Hey there fellow dealership owners and service managers,
Let’s talk about a sneaky little number that might be quietly eating away at your profits: Hold for Parts (HP) calls. You know, those frustrating moments when your service team can’t complete a job because the right part isn’t in stock? Yeah, those.
At Nexera, we crunch a lot of numbers, and one stat we keep a close eye on is the HP rate. It’s a big deal because it can tell us a lot about how smoothly things are running in your service department. Surprisingly, nearly 30% of dealerships manage to keep their HP rate below 12%. Kudos to them—they’re acing this part of the game.
But here’s the kicker: if you’re not part of that 30%, you could be losing out on some serious cash without even realizing it.
Let me break it down for you. Imagine your dealership falls into the median range with a 21% HP rate. Now, compare that to those top performers with a 12% or lower rate. It’s not just a 7% difference; it’s a whopping 50% gap. That means you’re marking calls as HP 50% more often than those top-tier dealers. Ouch.
Now, let’s put some numbers to it. Say you’re paying your technicians a fully loaded hourly rate of $60. On average, each tech handles around 80 calls per month. If you’re dealing with 16.8 HP calls per month compared to the “A” grade dealer’s 9.6, that’s an extra 7.2 calls per tech. Multiply that by the hourly rate, and you’re looking at an additional $432 per technician every month. If you’ve got 10 techs, that’s over $50,000 down the drain annually. Yikes!
But here’s the silver lining: you can turn this around. We’ve seen it happen with dealers just like you.
It all comes down to two key factors: car stock and territory management. I know, it’s tempting to throw your hands up and blame your unique territory and diverse inventory. But trust me, it’s doable. The top 30% of dealers prove it month after month.
By leveraging tools like our Nexera WorldStats™ database, you can predict your territory’s service needs and tailor your car stock accordingly. It’s all about finding that sweet spot where your inventory meets your demand, minimizing those dreaded HP calls.
And here’s the best part: it won’t cost you extra. Yep, you heard that right. It’s all part of your Nexera subscription.
So, if you’re feeling the pressure to cut expenses and boost profits, start by taking a closer look at your HP rate. With the right strategies in place, you could be saving big bucks and steering your dealership toward that coveted “A” grade.
Here’s to smoother service calls and fatter profit margins!
Cheers,
The Nexera Team
