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Flat Rate Pay: Have You Successfully Changed This At Your Dealership?

Nov 29, 2021
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KATHRYN
Over the years more and more we are getting complaints that flat rate is no longer as effective as it once was. We are exploring different avenues but I am wondering if anyone out there has had success with this in their shop. If so, what did your pay structure look like? I am not looking for exact dollar amounts, but examples like salary plus a production bonus, tiers, etc. We have some ideas in mind but was hoping to find someone with success in this to speak with.
 

ChrisR

Boss
Oct 12, 2015
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Christian
Over the years more and more we are getting complaints that flat rate is no longer as effective as it once was. We are exploring different avenues but I am wondering if anyone out there has had success with this in their shop. If so, what did your pay structure look like? I am not looking for exact dollar amounts, but examples like salary plus a production bonus, tiers, etc. We have some ideas in mind but was hoping to find someone with success in this to speak with.
Only time I have been at a store that hasn't paid flat rate was exclusively in our used car department. Those guys got paid a base/salary to work on cars from 8-5, didn't matter how much was needed on it. That way, they weren't incentivized to try and make every used car a new car.
 

DrewAment

3rd Base Coach
Apr 30, 2009
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Drew
Flag / Book / OEM time - all the same names for what a job "should" take.

However, isn't the goal for the tech to be efficient? The normal is for techs to be able to flag more time than he/she works. I have seen techs flag 80 hours for a normal 40-50 hour work week. I would recommend that your "bonus" be paid off efficiently. IE: 125% = 1$/hour more, 150% = 2$/hour more, etc etc DO what works for your shop based off %% and $$.

Only time I have been at a store that hasn't paid flat rate was exclusively in our used car department. Those guys got paid a base/salary to work on cars from 8-5, didn't matter how much was needed on it. That way, they weren't incentivized to try and make every used car a new car.

Yep - used car recon is a good case for base/salary/hourly. Another case is your quick lube (oil change) techs if you have a quick.fast lane.
 
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Nov 29, 2021
4
1
Awards
1
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KATHRYN
Only time I have been at a store that hasn't paid flat rate was exclusively in our used car department. Those guys got paid a base/salary to work on cars from 8-5, didn't matter how much was needed on it. That way, they weren't incentivized to try and make every used car a new car.

Thanks for your input. This is a complaint I'm getting more and more from techs looking to get out of the business. I've heard of people switching however have not heard of success. Thanks for your time.
 
  • 1Like
Reactions: ChrisR
Nov 29, 2021
4
1
Awards
1
First Name
KATHRYN
Flag / Book / OEM time - all the same names for what a job "should" take.

However, isn't the goal for the tech to be efficient? The normal is for techs to be able to flag more time than he/she works. I have seen techs flag 80 hours for a normal 40-50 hour work week. I would recommend that your "bonus" be paid off efficiently. IE: 125% = 1$/hour more, 150% = 2$/hour more, etc etc DO what works for your shop based off %% and $$.



Yep - used car recon is a good case for base/salary/hourly. Another case is your quick lube (oil change) techs if you have a quick.fast lane.
Yes definitely as far as efficiency. Our worry is changing the pay structure = immediate loss of production so were looking at ways to still tie in flat rate while giving a base weekly pay for 45 hours of work. Just something we are throwing around. I appreciate your thought on the bonus part. What I am hearing has techs are looking to do something else is their disdain for flat rate so we were putting thought into something that would help. I appreciate your time. We didn't want to look at hourly for them, more of a base plus production bonuses, potentially.
 

ChrisR

Boss
Oct 12, 2015
412
381
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Christian
Sounds like sales people who complain about not having guaranteed pay, but don't want to put the effort in, to maximize their pay checks.
 
Nov 29, 2021
4
1
Awards
1
First Name
KATHRYN
Sounds like sales people who complain about not having guaranteed pay, but don't want to put the effort in, to maximize their pay checks.
Unfortunately hearing more and more of this over the year from all levels of technician including high producers. Maybe it's where we are located. Maybe it's a generational thing. I am not sure. This is not something set in stone but I'm open to hearing about different bonus structures that have helped morale/motivation.