RAISING YOUR PRICES IS KEY TO GOOD EMPLOYEE COMPENSATION!

(Article published in L’Automobile Mechanic magazine, February 2024)

By Noëllise Turgeon

In 2007, when Richard Castonguay was a garage owner, he took a training course at NAPA that transformed and improved the way he ran his business. Since then, he has become a much appreciated trainer-consultant for garages across Québec.

“As the enthusiast that I am,” explains Mr. Castonguay, “I wanted to share with other garage owners and entrepreneurs how this training had positively influenced the profitability of my business.” That’s why he decided to become self-employed, offering his services as a workshop management trainer throughout Québec. Today, on the eve of retirement, he continues to be available on call as a trainer-consultant.

Mechanics: A Trade to Value

“I’ve always been proud to be a mechanic,” says Mr. Castonguay, “but I’ve often found it a shame that the trade isn’t appreciated for its true value. There are still mechanics who charge less than $100 an hour,” he says. He recalls that, at one time, an independent workshop owner made a point of charging his customers lower prices than the dealerships. But the situation has changed. Today, customers are looking for performance and high-quality service, and they know that this expertise comes at a price.

Raising Prices, a Winning Strategy

“You have to be wary of the trap of fear of loss, fear of competition, fear of falling sales, etc.,” says Castonguay. According to him, some garage owners don’t dare increase their rates, because they don’t always realize the quality of their services. “You’ll never hear them say, ‘my workshop is well equipped, I have excellent employees, I offer outstanding service to my customers and all this is worth that much!’”

By raising the rates for the services they offer, they can pay their technicians what they’re worth. Employees who feel appreciated in their work and who are well compensated tend to excel, which benefits both the company and the customers. To justify a price increase, a garage owner can remind his clients that he invests in the beauty of his facilities, employee training and state-of-the-art equipment.

Mr. Castonguay concludes by pointing out that, in a context of labour shortage, it’s better to make sure you offer your existing customers the best possible service than to prospect for new ones. “You’ll not only generate more profits, you’ll also be able to better manage your technicians’ time.” Great food for thought!