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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industry expert / bhph
Track Fixed Ops Costs for Valuable Information on Your BHPH Business
Mark Dubois is is the director of buy here pay here performance groups and a BHPH moderator at Performance Incorporated, a division of ADP Dealer Services. He has more than 30 years of experience in the automotive industry and can be reached at 941.729.5765.
MDubois@AutoDealerMonthly.com
here pay here dealers across the country. One, dealers are paying higher prices to buy the same types of vehicles than they paid in previous years. Two, on average, vehicles have higher mileage than in
T
here are three things that appear to be consistent among buy
previous years. Three, dealers are traveling greater distances to acquire vehicle inventory in higher volume levels.
What impact does this have on fixed operations for a BHPH dealer? The answer requires a broader look at the options dealers have for managing
their fixed operations. For the most part, the focus of fixed operations in a BHPH business is largely on reconditioning and repairs to vehicles. The biggest decision a BHPH dealer will make in this aspect of the business is whether to do reconditioning and repairs in-house or sublet the work to outside garages and repair centers. Both options have ad- vantages and disadvantages.
The decision to do recondi- tioning and repairs in-house is largely driven by the invest- ment required for equipment, tools, staff and facilities. For
many BHPH dealers, the cost and space requirements of those items present a knock- out punch right away. For dealers who are able to implement an in-house recon- ditioning and repair center, the biggest advantage they gain is control over quality and type of reconditioning and repairs that are done. By utilizing your own facilities and staff, you control many other key factors in the reconditioning and repair process including the cost of parts, labor rate, the type and extent of repairs that are done, the experience level of mechanics, and the peace of
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