Service Efficiencies Are The Key To More Sales
26th October 2016
Dealers who offer servicing work to their customers should pay particular attention to their service efficiencies so that they can maximise their profitability, and make sure that they do not fall into the routine of doing an hour’s work for an hour’s pay.
Improving service efficiencies means more work can be booked into the workshop, therefore increasing the number of hours invoiced in a day. Increasing efficiency by just one hour, per day, per technician, charged at £80 an hour retail, equates to £20,800 extra labour sales per year.
That figure is per technician – so a dealer with five technicians stands to turn over in excess of £100,000 extra labour sales each year simply by ensuring they are working efficiently to the tune of just one hour per day.
There are a few ways that efficiency and profitability can be increased, but before they can be improved dealers need an accurate way of measuring the attendance of their technicians, and the time they spend on service jobs and non-productive time.
A Dealer Management System with an integrated time and attendance clocking system, and a comprehensive reporting module, is key for allowing the service manager, or workshop controller, to access the information they need to manage their technicians’ workloads.
Dealers need to divide the hours charged to the customer for the service job, by the hours their technicians have been clocked onto the job (the actual time spent by the technician). In order to increase profitability, the aim is to sell more hours than the technician has physically taken to complete the job – so they must complete the job in a lesser time than the number of hours charged to the customer. Bear in mind though that the allocated time should always be achievable and allow the technician to ensure that their maintenance / repair quality is not diminished. Dealers should aim for their technicians’ efficiency percentages to be between 110% and 125% – the higher the better.
While some dealers may believe it to be prudent to book less hours in to their workshop than they have available to them from their technicians, allowing for possible unforeseen circumstances, it is actually counter-productive. Technicians will either take their time with jobs or run out of work, which is not good practice for any workshop.
Dealers should roughly book 10% more work into the workshop each day than they have in available hours, with them monitoring and managing technicians’ efficiencies to achieve the workload. Using a Service Booking Calendar within a Dealer Management System is essential for being able to see the workshop loading and ensuring that every working day is filled to the agreed capacity.
When booking customers into the workshop, the service advisor / receptionist should always check for previous recommended work or advisories from their last visit, or from any Vehicle Health Checks carried out beforehand. If there is, they should ask the customer if they would like them attended to on this visit. Alternatively, if this is the first time that this particular customer has contacted the dealer for servicing, ensuring that they are informed of special offers that might relate to their particular car, or general items such as an aircon re-gas or winter checks, can also help to secure extra work you workshop right from the outset of a service.
Vehicle Health Checks (VHC)
Garages carrying out VHC’s have become pretty much standard in recent years, as they increase trust with the customer due to the fact they highlight safety benefits and provide upselling opportunities for the dealer.
Dealers should have their own VHC checklist with a list of items to check, meaning it is important that their VHC tool allows them to create their own templates – particularly if the dealer has a number of different checklists they wish to use for different reasons.
DragonDMS users are able to use the free mobile app, Dragon APPraise, which is available on both Apple and Android devices. The app allows technicians to complete a VHC and add notes and photos, but also gives them the capability to record and send a video of the fault directly to the customer’s mobile phone, later alerting the dealer once the customer has watched the video.
Once the dealer receives the alert, it is the opportune moment to call them to see if they will authorise the work. Letting customers see the item for themselves with a technician explaining what is required, increases their trust in the technician and their opinion that the work they are highlighting is necessary.
Tracking of non-productive time
Another way to improve workshop efficiency is to tackle is the amount of non-productive time. If dealers find technicians are spending some of their time cleaning or driving cars, it may be worthwhile hiring dedicated valeting/driving staff as the increase in profitability from improved efficiency would far outweigh the extra cost.
Tea breaks are an area, where once again, the use of a clocking system is crucial for enabling dealers to access accurate efficiency rates. If technicians are not clocking on and off their tea breaks, their hours worked will be over-allocated, directly affecting the efficiency percentage. Also, considering staggering your technicians’ tea breaks throughout the day, therefore reducing the impact of these scheduled breaks on the service department.