost not to exceed which generally is 3X what the estimate is. When they tell me I'm nuts I tell the customer that when I charge by the hour, I will produce an honest hour of work for an honest hour of wages. It is the best form of "weed control" you can ask for. Let me also say something that I have heard two successful shop owners tell me. EDUCATE YOUR CUSTOMER. When that rule is followed with great detail, you rarely have any money issues with the customer. Document everything you do on the vehicle with the customer. If a problem arises, by you "educating" your customer on the problem and giving your suggestions on a remedy, they understand what you are encountering. Then it is your part to be sympathetic to their dilemna however most understand going in that all they are doing is buying your 'time' and 'materials'. It took time to find the problem, it took time to solve the problem, and it takes time to correctly remedy the problem --and that none of this is directly your fault! Now on the other hand, if you have ten '32 chassis' to build in an assy line, then by all means charge a "flat-rate".
brent, you took the words right out of my mouth. we never give a flat rate unless it is something that is a repititous installation. a 4-6 drop on an 88-98 chevy truck is always gonna be the same price. now an air bag system on the same truck, i might be able to quote it closely, but i tend to give a open ended answere due to the diff factors that may apply. brent the problems you have are similar to problems i was trying to address. i am also looking for a better solution as how to stay on top of inventory as well. hopefully this thread will cause some program writer to get off his ass and design something. thats what happened for us in the tow industry.
the hard part about educating my customers is explaining it to them over the phone. any solutions for this problem or any past experiences? it is ok if they have email and i can send them pics but when they can't see what you are talking about it is hard. has anyone had a problem with estimating turn key fiberglass street rods, that you build on a regular basis, that are all basicly the same but of course a different color and motor etc. the problem i run into is a customer wants a turn key price before he starts the build and it seems to them if you build them so much you should give them a price pretty firm price which i could totaly understand since you can buy one cheaper then you can build it. also how long does it on average take you to build a turn key car fiberglass or steal. not a major exotic build but a basic street rod with little flare to stand out in a crowd. if these don't make since let me know alot of questions are going on in my head and i am trying to jot them down as i think of it.
Pardon my ignorance guys, but what is the difference between a regular inventory control program and one tailored specifically for your shops or businesses? I have used QB in the past, and it does what most retail shops require. I have written some basic web based inventory apps as well, the could be used in various retail shops and warehouses. Am I missing something? grumper
Well, to be honest with you, inventory control is not a big problem with us because I force us to make a 'P.O.' on everything we use (parts materials, supplies, etc.) so that it goes into inventory first. Even if it is a one-time item. That way I have the ability to track it all. I just got through looking and have 3118 items on my Item List. We charge for everything we use on a project. Fastener hardware to bodyshop supplies has a part number. For example my part number for 1000 grit sandpaper is BS 1000 which stands for Bodywork Sandpaper 1000 grit. Generally we purchase it by the sleeve and so at any given time, if I look in Inventory Control and it shows we have 22 sheets on hand, if I go to the cabinet, there had better be 22 sheets available for use. The same thing applies for rust-busters, silicone sealers, Loc-tite, etc., etc. A customer understands if you charge them for .1 of Loc-tite or .25 of Silicone Sealer. They don't like it when you charge them for a whole tube if you don't use it all on their project. The true problem is like what I posted above. Shop owners can make great biz decisions if they knw the facts. Many times they cannot see the forest because of the trees. Being able to tell which employees are making him money and which operations are losing money. K-rods, I know this is gonna sound lame but you need to decide something right now --are you in the Street Rod biz for "Passion" ...or "Profit"? Neither answer is wrong but you must decide early on and never deviate. I personally am in business for the 'Profit' side. I am 45 years old and have done this long enough to realize that there is life outside of cars, so I want to provide a "living" for my family. Now when you ask about turn-key cars, let's analize a couple of things. Customers will use your services for one of two reasons. Either they like you ...or you're the cheapest. The biggest single thing that will take a business under is not knowing what your proper hourly rate should be. Charging $55 an hour just because 'JimBob' across town is charging that is a recipe for disaster. Being able to know what your 'overhead' (fixed & variables) is defines what your hourly rate