Making More Money with TRACS: Labor Pricing

Volume 1, June 2013
Installer Edition: Making More Money With TRACS: Labor Pricing
Making More Money with TRACS: Labor Pricing
This is the second part of our continuing series on improving the profitability of your shop by using
the powerful tools available to you in NAPA TRACS.
Did you know?
Raising your labor rates according to job difficulty rather than increasing the time, will save your
customers money and will ultimately be more profitable for you.
In the following examples, we’ll show you how to use NAPA TRACS and the Mitchell Labor
Guide to establish the most profitable labor pricing for your shop.
In the examples below we’re using the standard Labor Rate of $80 per hour with the technician
receiving $25 per hour.
TIME
LABOR
RATE
CUSTOMER
PAYS
PAY TO
TECH
GROSS
PROFIT
Standard
2hrs
$80
$160
$50
$110
Increase Rate
2hrs
$85
$170
$50
$120
Increase Time
2.5hrs
$80
$200
$62.50
$125
Looking at the chart above you can see in the third example that by increasing the time charged
for the job, you’re increasing the cost to the customer by $40 over the standard rate, as well as,
pay to the technician. In the second example you’re only increasing the cost to the customer by
$10 over the standard Labor Rate and that goes directly to your Gross Profit and the shop
benefits.
How do you set up rates?
In NAPA TRACS, under Labor Rates, set up multiple rates according to the Mitchell Skill Level
Code starting with your base Labor Rate in the Semiskilled Code or C. Then adjust Labor Pricing
in increments of $5 as you increase difficulty and keep lower skilled jobs at your base rate. As
the job gets more difficult (A + B skill levels), the Labor Rate goes up to compensate your shop
accordingly.
A- $90
B- $85
C- $80
D- $80
E- $80
pg 1
X
Labor Rate List
Rate Name
Rate
Rate Cost Basis
AJOB
90
Actual
BJOBS
85
Actual
CJOBS
80
Actual
Done
New
Edit
Delete
Labor Guide
SAVE
Have questions about setting up or using any of the profit controls mentioned here?
Feel free to contact NAPA TRACS Support Monday – Saturday at 800-742-3578.
PRINT
Installer Edition: Making More Money With TRACS: Labor Pricing
Volume 1, June 2013
More shops are setting up multiple Labor Rates which correlate to the Mitchell Skill Level Codes.
Mitchell ranks the difficulty of each job and provides you with a suggested time for that job.
X
Labor Rate List
A- Highly Skilled
B- Skilled
C- Semiskilled
D- Low skilled
E- Low skilled
X
Labor Estimating Guide Rates
Guide Rate A-
AJOES
Guide Rate B-
BJOES
Guide Rate C-
CJOES
Guide Rate D-
CJOES
Guide Rate E-
CJOES
Done
Save
New
Cancel
Edit
Delete
Labor Guide
Once you have set up labor pricing, TRACS will automatically select the correct rate from the
Mitchel Guide. Once you have implemented this method you should start to see an increase in
your gross profits very quickly.
What NAPA TRACS Users Are Saying:
"Labor pricing helps me account for jobs that are more difficult and time consuming and
therefore should be more profitable. It is super easy to set up within TRACS. I continue to use
this coupled with a parts matrix to maximize profitability."
Steve Horvath
Jeno's Automotive
Littleton, CO
"The labor matrix within TRACS is great ---it's as simple as classifying A, B or C in terms of job
difficulty. It has increased by profits by approximately 15-20%. I have been using it a little over a
year and love it!"
Brian Burford
Zarlingo's Automotive Service Center
Grand Junction, CO
pg 2
SAVE
Have questions about setting up or using any of the profit controls mentioned here?
Feel free to contact NAPA TRACS Support Monday – Saturday at 800-742-3578.
PRINT