Changing The Industry Podcast

Lucas Underwood [00:00:02]:
Well, here we are again. We're all stuck with David. I don't know what to do about that, but. Steve, Michael, welcome to the show. Steve, introduce yourself, brother.

Steve Schlaff [00:00:12]:
I'm Steve Schlaf. I've been started as a tech and been in the industry for about 25 years. And now I'm the COO of All Around Auto Care. We have two locations in Colorado with a third coming next year.

Lucas Underwood [00:00:24]:
Nice. Very cool, Very cool. Michael, tell us a little bit about yourself.

Michael Hilzley [00:00:29]:
Michael Hilly. I am the managing partner of Auto Safety Center. We have three locations northwest of Milwaukee.

Lucas Underwood [00:00:36]:
Very cool, very cool. So Steve, you were saying, pretty interesting. You were saying you guys have been going through some like, insurance changes. I know it's not what we're supposed to be talking about, but like, what's the, what's the deal with that?

Steve Schlaff [00:00:51]:
You know, there was, there was a mix and unfortunately, calendar wise, they all fall in the same like two month period a year where I have to do the, you know, the workers comp. Audit. Yeah, but we had to change our, the company that had a great rate last year for our garage keepers and business and all that got out of the industry. So we had to redo all of that. We changed ownerships, ownership of one of our buildings. Someone, someone else bought the property. And then the struggles are just open enrollment for health care for a small company. You know, hopefully when we get to the four to five shop range and double or triple our participation, I can get great rates for our team.

Lucas Underwood [00:01:29]:
A little more comfortable. Yeah, yeah. I don't know if you know this. And I went through this deal, I just switched insurance agents and I've known David Corey down at igo. They're kind of like a North Carolina repair shop insurance group. That's, that's what they specialize in. And he came up and he looked at my numbers. I was really frustrated because I kept trying to talk to my agent about this insurance deal, right.

Lucas Underwood [00:01:52]:
And, and I would tell him things. I'm like, hey, I'm a little bit worried about this coverage. Can you explain this? Can you go over this? And he would come over and he'd be like, oh, yeah, we need to change this. We need to do this, we need to do that. I'd give him a list of cars and like, hey, I need to add this driver. Move that driver, whatever it is. And he never would do anything. And I started catching on, like, hey, he's not actually doing this.

Lucas Underwood [00:02:13]:
And so I went to David and I said, hey, David, tell me, can you review my policy and tell me, is it right? And he said, he just, like, opens the paperwork and he's looking through it, and he's like, so tell me, how do you feel about this $10,000 a quarter insurance audit? And I was like, dude, it sucks. Like, why do they do that? And he said, oh, you don't know why they do that? And I said, no. He said, it's because your insurance agent gets more as a commissioner, a bonus in this particular plan if they bill you more after. And he said it's because it's a higher percentage if they get the audit wrong. And he said, so he intentionally put your number super low so he could earn more money on your audit. That's why. And I'm like, oh. And so I saved like four or five thousand dollars a year just by reporting the correct employee pay that I didn't even know I had a choice to change.

Lucas Underwood [00:03:04]:
But whatever, I don't know. David, how are you doing?

David Roman [00:03:10]:
I'm great.

Lucas Underwood [00:03:11]:
You don't sound great, bro. You okay?

David Roman [00:03:14]:
I've never had the heat turned back onto my office.

Lucas Underwood [00:03:17]:
Yeah?

David Roman [00:03:18]:
Yeah. Some cold?

Lucas Underwood [00:03:20]:
Okay. All right. Well, you know, one of the big things that comes up in the groups all the time is fleet service. And so we've asked you guys to come on because you guys are really big into fleet service. You do a lot of fleet service. And we want to talk it through, because I'm not going to lie, I have always avoided fleets. I felt like they were a lot to manage. I felt like there were a lot to work with.

Lucas Underwood [00:03:44]:
They often demanded out of me, like, hey, you need to get this moving right now, and you need to get it going. And I have to have this today, right? And so I often found a lot of really unreasonable expectations from some of the fleet clients. And then they had these crazy management things. I was working with GSA and they were terrible to deal with, and they wanted to set the prices this whole deal. And so I had really moved away from fleets, and I kind of watched some of the stuff y'all did, and had been talking to Monique, she had talked to you guys about some of the fleet stuff y'all did, and she was sharing some of those things. And I started doing some of the things y'all have talked about with some local small businesses, right? Not trying to get these giant fleets and pull these, you know, medium duty trucks in and all this, but I really focused on, there's some breweries in town, and I started building systems around these breweries that worked for them and worked for us. And I started working with some of these electricians and really primarily smaller companies. And I found, like, hey, fleets aren't really that bad.

Lucas Underwood [00:04:47]:
I would like you guys to kind of walk us through some of this, though, because, you know, shopware has recently integrated some things that make fleets a lot easier to manage and work with. Steve, I'll start with you. How. How do we go about this? If. If a shop saying, hey, I need to bring in some business, I want to bring in some fleets, what's the strategy for bringing a fleet in?

Steve Schlaff [00:05:09]:
I mean, you know, we've. We've gotten them a lot of ways. One of our buildings is very old and has needed a lot of work over the years. So I just have a conversation with the owner or their manager whenever they come out to do electrical work, plumbing work, H vac, stuff like that. You know, a lot of times, well, they've mostly gone to contract, but I've been, you know, reaching out to my parts suppliers, you know, anybody that actually manages their fleet in house or owns their fleet, and, you know, hey, who takes care of your vehicles? And then ultimately, you know, I. I told my store managers, we. This is actually a conversation we had at lunch last week that we need to really up our fleet count, especially at my newer store, it's only four years old. And I said, make.

Steve Schlaff [00:05:52]:
Make a list. Make a list of who's out there not to be judgy. I told them, kind of avoid landscape companies. They do not care about their vehicles. They will leak oil on the street as their leaf blowing. But, yeah, we've. We've landed some great fleets. Been lucky throughout the years.

Steve Schlaff [00:06:10]:
We've got one construction company with about 60. 60 vehicles. We've got a glass company with about 20.

Lucas Underwood [00:06:17]:
Wow.

Steve Schlaff [00:06:18]:
Multiple electricals, plumbing, some. Some steel delivery groups. We actually, actually we do all the fleet for one of the biggest TV stations in Denver, too, so.

Lucas Underwood [00:06:30]:
Very interesting, Very interesting. Michael, how did. How did you get into the fleet business?

Michael Hilzley [00:06:37]:
Some of what Steve said, knocking on doors and using our contractors. We just opened up our third store, required a lot of. A lot of work, unfortunately, before we opened up both with plumbers and electricians, and we ended up landing both of those guys to come in, just having conversations and building relationships. I've knocked on doors. I walked in and introduced myself. We created a flyer for. For fleet management. Okay, with what you said, Lucas, there's certainly some of them that want the now.

Michael Hilzley [00:07:07]:
It's got to be a now. And you have to. You have to work with them on that. But there are a lot of them. They drop it off for the day, it's planned to be out of service. They don't mind. It's not a big deal. It's something they're playing for.

Michael Hilzley [00:07:17]:
But you have to be able to work with them when the time comes and they needed the emergency, and then they just stay loyal to you when you're able to help them with that.

Lucas Underwood [00:07:26]:
So let me ask you guys this. When we think of fleets, right, Because I've built my business on the independent client, right? I've built my business on the soccer mom. I've built my business on the college student. I can see the downfall in that, right? Because, like, right now, all the college students are out of town. The soccer moms are preparing for Christmas. They're not thinking about getting in for work. But I was talking to some of these guys that I've started to work with as fleets, and they're saying, well, but this is our slow time of year, right? You're. Unless it's an emergency, they're not calling the plumber, right? Like at this point, if you're calling the plumber, it's an emergency.

Lucas Underwood [00:08:02]:
And usually they're not calling the electrician. Steve, how does this play into the financial role of the shop? Do you feel that it beefs up that bottom line a little bit and gets us build up just a touch? So when it slows down, does it even out that wave of gross sales, you think?

