Fixed Ops Magazine - 2021 Vol18 01 - 61

The starting point is clear: The single largest expense

Mr. Demaree added, " We also continue looking to be

category in almost every dealership is headcount. For

'Best in class' on all of our processes, which is a broad

decades, we in the automotive industry have been

statement with a potential blurred outcome. You must

turning to technology to automate
processes,

increase

productivity

The single largest

tions from the January 2021 issue of

tached to a 'Best in class' focus.
We evaluate the potential return on

and drive profitable growth. Not
surprisingly, one of the 2021 Predic-

still have a financial component at-

expense category

sales and the cost that we will incur

in almost

pline is a must for our teams as we

the Automotive Ventures Intel Report is, " the next wave of automotive tech will automate processes " ,
" helping dealers and OEMs to auto-

every dealership

vendor cost and complexity, reduc-

move forward into 2021. When managing through COVID and beyond,
we have come to learn that it is imperative that headcount in Fixed

mate processes and reduce costs. In
many cases this will be by reducing

to drive that outcome. This disci-

is headcount.

Operations be as close to NCM
Benchmarks as possible. This main-

ing headcount, or making existing headcount far more

tains the Net to Sales the store deserves. Anything we

efficient. " Seek out areas that are under-utilizing tech-

can do to automate a process to avoid hiring is high

nology and evaluate your options. 

on my radar. "

For example, most dealers utilize a full-time dedicated
person with several support people and/or back-ups
to perform warranty processing. The average dealer
has 1.6 FTE's handling warranty processing. On average, it takes 11 minutes to fully process one claim. This
results in 6.1% of the warranty RO being consumed by
processing costs. This is an area that is ripe for a technology solution to help drive profitable growth. 
One progressive dealer group that has embraced the
profitable growth worldview is the Tom Wood Group,
a 16-store conglomerate based in Indianapolis Indiana. The group includes a collision center, tire store, 7
motorcycle stores and an aviation company.  Service
Leader William Demaree states, " It clicked with me
this year as we managed through COVID - our singular orientation must be profitable growth. To drive this,
I built a 'Re-engagement' document in March for all
the dealerships and it has transformed to our rhythm.
We've since added new reports and dashboards. We
live by this document each month as we calculate
gross and expense for every decision we make including hiring. We judge hiring based on NCM benchmarks
vs. 'I really need a porter'. By following these simple
metrics and creating a mindset of 'Profitable Growth'
vs 'Lets chase Gross Profit and not look at our cost to
do it' we have had a record year. "  

JANUARY FEBRUARY 2021 || FIXED OPS MAGAZINE

61



Fixed Ops Magazine - 2021 Vol18 01

Table of Contents for the Digital Edition of Fixed Ops Magazine - 2021 Vol18 01

Fixed Ops Magazine - 2021 Vol18 01 - 1
Fixed Ops Magazine - 2021 Vol18 01 - 2
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Fixed Ops Magazine - 2021 Vol18 01 - 61
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Fixed Ops Magazine - 2021 Vol18 01 - 67
Fixed Ops Magazine - 2021 Vol18 01 - 68
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