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Putting The Reins On Recon Vendors For Sublet Repairs To Increase Gross Profits

To some degree, subletting repairs is something that nearly all dealerships contend with – whether it is glass repair, collision repair, or repair work that the shop cannot handle for one reason or another. Regardless of the type of work, subletting repairs means giving up the dealership shop’s gross profit. But do you realize that subletting work to other shops or mobile repairers can lead to also giving up gross profit on sales?

To illustrate, how often do you find yourself waiting for the glass guy to show up or scheduling recon work around the water guy that only comes to the dealership on Tuesdays? What about getting photos of your newly detailed vehicles? Many dealerships wait for days, even a week or more, for the photo crew to show up to take pictures of a vehicle that just came out of detail so that the vehicle is properly merchandised online. The point is that vendors that cause delays in recon cost the dealership money.

In striving to build streamlined and efficient reconditioning operations, dealers must pay close attention to the time that it takes vendors to complete their work on recon units. When it is necessary to sublet work to another shop or mobile repairer, dealers must hold these individuals accountable for performing the work within the same time threshold that the dealership’s service staff is required to meet. Every day, dealerships lose sales gross profit in time wasted while recon units are waiting for vendor repairs to be completed.

Imagine what would happen if a customer were to call the Service Department to schedule an oil change and the service scheduler told the customer that the dealership provides oil change services on Tuesdays between 7 am to 12 pm only. There’s no doubt that the customer would say, “You gotta be kidding me, right?” and then hang up the phone and call another dealership. Dealers should do the same when subletting work to vendors; after all, the dealer is their customer and expects timely service for the money it pays the vendor.

Think about the bottleneck in recon that occurs when waiting to get photos of recon vehicles after being detailed – in more detail. Dealerships often find themselves waiting for days for someone to show up with a camera to track down newly detailed vehicles. Then, photos are uploaded into the inventory management tool and sometimes another 12 hours goes by before a feed is sent out to populate the listings on the dealership website and classifieds. I’ve seen this process go on at dealerships for years, with many managers accepting this as the norm or a problem they can’t fix. At times, days have passed before managers even notice that a significant percentage of the used inventory on their website does not have photos, after checking them due to a decline in sales leads and phone calls. If the dealership can’t get the photo guy or gal there immediately after a car is detailed and get pictures in the inventory feed right away, the dealer needs to find another service provider or handle this function in-house.

When a dealer acquires a preowned vehicle, within a couple of hours it should be inspected for necessary repairs. If the dealership is doing things right, work approvals should happen within minutes after the inspection is complete and the repair items priced out. At this critical juncture in the recon process, vendors should instantaneously be made aware of impending work. Dealers must ensure these processes are in place, using modern automotive reconditioning software, and then hold vendors accountable so they are not causing bottlenecks in the recon operation and chipping away at gross profits. If a vendor is located blocks from the dealership, the dealer needs the tools to physically see the movement of each vehicle at the vendor’s location to prevent delays.

It is not possible to get real-time insight into recon workflows and to track vendor work progress without software. With ReconVelocity, dealers know the exact location of every vehicle in recon and how long a vehicle has been sitting. They have total transparency into every step in the process with real-time notifications of status changes and cross-departmental communications. Having this insight allows dealers to hold vendors accountable for partnering with the dealer to achieve maximum efficiency in their recon operation and to protect the dealership’s gross profits.

Karla Guleserian, MSEC
ReconVelocity Recon Expert
June 2020

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