Steve Schlaff [00:08:19]:
I think it helps quite a bit. You know, another. Another reason I've been. I've been pushing on my store managers to really get out there and get some more fleets in, but they, for the most part, they don't really have slowdowns. I mean, yeah, they might have a day off for Christmas or New Year's or something, but, you know, a lot, a lot of times in their mind, you know, number one to them is time on the road. How. Yeah, you know what, how many days a year are those vehicles available to be driving to and from job sites and customers, you know, locations and, you know, so if they're. If they're closed for a day, they.

Steve Schlaff [00:08:53]:
They might want to leave it for, you know, hey, we're closed for Wednesday, Thursday, Friday, next week. So let's, let's just leave and get that big, you know, that big thing done you talked about.

Lucas Underwood [00:09:02]:
Right, exactly.

Steve Schlaff [00:09:04]:
Definitely helps, but we need to up them.

Lucas Underwood [00:09:06]:
Michael, do you experience kind of the same thing? Do you think it evens out the wave or.

Michael Hilzley [00:09:11]:
We designed fleet to be a filler. It's not, you know, we kind of echo what you do, Lucas. The majority of our business, we want 90% of our business to be the retail customer. That soccer mom, that college student, that working family, the. The fleet businesses. We don't want it to be the main source of our income. But, yeah, it does help equal out that bottom line. It does help fill in those gaps when you are a little bit slower.

Michael Hilzley [00:09:35]:
Where we're at in Wisconsin, typically January and February are two of our slower months out of the year.

Lucas Underwood [00:09:41]:
Right.

Michael Hilzley [00:09:41]:
But having these fleet customers come in, our plumbers, our electricians, they don't stop.

Lucas Underwood [00:09:46]:
Yeah.

Michael Hilzley [00:09:47]:
So it's. It's nice to fill those gaps.

Lucas Underwood [00:09:50]:
And, you know, one of the things that I had been kind of lost upon me, right, We've got this H Vac company that we had worked with a little bit, and he came in and he had these sprinter vans, and he. He kept having it. At the time, there wasn't a lot of options for if there was a def lockout, right. Because they would go into def lockout and it wouldn't drive and it shut down and wouldn't start, or it would reduce the speed to five mile an hour, whatever it was. And he said, you know, here's the problem with this is, he said, I've got these drivers and they're H Vac guys. They're not really paying attention to the message on the dash. He said, they crank the radio up and they throw their tools in the back and they take off. And he said, so it's happened more than once that we've end up locked out or we've ended up with an issue where it thinks it's low on deaf fluid or a knock sensor goes bad and it doesn't realize that it's actually working like it's supposed to.

Lucas Underwood [00:10:44]:
And he said, I just want you to think about this. He said, I want you to take a million five and divide it by 52. And I said, that's a lot of money. He said, that's what that's worth to me every single week. And I said, okay. He said, now think about this for a minute. If it's worth that much money and you're going to tell me that I have to put it on a rollback that's going to cost me $400 to send it three hours away, and then I have to take two employees and drive them three hours away to pick that van up and bring it back on top of a 2000, 3000, $4000 repair. You tell me that makes sense.

Lucas Underwood [00:11:24]:
I'm like, no, that doesn't make sense at all. And he said, look, man, he said, for me, it's all about making money with these vehicles. These are, these are just like your bays. They're important to me. I need them to be functioning, and I can't have the inconvenience of going in now. Dude, he changed his entire vehicle lineup because of that. Right. Went and bought brand new vehicles and got rid of the Sprinters because it was too much of a problem.

Lucas Underwood [00:11:50]:
And that really had me thinking about it, because these clients, they really need these vehicles. They're important, and many of them will invest to repair it properly. Is that what you guys have found? I know. Steve, you said that, that the landscaping guys, that's not necessarily the case. What about your other guys? Are they doing a good job of keeping up with them?

Steve Schlaff [00:12:09]:
You know, we finally got the one, our biggest fleet to be on board with actually doing scheduled maintenance. They would, you know, they go to grease monkey for oil changes. So we don't, we don't have time. We, you know, to come in for a whole inspection and all that. So they come to us every 30k and when there's an issue. But they had on these, was it the E350s? They had a transmission fail, one a month for four months. That's at like 75K. And he said, what is going on with these Fords? Do I need to change, you know, stop getting Fords? And I said, no, but do you, do you want to try to have that maintenance conversation one more time? And he finally did.

Steve Schlaff [00:12:48]:
But, but for them, I mean, one fleet I pitched a couple months ago, I just walked into a construction company and said, you know, hey, who takes care of your vehicles? What do you drive? Knowing the pain point of this isn't on the road, or I need more vehicles. And he's right. The biggest one is those that they want kind of the bare bones, white even, or, you know, F150, 250, 350. They're six plus months out. A lot of times to get one.

Lucas Underwood [00:13:14]:
Yeah.

Steve Schlaff [00:13:14]:
And, you know, if that thing's worth 15k right now, but it needs a motor and it's going to be 12k, but I can have it to you Friday. That's. That's the right decision for them. And so, you know, one thing I noticed with switching to shopware is all those analytics and reports. And there was one. It's revenue distribution by make.

Lucas Underwood [00:13:34]:
Right.

Steve Schlaff [00:13:35]:
And not a lot of my regular customers drive Fords. I mean, it's Just an average mix. But ford is like 30% of my revenue across both shops, which are totally different demographics, and that's what it is. Most of my fleets drive Fords. We do a lot of fleet work. And all those people, if they need an engine, transmission diff, anything major, they're. They're just doing it right. It's when, not how much.

Lucas Underwood [00:13:57]:
So because it's. It's valuable to them, they have to have the vehicle. Michael, have you found the same thing, or are you seeing that they really invest in the major repairs to keep them on the road?

Michael Hilzley [00:14:08]:
It's an interesting dynamic, but the echo, what Steve said. Yeah, it's month in, month out. It's Ford. When you look at that analytics report, Ford every single month. And we have our largest fleet customer is actually a ambulance company with a medical transport. They have. I've been dealing with them for 12 years now. And we actually have a computer program where we've got.

Michael Hilzley [00:14:29]:
Designed for his maintenance, layout. When are we going to do this? When are we going to do that? And he abides by it. But what I've also found is that some of our fleets that we deal through Enterprise, they have a preset scheduled maintenance plan. It's interesting. Sometimes it's frustrating. They'll do a transmission service, but they won't do the brakes yet.

Steve Schlaff [00:14:48]:
Right.

Lucas Underwood [00:14:49]:
They'll let those go.

Michael Hilzley [00:14:49]:
Or the tires aren't down far enough, but they want to change the.

Lucas Underwood [00:14:52]:
I've driven some of those cars, Michael. I'm promising you, if it's an enterprise, I have driven some of those. I've learned my lesson. I'm an Alamo guy now. Right. You know, when we talk about numbers and we're really looking at analytics, because I'm the same way. Like, that's my job. I've got somebody who's managing the shop.

Lucas Underwood [00:15:11]:
I've got all these other things I like to drill down into the analytics and shopware to really understand, like, these variables and look and see where we're getting that revenue from and how it affects things. And I have definitely noticed that I've got some big revenue jobs that are coming from these fleets. Right. And it really does impact that bottom line. And I found they're more convenient to work with in some ways. Right. There's a lot of folks in my neighborhood that will service these vehicles on a whim, and they'll get them in for the really fast, really quick, really easy stuff. They can buy some of this stuff super cheap and just knock it out like nobody's business.

Lucas Underwood [00:15:48]:
But I've noticed they come to me for the big stuff and I noticed they come to me for the complex issues that that other shop can't figure out. And I found for me, those are higher GP per hour jobs. And it gives me flexibility to where I can say, hey, let's get you scheduled in to deal with that here and now. I can put that at a time when my texts are a little bit slower or I've got some ability to move that around and we can plan around that. That was a really neat thing for me because I was noticing, you know, at first when I was looking at fleets, I was thinking, gosh, I'm not going to be able to have this flexibility because they want it right now. Well, it's cool because now you can schedule these because they need this vehicle at particular times and they want to have this in service at a certain time. If we can work together and communicate now, we can get that vehicle in when it works for both of us and I can move it through faster and they don't need it that week. Right.

