Auto Dealer Monthly Magazine is the daily operations publication serving the retail automotive industry. This automotive publication serves dealer principals, officers and general managers with the latest best practices.
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By David Keller AC C OUNTING ©ISTOCKPHOTO.COM/MORGANL COUNTING ON SERVICE An effcient, proftable parts and service operation can generate steady revenue and keep customers coming back. Take a bird's-eye look at your deal dealer dealership property. What is th la the largest area you see? For m stores, it's the service demost s pa partm partment. It takes all that space fo for a reason: Maximizing reven i enue in the service department can help ofset the ups and downs of sales and F&I.; Sadly, the service department ofen takes a back seat when dealers set their priorities. Te front end tends to dominate dealership operations because it normally produces the most sales and gross proft. But what happens in the months when the front end falls fat? When sales and F&I; don't produce, the parts and service departments tend to get more attention from management. When one department doesn't carry its weight, everyone expects the other departments to make up for the lost gross profits. And when the front end, parts and service sales fall of in David Keller is a partner with CliftonLarsonAllen, a Top 10 nationwide accounting firm with extensive experience in serving new- and used-vehicle retailers, heavy truck and utility trailer outlets, and BHPH dealerships. DKeller@AutoDealerMonthly.com 10 AUTO DE ALE R MONTHLY • AUGUST 2013 the same month, things can get very ugly. T is situation can be prevented. If you pay enough attention to service all the time, it will always do well. Here are six ways to "repair" your parts and service departments: Do the Math: Determine your sales and gross profts for the year to date. Compare the last 12 months of sales and grosses side by side by running a general ledger account-trend report for the service and parts departments. T is will tell you what the volume of activity has been for each month and how much it has fuctuated. If you spot any seasonal trends, they may help predict future sales. Re-evaluate Your Service Drive: How is your service operation set up? It should be inviting, easy to access, clean and well-lit. It should also be properly stafed, especially at the busiest times of the day. How ofen have you seen staf walking around at department stores while customers waited in long lines to check out? Annoying, isn't it? An efcient service write-up area could be restricting your sales volume and driving of potential lifelong customers. Sell Service: Many dealers are slowly losing maintenance business to third-party shops. Why is this? Most dealerships don't ofer the same fexible service hours as their independent competitors. Most customers have no idea the dealership is usually just as competitive on