Absorption _____ Where does your store need help? 5 key items Parts and Service what is your absorption percentage? What should it be? – – Technician productivity, sell every hour Parts fill rate, pricing matrix Reduce non-variable expenses Variable percentage sales commission analysis – Gross profit per unit Carry what sells, sell more! of Profit Accounting The “Why” “Mini” deals? Minimum Wage? Unapplied time? Low technician productivity? Obsolete parts? Parts Shortages? High sales commission expense Why do cars stay in stock over 60 days? Why am I out of cash today everyday! – Why Creating Profit Reports for Managers Monday and why Last week’s overtime report (this month’s focus) Tuesday Service and Parts – 10 oldest parts why did this happen? Can we get rid of? – 10 oldest repair orders (with hr and pts) why still open? – Lowest productivity technicians why? – 10 oldest warranty claims why? – Weds Inventory day – 10 oldest new why? What do we have in stock vs. on order – 10 oldest used - why, What is our mix vs what sells? Are we advertising vs. what is in stock? Thursday Car deals – Lowest gross profit front and back why? What is common? – – Deals not in the office why, reasons (vlookup) – Oldest contracts/VR not paid why reason (vlookup) – – Deals per sales person who is on top? Who is lowest? Why? – Profit Accounting Requirements Get your office organized - time Create your metrics Understand Gross Profit the – let’s start at bottom…parts
Absorption _____ Where does your store need help? 5 key items Parts and Service – what is your absorption percentage? – What should it be? Technician productivity, sell every hour Parts fill rate, pricing matrix Reduce non-variable expenses Variable percentage – sales commission analysis Gross profit per unit Carry what sells, sell more! The “Why” of Profit Accounting “Mini” deals? Minimum Wage? Unapplied time? Low technician productivity? Obsolete parts? Parts Shortages? High sales commission expense Why do cars stay in stock over 60 days? Why am I out of cash today – everyday! Creating Why Profit Reports for Managers Monday Last week’s overtime report (this month’s focus) and why Tuesday – Service and Parts 10 oldest parts – why did this happen? Can we get rid of? 10 oldest repair orders (with hr and pts) – why still open? Lowest productivity technicians – why? 10 oldest warranty claims – why? Weds – Inventory day 10 oldest new – why? What do we have in stock vs. on order 10 oldest used - why, What is our mix vs what sells? Are we advertising vs. what is in stock? Thursday – Car deals Lowest gross profit – front and back – why? What is common? Deals not in the office – why, reasons (vlookup) Oldest contracts/VR not paid – why – reason (vlookup) Deals per sales person – who is on top? Who is lowest? Why? Profit Accounting Requirements Get your office organized - time Create your metrics Understand Gross Profit – let’s start at the bottom…parts