Lucas Underwood [00:16:40]:
It helps set that up. Steve, what analytics are you typically looking at for your fleets and shopware?

Steve Schlaff [00:16:47]:
I mean, I, I keep it pretty basic for them. You know, a lot of times, you know, again, the, the revenue per make. I don't, I don't filter a whole lot of reports by fleet, but I know our, I know our key fleets. I do check in periodically. What's their spend this year? What's, you know, how's their, how's their ARO looking? Actually, two of them are down quite a bit and I looked into it and literally one, one of them, I don't know if their funding changed, their budgeting changed, but most vehicles that came in and were like, ah, yeah, it needs this, this and this, and it's three grand. They, they replaced about half their fleet this year.

Lucas Underwood [00:17:23]:
Oh, wow.

Steve Schlaff [00:17:24]:
And so, you know, we bought a couple used cars on the cheap from them because they didn't, they didn't care. But yeah, a lot of them, they, well, they specifically phased out Fords and bought a lot of Honda pilots so.

Lucas Underwood [00:17:36]:
That, hey, listen, as long as you're not fully dependent on that fleet, you'll be okay. But those Hondas are far more reliable than Ford's.

Steve Schlaff [00:17:43]:
Yep.

Lucas Underwood [00:17:44]:
You're in trouble if you're depending on that one fleet. If that's the case, Michael, what, what numbers are you using? How, how do you manage this fleet aspect? Do you have a system built around how you manage it and how you continue to, to Watch those numbers and drive those numbers. Or you just let it come and go as it pleases.

Michael Hilzley [00:18:02]:
Definitely not let it go come and go. Our biggest KPI that we measure, period is our gross profit per hour.

Lucas Underwood [00:18:09]:
Yeah.

Michael Hilzley [00:18:10]:
So we've set a number on that. The fleet gets a discounted pricing both on labor and parts, but we still have a KPI of a GP per hour of 150.

Lucas Underwood [00:18:19]:
Okay.

Michael Hilzley [00:18:20]:
Where we have to average. And that's really what we push for because that's what works for us. Based off of cost per hour.

Lucas Underwood [00:18:25]:
Yeah. I'm going to tell you something. I think that far too many shop owners do not utilize that number. That is a very, very important number, especially if you understand how to calculate what it needs to be. Right. I've got a lot of shops that I talk to and I'll talk to them and say, hey, let's put your numbers together, let's look at your expenses and then let's divide that up by your average billed hours. Let's figure out are we making money or not? And when you put that number on paper, I have seen some shop owners jaws hit the floor because they're over here at 70 and $80 of gross profit per build hour. And I'm like, you understand it costs you more than that per hour to operate, right? Like, there's no money.

Lucas Underwood [00:19:07]:
You're giving it all away. You're working on cars for free. And so many of them just don't see that. So, I mean, I'm really happy that shopware's got that number in there and be able to see it even at a job level. And, you know, that was for me, especially with big jobs. Because, Steve, you might appreciate this. As a technician, I always felt really accomplished when I put an engine in a car or put a transmission in a car. I did big work and it had 40 hours on it.

Lucas Underwood [00:19:34]:
As a shop owner, I get really nervous when I do that because this big job just tied up a Bay for 40 hours and it made less money than four brake jobs would have made. But as techs, we don't see that. We overlook the fact that that didn't actually make money. And we were just in a conversation today in some of the groups and these guys are saying, oh, engines and transmissions. I use used ones, engines and transmissions. I just mark them up $200 so I can get the sale because. Because that's a big job. And I'm over here saying, well, are you actually making money for the 40 hours you're working on it? And it seems Like a foreign concept.

Lucas Underwood [00:20:10]:
Do you use GP per hour in your shop, Steve?

Steve Schlaff [00:20:13]:
You know, I've noticed it in the bottom corner of the report screen every week when I'm, you know, checking the numbers or pulling them for payroll. I haven't really focused on that one in particular. You know, we mostly focus on, you know, labor gp, parts, GP aro. And then, you know, in my. I have some pretty complex spreadsheets for payroll. So right when I, When I get in there and see the true labor gp, you know, once it's, Once I've calculated all the tax pay, you know, we focus on that number quite a bit. So I haven't. Yeah, I haven't dived into that too much yet.

Lucas Underwood [00:20:49]:
I'll tell you the spot that I think it makes the biggest difference is so if you're looking at GP per hour, right, and you've got these jobs coming through the shop, you might look over there at the GP on parts and you might look at your total GP on jobs and everything looks okay. But then you find out that, hey, there were a bunch of hours. So, like rear main seals and the advisor, all they get on that ticket is the rear main seal and what they need to do an oil change. They didn't get the exhaust gaskets, they didn't get the exhaust bolts. They didn't think about the fact that those torque converter bolts are torqued to yield and they didn't put anything else on there. And so the GP and the labor GP look great, but there weren't enough parts on the job to make that job sustainable and get us the GP per hour we need to survive, right? And so what we were finding was, is like, hey, if I take all of my cost And I add 20% because I want to make a 20% net profit when it's said and done. And I take all my cost and I divide it by my average billed hours with that 20% on it, I'm 157 and I was over here at 120 and 130 per gross profit hour. And I couldn't figure out why.

Lucas Underwood [00:21:59]:
There were times that it was a struggle, you know what I'm saying? And I couldn't figure out these waves because it was like one week I would have money in the bank account, I did the same amount of revenue, and then another week I didn't have money in the bank account with the same revenue, and I couldn't figure out what that was. GP per hour has opened my eyes to that and it's probably made me a little bit biased because I've stopped doing as many engines and transmissions and big work. I'm just like, man, I'm sorry, I don't want it. Take it somewhere else. I send it to Kansas City and David works on it. David, do you even look at your numbers?

David Roman [00:22:31]:
I try not to. They're depressing.

Lucas Underwood [00:22:33]:
Are they really that bad?

David Roman [00:22:36]:
It is that bad.

Lucas Underwood [00:22:38]:
But I mean, things are getting better though, right? Like, things are starting to speed back.

David Roman [00:22:41]:
Up a little bit. Yeah, a little bit. You know, that was definitely an issue with fleet. When I first built my website, like 2017, I think it was. I had them build a whole section just for fleet and I had brochures made out and I was going to go talk to all these people and we got some fleets and it was awesome because we had cars and then nobody wanted to fix anything. Everything was clapped out. They're like, can you just patch this? Can you just throw some. Stop leak? Can you just do this, that and the other? And man, that just soured me on fleets.

David Roman [00:23:17]:
And it wasn't until way later that we picked up a few companies that were like, they don't fix everything, but when it needs brakes, they put the brakes on. They do tires, they just need the truck back. And so everything's about scheduling with them. Hey, I'm going to drop it off on Friday. I need the vehicle back Monday morning. It's like, okay, so whatever we do, it's got to be ready Monday morning for them. And if we can't, for whatever reason, the car needs a transmission, whatever, we just coordinate with them. And if it's going to be two day or three day turnaround, we just tell them.

David Roman [00:23:47]:
And as long as we deliver on time, they've got a credit card on file. It's super easy, super convenient. That's been fantastic. And we picked up another fleet that does. They do everything like an extended warranty company. So I got to call into the company, give them the rundown, and then they approve and decline everything. And they have a very specific, like, type of thing that they want us to do for them. But as long as you abide by that, man, they just.

David Roman [00:24:14]:
They fix whatever as long as it doesn't exceed the cost of the vehicle. And so that's great filler work. Just like you were saying. I think Michael. Right. You were saying it was filler work. I think you both said it. And it's great because sometimes you're just like, hey, I need two or three more cars this week.

David Roman [00:24:31]:
And the fleet Guy drops off four, and you're like, awesome.

Lucas Underwood [00:24:35]:
Yep.

David Roman [00:24:36]:
Let's not go chasing customers. The only issue is, you remember that gal from California, Lucas? The only issue is you cannot have 90% of your business.

Lucas Underwood [00:24:49]:
Oh, buddy.