should be. Then to confuse the issue, many of the overhead figures change month-to-month so you must be able to be flexible. This means cutting costs when times are leaner or be able to bid higher when times are slower. Go back and re-read what I just said!! Therefore you giving a price on a turn-key car will change and it can do it from car to car. Too many prices change from vehicle build to vehicle build --and you nor I have the clout to be able to do like the large automakers and get locked in price quotes on parts for months in advance. Now here is something that I do not understand your rationale. We are not in the business of turning out cookie-cutter cars. You are not and doubtfully will ever be a manufacturer. You are a service provider. That means you want to build a vehicle where your customer does not "see himself coming up the street". Therefore if it is different than anything else you have built, just how can you know your exact costs? You asked about talking with a customer trying to explain problems. Your business is based off of trust but you must remember that every job that comes into your shop will not always be profitable. Certain situations arise in every scenario that will cause you to need to walk away. If it is a simple rear end swap, then you have no real need for contant visual inspection however if you are doing sheetmetal fabrication, then the need for ongoing visuals to be sent is a must. Your options is to take pictures and either e-mail them or FedEx them. If this is too great of a hassle, then either you must charge for your time or pass on the project. I personally view lack of e-mail just as if you have a customer that only has $1K a month budget to spend on a build. For us, our shop space has a greater value than what the $1K benefit to us is. I am getting tired ...and I know there are other shop owners out there that are viewing this thread. I sure wish you guys would jump in and make some comments too. I know my answers are not the only way and I am wanting to hear other opinions too.
Anytime I've given a price I've lost money. You can give a ballpark figure based on previous jobs, but never give a firm price. We are in the custom business, and there is no book to open that tells us how long it will take to fabricate a bracket to mount an air conditioning compressor on a Hudson. If you are doing repeat jobs over and over, you can get pretty close. Where the problem comes about is when you tell your customer it will cost you $xxxx. to rewire your car. He agrees, and goes home. The next day he calls and says while it's there take a look at the brakes or whatever, and you call later and say, it is going to need front pads, and it wil be about $xxx., and this goes on and on for the next two weeks. Many upgrades latter, and many dollars, he comes to pick up the car, and the only price he remembers is the first one you gave him for the wiring. Now, we not have to just educate the customer, but we also have to educate ourselves everyday. Our job changes with every customer. In an ideal world, we would give him a written confirmation of every change he has made and sign it, but I haven't found that ideal situation. A big problem recently has been these unrealistic TV shows that build a turnkey car in 7 weeks, because now the new guy to the custom car world comes in and thinks we are nuts when we tell him it will be a minimum of a year. Fortunately we haven't had too many of those yet! And to answer your question Jason about a tow truck program, I can guarentee you there are a whole bunch more tow companys than there are rod shops that would want a program designed specifically for us. We use Quick Books Pro in our shop, and while it does have some quirks, in general it works pretty well. Our shop has 15 employees, and we had a system previously called shop writer that was supposed to be for shops of this size, it cost $10,000., and sucked. We trashed it and paid closer attention to what Quick Books is capable of, and we are very happy.
Brent, you seem to be quite knowledgable in regards to programs that make the buisness run smoother. I'm sure you know that MS Project will allow you to produce Gantt charts for traking projects. I for one am very interested in this thread, we will be introducing QB into the buisness soon and I am looking forward to more dialogue
HOTROD34, now you are making very broad assumptions. Actually, you are the 2nd person that has told me that MS Project will possibly do what I am asking but I don't know one iotta on how it does it. The other one is a construction company Project Manager in the boston area. My way of doing it right now looks more impressive than it is. I am using a whiteboard with a bunch of lines. The only thing it does is gives my guys some idea on what is coming up next for them. I hope you can tell us how MS Project can be taylored for all of us to use. So in closing, I guess if the truth is known I am not very program savy on the business side. I do know what works for us but I am not always sure that it is the best way. I always wondered what they would teach us in college about business. I feel pretty sure it would be how to track data that would show me where to make money. Also, if someone really knows Q/B, maybe they can tell us somethings that maybe we aren't using on the program.
