This month, NOLN discusses key performance indicators and how they can help you understand your business. Many of us have different roles within the organization that you work with and some of these numbers will be more important to you than others. In this month’s article, I will go over a few of the KPIs that I use on a regular basis and how this helps drive us towards profitability.
Car Count and Ticket Average Trends
Now I will admit, many of you will say that we may be a little excessive in this report. I would venture to guess that there are several operations out there that just look at these reports on an annual or even two-year analysis. However, we use monthly and yearly trends that go back 10 years. We want to know where we were and what happened to flip the trend positive or negative. When looking at these reports, we can see when traffic pattern changes or competition opening in the area affected our customer base. This is also a good way to see who your performers are that could be your next upper leadership role. If someone comes in and just skyrockets up, they are doing something that you need to replicate across the business. We use the ticket average trend line to determine what effect changes to base price took to customer counts. This can help you determine whether you want to make a pricing increase.
Preventative Services Report
Another good KPI to check to track sales of certain categories in your location. This report you want to look at over a period. A good one is to check weekly and monthly. The benefit is that this gives you an overview of your centers’ presentation to customers. I will give you an example of what I pull for reference. I pulled up a tracker that tells me percentages of customers purchasing an air filter or cabin air filter, a set of wipers, a tire rotation, or a light bulb. Why do I care to know just this small amount of item categories? These are the simple things that your team should be checking or offering to every customer with a need. If the numbers are much lower than the rest of your organization, then that is a key indicator that the team may not be pulling them or checking them, lessening your service standards and quality.
Labor and Traffic Reports
This is a good way to minimize your costs in the shop. Labor is the largest vacuum of funds from your business, with materials being right behind. By looking at a traffic report or hourly trend report, you will be able to determine approximately how many people that you need to have on the clock at that time to service the average customer counts that you will likely face in that period. So, if you are doing 1 car an hour on average between 8 a.m. and 9 a.m. then you likely will not want six people on your clock just waiting around. What we look for inside our operation is to put the proper amount of people on the floor daily and maximize the available hours for days that are traditionally busier. I would rather have seven employees on the floor on a busy Saturday, because I took one off the schedule on a slower day, then wasting the dollars where they were not needed. What customers come to us for is speed and you want those bodies available and ready!
There are probably 50 different ways to look at reporting and index numbers to make a positive change in your business. I would like to hear what some of those are if you wanted to reach out. G.I. Joe always said, “Knowing is half the battle” and that goes for anything that you are looking to succeed at. Knowing the pulse of your business is one of the most important tasks that you must deal with daily and if you put together the right set of tasks together to “see” this from an overview, you can be honest with yourself with what you need to take your team to the next level.