David Roman [00:24:50]:
She had. I remember that. Yeah. She buys this business. She buys this business in California. She hadn't run a shop before. She buys this business, and it is making a million a year in gross revenue. And she's like, great, I'm gonna pay whatever.

David Roman [00:25:04]:
However much money. She takes out a loan to pay for this business, and she thinks she's gonna get a 20, 25% return on her million dollar investment, and she's gonna making $250,000 a year, and this is gonna be just easy. Which she didn't look at her number. She didn't look at the customer list. And it was something like 75 or 80% of her business was coming from, like, two fleet companies.

Lucas Underwood [00:25:26]:
Yep, I remember that.

David Roman [00:25:29]:
She pissed them off and they. All of a sudden, her business went from doing, you know, 90 to $100,000 a month to $40,000 a month, and she had no idea what to do. And it's like, hey, let's look at this customer list. What's your customer list look like? I've got 400 customers on this list. You've been in business for how long? Oh, 10 years. Plus you have 400 customers. How's this possible? It's like, well, most of my business came from this cable company. Like, you should have been kissing their ass every day.

Lucas Underwood [00:25:58]:
Right. Whatever it takes to keep hovering up every single day.

David Roman [00:26:02]:
There was donuts one day and pizza the next day, and it was whatever to keep that fleet manager happy. Buy him dinner once a month. You know what I'm saying? Like, you have to kiss these people's asses because the minute they pull their business or somebody walks in the door and throws them a cheaper price. Hey, all your oil changes are free as long as you do the repairs with us. Yeah, okay. I'm not going to match that. They go away, then what? So you got to be careful.

Lucas Underwood [00:26:30]:
Yeah, yeah. You cannot overweight that for sure. And I, you know, I. I have had some fleets. And really what shied me away from it, there were a couple particular ones that come to mind there. There was a rental company and they had Porta John trucks, and we would work on those Porta John trucks. And, man, he like, there were things that I knew were not safe on this truck. And I' like, this is a medium duty truck.

Lucas Underwood [00:26:56]:
Something happens to this truck they're going to be looking at me saying, what have you done? And I will never, as long as I live, forget. And, and David's been here, so he knows the corner I'm talking about, like right down the street from the shop. We're, we're on a four lane highway, 55, 60 mile an hour and we're, there's sharp turns everywhere, right? We're in the mountains and so right down the street is like this hairpin turn and I've got one of their trucks out and I'm going around that turn and the gearbox is bad in the truck and I'm going around the turn and when I do it jerks the steering wheel out of my hand and takes me across the lane into oncoming traffic in this truck. And so I, I like clean my britches and I like limp the truck back to the shop. And I call him, I'm saying, dude, we have got to put a gearbox on this truck. This is going to get somebody killed. He said, I'm not worried about it. The driver knows it does that.

Lucas Underwood [00:27:47]:
Don't, don't stress it. And at that point I'm sitting here thinking, I, no, I'm not going to be complacent to that because I want your money, right? I have a, I have a professional obligation to repair this vehicle properly. Steve, have you ever ran into something like that with fleets where they're so price conscious that they're letting safety things go? Do you have to either put your foot down? I mean, how does that work?

Steve Schlaff [00:28:13]:
It's actually something that's not really fleet specific, but kind of long. You were saying what David just said a little bit ago. We have two very different demographics between our two locations. It's about two and a half times the average household income at one location versus the other, you know, only, only an hour drive apart too. But so with that, we do see quite a bit of rough vehicles and you know, we're very customer service focused. However, we, we do not have a problem when it's, when it's right to part ways with a customer, whether it's a fleet or a regular customer. And just explain, you know what I'm, I don't think I'm the right shop for you.

Lucas Underwood [00:28:56]:
Right.

Steve Schlaff [00:28:57]:
And so what, what we've done for years, whether we were with Shopware, Protractor, even, oh, don't get me started on before that. We, we've always used auto vitals for our DVI and every single section on all the five different, six different inspections we use Depending on what the visit is, they all have at the very end of each, each section is vehicle unsafe to drive.

David Roman [00:29:22]:
Right.

Steve Schlaff [00:29:22]:
And my text instructions are if there's anything that comes up that, that meets that criteria, you just click that in the comments. You literally just type that part. So you'll click that and type ball joints, dude.

Lucas Underwood [00:29:35]:
Hey, listen, I'm, I'm ready to run out of the room. We're redoing our dv. I'm ready to go down there and tell my manager right now. Put that on there. I like that.

Steve Schlaff [00:29:43]:
So it goes on the ticket and you know, it's a, it's a can job, all this verbiage, a nice line, extra line for the customer to sign and all that. And they do need to sign that. But we, we basically explain it as. We would love to be the ones to fix this for you however anybody can. But going forward, I'm not going to schedule to put one of my technicians behind the whee of your vehicle until this is taken care of.

Lucas Underwood [00:30:09]:
Right.

Steve Schlaff [00:30:09]:
And we, we. So autovitals puts that on the, on the Rex and Shop where we make a second one to put on the body so they can sign that and then we put it as their top reckon in red. So when you're setting a new appointment, that's the first thing that comes up on the screen there. Is vehicle unsafe to drive? You can look and see it was, you know, rear brakes, whatever it is. But you know, if you, if you don't, you know, if it's a, it's a budget issue, I offer synchrony, I offer a firm. Every once in a while we'll do a little something in house just to make sure you are leaving safe.

David Roman [00:30:40]:
Right?

Steve Schlaff [00:30:40]:
But it's, it's okay to part ways with a customer that doesn't want to take care of their vehicle the proper way.

Lucas Underwood [00:30:51]:
You know, Steve, let me ask you this because I have found that technically minded guys or gals, people who have worked in the bay, have a whole lot easier time saying that than some other owners that I've worked with in the past. Do you think that your experience as a technician, as somebody who's been in that bay and seen that makes that easier for you? I mean, I think it does for me because I look at that and I say, hey, listen, I can understand the gravity of this situation. Right? I understand what this could do. And this car passes my wife and kids on the road, passes my dad, passes my family. I understand the gravity of this. Do you think that makes it easier when when you make that call, I'm.

Steve Schlaff [00:31:34]:
Not really, I guess I'm not really sure if it's, if it's tech minded or not. I mean, I think they might understand the severity of the situation more than an advisor.

Lucas Underwood [00:31:43]:
Right.

Steve Schlaff [00:31:43]:
You know, sometimes you can say it, this is not safe to drive because of X, Y and Z. And you know, your salesman might say, what does that do? You know?

Lucas Underwood [00:31:50]:
Right.

Steve Schlaff [00:31:52]:
But you know, because that, I've seen some weird, weird stuff over my time. I pulled one in for a, for an LoF as a tech a long time ago and I crashed it into my lift.

Lucas Underwood [00:32:02]:
Holy cow.

Steve Schlaff [00:32:03]:
So I get in, I, you know, I make my maneuvers and stuff. And then I realized this thing does not stop. And so I hit it in reverse real quick. I hit it in drive back and forth and then pulled the E brake. And I went and told the customer and he goes, oh, yeah, I forgot to mention that. Yeah, this, this thing, you have to use the parking brake. Oh man, you're slowing down from highway speeds with a, with a parking brake. So it was.

Lucas Underwood [00:32:28]:
I'm going to tell a story on my shop and, and I probably shouldn't, but dear Ryan Jackals that works for us came from a kitchen. And Ryan is probably the best technician I have ever met in my entire life. And he still catches a lot of flack. For this, Ryan had gone and bought a brand new snap on toolbox. 16, $17,000 box. It's in the front of his bay. And we send him to get this Acura. Now the deal was is the client had started to do their own brakes and, and found they were over their head.

Lucas Underwood [00:32:59]:
And so I told Ryan, I said, this car has no brakes. If you want me to come push the car in, if we need to tow the car in, whatever we need to do, we'll do. Ryan goes to the car and he said, man, he said it felt like it had a pedal and I pushed the brakes and it slowed down. Dude, he slams that toolbox. I mean, he like turns it into a U two days after he got it. I mean it is literally two days. And I'm, I've got a video of him on camera just putting his hands up over his face like this in the car after he hit the toolbox. And I said, why did you do that? He said, lucas, he said it had brakes.