Brent, I would be more than happy to explain more about MS Project. I hold a Master's degree in Industrial Management and I am a Certified Project manager as well as a certified Strategic Manager. I am not saying this to toot my own horn but to give credentials as to why I feel that I can explain how MS Project works. The only problem is that it will take some time to put together an example project plan. I will be implementing project management principles where I work, but I have not had a chance to begin yet. Adam
What is your rate. I looked into moving to Austin this spring and didn't come accros anything worth while.
Great info on this thread, as I just started my first "customer" hot rod build. Brent and others, keep the tips coming please. I have had a ton of questions in my head about how to bill. Like a true greenhorn, I did this one at an agreed upon total price, and although I feel like this customer wont hold me to the exact figure, I certainly wont do it again. Already he has made several changes, and I will have to remind him that it is extra work, im sure. I doubt i'll be able to close overnight the business that has fed me the past 16 years, but I would love this one to get going and be able to get out of the systems integrator rat race i'm in now. Also I can vouch for Quickbooks pro, having used it for over 10 years in my other business, which is a computer sales and support company, my wife at one time was a Quickbooks certified instructor. It has worked well, and now has a Point of sale feature, and will support bar coded inventory control, among other things, i'm not using 05 version yet, but will be upgrading (again) shortly. Really makes it easy for payroll, and 941 payments and the other junk my wife does. Which reminds me, watch your bookkeepers. Mine, who was someone I was SURE I could trust made off with over 7 grand before we caught her.
I used to work in my Dad's "street rod" shop, and this thread is really interesting to me. On the subject of doing large jobs that extend over a longer period of time, one thing we did was to make an upfront agreement with the customer that they would get billed at regular increments. We were set up so that we could pretty much let the customer decide if he wanted to be invoiced weekly, every other week, on the 15th & 30th, or monthly. This seemed to work fairly well, and if a customer didn't pay, then the techs worked on another car. (There was always enough work to do this.) After a given amount of time of not getting paid, the customer had the option of picking up the project or paying rent. That was usually enough to get them to pay up and get us going again. As others mentioned, frequent communication with customers is imperative. And when they add more to the project, you don't just say, "ok". You say, "that's gonna add at least another $XXX. Are you sure you still want to do that?" And when you run into an unforseen issue, you call the customer right now. Then work out whatever you need to do. And we straight up told people, if you are worried about the cost, then you can't afford it. But then we were very clear on the invoice what we did, how long it took, etc. Customers almost always balked till they read all that, then they were OK... sorta! As for use of materials, we had different ways of accounting for them. Things you could physically count (hardware, sheets of sandpaper, etc.) had specific charges for each. Most materials like Permatex or Filler Rod were a little too time consuming to measure, so it would have been counterproductive to try to charge specifically for those. They were just considered shop supplies, and were basically "included" with the labor rate. Paint and vehicle-specific materials were charged completely to the customer, but then all the leftovers were given to the customer for touch-ups, etc. when it was all done. This is a great thread. The computer program stuff is particularly interesting to me, as Dad needs to get into the digital world! (Everything is done by hand right now... unless you count the adding machine! Custom shops in general make it so hard to measure productivity. You are not clicking out widgets all day, so you can't have a standard. Just because it took me 3.5 hours to straighten that 55 Chevy fender doesn't mean the other fender won't take 8hrs... or 15 minutes! Do yall have any ideas on measuring techs' productivity? This would be great info to have to be able to justify giving Tech A a raise, but when Tech B asks for one, you can give a straight answer why he's not getting one.
