News and Commentary
** Commentary are thoughts and views from the contributor and are not necessarily that of CalABC **
Feet on the Street - Commentary on Shop Life

Date: February 4th, 2019
RE: I'll take a #2 Please!
 
 
I’ll take a #2 please!

OK I have to admit I have used that “exact” phrase myself as I have gone to a McDonald’s drive through lane. For the uninitiated that is a Quarter Pounder with Cheese and a fry and a drink. <like you didn’t know – grin>. The beauty of this is you just say “Hi can I have a number two – with a diet coke <yeah I know diet coke ??>. What I hear back is that will be $7.32 at the first window, please pull forward.

That ease of ordering has been available in many different industries such as the local car wash, “I’ll take the premium wash service please with new car scent, <my car is too old for new car scent – but you know gotta dream>.

In the auto service arena, we have tried to use similar approaches with varying levels of success. An issue we have had in the past is that the Bureau of Automotive Repair has very specific rules and regulations for how an invoice needs to be created when providing a service to a customer. We are required to list each item/part used, and a line item for each labor service.

Shops have used Menu Pricing which is a bundle of included services for a set price. The idea just like McDonald’s is it lets customers look at your offerings in an easy to see format and just select what they want.

The problem is when you move from the menu to the invoice you have to adhere to the more complicated rules regarding the breakout of individual line items. The issue is that you may use more of one item and less of another and although the customer has approved the included listed items for a set price, you would be required to modify the listed line items pricing in order to stay within the bundled price point.

Recent changes to the rules regarding maintenance services have brought many Oil Change specialist into the Automotive Repair Dealer (ARD) registration requirement. The idea is that these service providers have been delivering work for customers for compensation and therefore, should be part of the ARD registered community.

However, this group of shops has historically used the menu pricing approach as their key business differentiator, along with their speed of delivery, versus regular automotive repair shops. This has the potential to put these brand new ARD members on a collision course with the BAR. There was considerable anxiety building over the new AB 3141 legislation that now requires them to fall under the BAR and the Automotive Repair Act because the initial estimating process and detail required by BAR would slow down the speed in which the businesses processed customers, which is one of the main reason a customer visits an oil change provider versus a full service provider. They want to be in and out as quickly as possible and the business needs to turn that service bay as quickly as possible since they operate on thin margins. That was the main reason we removed the requirement for an initial estimate for these minor services. The customers and the businesses both get what they want and can continue to provide speed, efficiency and convenience to their customers. And just as important, be in compliance with BAR Rules and Regulations.

Recently with input from the California Automotive Business Coalition (CalABC), the BAR has agreed to open a dialog to find a way to accommodate the menu pricing business model.
Rest assured we plan to be at the table for these critical discussions doing our best to make sure our new ARD friends are not only not on the food menu but are with us every step of the way.
Talk to you next month!  In the meantime:  Keep Your Feet Moving - Do Good Work - Take Care of your Customers
Bud Rice
President
Side B Corporation DBA
Quality Tune Up Shops
 
 

New Lunch and Learn April 17th !
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This quarter's Lunch and Learn is sponsored by our friends at Auto Advisory Services - KPA.
Our session is hosted by Universal Technical Institute. Campus President Tess Carey Dubois is offering a campus tour at 11:00am prior to the Lunch and Learn.
If you would like to attend be sure to contact our Executive Director 
Johan Gallo by calling him at 949-433-4513 or email gallojm1@outlook.com

Upcoming Events
Apr. 17th , Jul. 17th and Oct. 16th




Apr. 18th , Jul. 18th and Oct. 17th 
CalABC Board Meetings: Closed Session 12:30am - 1:00pm.  General Session from 1:00pm - 5:30pm. Location at the UTI Sacramento Campus.

2019 BAR Advisory Meetings:  9:30am - 1:00pm / Special Afternoon Session TBA 2:00pm - 4:00pm. Location at the Department of Consumer Affairs HQ1 Hearing Room 102
1625 North Market Blvd. Sacramento, CA 95834

Nielsen Sweeps Calendar for 2019
  • January 31 - February 27 ,2019
  • April 25 - May 22, 2019
  • June 27 - July 24, 2019
  • October 31 - November 27, 2019

CalABC Membership Information - Join Today!
Visit our website at www.CalABC.org to look at our accomplishments along with other interesting items.  We thank you for your time and hope you will join CalABC and become a member today.  Help us work on key areas for the betterment of our industry, consumers and the agencies who regulate and impact our businesses.  

Please don't hesitate to call me or any of our board members for more information.  You can also find out more by visiting our website at:  www.CalABC.org

Looking forward to your participation,

Johan 
Johan Gallo
Executive Director, CalABC
P: 949-433-4513
E: gallojm1@outlook.com

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Contact us at info@calabc.org for more information
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CalABC Office: 2200 L Street, Sacramento California 95816
P: 949-433-4513 / F: 925-369-0420 / E: info@calabc.org


Tuesday, February 5, 2019







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