Lucas Underwood [00:33:33]:
And I said, ryan, pick it up. And he picks it up and he takes the wheels off and there's no rotors and there's no calipers and there's no brake Lines anywhere. And I'm like, I do not know how you felt that car slowing down, but it was not the brake pedal. There was no chance. Michael, have you. Have you ever ran into something like that where you've had to kind of put your foot down with a fleet before?

Michael Hilzley [00:33:55]:
Too much with the fleet? They're pretty responsible about that because their liability is on the line, too. I haven't had too many of them that have said, no, we're not going to fix it. It's unsafe. I've had them retire them putting any more money into the vehicle. But echoing again, what Steve said, a lot of times it's the customers. And we have a plan in place, too. Vehicles unsafe for the road, you know, all that fun stuff, right? It's. It's mostly customers.

Michael Hilzley [00:34:20]:
The fleet experience we have, we've never had anybody do what they did to you, Lucas, where they just said, that's fine. Yeah, it's their ass on the line, too.

Lucas Underwood [00:34:29]:
Right? And that's what you would think. And this particular truck, we had an employee that worked for us, and. And this truck would leak blue water everywhere. And so this employee is crawling around underneath this thing. He's long hair and his hairs drooped down in this blue water that's full of little white chunks. And I kept saying, hey, dude, that is not clean water. And he said, no, no, it's. They put the blue in and this tank pumps the blue water into the porta John's.

Lucas Underwood [00:34:55]:
And I said, no, they go to the porta john and they pump the blue into the porta john out of a jug, and then they fill it with water. Well, these trucks went all around town just dripping this blue water all over the place. I fired him because he came back to work the following day and he still had blue and white specks in his hair. So I turned after that. We'd been wondering what the smell in the shop was for a while. I guess we figured that out. But, you know, I agree. I think that the majority of fleets we have now are very respectful of that.

Lucas Underwood [00:35:23]:
And I think as business owners, they respect the fact that we have a legal obligation as a professional to do what's right and to protect the motoring public. I think they know that because they have the same type of obligation in their field. I'm curious about systems, and Michael, I want to start with you. Shopware has got a really cool way of doing fleets and building these fleets into the software. When you think of this, bringing fleets into a new shop. So a lot of listeners have Asked us, hey, I'm thinking about doing fleets. What's the steps? What's the process? Do you think of this from, hey, I'm just going to go out and get fleets right away, or do you start building a system, a process, a policy in the shop first and kind of utilize shopware to get that built up? How do you go about that?

Michael Hilzley [00:36:13]:
Well, you have to have policies and procedures in place for everything you do, of course. So our policy with them is, I kind of mentioned earlier, is we have reduced pricing for them. We have parts markup and labor for them. We have a reduced warranty for them. Like we do a 550 on everything retail.

Lucas Underwood [00:36:32]:
Okay.

Michael Hilzley [00:36:32]:
For our fleets is 224.

Lucas Underwood [00:36:34]:
Okay.

Michael Hilzley [00:36:36]:
We have a labor bump that we use for retail. We don't do a bump on the fleet because typically for us, the bump is more to accommodate for rust where we're at.

Steve Schlaff [00:36:46]:
Right.

Michael Hilzley [00:36:46]:
And our fleet customers have a ton of miles on their car, but they're usually our vehicles, but they're only usually a few years old, so the rust isn't terrible.

Lucas Underwood [00:36:53]:
Okay.

Michael Hilzley [00:36:54]:
It also helps us stay more cost effective with what we're doing to get those businesses.

Lucas Underwood [00:37:00]:
Okay.

Michael Hilzley [00:37:00]:
Shopware is lovely with the fact that I can put in there a fleet rate, so it chooses it for the customer. The guys can do that very easily.

Lucas Underwood [00:37:07]:
Okay.

Michael Hilzley [00:37:08]:
I love the layout with shopware as far as having the contact information in there, who the driver is, you know, fleet. If they're tax exempt, I can put everything in there.

Lucas Underwood [00:37:18]:
Right. And kind of manage that. Now the kind of. The newest thing that's out there right now is bulk pay. And. And I've been using it for not just fleet accounts. Right. I've got some other accounts that they'll come in, and maybe they have two cars here at one time or maybe they have two tickets open and that kind of thing.

Lucas Underwood [00:37:34]:
We never let people leave without paying, but it might be that, hey, I'm bringing in my other car. And so now I have your other car. Hey, can I just pay for both these at the same time? That is really cool. And I know that some other products offered something like that years ago, but this is pretty impressive. Steve, have you been using that recently? What do you think about it?

Steve Schlaff [00:37:56]:
We've only had a couple chances to use it. One. One that we do is a. We have a body shop right next to each. Each shop that we have a good relationship with. And. And the one by my one location was bought by a corporate company, so we had to, like, set up all this stuff with their home office in New Hampshire or something like that for billing. Right.

Steve Schlaff [00:38:16]:
Where the guy used to just bring us a check every time he came to get another vehicle. And it's mostly alignments every once in a while, you know a mechanical thing.

Lucas Underwood [00:38:23]:
Yeah.

Steve Schlaff [00:38:23]:
But just about two or three weeks before we went live on the early access or beta, whatever you want to call it of the bulk pay.

Lucas Underwood [00:38:32]:
Yeah.

Steve Schlaff [00:38:32]:
You know I'm looking at my payments every day and I saw we had six, seven hundred dollars in checks. But it says we, this says we have 28 checks from today. And you know, turns out it was one big check and applied for an alignment or odds and ends on that many vehicles. So it, it does make it quite a bit easier. You know especially there's a lot of, there's a lot of room for error when you're, when you're paying, you know, you get a check for $1500 or something and you're paying 28.95 on one ticket and 69.95 on one and you're trying to apply that to 20 plus tickets. There's a good chance at the end of the day that that one check that, that my bookkeeper is going to cash is not match what shopware shows. So the bulk, the bulk pays good. We've used it a couple times.

Steve Schlaff [00:39:19]:
It's also going to enable us to do something I've, I've wanted to do for a long time. It's always just been standard since before time to fleets on net 30.

Lucas Underwood [00:39:30]:
Right.

Steve Schlaff [00:39:31]:
I don't particularly like that, you know especially one I, I have one that does, you know a lot of times they're you know, a couple hundred dollars but a lot of times it's 8, 10, $12,000 jobs.

Lucas Underwood [00:39:42]:
Yeah. 10 days is a long time to wait on that.

Steve Schlaff [00:39:45]:
Yeah.

David Roman [00:39:45]:
Especially I don't do nothing. Screw that noise.

Steve Schlaff [00:39:48]:
Every, every single ticket is 30 days out for when they pick it up. And so what I like especially they're bigger, they're bigger companies with their own, you know, accounting and billing department is, you know I'm going to send you an Invoice on the 1st for everything we did for you last month. And you know I just, payments due by the fifth or sixth, something like that. And so it's very easy to you know, get that. So I, I like the bulk pay. It's good for posting payments. But I like the idea of, I think, I think a new feature with that was consolidating an AR report per customer.

Michael Hilzley [00:40:23]:
Yes.

Steve Schlaff [00:40:23]:
And so the ability just to say, you know, go and go into ar, type in that one fleet's name, select all send. Yeah, and they get that. And if they, you know, then we'll get a check for, you know, 20. 20 grand a couple days later. Select all post. And it's, it's, it's great.

Lucas Underwood [00:40:41]:
So, you know, my biggest failure as a leader and, and probably the reason that I would never be a decent MSO is because, like, I like to metal. David picks on me all the time because I'm like always messing with everything and I'm changing everything and I'm changing and bending the rules and I make all these different things. And so it sounds like you guys have a really solid system set up. Do you use shopware for the base of that? In other words, do you build a system? Because, you know, it's like Michael was talking about, I can go ahead and set the pricing, right? And there's no need to adjust the pricing. There's no need to say, hey, I need you to go give this guy a 10% discount and this guy gets a 5% discount. That's what I would do. I'd be over here. I like that person more than this person.

