KPIs are the one way to gauge if your dealership is on the right track. So every car dealer measures, analyzes and checks accuracy religiously – especially when the market is shifting.
Whether it’s website conversions, the number of ups, appointments, or closing ratios – auto dealerships must keep up with market fluctuations by constantly monitoring and adapting. Why? To gain a competitive advantage and improve its bottom line. Like NFL coaches adjust plays after halftime, the best dealer operators create a new plan based on KPI insights to make the store as successful as possible.
However, vehicle reconditioning typically takes a back seat and is easily neglected. Because many dealerships are making money in the current market, optimizing recon efficiency and processes gets pushed aside. This is a big miss for car dealerships. Auto reconditioning can help provide shoppers with the best-used – and most sought-after – vehicles in the market. So which recon KPIs should auto dealerships be monitoring?
We all know starting a new process is always challenging, no matter what it is. People naturally do not like change or accountability. But the best time to fix a leaking roof is before the storm.
KPIs – measuring for success
1. Recon to retail timing. The time it takes to get vehicles retail-ready is one of the most important KPIs for your team. For the average dealership, vehicle recon takes 7 to 10 days. But what if you could cut that time in half using better technology and processes? Dealerships are losing money every day on vehicles that are not on the lot. And in a market with fast-changing valuations, this risk escalates. You can take steps to protect your inventory and avoid a slow recon time that eventually turns that perfect car into a loss.
2. Check the Pulse of Each Cars Recon Status. Knowing every car’s exact reconditioning position is vital for your team’s performance, including the status, where it’s going next and the cost of repairs. Don’t let your vehicles become “lost” or forgotten. Manual tracking often leads to countless blind spots that will hurt the bottom line – often without the dealer even being aware.
3. Vendor Accountability. Be proactive in notifying vendors of the work to be done on all vehicles needing their service. Hold them accountable for how long it takes them to complete a job and be sure it’s within your timeline.
4. Approval Times. This is one of the biggest bottlenecks in the entire recon process. On average, technicians or advisors handwrite repair estimates on the back of an RO, then physically walk it to the used car manager for approval. What if they are off or away from the desk? An automated workflow management tool helps hold everyone accountable and quickly identifies opportunities to improve efficiency. Mastering this KPI can cut recon time an estimated 12 hours to 2 days.
ROI on your investment
Leverage technology that supports your existing recon process using one application that can easily adjust to market fluctuations – then track, adjust and optimize. This ensures you can dramatically improve the speed of your recon to retail strategy.
For questions about this article or to get your recon process in gear, visit us at velocityautomotive.com.
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