Unlocking Your Dealership's Hidden Revenue: The Power of Warranty Reimbursements - AutoSuccessOnline

Unlocking Your Dealership’s Hidden Revenue: The Power of Warranty Reimbursements

Partnering with a qualified vendor to ensure you receive what you’re legally owed is more than just advantageous — it’s a necessity.

For as long as there have been franchised auto dealers, the battle over factory reimbursements for warranty work has raged on. It’s a crucial revenue stream, yet dealerships often receive only a fraction of what they are owed. However, the law is clear: auto dealers are entitled to reimbursement by automakers for warranty work at their retail rate. Partnering with a qualified vendor to ensure you receive what you’re legally owed is more than just advantageous — it’s a necessity.


In all 50 states, legislation supports auto dealers in seeking reimbursement at their retail rates for warranty work. Despite this, dealerships commonly fall short, receiving far less than they’re entitled to. The benefits of partnering with a professional vendor to secure these reimbursements are substantial.

Why Act Now at the Beginning of the Year?

1. Immediate Action Yields Long-Term Benefits: The urgency lies in the timing. The sooner you submit for an increased reimbursement rate, the longer you capitalize on this increased revenue throughout the year.

2. Leveraging Slower Sales Periods: The first three months of the year often witness slower sales. Capitalize on this period by focusing on fixed operations, maximizing warranty reimbursements to supplement lulls in the sales department.

3. Strategic Timing: For states that allow biannual submissions (Florida, Illinois, Maine, Minnesota, Missouri, Nebraska, New Jersey, New Mexico, Vermont), initiating the process early in the year aligns with slower sales periods and gives dealers in those states a better opportunity to submit again later in the year, if need be.

4. Data-Driven Opportunities: Year-end service department rush that typically occurs during November and December means more data for analysis, enhancing your chances of optimizing reimbursement rates.

Once you’re ready to get started, there are ways to help amplify your rate — different analyses and control checks that can be run to ensure that your rate is both justified and maximized.

Why Not In-House?

You might wonder why not handle this in-house. The reality is that working with professional services firms specializing in retail warranty submissions can significantly impact your dealership’s profitability.

1. Expertise Matters: Qualified vendors understand the intricate state laws and automaker requirements, ensuring flawless submissions that expedite reimbursements. Their technological prowess and experienced teams ensure more accurate calculations, far beyond mere estimates.

2. Time is Money: Delegating this task saves valuable dealership time and resources. While in-house efforts might drain your team’s focus and time, a professional vendor ensures efficient handling without affecting day-to-day operations.

3. Results Matter: A professional vendor typically works on a success-based model — getting paid only when you do. Moreover, asking for a projection of potential increased gross profit can solidify the value they bring to the table.

A Profit Boost for Your Dealership

Securing warranty reimbursement at retail might seem like a dream, but it’s your dealership’s legal entitlement. By maximizing this revenue stream through professional rate submissions, you’re unlocking substantial profits. With minimal effort and no upfront investment, the added gross profit is too substantial to overlook.

Don’t leave money on the table. It’s time to harness the full potential of your dealership’s warranty reimbursements and boost your bottom line.

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