Lucas Underwood [00:41:28]:
So I need to adjust this a little more than that. And hey, lower those prices down because I don't like that guy, you know. And so is that how you manage a consistent experience across all the shops? That, that's, you know, and like right now we're doing this tire special, and I told my guys, I said, hey, you need to make sure you're profitable in doing this. And they said, oh, well, while we're doing the special, we'll change this price and we'll do this. I said, no, no, no, no, no, no, no. You're going to mess up and you're going to change a price and you're going to give one person one price. You're going to give another person another price and you're going to make us look like assholes. And so is that how you manage this to where you have consistency across all the shops?

Steve Schlaff [00:42:11]:
You know, there's, it's, it's pretty consistent. You know, I do wish I came, I came from Protractor. You know, we. About three years with Protractor, and now we're just wrapping up our third year with shopware.

Lucas Underwood [00:42:22]:
Okay.

Steve Schlaff [00:42:24]:
I do like protractor. I mean, it was, it was overkill because it wants to be your, it wants to be your, it wants to be your QuickBooks. You know, it wants to be everything for you.

Lucas Underwood [00:42:33]:
And Bro, Protractor also wants to be your spouse and a few other things. Okay, that, that sucker is next level over detailed, but.

Steve Schlaff [00:42:42]:
Yeah, but, but you got to wait a decade if you want to text somebody from it. I think they have it now.

David Roman [00:42:49]:
Hey, hey, now they're cousins. They're cousins now. So I do. He doesn't mean protracting means tech metric.

Lucas Underwood [00:42:59]:
Cue the responses from Sunil and PJ and everybody else. Oh my God.

Steve Schlaff [00:43:05]:
I do wish there was a little more MSO functionality in shopware. You know, the nice thing was both of my shops existed when we made the switch and I worked with my integration person a long time and basically I built out all of the, all the maintenance can jobs and everything we wanted in one location. And then on their back end he's able to export that and upload that into my other locations. We were good from there, but now everything we make a change to, we're changing pricing. Anything else? You know, upping LOF packages for the new year. I do have to go and do that in, in both. Okay. But you know, I primarily all I, all I do all day is sit on my computer and do, you know, tweak stuff like that and make those changes and, and you know, run reports on what changes we should make.

Steve Schlaff [00:43:53]:
So it's, it's pretty easy log into one shop, make those changes, go right into the other shop with one click. And now I'm making those changes there. But we do have a little bit different pricing. You know, again, we're in different demographics. I have higher labor rates at the one. You know, even, even repair pal lets me approved me for a higher extended warranty labor rate at one location versus the other. I can't, I can't get over 200 with them at one location. And they go by zip code for what they'll approve or not.

Steve Schlaff [00:44:22]:
So. But you know, we, we offer a pretty consistent experience for fleet. Fleet or otherwise. You know, I have my, my select list of parts that I put a very specific gp. I've got my dealer parts at tagged at a very specific gp. Batteries at another one, tires and another one. And then everything else, I just let the GP matrix for parts do its thing.

Lucas Underwood [00:44:45]:
Right. Okay. Michael, what about you? Are you seeing something similar to that as far as building that consistency, especially with fleets. Right, Because I was talking to a gentleman a while back and he was talking about the effect of, hey, I work with one fleet. I have shops across multiple cities and those fleets move back and forth between the cities. And so he said oftentimes I'll have this one in this shop over here. And so he said, when they got that invoice and they saw that I charged them something different at this shop for this same vehicle than I did at this shop. I got a talking to and they were concerned about that, and they wanted to know why it was different.

Lucas Underwood [00:45:25]:
I would just like to have somebody in accounts payable that paid that much attention. Right. I've paid bills that I didn't owe, but either way, they were noticing those things. How do you build consistency in your shop for the fleets?

Michael Hilzley [00:45:38]:
It's really simple. With the ShopWire program, we just put the labor rate for fleet. It's just called fleet because it's the same. We have the same deal with everybody that we work with. We didn't over complicate that. I don't have a rate for, you know, ABC Electrician and. And another rate for ABC Plumbing. It's the same rate, same parks markup.

Michael Hilzley [00:45:57]:
So across our stores, we have, like I said, three of them. Two of them are in the same city and one's in a different area, but they have the same pricing for them. So if they fluctuate and they go. Because we have plumbers that do that, we have electricians that do that. We have an ambulance company that uses multiple stores. They have the same rate. And it's really easy for everybody at that point in time.

Lucas Underwood [00:46:17]:
Yeah, for sure. And I think that that makes it easier for you as well, managing those numbers and knowing where they're at now. Guys, let me ask you this. Michael, I'll ask you, since you're the one speaking right now, is when it comes to these fleet agreements, are you having an agreement with them? Are you putting something on paper saying, we'll do this for you. Here's what we expect from you. How do you do that? Or you just say, hey, we'll give you a better deal. Come on in most of its handshake.

Michael Hilzley [00:46:43]:
And we sell the discounted off of retail. I don't okay the numbers, generally speaking, like what you're gonna pay. I have one fleet customer that I've had for a dozen years. He knows exactly what his labor rate is, and he knows exactly what I mark up the parts to. Okay, that's a long time customer. That's a long time experience. But most of the time we sell our service. We do offer them, and we do stress that if you want same or next day service, we'll make that happen for you.

Michael Hilzley [00:47:09]:
It can't be a constant thing. But when you're In a pinch, we'll be there for you.

Lucas Underwood [00:47:13]:
Yeah.

Michael Hilzley [00:47:13]:
With the three locations, especially two in the same town, we'll get you into one of our stores right away. We'll get the ball rolling. We. We. We market our text and we market our service more than the pricing.

Lucas Underwood [00:47:26]:
I like that a lot. I really like that because, I mean, I think it. It gives you the chance to. To set yourself apart from everybody else. Now, are you doing one of the things? Like, I was working on a particular government entity vehicle, and they don't like it when you talk about them, but I was working on a government vehicle or a group of government vehicles, and they hated it when we did DVIs on their cars. They did not want to know. They didn't care. They didn't look at them, and they didn't want you to say anything about what that car needed.

Lucas Underwood [00:47:56]:
Michael, are you doing. Are you doing DVIs on their cars? On the fleet cars?

Michael Hilzley [00:48:00]:
Yeah, and everything. Every single car, you know, 300 rule, right?

Lucas Underwood [00:48:05]:
Yep.

Michael Hilzley [00:48:05]:
100 of the cars, 100 of the time. 100 priced out and presented. It doesn't matter. I mean, yeah, we have exceptions to the rule that apply to both retail and fleet, you know, depending on the frequency of the visit and things like that. But everybody gets a dvi. Everybody gets it emailed or texted to them, however they prefer it.

Lucas Underwood [00:48:22]:
Got it.

Michael Hilzley [00:48:23]:
But, yeah.

Lucas Underwood [00:48:25]:
Steve, what about you? Are you doing DVIs on all of them?

Steve Schlaff [00:48:28]:
Yeah. Yep. We do a DVI and everything. We do. I. Part of the reason I have five or six of them is we do cater to what your vehicle goals are.

Lucas Underwood [00:48:36]:
Yeah.

Steve Schlaff [00:48:37]:
You know, if you. If you want, bare minimum, I have. I have a visual inspection. Now. We still shake everything down. We measure all the brakes, but my texts are instructed when you see a leak, you take a picture. And. And my.

Steve Schlaff [00:48:48]:
My actions in autovitals are literally the fluid types that it could be. Yeah. Because those are people we. We feel obligated to service them, but we. We know they're not interested. And that's actually a CYA thing. I had a guy that did nothing but oil changes for three years and then claims his puddle was our fault. And I said I took pictures of a soaking wet timing cover.

Steve Schlaff [00:49:08]:
3. Three visits in a row.

Lucas Underwood [00:49:10]:
Right.

Steve Schlaff [00:49:10]:
You know, and so it's the cya. Yeah. We do. We do the full inspection. We try to have all the conversations about what are your goals with this vehicle? You know, I can. I can only. I can only care about your vehicle as much as you do.

