How Many Employees Do You Need?

How many techs do you really need?

It’s a question shop owners have to answer time and again. And the answer may swing wildly between “More! More! More!” and “Are you for real? I don’t have enough work for the techs on payroll.”

But are you hiring because you need more techs, or because your current techs aren’t being properly utilized? The most recent data in our State of Heavy-Duty Repair report suggests that tech utilization is a bit lower, on average, than we’d like to see: 66%, as opposed to an average efficiency rate of 84%.

In other words, utilization could be better.

If you hire someone to fill a gap caused by your own inefficiencies, they’re not going to magically fix those inefficiencies. They’ll just end up inadvertently contributing to them.

Maybe you don’t need to hire five new techs. Maybe you need to fix your stuff and hire one or two.

We sat down with Chris O’Brien, COO of Fullbay and former fleet manager at Shamrock Foods, to find out the best way to go about hiring—as well as find out if you even need to hire.

GET YOUR SHOP IN ORDER

There are three things to really look at when making sure you’re in a position to hire: technician time, utilization, and efficiency.

“Those are the cornerstones of any company,” Chris says.

It’s also one of the cornerstones of Fullbay, which measures a tech’s utilization of time. And yes, Fullbay can make tracking that easier…but we’re writing this article for everyone. You don’t need our software to figure this stuff out.

Here are some of the biggest time-sucks a technician faces:

• Work assignments. If your service manager (or equivalent) is buried in paperwork and can’t ferret out jobs or get authorizations quickly, you may find your techs just standing around, wondering why we cook bacon but bake cookies.
• Transit time. Most maintenance and repairs require at least some parts. Let’s say a tech heads to the parts manager and announces they need seven parts. They finish…they walk back to the bay…they remember they need an eighth part. They go back. Or maybe they’ve forgotten to write down what they need. Or they wrote it down, but it’s indecipherable, so the parts manager calls them back. Or the tech actually needs to go out and pick up the parts from a vendor. It’s all time spent away from the bay—and cuts into productivity and utilization.
• Administrative work. Are your techs accompanying the customer to the front office to settle up, or handle other administrative tasks? That’s also—wait for it—time away from the bay.

Chris emphasizes the time lost in these endeavors: “You can have all the techs in the world, but if you have them chasing parts, that’s a huge mistake,” he says. “Or you can have all the techs in the world, but you have them writing up service orders and collecting cash.”

This means you might still need more people, but you might not need techs. Which conveniently segues into our next topic…

THE DISTRIBUTION OF WORK

If you’re constantly pulling technicians off the floor to make them handle the admin stuff, that’s a huge drain on their efficiency.

“Sometimes you need that expertise [in the moment],” Chris concedes. “But in many cases, you don’t need to pull that many techs off the floor.”

Every time you yank a tech out of a bay to help with other tasks, that’s a loss of productivity for them and potentially a drop in revenue for you. Are you pulling techs? Maybe it’s time to hire someone to handle the front office stuff—or hire someone to help the people you’ve already got. Find someone who is good at invoicing, at office management, and so on; they can learn to answer customer questions over time.

“You can train people,” Chris reminds us. And look, if a customer really does need to talk to a tech, you can still pull a tech—but hopefully that won’t happen as often.

And heck, maybe you go a step further. Are your techs losing a ton of time ferrying parts back and forth? Look into hiring a parts runner, or someone part-time to help out with that work.

If you’re sure you’re distributing work correctly, then it’s time to look into how your techs are completing the work they’re doing. That’s right, folks—we’re getting back into efficiency and utilization.

via GIPHY

PIVOT!

MAKE SURE YOU’RE BILLING HOURS WORKED

Okay. First things first as we shift gears: Do you track efficiency and utilization? If not…well…you should start. Again, you want to hire new techs when you need them—not because you’re underutilizing the ones you have!

If you do track it, how do you know it’s accurate?

Are you following Standard Repair Times (SRTs)? The American Trucking Association has RP codes you can follow; our very own integration with MOTOR includes labor time guides. In many cases, there’s an established timeline set for repairs; if a brake job should take, for example, four hours, are you charging for those four hours?

Is the brake job taking longer than four hours, and you’re still only billing for four? That’s a hit to the bank account.

Are you billing the six hours but losing business? Also a hit, because everyone else can do a brake job two hours faster than you.

You might also have techs who have particular skill sets that may not be utilizing them properly. Let’s say your shop deals with a lot of rusted components because you’re in a region that experiences Actual Weather. It’s inevitable that your techs will end up filing a lot of rust off those components…but is that cutting into other work they could do?

Maybe that’s an opening for a certain kind of worker, Chris says. A junior person (maybe not even an apprentice yet, but that’s not out of the question) who can handle some of the time-consuming jobs that cut into your techs’ work.

TECHS-TO-VEHICLES: A FORMULA

Okay, Fullbay, you may be saying, if you’re so smart, tell me how many techs I SHOULD hire.

Okay, dudes, we can’t do that and you know it. Shops need to make their own decisions and all that. But we can show you what one particular shop did: AM PM Diesel Services in Texas. We had them join Chris and Fullbay CEO Patrick McKittrick for a Shop Owners Roundtable at the beginning of the year, and founder Dale Bowman shared their formula.

Ready? It’s easy.

Basically, you need a head count on equipment to determine how many techs you should have.

AM PM services fleets, so when they take on a new customer, they ask how many trucks and trailers that customer has. “For every 23 pieces of Class 8 equipment, you’ve gotta have one technician.”

In other fancy math terms, that’s a 23:1 ratio.

If a customer has 230 pieces of equipment, they’ll need 10 experienced technicians assigned. And they’ll be responsible for every bit of maintenance and other work the fleet needs.

Now, will this formula work for everyone? No—you’ll need to make some adjustments to it based on your own situation and what your techs work on. But it’s a good starting point to work backwards from.

GO FORTH AND HIRE

And that’s a wrap! Hiring additional technicians can be a boon to your shop and just what you need to grow your operation—but make sure you’re fully utilizing your existing staff before going on a spending binge.

Throwing bodies at an improper utilization is only going to exacerbate the problems you already have. So get your shop in order, make sure you’re trimming inefficiencies, and then go forth and bring on more bodies.

Happy hiring!