How Can A ROSE Make You More Money?

brian hammerman newsletterWhen you are talking about a Repair Order Survey & Evaluation (ROSE) the answer is simple. There are countless ways ROSE can help to increase your Effective Labor Rate (ELR), raise your gross profit and your gross profit percentage, as well as increase your maintenance sales and productivity. You are probably thinking, “This sounds too good to be true–where is the catch?” Well there really is none. Any Service Manager that has conducted a Repair Order Survey knows that they learn a lot of valuable information from looking at a sample of ROs. So why don’t we do them more often? Well the bottom line is, it takes WAY too long!!! ROSE is a tool that can sort through ROs in no time at all and can break down any information that you want to see. Let’s look at some reports and decide for yourself if this information is valuable or not.

 Scenario One:

 My customer pay ELR is $77.99.  My Door rate is $117.47.  Is this a good ELR???

 On the surface, you are thinking to yourself, Brian what’s wrong with you? Of course that is a bad ELR. However, you cannot really answer that without knowing how much maintenance they sell. If a dealership is very successful retaining their customers and selling maintenance, then we would expect the CP ELR to be lower because the maintenance is done at a lower ELR. The Dealer, of course, is thinking the Service Advisors are giving the store away and wants the Service Manager to get a grip on things. Looking at the ROSE report “Analysis Summary” we can look at the Maintenance ELR and the Repair ELR independent of each other. This will tell us what percent of the CP Flat Rate Hours are Maintenance and how much is Repair or Competitive. Examine the ROSE samples below from an actual dealer:

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This shows the CP ELR of $77.99. 2.0 Hours per RO!!! Is that good???? Their CP hrs are 39.41% of the total hours. Warranty is 37.25%. Seems like they should be selling more CP. We will get back to that but it is an observation.

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This Section of the ROSE report shows that their Maintenance ELR is only $44.91. I have seen maintenance dealers who are dialed in over $75.00 for their Maintenance ELR. The typical dealer is around $65.00. Their Repair ELR is only $98.87. With a door rate of $117.47, this is low and perhaps the Dealer was on to something when he thought the SA’s were discounting. If this dealership was on a grid, they should have a Repair rate over their posted door rate if they adhere to their pricing policy at least 90% of the time. This dealership has an adherence to their door rate of only 54.62%. This is low! How would you figure out who was doing the discounting? Again, simple with ROSE. All you would have to do is look at a “Job List” report and add data filters to look at CP and Repair lines only. Here is what their report looked like. I also sorted the list by ELR from the lowest to the highest.

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The ELR is in red because it is below the posted rate. This goes on for a few pages. You can see there was a 2.5 hour job sold for $87.50 which has a $35.00 ELR. I would go look at the RO and find out why. Now let’s sort the same data by FHR’s highest to lowest and see.

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WOW!!!! There is a 12.0 hour job sold for $500.84!! That has a $41.74 ELR. The cost on that was $360.00. The dealership grossed $140.84 on that 12.0 hour job. Done at the door rate sales would have been $1,49.64 a difference of $908.80!!!!! Now that’s a discount! And one no one probably would have found without ROSE. What a great way to hold SA’s accountable. ROSE is a great tool to use to compare each SA or Tech and counsel with them on their performance. All of the reports can be sorted by SA and/or Tech or select as many as you want if you wanted to look at a group of them.

This is just the first in a series of articles on how ROSE can make you money in your Service Department. Try ROSE absolutely FREE for 30 days. I am happy to help answer any questions and help with the initial set-up. Once you learn all the benefits of ROSE you will ask yourself, how have I managed a Service Department without this? Stay tuned for more examples of all ROSE has to offer.

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