Studies show that by Valentine’s Day, most New Year’s resolutions are but a memory if they haven’t been reached. If you’re doing great on your New Year’s resolutions – OUTSTANDING! If not, let’s try another- Resolve to eliminate wasted time at your Dealership or in your Department. I think you’ll be amazed at how much WASTE you can find just by looking. In most Service Departments, the average gross profit per Technician billed hour runs between $95 and $110, so it doesn’t take long for the savings to add up. A Sales Person’s time can run between $85, to well over $150 an hour, depending on his or her abilities. It doesn’t always take a Time and Motion Expert to see what can be improved. Read below and think about some of the common areas of waste (besides being seduced to surf the Internet) at your Dealership:
WAITING: Employees waiting for Customer approvals or authorization, equipment to be repaired, parts to arrive, the finance manager to be available, etc. Waiting probably accounts for the biggest waste of time. Would increasing the number of Customers making appointments help? Would better Repair Order descriptions help?
CORRECTIONS: Fixing a repair twice, re-ordering a needed part, re-contracting a finance Customer, etc. Taking the time to get it right the first time will save you time. I’m reminded of the saying, “If you don’t have the time to do it right, when will you have time to fix it?” Do we have the right Techs working on vehicles? Do we have properly trained salespeople? Spending all your money on Advertising only for Customers to receive average treatment from their Sales Person is time AND money wasted.
MOTIONS: People, paper work or equipment moving more than required. This is probably the easiest to fix. Starting with streamlining processes, then updating or adding new equipment. Could barcoding parts and vehicles save you time and money? Are Technicians wasting time looking for a Customer’s vehicle? Do Salespeople roam the lot in hopes of finding a vehicle to sell to their Customers?
OVER PROCESSING: Are there process steps not required to take care of a Customer or used to fix a poor design. Think of a title clerk hand addressing envelopes for vehicle registrations that could easily be put into a window envelop.
UNDER-UTILIZATION: Under utilizing the potential of your people can also be considered a waste. When you have a Tech (generating $100 an hour) does it make sense to waste any of his or her time? Pre-pulling parts or running parts to Technicians would make better use of the Techs’ time. Should the Salespeople be gathering insurance information instead of the Finance Manager?
By eliminating or reducing waste, the result will improve the overall efficiency of your Dealership-thus providing time to generating more income. Involve your Employees to see how wasted time can be eliminated in every Department.