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g/auto • Posted by u/transmission_ted •

Shop rate went up 18% this year and I lost two customers — where is everybody actually landing? Shop Talk

Independent transmission shop, four bays, three techs plus me. Raised the door rate from $138 to $163 in February. Parts margin unchanged.

Lost two long-term fleet accounts over it. Kept everything else and revenue is up about 11% net, so on paper the increase worked. But losing accounts you have had for a decade does not feel like a win even when the spreadsheet says it is.

Two questions. Where is your rate, and how did you communicate the increase? I sent a letter thirty days out and I am wondering now if a phone call to the big accounts would have kept them.

📊 Poll

Under $120/hr 11% · 6 votes
$120 to $150/hr 31% · 17 votes
$150 to $185/hr 40% · 22 votes
Over $185/hr 18% · 10 votes
55 total votes
💬 6 replies

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u/scan_tool_sam •

Phone call to the big accounts, always. A letter is fine for the general customer base and it is the wrong tool for an account that does forty thousand a year with you.

Here is the thing — the fleet manager who got your letter had to take a rate increase to their boss with no explanation attached. You made their job harder. A phone call two weeks earlier lets them go in with context, and half the time they will tell you what number keeps them, which is information you cannot get any other way.

Your rate is fine. Your rate is arguably still low. The delivery is what cost you.

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u/transmission_ted OP •

That reframe stings a bit and I think it is right. I was thinking about how to justify it to them. I was not thinking about what I was handing them to carry upstairs.

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u/wrench_monkey •

$163 for transmission work with four bays is not aggressive. I am seeing $175 to $190 at the independents around here for heavy line work and the dealers are north of $220.

The thing that made my increases stick was decoupling them from any single event. Small increase every year in the same month, so it becomes a known thing rather than a shock. The shops that get pushback are the ones that hold flat for four years and then need 18% at once, which is exactly what you did.

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u/diesel_dan •

Fleet side of this: when my shop rate goes up I care much less about the number than about whether the turnaround holds. A truck sitting an extra two days costs me more than the entire labor delta on the repair.

If you want those accounts back, do not lead with price. Lead with a scheduling commitment.

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u/transmission_ted OP •

That is worth the whole thread. One of the two accounts I lost had been complaining about turnaround for a year before the increase. I have been telling myself I lost them on rate. I probably lost them earlier than that and the rate was just the moment they acted.

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u/estimator_erin •

From the estimating side — an 18% jump also breaks every budget somebody built off your historical numbers. Annual small increases are not just gentler psychologically, they are easier for a customer's own planning process to absorb. The customers who plan are exactly the ones you want to keep.

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