Notifications & Messages

Jared Hamilton
From: Jared Hamilton
Hey - It’s time to join the thousands of other dealer professionals on DrivingSales. Create an account so you can get full access to the articles, discussions and people that are shaping the future of the automotive industry.
×
Mark Curcio

Mark Curcio Director

Exclusive Blog Posts

A Quick Tip to Increase Finance PVR

A Quick Tip to Increase Finance PVR

It's no secret that customers are wary of the Finance department.  Jason explains a simple tip that can help you build trust and set you up fo…

Where Will the Service Department Take Your Store in 2019?

Where Will the Service Department Take Your Store in 2019?

December is in full swing, hopefully off to a strong start. In the blink of an eye, it’s going to be New Year’s, and a blank slate will be …

How Important are Pay Plans?

How Important are Pay Plans?

Dave Druzynski, Chief People Officer at Auto/Mate presents the motivators employees are looking for in a career.  "They try to create pay pla…

Solving the Attribution Problem in Automotive

Solving the Attribution Problem in Automotive

Customer obsession and identity mapping will take advertising and attribution to the next level in the automotive industry. This was the key takeaway …

3 Ways to Increase your Commissions

3 Ways to Increase your Commissions

Car Salesmen have a tough job. They have to juggle demands, personalities and the clock, all the while attempting to engage customers in a way that ma…

Examining Time to Line

One of the most important, yet overlooked, metrics in a used vehicle operation and key to managing the pre-owned inventory effectively is maintaining an efficient time to line metric.  Time to Line is the concept that refers to how long it takes for a vehicle to become “retail ready” for the front line of the pre-owned lot.  This metric entails accounting for the following;

  • - Transportation of the vehicle to the dealership

  •  

  •  

  •  

  •                 

- Mechanical inspection of the vehicle

  • - Repair work on the vehicle (mechanical, tires, brakes)

  •  

  •  

  •  

  •  

  •  

  •  

  •  

  •  

  •  

  •  

  •  

  •  

  •  

  •  

- Reconditioning of the vehicle

Developing a tracking system or utilizing software like Rapid Recon (https://rapidrecon.com/)  that tracks and monitors the time and location of each pre-owned vehicle is the most efficient way of managing this important aspect of the pre-owned inventory.

Holding costs refer to the carrying cost of inventory incurred from the operation of the pre-owned department.  These costs include storage and fixed overhead excluding variable expenses.  NCM and NADA data estimates that the average holding per day, per vehicle is forty dollars.  Many dealers have shown even greater daily holding costs. 

  • - At $40 holding cost, a 12-day time to line costs a dealership $480 per vehicle

  • - At $40 holding cost, a 16-day time to line costs a dealership $640 per vehicle

When compared to the average gross profit per vehicle on the sales side, we realize that slow time to line processes directly impact the net profit.  Time to line is an invisible cost from the front end of the pre-owned department, it’s only when we calculate the holding cost factors that we realize how much a slow or inefficient process can impact the bottom line. 

Needless to say, if you look at this from the other side of the coin, reducing the amount of time to line will also reduce your holding costs.  Here at VAN, we are constantly on the lookout for best practices to improve time to line.  Acquiring vehicles from private sellers is a great way to dramatically improve time to line, transportation costs and several days of the associated holding costs are eliminated as consumers bring their vehicles to the dealership. 

We’ve interviewed Dennis McGinn, CEO of Rapid Recon; Mike Anderson of Rikess Group and benchmark methods that support the improvement of your time to line metric.  Below are a few of the best practices that we see supporting a strong time to line metric.

  • - Assigning a Service Advisor to oversee the repair and reconditioning for pre-owned

  • - Agreeing on threshold approvals for the most common repairs and replacements

  • - Prioritizing and sequencing the repair and reconditioning work to be completed

  • - Tracking the stages of repair and reconditioning processes at all times

  • Examining your pre-owned work flow, implementing a monitoring system to review for efficiencies and refining these processes will result in thousands of dollars of savings per month, avoid losing track of vehicles and reduce the stress of getting pre-owned vehicles ready for sale.  

  •  

 

Bart Wilson

Great info Mark.  Time to line can really impact used car profits.  I see huge value in the communication between service and the Used Car Manager.  Used Cars wants to make a 4 pounder on the car and service wants to do a ton of work to it.  Do those thresholds solve this problem?

Mark Curcio

Great question Bart! The thresholds go a long way to finding common ground on what is both necessary and mutually beneficial for both departments. Using a tire tread threshold for replacement males a lot of sense, for example. 

 Unlock all of the community & features  Join Now