Why teach business management to installers? Because oftentimes, Schmitt says, “a shop manager or a store owner is one in the same. I’ve had lots of technicians say to me, ‘You know—those are some of the most important things I’ve learned—learning how to charge, because we can do the work, but have lost money on those big jobs.’ Now they have a better understanding of the business side of the installation part of it. Also, I think it’s important that these guys, these installers, are not blind to what’s going on up front. When they go out and bid a job to a customer, they’ll be more educated on how to speak to them. The way we like to do it is in labor units. It’s just like a body shop—it’s figuring how many hours you think it’s going to take. We work off a bid sheet that we give these guys, so that they learn how to do it right instead of just shooting from the hip and saying, ‘Oh, it will take a month and it’s going to be $10,000.’ We give them a way to break it down into details that add up to a total labor amount.”
Schmitt points out that the vast majority really doesn’t think about installation jobs in terms of hours, often taking stabs at cost guesstimates and later regretting they hadn’t bothered to calculate better. “They might think $10,000 is a lot of money, but when they’re having to turn away jobs and lose other business opportunities, it’s costing them much more than that $10,000. They’ve really got to make it efficient. You can do a survey and ask how many guys have done big jobs where they’ve lost money on them, and almost everyone will raise their hand.
“Projects need to be broken down into smaller chunks to be managed,” Schmitt says. “We do it like a body shop does—you do a door panel, and it takes 4.5 hours, and that’s how you’re paid for it. If it’s anything over that, if there are reasons why, we need to adjust our bid sheet so the next time that car comes in, we know it’s more difficult and we bill for it.”