Lucas Underwood [00:49:24]:
Yeah. You know, absolutely. And you Know, as, as a tech turned owner and the person who is on the front counter and the person who has worked on the car for the longest time, I really struggled with that. I'm not going to lie, because especially with some of the fleets, and I think that's what turned me away from them initially is because I felt like my job was to repair this vehicle and get it right. I didn't do a very good job with, hey, this is your vehicle. I'll maintain it how you want it. Maintain, maintained. And so I kind of got in this mindset and I don't think it was right.

Lucas Underwood [00:49:56]:
Don't get me wrong. I'm not sitting here saying it was the right thing to do, but I got into this mindset that, hey, this is broken. If you don't want to fix it, man, just stop coming here.

Steve Schlaff [00:50:04]:
Right.

Lucas Underwood [00:50:04]:
Because I've fixed broken cars. My job is to fix this and make it right. And I think for a while, I lost sight of that. At the end of the day, it's still their car and we still have to fix it the way they want it fixed. And we need to meet their goals. So I think it's very important to have that conversation, have that, that sit down discussion of what it is that you want. Now, is that something you do with your fleets when you, when you bring them in? How do you, how do you do that?

Steve Schlaff [00:50:31]:
I mean, we treat them a little differently, but, but for the most part, it's, it's just another customer.

Lucas Underwood [00:50:37]:
Okay.

Steve Schlaff [00:50:37]:
You know, we're, we're in the business of building trust and creating relationships with these customers.

Lucas Underwood [00:50:43]:
Correct.

Steve Schlaff [00:50:44]:
And, you know, fleece can just be a lot more, more worthwhile, you know?

Lucas Underwood [00:50:47]:
Yeah.

Steve Schlaff [00:50:48]:
You have a customer come in that buys everything. You make a great relationship. And okay, their household has two vehicles. You're getting three to five visits a year now.

Lucas Underwood [00:50:56]:
Right.

Steve Schlaff [00:50:56]:
You do the same thing with the fleet, you might be getting 60 to 100. Yeah. And it's still just one person you're making that relationship with for sure. But the way I phrase it too, I, I try not to make it sound like, are you the right customer for me? What are you buying? What I'll tell them is, what, what are your goals with this vehicle if you're going to replace this in the next year? It's, it's a waste of your money to do a transmission flush.

Lucas Underwood [00:51:19]:
Yeah.

Steve Schlaff [00:51:19]:
You're not reaping, you're not reaping the benefits of this. You know, it's not going to prevent something. You know, in the next 10,000 miles over the next year, most likely of a catastrophic failure. But if you're going to keep this for three plus years, you 100% benefit. So if you want to, I tell them it's the same line every time. If you want to keep this vehicle on the road for a long time still, it's my job to make sure you don't miss any Dubai mileage services and you don't spend a dollar on something that's not due yet.

Lucas Underwood [00:51:46]:
Yeah, yeah, I agree. And, and we're really kind of morphing in that direction and taking that aspect. Michael, what about you? Are you doing the same thing or you, are you having a more detailed conversation to meet, make sure you're meeting the fleet's expectations?

Michael Hilzley [00:52:03]:
My experience has been the fleets tell you what their expectations are. Yeah, we're going to replace this. Like we just had a police department that we service, say we're finally getting our new squads. Let's just make sure it's safe for the officers. We're not going to do too much. I just, let's keep it on the road because they're all going away.

Lucas Underwood [00:52:20]:
Yeah.

Michael Hilzley [00:52:21]:
And then the same thing with like an ambulance company we service, they're having a really hard time getting their transit vans and even new squads years off from where they're supposed to be. And so he's told me, I've got to spend the money on this, I've got to keep it on the road. I don't have an alternative. But my experience has been they share with you what they want, they tell you what they want, and it's without even asking because they need their expectations taken care of.

Lucas Underwood [00:52:46]:
So I'm going to tell a little story, and I think David's got a story about fleets. One of the things that I find interesting about Fleets is that there's, there's the management of the fleet. Right. And so is that a fleet manager? Is that the owner of the company, whatever it may be? And then there's the driver of the car. Right. And I will never forget there was a particular law enforcement agency which came to my shop very frequently and we took care of all of their cars. And this agency hires ex DOD employees. And these guys are intense.

Lucas Underwood [00:53:21]:
I mean, like, they, these are like special forces guys, and they are very intense people. And they had hired a new employee. And this new employee was. Buddy. He was intense, to say the least. And he, he carried himself right. Like you just knew you didn't want to mess with this guy. And so he, we had Finished the car the night before, and it was a Crown Vic.

Lucas Underwood [00:53:44]:
And the. The wheel bearing had failed, and they kept driving it, and it almost cut the axle in two. So I got a new axle and I got the wheel bearing. I flush everything out and put the new axle in, and I send him down the road. And he calls and he's. He's very upset the following morning. And I said, is everything okay? And he said, this car. And.

Lucas Underwood [00:54:04]:
And I said, okay, tell me what's going on. He said, I'll be there in a minute. And he slams the phone. Like, you can hear him throwing the phone through the car. He didn't even hang up. And he's like cussing in the background, like, oh, my God, what are we getting ready to get into here? And so he comes in and this man comes in and he looks disheveled as all get out. I mean, he looks like he's in bad shape. And I said, what's going on? And he said, just come out here, I'll show you.

Lucas Underwood [00:54:30]:
And I'm thinking, what have we done? And I go out and the passenger side back window. Now, this is his supervisor's Crown Vic. The passenger side back window is blown out. The bars are knocked off the windows. The entire door is like ballooned out the side of this Crown Vic. And I said, I don't think we did that. He said, oh, no, you didn't do that. I said, what happened? He said, man, he said, I got this call that there was a car on fire in the middle of the road.

Lucas Underwood [00:54:58]:
And he said, I was getting off work in 30 minutes. And he said. So I get there, and this man standing in the middle of the road, buck naked, watching his car burn. And he said. So I went up to him and he said. I said, look, here's the deal. I have to put you in handcuffs. You're going to call somebody to come get you.

Lucas Underwood [00:55:17]:
I'm going to send you home. We're going to say, your car caught on fire and I'm going to go home. And you're going to go home and everything's going to be okay. And he said. He said, okay, not a problem. He said, I put him in handcuffs, put him in the back of the Crown Vic, shut the door. He said, I turned around and I was talking to the guys from the fire department, and he said, they started laughing. He said, when I turn around and look, he's busted the back window out of my supervisor's car.

Lucas Underwood [00:55:41]:
And he has taken off running through this field, jumped a barbed wire Fence. And he takes off. And he said, and at this time, I'm realizing, man, he's got an odor about him. There is something really odd with this. He takes off running after this guy. He steps in this huge mud hole. He's covered. He jumps over.

Lucas Underwood [00:55:58]:
He's like, man, he's like, I would have just let him go, but he was in handcuffs. He said, they teach us in Blet that if you do that, that could be attempted murder. If he, like, hangs himself up on something, you know, he can't get free. He said, lucas, I run through this field. He said, I chase him. And he said, when I land on top of him, attack him, he defecates himself. And he's like. It was like water, and it sprays all over me.

Lucas Underwood [00:56:22]:
It sprays all over him. He said, it goes everywhere. And so now I'm sitting here trying my best notes.

David Roman [00:56:33]:
It's everywhere.

Lucas Underwood [00:56:35]:
He's like, I am just trying my best, man. I'm trying not to laugh at this guy. And so, I mean. Yeah, exactly. I'm kind of backing away. Hey, can you clean the car out? I don't do that. You know, that's on y'all. But.

Lucas Underwood [00:56:50]:
But have you experienced any issues where you had a driver that doesn't line up with the. The goals of the company? Have you ever had issues where you had to step in Steve and say, hey, Mr. Company man, I just need to let you know about this. Has that ever come up?

Steve Schlaff [00:57:08]:
It's. It's been pretty infrequent. You know, one. One thing we do insist, you know, when there's a specific concern or complaint that we. We really want to talk to, who actually drives his vehicle.

Lucas Underwood [00:57:20]:
Yeah.

Steve Schlaff [00:57:21]:
And over time, our. Our contact at those fleets has gotten used to, oh, okay. They actually want a lot of information because they want to get this right. And then we'll ask, you know, final questions when the. When the driver comes in. Every now and then, we do it as gentle as possible. We've had to, you know, explain to the. The point of contact that, hey, this is actually an operator error.

