There are numerous indicators available to management that contribute to an in-depth analysis of the financial health of the workshop. Each provides a detail that enables maximisation of workshop profit.
Listed alphabetically below are typical examples of financial indicators in commonly use:
- Actual Turn-over as a % of Potential Turn-over
- Average Hours per Job Card
- Average Labour Value per Job Card
- Cash Sales
- Departmental Expenses as a % of Gross Profit
- Direct Expenses
- Fix Right First Time (from OE CSI, as a measurement of inefficiency and lost revenues in rework)
- Gross Profit as a % of Total Service Turnover
- Indirect Expenses
- Internal Labour Sales as a % of Total Labour Sales
- Labour Gross Profit
- Net Profit per Hour Sold
- Parts Value per Job Card
- Parts Value to Labour Sales Ratio
- Productive Costs per Hour
- Retail Labour Sales as a % of Total Labour Sales
- Service and Motor Plans Payment as a % of Submissions
- Sublet as % of Turn-over
- Support Costs per Hour
- Total Labour Sales as a % of Total Turn-over
- Upsell Value per Job Card (excluding Warranty and Internal)
- Warranty Chargeback as a % of Total Warranty Submissions
- Warranty Labour Sales as a % of Total Labour Sales
- Warranty Payments as a % of Total Warranty Submissions
- Workshop Debtors
- Workshop Jobs per Head Per Day
- Workshop overhead Absorption
- Workshop Profit as a % of Total Service Turnover
- Workshop Revenue per Head Per Day
In addition to the above, the Support Staff ratio should be monitored. This benchmark will indicate if the dealership has too many support staff (non-productive staff) relative to productive staff. Productive Staff is those selling labour hours and include Technicians, Working Foremen, and apprentices. Non-Productive staff includes ALL OTHER workshop staff. The desired ratio of Technicians to Support Staff is in the region 2,7-3, however, there are many dealerships operating at values of 1.7 or less.