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The KPI Tracker Profile

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The KPI-Tracking Guide
Take control of your business by monitoring the numbers that matter.

With information culled from the inaugural Ratchet+Wrench Industry Survey, here's a statistical breakdown of what shops are tracking KPIs and how it affects those businesses' numbers. (Note: This is a companion piece to Your KPI-Tracking Guide.)

 

The Typical Shop

Just under 450 auto care professionals completed the inaugural Ratchet+Wrench Industry Survey, and, while they were evenly dispersed across all U.S. markets, the majority of respondents followed a distinct demographic pattern that also closely aligns with our overall readership.

 

The Average Shop

Shop Type: Independent repair business (85%)

Work Type: General repair (76%)

Region: Midwest (31%)

Shop Size: 2,000–4,999 square feet (42%)

Number of Lifts: 3–4 (28%)

Number of Bays: 5–6 (27%)

Number of Employees: 3–4 (22%)

Annual Revenue: $1 million–$2.49 million (35%)

Average Monthly Car Count: 100–149 (20%)

Average Repair Order: $200–$399 (43%)

Overall Gross Profit Margin: 50–59% (38%)

Net Profit Margin: 10-14% (19%)

 

The KPI Difference

While KPI-tracking rates hit an all-time low for Ratchet+Wrench surveys in 2017, there was a return to form in the 2018 Industry Survey, with 77 percent claiming to routinely track KPIs (as opposed to 64 percent in 2017).

When looking at individual performance, there are significant differences between shops that do and not routinely track KPIs. With “routinely” being the keyword here, we can observe what happens when shop owners are aware of their business's numbers, but do not have a uniform system for tracking the metrics. Here are the various categories where each group falls into.

 

The Shops that Track KPIs

Annual Revenue over $1 million: 42%

Sales Closing Ratio over 70%: 52%

Average Repair Order Above $400: 57%

Overall Gross Profit Margin Above 50%: 63%

Gross Profit Margin on Parts Above 50%: 51%

Gross Profit Margin on Labor Above 60%: 67%

Overall Net Profit Margin Above 10%: 68%

Posted Labor Rate Above $110: 44%

Effective Labor Rate Above $90: 44%

Efficiency Above 100%: 36%

Productivity Above 90%: 41%

 

The Shops that Don’t Track KPIs

Annual Revenue over $1 million: 11%

Sales Closing Ratio over 70%: 66%

Average Repair Order Above $400: 36%

Overall Gross Profit Margin Above 50%: 41%

Gross Profit Margin on Parts Above 50%: 32%

Gross Profit Margin on Labor Above 60%: 39%

Overall Net Profit Margin Above 10%: 54%

Posted Labor Rate Above $110: 15%

Effective Labor Rate Above $90: 15%

Efficiency Above 100%: 16%

Productivity Above 90%: 40%

 

Who is Tracking KPIs?

The Industry Survey also observed the type of owner who does and does not routinely track KPIs, and their reasonings for doing so.

 

What Demographics are Tracking KPIs?

In addition to identifying the average shop participating in the survey, Ratchet+Wrench also wanted to get an idea of the type of shop operator engaged with the industry. Here’s a breakdown of the average operator that routinely tracks KPIs.

 

The Average Survey Participant

Age:

Under 20: 0%

20–29: 2%

30–39: 13%

40–49: 20%

50–59: 39%

60–69: 23%

70 or older: 3%

 

Age Becoming a Shop Owner:

Under 20: 1%

20–29: 39%

30–39: 33%

40–49: 14%

50–59: 5%

Not Applicable: 8%

 

Gender:

Male: 95%

Female: 5%

 

Had Parent in Industry:

Yes: 33%

No: 67%

 

How They Acquired Business:

Pre-existing business passed down or purchased from family: 18%

Launched independently: 48%

Pre-existing business purchased from another owner (non-family): 23%

Not applicable: 5%

Other: 3%

 

Positions Worked Before Current Position:

Porter: 9%

Service Writer: 37%

Technician: 65%

Vendor: 5%

Administrative staff: 12%

Manager: 37%

None: 11%

 

Years in Industry:

1–9: 6%

10–19: 13%

20–29: 20%

30–39: 31%

40 or more: 30%


 

Why are 77% Tracking?

Question:

What is the significance of measuring KPIs in today's auto care industry, and what impact has it had on your business?

 

Answers:

  • “It's comparable to gauges on an instrument cluster in a vehicle. It keeps you constantly focused on the important areas of the business so you can set goals, measure progress, and triage any problems as soon as they arise.”
  • “Tracking KPIs has been instrumental to improving my business to the point it is now.”
  • “If we didn't know our shortcomings we couldn't fix them. Tracking KPIs has helped us sustain and average growth of 20 percent a year for the past 10 years while increasing gross profit over 20 percent and net profit 10 percent.”
  • “It keeps employees accountable and on track to hit goals. It has made me lots of money and time in this business, and to get great employees to work for me.”
  • “You need to know where you are at to know where you need to go. The KPIs tell a story about your business and once you know how to read them you know when and where to make adjustments.”

 

Why are 23% Not Tracking?

Question:

Why don’t you regularly track KPIs?

 

Answers:

  • “I dont have the systems to enable me to track them.”
  • “I try but have a hard time understanding all the numbers, what they really mean and how to improve.”
  • “Not needed, I am here keeping an eye on things.”
  • “No time.”
  • “I have stable customer base, grow by word of mouth, check income by end of month sales tax report.”
  • “Used to but got away from it the past few years.”

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