Hey Adam, I definitely would love to hear your input and I don't think you or anyone else that gives facts on their training should be considered "tooting" uhh their horns that is! Actually, someone like you could be very valuable to alot of us here whether they own a shop or not. Building a car is all about project planning and execution. Many people get overwhelmed because of their focus gets lost. I would like to a small tutorial written by you just how we should/could use MS Project. Since I don't know what data you must enter to get information out, anything you can tell us will greatly be absorbed. Good 'heads-up' there My31and37! I don't know what version you are using but IMO, '05 was not great enuf for me to justify the upgrade price. I use the Adobe pdf function all of the time because of invoicing customers and sending documents. Many of you will probably croak but I see my invoices upon completion of frame-up restorations that will go in at 45-50 pages long!! A rod build will generally not go that much because of the store bought items decrease the space needed for explanation on how something was rebuilt. SLIDE brings up a couple of very good points that probably need to be discussed by all of us. I don't know about you'all, but we use a Customer Agreement (contract) on almost all of our projects. Our agreement states how we conduct business and what the customer can expect from us ...AND it also states clearly what we will expect from the customer. I cannot stress enough that you really need to think out how you expect payment. Personally I do not limit myself to a set payment schedule. I do it strictly based off of remaining balance in the customer's account. When it approaches a $0.00 balance, we invoice the customer. The customer has 5 business days to pay more on the invoice or it is then considered delinquent. We then have the option to implement a $15 a day storage plus a late fee. What we have found is that some customers just enjoy having their vehicle in a shop where they can brag to their buddies about what is being done. Some would allow their car to take up permanent residency if this was not in place. Now one also needs to realize that all customers do not have pockets that reach to the floor. Again, educating the customer on ongoing & projected costs just like SLIDE is saying is a must, --plus having a feel for what is affordable for the customer will keep cash-flow coming on a steady basis. Something that SLIDE and I have a slight difference of opinion on is being able to accurately track productivity. Before we get in-depth on this thought, let me explain what I think the definition of "productivity" is in our business. Productivity is the comparison of Actual hours Billed vs. Actual hours Worked. IMO, a "Time & Materials" shop should never see greater than 100% productivity if they are being honest with the customer. A mechanic that is working off of a "Flat-Rate" can indeed run over the 100% mark (good technicians can sometimes run 150% or more) however on a T&M shop, you are only supposed to be charging for actual hours worked. What this means is that you add up the hours that a technician has worked (day, week, month, whole project, etc.) and then add up the Billable Hours on the project. If the Tech logs on his time-sheet 40 hours and they actually logged 40 billable hours on the Invoice, then his productivity is 100%. Now lets say the same Tech had a 40 hour workweek but he was kinda coasting and logged 30 hours to pull an engine and you and I know from experience that it was a 20 hour project MAX. Then he goofed-off and logged another 10 hours to wash, inspect and inventory parts. Even though you know the Tech logged 40 hours total on his time-sheet, you decide that in fairness to the customer, you should only bill them 30 hours of Shop-time. That would mean the Tech has a 75% productivity for that time. Other things can factor in on productivity that must be considered. Let's say the Tech was careless and pinched a brakeline as he was putting a customer's vehicle on the lift. Ethically the customer should not have to pay for this repair ...and you know how we are all able to make mistakes from time to time, so the Tech must take 2 additional hours to do the repair. Other things like fixing a broken shop hose, or cleaning up a spilled quart of oil ...to whatever are all ways that productivity can fall. Being able to track this to see what their average is on a regular basis is crucial to a shop making money --AND the Tech making more money. His value to shop revenue is directly tied in to his value come promotion time. Personally I tell my guys that I want a minimum of 7 billable hours per day for an 8 hour day of payroll. This reverts to 35 billable hours on a 40 hour week. Factoring in overhead needs to be done based off of a 75% of shop productivity. IMO if an employee cannot repeatedly produce at least 75% productivity on a daily, weekly, monthly and annual basis, then they are not a value to your financial bottomline --NOR your customer. Trust me, your customer will know if the tech working on your car is a value to him even if you shave hours to bring his bill inline. * So now, let's hear what you think the ratio between Payroll (including labor burden) and Shop Rate should be! *Also, let's hear how you figured what your Shop Rate should be! This should be interesting! DISCLAIMER: I ain't sure I know the proper answer to the above questions either!!
The Jalopy Journal
