In this article we offer some “best
practices” and an action plan using a business management system to get your parts sales up when the economy is down. The plan is based on an article written by John Walker (President and CEO of After Market Service Consulting Co, Inc.)
The typical equipment
dealership’s Service Department offers the dealer a possible steady cash flow,
with the largest possible gross margins of any profit center within the
dealership
Creative parts
merchandising, up-selling, advertising, promotions, etc., are all effective
ways to increase parts sales, but according to John Walker, the sure-fire way to increase
your parts sales quickly is to focus on selling your service to those customers who purchased equipment from you. Sounds simple, but it makes sense. Making sure
that customers who own your products are using your
service department, guarantees that your
parts are the ones being used on that particular service job!
To get an idea of how
much your dealership is losing in service revenue, determine a ratio of parts
dollars to service dollars on any work order. For example, $10,000 in parts
sales to a competitor has potentially caused you to lose an opportunity for
another $20,000 in service.
As a small business owner or employee, you do not want to be caught
unprepared when the flu season hits. Regardless of the size or type of your
business, a bit of planning now can put strategies into place that will help
protect the business and its employees, when 2009 H1N1 flu hits. It is important that you plan now for
the return of 2009 H1N1 to your community and for the potential for a more
severe outbreak.
Why should small business owners prepare their workplace for the 2009 H1N1 flu?
Ron Slee, consultant to the eqiupment industry, says in a recent article, "Every now and then it is good to give your software a check-up. Too
often, we do a review of software, or in some cases let our equipment
suppliers make recommendations, only when we are changing packages or
computer hardware." Ron asks, "Is that sufficient? The world around us is
changing, customer needs change, employee skills change, information
needs change."
In this article about evaluating business management software, Ron offers several critical situations in which to evaluate your software needs. Ultimately, if you software doesn't meet these standards, a change could be very beneficial to your dealership's profitability. As Mr. Slee says;
"Even though these are challenging and financially difficult times, now is the time to do it."
George Hedley,Commercial Dealer Magazine, December 2008
"Customers have stopped buying,
companies are closing, layoffs are common, banks have stopped lending, consumer
confidence is falling, and the list goes on. Many business owners hope things
gets better before it’s too late and are struggling to stay afloat during these
tough times," says George Hedley, author of "Get Your Business To Work!" George, a professional speaker, helps entrepreneurs and business owners build excellent companies. In this article from Commercial Dealer Magazine, George calls dealers to action with his list of Ten Things to do NOW to Grow your Dealership.
As a business owner, manager or leader your choice
is simple. Do what you know you need to do and do it fast, or die a slow death.
Most people are afraid to make tough decisions, try new ideas, or do business
differently. So they continue to hope their outdated business strategies will
keep working as they tread water or sink slowly and wait for something good to
happen. Even if survival is your goal, past methods won’t work. Running your
company the same way you always have will result in failure. The successful will
make tough decisions. What difficult choices do you need to make right now to
grow your business and make a profit? Read the article.
Most people are afraid to make tough decisions, try new ideas, or do business
differently. Increase spending on technology now! Can you improve or become more efficient by
implementing cutting-edge technology? Make it your goal to eliminate paper, and
never stop upgrading your technology.
Gauge the Amount of Precious Time Lost on Daily Tasks
A minimum of 85% of a technician’s day can be billable hours, so any non-revenue generating task they perform can cause your dealership to lose money. Having technicians perform duties such as clean-up and maintenance takes them away from revenue-generating activities.
