Three Ways Service Writers Can Benefit from Data

The Tekmetric Shop Index allows auto repair shops to benchmark themselves against thousands of Tekmetric shops nationwide

Most shop owners have a feel for how their business is doing. They know the slow weeks, the strong months, and whether the bays stayed full. What they often don't have is a good way to compare those numbers against anyone else.

That gap is where opportunity hides — and it's exactly what the Tekmetric Shop Index is built to close.

The Tekmetric Shop Index is a free benchmarking tool that lets you enter your shop's key metrics and instantly see how you stack up against more than 10,000 auto repair shops nationwide. No Tekmetric account is required. No commitments either. It's just an honest look at where your shop stands on the four numbers that matter most.

Top-performing shops track these metrics religiously — and they know exactly where they stand relative to the industry. Here's what each one means, why it matters, and how your numbers compare.

➡ Try the Tekmetric Shop Index →

1. Average Repair Order (ARO)

ARO is the average dollar amount of each repair order — total revenue divided by the number of cars you serviced. It's one of the most direct measures of how well your shop is selling and completing work.

A low ARO isn't always a bad sign on its own. But if your car count is healthy and your ARO is lagging, you could be leaving approved work on the table, underquoting, or missing opportunities to present needed repairs. A high ARO, on the other hand, means customers are approving more of the work their vehicles need.

ARO is also the metric most directly tied to your digital vehicle inspection process. Shops that complete digital vehicle inspections (DVIs) consistently — and share them with customers — tend to see higher approval rates and stronger AROs.

"I like the ease and the ability to be more transparent with my customers with detailed inspections and photos."  — Verified Tekmetric User, G2

➡ See how your ARO compares →

2. Car Count

Car count measures how many vehicles you service in a given period. It's the volume side of the revenue equation. ARO tells you how much you make per car; car count tells you how many cars you're making it on.

Both numbers matter. You can have a strong ARO and still struggle to grow revenue if car count is stagnant. And you can have a strong car count but a weak ARO if jobs aren't being sold thoroughly. Top shops keep an eye on both.

Car count breaks down further into new customers and returning customers — a distinction that matters when you're trying to understand whether your growth is coming from acquisition or retention.

"Customers can review inspection results, check estimates, and approve repairs with just a click. Everything is integrated, making our workflow way smoother than before."  — Verified Tekmetric User, G2

➡ See how your car count compares →

3. Parts Margin

Parts margin is the percentage of profit you're earning on the parts you sell. It's calculated as (retail price minus cost) divided by retail price.

This one is easy to overlook, especially if your shop has been using the same parts pricing for years. But small differences in parts margin have a compounding effect across hundreds of repair orders. If your parts pricing isn't keeping up with cost increases from your suppliers, your margin erodes quietly.

Top shops use tiered parts matrices that automatically adjust markup based on part cost ranges, protecting margin without requiring manual pricing decisions on every job.

"We were stuck at a certain level. … Once we made the switch, it just opened doors — payments, parts ordering, inventory — it all became more streamlined."  — Tim Lanier, Lanier Auto Group, Tekmetric Customer

➡ See how your parts margin compares →

4. Effective Labor Rate

Effective labor rate is the actual dollar amount your shop earns per labor hour — not your posted rate, but what you actually collect after discounts, flat-rate work, and packaged pricing.

A shop might post a $140/hour labor rate but collect significantly less per hour because of how jobs are built, discounted, or packaged. Tracking effective labor rate surfaces that gap and gives you something concrete to address.

This metric also helps you evaluate how well your labor matrix is working or whether you need one.

"I value its cloud-based agility and the way its real-time shop management board eliminates the bottleneck at the service desk … handling parts tracking and labor margins seamlessly."  — Verified Tekmetric User, G2

➡ See how your effective labor rate compares →

So Where Does Your Shop Stand?

These four metrics are the foundation of shop performance analysis. But knowing what they are is only half of it. The other half is knowing how your numbers compare — not to a theoretical ideal, but to real shops in the real industry.

That's what the Tekmetric Shop Index is built to show you. It's a free benchmarking tool that lets you enter your shop's numbers and instantly see how you compare to shops across the country on ARO, car count, parts margin, and effective labor rate. No Tekmetric account is required.

"With the implementation of Tekmetric we have seen a dramatic increase in business and positive feedback from customers."  — Verified Shop Owner using Tekmetric, G2

You can't improve what you don't measure. And you can't prioritize improvements without knowing where the gaps actually are.

Takeaways

• ARO measures revenue per vehicle. Strong shops track it and act on it.
• Car count captures volume. Both new and returning customers matter.
• Parts margin erodes quietly if you're not tracking it against your costs.
• Effective labor rate reveals the gap between your posted rate and what you actually collect.
• Benchmarking against real industry data turns these numbers into a roadmap.

See how your shop compares. The Tekmetric Shop Index is free, takes less than two minutes, and doesn't require a Tekmetric account.

,➡ Benchmark Your Shop Now →

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Your auto repair labor revenue and parts margins are critical for enhancing your shop’s profitability. Adjusting your pricing on parts to make a profit is pretty straightforward.

But when it comes to labor times for auto repair shops…that’s where things can get a bit tricky. 

Yes, you need competitive labor rates, but you also need to keep those rates reasonable so you don’t scare off your customers with sky-high prices. 

3 ways your shop can make more money on labor: 

1. By using a labor matrix 
2. By creating custom labor rates 
3. By applying a labor guide markup 

Before we dive into the differences between these three methods for setting the best labor times at your shop, here’s a quick refresher on the one thing these methods have in common: the labor guide. 

What is a Labor Guide? 

A labor guide is like the gospel of labor times for auto repair shops. It tells you how long, on average, it takes to complete different types of repair work.

Remember that the times listed in auto repair labor guides are averages, so it’s best to treat them as a starting point.

The holiday season is now in full swing, and as a shop owner, you’re probably thinking about how to best lead your team during this time.

Between the hot chocolate and the carols, there will be a lot you’ll have to navigate, including holiday pay and time-off requests.

By preparing and leveraging auto repair shop management software, all of this can be a piece of cake (or pie, if that’s your holiday dessert of choice).