When is enough…enough? If you are in Fixed Operations, this question is surprisingly easy to answer.
There is never enough Gross Profit. In fact, when was the last time you and the Dealer Principal sat down in the office and he or she took out the latest financial, looked it over and then said to you “Go ahead and close the service drive and take the rest of the month off. We have enough Gross Profit!”
There is never enough Service Absorption. We live in an uncertain and untimely world my friend! Today the sky is clear and the sun is bright. Tomorrow there may be clouds and rain and wind. Wouldn’t it be nice to “weather” it in comfort. This is called 100% Service Absorption. The more absorption you have the easier it is to “weather” the storm.
There is never enough margin on your Gross Profit Margins! Got aging inventory? Got “A” level Master Techs? Got Sad Sack Sam as a Service Advisor? Then you need more margin! When you have great margins you can have an off day or two in the month because your margins cover the spread. If you have low margins, an off day or two kills you!
So, if you are a Dealer Principal or General Manager and you need more Profit, more Service Absorption and more Margin…why oh why would you continue to do the same things that got you these “Dealership Going Out Of Business” results?
What are you afraid of? Success?