RV PRO

November '19

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B U S I N E S S 120 • RV PRO • November 2019 rv-pro.com Do You Have a Fixed Ops Sales Team? If not, consider implementing a culture of sales in your fixed operations department – and watch your profits soar. By Don Reed Don Reed is the CEO DealerPRO Training Solutions based in Gahanna, Ohio. For more information, visit www. dealerprotraining.com or call 888-553-0100. W hen it comes to managing service and parts departments for max- imum profitability, I always start with measuring service absorption. (As a reminder, you arrive at this number by determining what percentage of your total dealership expenses – minus your sales department's variable selling expenses – are being paid by your total gross from parts and service sales.) With that being said, I would hope every dealer and fixed ops manager would make it their mission in the coming year to put forward a plan to move aggressively toward achieving 100 percent absorption. In other words, let's start thinking BIG! Let's look at some strategies that will enable all of you to do just that. Our focus will be on the retail service customer, given that this rep- resents the greatest opportunity for increasing gross profit. It all begins with your perception of how the service and parts departments should be struc- tured and managed. Specifically, do you have a culture of administration or a culture of sales? For example do you employ service writers (administrative clerks) or service advisors (sales- people)? Do you have a high percentage of one- item repair orders, like 50 to 60 percent (admin- istration) or a low percentage, like 15 percent or less (sales)? Are you experiencing a declining customer pay repair order count (administration) or is your customer base expanding (sales)? To aggressively work toward that worthy goal of 100 percent service absorption, a fixed opera- tions director must be a good sales manager and employ many of the same management strate- gies used in the front-end by the general sales manager. Given that one can't effectively manage what one does not measure, you must identify the performance metrics that guide successful sales operations, as well as service operations. See Figure 1 on page 121 for a comparison of these metrics for both departments. Every single one of these metrics requires some form of sales management for both managers. In working with many dealers across the country, we have found that most dealers do a fine job of devoting their time, resources and capital to sup- port and evaluate the performance of their sales management team and hold them accountable for their results. However, far too often when it comes to doing the same for the fixed operations team, there seems to be a different set of standards, usually attributed to a lack of accountability. So, how about you service and parts direc- tors make the commitment right now to start measuring the performance metrics for your sales team. Get out of that administrative chair, get on your feet and focus your efforts on managing sales. Take a walk through the shop and observe a technician performing a 27-point courtesy inspection of your customer's RV. Show those technicians that you care, and thereby rein- force the notion that the inspection process is important to you and your customers. Your technicians' goal is to ensure that each and every customer leaves your dealership with a safe and reliable RV. Start your day each day with a brief 15 min- utes or less daily sales meeting with your service advisors and parts personnel reviewing yester- day's performance and today's plan for reaching your goals on HPRO, profit margin on parts and labor, up-sell penetrations, closing ratios, etc. Next, how about 30 minutes observing the customer reception process and maybe shake a few hands with a "Welcome to our deal- ership. I'm your service director. How can I assist you today?" Evaluate and coach your advisors on their walk- arounds, their menu presentations, and their customer communication skills. At the end

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