Steve Schlaff [00:57:45]:
Not. Yeah, not. Not a Ford. I'd love to fix something for you, but you need to actually, you know, don't. Don't use overdrive when you're towing or don't use four low almost ever, you know.

Lucas Underwood [00:57:59]:
Right.

Steve Schlaff [00:57:59]:
You know, stuff like that.

Lucas Underwood [00:58:01]:
David, didn't you have one of those instances? Something about a telephone pole in a fleet? Wasn't that what that was?

David Roman [00:58:07]:
Let's not talk about that one. What if the car comes in what if the vehicle comes in and the driver drops off the vehicle and it reeks of weed? Like, it's like it stinks. The high heaven, bro.

Lucas Underwood [00:58:21]:
Stinking Colorado, every vehicle stinks.

David Roman [00:58:27]:
What are you talking about? Listen, listen, listen. I get that in Colorado everything stinks like weed. But. But the fleet vehicles cannot smell like wheat. Like, the guy cannot come in high. He had a drop off car and he's like stinking of weed and his eyes are all bloodshot and you get in the vehicle and you're like. And it smells terrible. Do you tell the fleet owner responsibility?

Michael Hilzley [00:58:50]:
You absolutely have to. Who's your loyalty to? The high driver or the guy that pays your bills? Right?

Lucas Underwood [00:58:56]:
Yeah, that's a valid point.

David Roman [00:58:58]:
Yeah, I asked. So I call and I'm like, hey, how long have you had this employee working for you? And he's like, oh, a little bit. I just hired him like, you know, a couple months ago. I'm like, do you like him? He's like, he's okay. What happened? He didn't care. He didn't care. It was electrician. He didn't care.

David Roman [00:59:19]:
I'm like, this thing reeks.

Michael Hilzley [00:59:21]:
What?

David Roman [00:59:21]:
I mean, reeks. Reeks of weed. He's like, he was smoking in that thing right before he dropped this thing off, which means he's doing it all day, every day as he's walking into your customers houses to fix whatever reeking of weed. Do with that what you want.

Michael Hilzley [00:59:37]:
Yeah, we actually had a story like that at one of our shops a few years ago where it was a construction company. And the guy pulled into the parking lot, sat there, fell asleep for a little bit. I went out there, knocked on the glass. He didn't move. But I saw some paraphernalia in his lap, so I called the police. Turns out he was doing heroin in our parking lot.

Lucas Underwood [01:00:00]:
Oh, my God.

David Roman [01:00:01]:
Oh. So this wasn't like. Oh, it was. It was a blunt. No, this was. This is a hard stuff.

Michael Hilzley [01:00:07]:
The hard stuff. He was supposed to be coming in to get a tire repaired.

Lucas Underwood [01:00:11]:
Yeah.

Michael Hilzley [01:00:11]:
Police showed up and he's like, yeah, I'm here to get a tire. No, what are you doing? He had like two warrants. They took him out.

Lucas Underwood [01:00:18]:
Holy cow. Well, I mean, we all have to understand that. That good employees are hard to find these days. Okay. Especially for some of these guys that just need somebody to, to haul boxes around. I could understand it. I get it. Wanting to keep them because you can't find help.

Lucas Underwood [01:00:34]:
Right? But I think you're right. I think we do have a bit of an obligation to the owner of the vehicle to make them aware. We had a fleet of trucks that we worked for, and the fleet owners became friends of ours, and there were two friends. And over the years, you go through a lot with your clients, and you see people go through really hard things and really experience some nasty stuff. And so this particular fleet was one of those situations, and somebody got hurt. Kirk got paralyzed and had been drinking on the job, and some bad things happened. And then the two divided and went their separate ways. And I remember having a conversation with the one who retained the business and saying, I'm not going to be able to continue to fix these vehicles because your guys are destroying them to the point that I can't do anything about it.

Lucas Underwood [01:01:30]:
And they have got to the point that they call me personally on my personal cell phone to come bail them out of trouble. Over and over and over again, they're destroying the vehicles. I can't maintain them. I can't keep up with them. They. They're telling you that they're doing the basic maintenance on the vehicles. They're not. I can't continue to do this.

Lucas Underwood [01:01:50]:
Right. Because it was turning into a situation where they were saying that I was doing repairs to vehicles that I wasn't even doing. And I'm like, what? I didn't bill you for this. Well, they said they just stopped by and you. You plugged that tire. They said they just stopped by and you threw in an oil change. No, I didn't do that. Well, you didn't put oil back in the truck when you did it.

Lucas Underwood [01:02:11]:
Come on now. Like, it's not even in line with what we do here, and you know that. Right. And so I've. I've had some interesting situations over the years that, that have popped up and, and have impacted those relationships. And I think that comes back to exactly what David said. Never, ever, ever depend on one fleet for your entire business. Business.

Lucas Underwood [01:02:31]:
Right. Not even two, not even three. I think customer pay, work that is not fleet should be. What. Do you have a percentage that you would think of, Steve? I'm thinking 60, 70%, and the rest could be fleets. Is that, is that in line with what you'd think?

Steve Schlaff [01:02:46]:
You know, I, I don't really have a target. I mean, I, I would say we're closer to like 10 to 15 on fleet right now in. Not. Not in car counter, but revenue.

Lucas Underwood [01:02:56]:
I don't.

Steve Schlaff [01:02:57]:
I don't really have a. A target. As long as you are, you know, the opposite of what you Know the story you said about the. The shop in California?

Lucas Underwood [01:03:06]:
Yeah.

Steve Schlaff [01:03:07]:
I wouldn't care If I was 80 fleets if that was a hundred different fleets. Yeah, you know, sure. Even I lose my biggest one at 65 vehicles. I still have a lot of fleet clients. I mean, we probably have big fleets that are there regularly, like at least one vehicle a month, probably around 30 to 40 between the two stores.

Lucas Underwood [01:03:29]:
Okay, so it. It. And. And Michael, I want to ask you the same question. Do you have a target? Do you have a number that.

Michael Hilzley [01:03:38]:
Our biggest number is the gross profit per hour.

Lucas Underwood [01:03:41]:
Yeah.

Michael Hilzley [01:03:42]:
You know, as long as that makes sense, I don't care if it's. I mean, we average about 10. Very close to what Steve was saying. Every month fluctuates. It could be 5, could be 15, depending on what the retail side of things are. But it's the. It's got to be profitable for us. It's got to make sense.

Michael Hilzley [01:03:57]:
Dollars and cents wise. That's the biggest thing for us. I could never see us going to even 5050 fleet, though. Yeah, that's not where our bread is buttered.

Lucas Underwood [01:04:07]:
Yeah, for sure. Michael, before we close, I want to ask you both, really. But Michael, we'll start with you. Shop owner here listening to this episode saying, hey, man, I want to get into fleets. What's the number one piece of advice you'd give them?

Michael Hilzley [01:04:23]:
Have a process in place. Set your service, set your standards. Be smooth. Be listening. It's just like a retail customer. You listen to their wants, their needs, and back it up. If you tell them you're going to do something, let your yes mean yes. And you know me.

Michael Hilzley [01:04:39]:
No, I love that, dude, to be honest.

Lucas Underwood [01:04:41]:
Yeah, that's honest, dude. I love that. Steve, what about you? What's your piece of advice you give? Just.

Steve Schlaff [01:04:48]:
Just like any other customer, build the relationship. Find out what their goals are with their fleets set. Adjust their expectations when what they think is going to happen is not realistic, and just. Just maintain those relationships with them. You know, build. Build the trust. Have a good point of contact and. And again, do not with.

Steve Schlaff [01:05:07]:
With them or any. Any customer. Don't be afraid to have the conversation of, you know, I'm. I just might not be the right shot for you.

Lucas Underwood [01:05:14]:
Amen, buddy. Absolutely. Absolutely. Thank you guys so much for being here.

Steve Schlaff [01:05:19]:
Absolutely.

Lucas Underwood [01:05:23]:
All right, when he ends this here.