Involving technicians in finding and selling additional repair work using automated tools is critical to increasing the profitability of dealership service departments, according to a new report from Reynolds and Reynolds.

The report entitled The golden key figures for fixed processesfocuses on metrics that drive fixed ops decision making and how traders can improve their results.

The metrics are broken down by dealers’ repair order volume and the type of area they are located in – city, metropolis, township or rural area. In terms of volume, dealers are divided into five classes: less than 300 repair orders per month (Class 1), 301-499 (Class 2), 500-849 (Class 3), 850-1,199 (Class 4) and more than 1,200 per month in Class 5.

“When the sources of results become too diverse, the benchmarks become too general and applicable to only a very few actual cases,” said Jason Sideris, vice president of product management at Reynolds. “This report is a unique opportunity to provide dealers with a clearer picture than the benchmark data the industry has provided to date.”

“We all know there are differences between service departments in big cities and rural areas, and between high-volume and low-volume departments. By segmenting the data, we can all compare and understand the results more accurately.”

Jason Sideris

The breakdown shows clear differences between size and location classes in terms of what Reynolds calls the “golden metrics”: total hours sold and hours per repair job, effective labor wage and profit per repair job paid by the customer.

However, all courses showed consistent results regarding the involvement of technicians in the sales process.

“Each of the golden metrics … is subject to things outside the dealer’s control,” the report says. “However, there is one factor that dealers can directly control: technician involvement in sales time. … The data shows that the more the technician can be involved in the quote process, the better the dealership performs on all three metrics.”

The report found that technician performance increased significantly with the use of tools to increase efficiency and accuracy. Data showed that the use of this technology resulted in increases in hours sold, effective labor rates, and profit per RO for all volume classes, with the increase in average profit ranging from nearly $15,000 per month for low-volume Class 1 service departments to more than $42,000 for Class 5 at their minimum level of 1,200 ROs per month.

The full report can be downloaded Here.