A key indicator that measures the impact of the Aftersales Department on the dealership’s bottom line is the Absorption Rate.
This indicator is especially important in times of lower sales, since it reveals to what extent the dealership’s expenses are covered by the Aftersales Department.
Here are 3 tips to improve the Absorption Rate:
1. Increase the amount of jobs per repair order
To maximize sales, when the Service Advisor is taking note of the services requested by the customer, they should also offer:
– Preventive maintenance services
– Services that were offered to the customer in the past but were rejected
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2. Measure workshop efficiency and productivity
The Service Manager should know how much time technicians dedicate to each job in each repair order, so as to detect delays and unproductiveness.
3. Efficiently manage the Parts Department
Obsolete parts can be a huge problem. A dual strategy aims to first clean up the dealer’s parts inventory, and then to improve the purchasing process based on statistical data provided by the dealership management system.
Boosting sales and profitability in the Aftersales Department is the best strategy a dealership can pursue as a means to get through periods of lean sales. Ideally, a dealership will put these practices in place as their regular strategy, and not as an act of despair to overcome unexpected crisis.
