KPI Industry Benchmarks

May 1, 2019

With so many KPIs, numbers can lose their meaning—make sure you know where you stand  

Mark Martincic, director of fixed operations at KEA Advisors, provided a list of industry benchmarks to provide guidance on what numbers you should be hitting—or better yet, surpassing—when it comes to common key performance indicators.   

Overall Dealership

Economic Profit Percentage: 20 percent

Economic Profit $: $0.00

Cash Flow as Return on Investment: 20 percent

Return on Sales: 4 percent

Absorption: 115 percent

Economic Profit Absorption: $0

Current Ratio: 150 percent

Debt to Equity Ratio: 3:01

Sales Gross Profit % total gross profit: 30%

Fixed gross profit % total gross profit: 70%

V/R: <10 days

A/R days supply: <25 days

W/R days supply: manufacturer cycle time plus five days

Sublet inventory: <2 days

WIP inventory: < 2 days

Open Ros: <2 days

Open truck sales (booked, not in accounting): <3 days

Contracts in transit:  F&I provided cycle time plus 2 days

RO cycle time: RH billed plus 2 days

Service Department:

Customer gross % : 73%

Warranty gross %: 72%

Internal gross: 72%

Total gross %: 68%

Personnel % gross: 40%

Semi fixed % gross: 17%

Fixed % gross: 13%

Total expense % gross: 70%

Net as % of gross: 30%

Return on technician investment: 110% x (ELR- average technician rate)

Technician productivity: 88%

Technician efficiency: 125

Technician proficiency: 110%

Unapplied time as % of sales: 2%

Service writer productivity: 80 hours billed per day

Policy as % of sales: 2%

Gross effective labor rate: Door rate plus $2

Hrs. per customer RO: 5-7

Customer parts to customer labor: $1

Fixed expense allocation: 42% (note: if dealership has a body shop, change to 28%)

RO open to first punch: 2 hours

RO first punch to last punch:

RO last punch to close: < 2 days

Parts Department

Counter Gross %: 28%

Customer labor gross %: 32%

Warranty Gross %: 24%

Internal Gross %: 32%

Total Gross %: 29%

Personnel % Gross: 45%

Semi fixed % gross: 12%

Fixed % gross: 12%

Total expense % gross: 68%

Net as % of gross: 32%

Freight % Gross: 2%

Cost of sales per person: $30,000-$43,000 per month

Gross inventory turns: 8

True inventory turns: 6.4

Days supply of inventory: 45

Stock order performance: 80%

Level of service from inventory: 90%

Gross return on inventory investment: 232%

Net return on inventory investment: 74%

Inventory obsolescence: 20% over 9 months no movement

Fixed expense allocation: 33%

Variance of book to management report: 2%

Lost sales (pieces): 4 per counter person per day

Dirty cores: None over 30 days

Dirty core vs. liability: 100% credit vs. vendor availability

Body Shop

Customer gross %: 68%

Warranty gross %: 68%

Internal gross %: 68%

Total gross %: 65%

Personnel % gross: 50%

Semi fixed % gross: 17%

Fixed % gross: 13%

Total expense % gross: 80%

Net as % of gross: 20%

Gross profit per man hour invested: 123% x (ELR- average technician rate)

Technician productivity: 88%

Technician efficiency: 140%

Technician proficiency: 123%

Unapplied time as % of sales: 2%

Policy as % of sales: 2%

Fixed expense allocation: 14%

 

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