Now that you have recruited a person with good communication skills, compensated them based on their individual performance, dressed them like a professional salesperson and trained them how to become a professional salesperson, let’s look at the results that you can expect to achieve:
1. Increase in sales per customer pay RO
2. Increase in repair order count
3. Increase in CSI
4. Increase in owner retention
5. Customer pay labor gross profit at 70 percent of sales
6. Customer pay parts gross profit at 45 percent of sales
7. One item repair orders at 10 percent or less
8. Increase in “Fixed right first visit”
9. Increase in Technicians’ productivity
10. SERVICE ABSORPTION AT 100 PERCENT
If all of the above sounds like a good thing to you, then let’s now determine what this Service Advisor is worth. Please review the following outline where I am comparing the “worth” of a service advisor to the “worth” of an automobile salesperson.
As you can see by my example, a salesperson must sell about 22 CARS A MONTH to equal the gross profit performance of a service advisor writing 15 repair orders a day at 1.5 hours per RO. Now do the math and you will instantly realize the additional profit potential for this advisor without writing any additional repair orders. For example, 2.2 hours per RO will generate about $60,000 in gross profit and 3.0 hours per RO will produce about $80,000. Your “TOP GUN” on your showroom floor would have to deliver about 44 cars a month to match the performance of this advisor! Remember, a service advisor should be a salesperson, not a CLERK; thereby, enabling your dealership to achieve 100 percent service absorption. In my example, you can see that an advisor is compensated at about 10 percent of gross profit, while an automobile salesperson is compensated at about 20 percent but produces half of what an advisor does!
As a dealer or general manager you should visit with your advisors daily, let them know you care, acknowledge a good job, correct substandard performance immediately and EDIFY these advisors to their customers, managers and fellow employees.
The results will astound you.
Vol 2, Issue 5