April 04, 2016 3 Comments
This piece is only of interest to a minority of professional bicycle mechanics. That’s my excuse for such a lengthy exposition and references mechanics will catch but others may not. The time for this story is now, mechanics are networking and organizing as never before.
Starting with a cadre of race mechanics, acquainted through events and programs like the USAC Mechanics Program, there is now a professional mechanics FB site that has grown to 3000 members in a matter of weeks. If you are a mechanic and not a member, please check it out. Many important discussions are occurring around shared goals of improved standards, wages, accountability, diversity, technique, and advancement. My two bits are related to those topics.
The following concepts are big but simple, so I’ll tell it like a story. The story is true in message but not every detail is exact. Please follow along and see if the points make sense.
Service in today’s economy
Service is one of the most secure, best paid, and fastest growing employment sectors in the developed world. Fixing and maintaining copiers, plumbing, computers, vehicles, elevators, espresso makers, etc. is in increasing demand.
Yet bicycle service is plagued by low wages and high turnover. There are few paths to advancement, little diversity, working conditions are often primitive, and access to training is scarce. At the same time, employers (shops, teams, companies, riders) complain of a small pool of effective technicians, widespread low standards, unprofessional attitudes, and lack of accreditation.
Why the contradiction?
When I left retail in 1999, my shop was trying some novel service ideas. That experiment was interrupted but interesting points were raised. I dove into cycle manufacturing, particularly large scale wheel building. I found the economics of manufacturing surprisingly similar to shop service departments. Yet, in shops, service is usually managed like a subdivision of commodity retail.
Seeking answers for the mechanics' dilemma, I interviewed service operations in motorcycle, auto, marine, and aviation. Perhaps their practices would help explain the contradiction. A telling experience in my quest was a visit with Cal BMW’s owner, Kari Prager (much admired and since passed). His Mountain View, CA business was among the premier BMW motorcycle dealerships in the US. I explained my quest and he asked a few questions.
“What’s your shop rate?”
I said “$95/hr.” My shop was 20yrs old and regionally well known. We had mechanics with high level experience and an impressive service department. Other shop rates went from $50 to $85, so we thought it wise to stake out $95 for ourselves. That's the way most shops do it: we select a rate rather than generate it from our costs.
Kari said, “Great, I’m impressed. So you pay your mechanics $45/hr? I wish I could do that. Our starting wage is over $60/hr and still we have turnover trouble. They’re poached by auto performance shops that pay better.”
I said, “Whoa, we pay around $20/hr and are locally famous for such a high rate. I couldn’t pay more if I wanted.” Kari said, “That's incredible. You charge $95/hr and only pay $20? What a clever guy you are. What do you do with all that money?”
I said, “No way. I’m always broke and challenged to make payroll. I can’t buy a new car. There’s no gold mine at my shop.”
He said, “Something is wrong. If you charge $95, where is the money going?” This led to a simple experiment: determine the ACTUAL labor rate. It’s simple: pick a period, divide all receipts for labor by all hours devoted to those jobs. Exclude phone calls, customer consults, and parts chases. Count only hours for jobs. This will identify the ACTUAL labor rate as opposed to the ADVERTISED rate.
We did this and found our ACTUAL rate was 1/2 our ADVERTISED. I have since done this calculation at a number of shops and never found an ACTUAL rate that was more than 1/2 the ADVERTISED rate.
Huh? Customers are asked to pay a labor rate, they agree and, without being told, are charged half. Mechanics are told their work is being charged out at a specific rate but then paid less than 1/4 in wages. Service business in the larger world doesn’t do this. This is broken thinking and everyone loses.
What do other service sectors do?
In auto, marine, and aviation service operations, I found similarities to each other but little resembled bicycle practice.
The point is to know more precisely how service makes money, which usually leads to higher wages for mechanics. Here is how it is done: each task is assigned a flat rate that represents expectations (not necessarily outcomes) for each job. Mechanics record (with a time clock) the beginning and end of every task. Answering phones, service writing, selling, unpacking orders, these are clocked accordingly, NOT as service labor. This record keeping must be diligent, it's nearly impossible to track without time clocks.
Time clocks are unwelcome in most bike shops, seeming impersonal and authoritarian. However, service is more like manufacturing than commodity retail. In manufacturing, time clocks are the worker's best friend. They defend proper compensation. Management must prove that all clocked hours are paid. Time clocks are not exploitative but empowering evidence on behalf of mechanics. Likewise, if your efficiency as a mechanic is brought down by interruptions, the evidence should be available.
Using a time clock does not mean piece work pay. That is another discussion. The time clock gives the shop data to become smarter and, in turn, mechanics are usually winners.
Each week, data must be analyzed. Every job type (overhaul, tire install, etc.) is checked against hours to see how close it comes to expectations (flat rate). Each mechanic is measured for efficiency. Some are fast, some are slow. We know whose work is better (compliments, come-backs...) but who is consistently faster is often barely known.
What to do with this insight?
Some jobs need re-pricing, up or down; others require better specs so time spent matches time expected.
Mechanic productivity varies more than most think. Interruptions are extremely expensive. Mechanics who are best paid are too often slow. No other service scene employs so many that are not particularly mechanical. Intuitive mechanics solve problems while they move forward, anticipating parts and tool needs, and try and work as quickly as possible. It seems programmed into the very core of a gifted mechanic. Like commercial chefs, they do not work like home cooking aficionados. Many bike mechanics are enthusiastic riders. Some should be service writers, not mechanics.
Shops are like race teams. In general, the quickest rider is the best paid. Many shops do not know enough about speed. Faster mechanic numbers jump off the page. They can be 2-4X faster, may lack an interest in chit chat, may not ride so much, may prefer mechanical hobbies.
Our industry does a poor job of retaining them because they are not paid according to their productivity and drift to industries where they are. Too many cycling mechanics are not mechanically intuitive. Service businesses outside cycling normally pay at least 1/2 of their labor rate to the mechanic. If paid less, the shop rate may be bogus.
There is no correct response to this collected data. Anyone with it will have ideas. Slow mechanics are welcome but shouldn't be paid too much. For tiny shops, time clocks may not be an option. The point is: too few in the service end of cycling seek or have these numbers. We're not trying to make shops like factories. We want to be as smart as possible and not suffer any avoidable handicaps.
Until more shops measure service the way successful operations outside cycling do, gifted mechanics will have trouble being paid and the career will remain backward. Many improvements in the profession are needed but if the engine that pays is busted, progress will be slow!
Comments will be approved before showing up.