Recon Will Sink You in 3Q

Recon Will Sink You in 3Q

If recon accountability is inaccurate, then profit expectations will not be realistic. And specific problems are sure to arise, which will kill sale margin.

Has anyone ever told you, “If the shoe fits, wear it?” 

If advice or counsel describes your situation, don’t foolishly kick the wisdom to the curb.

I bought a pair of Hoka running shoes the other day and, after trying them on for a test drive, I bought them. This shoe brand was not on my radar until someone mentioned how they might rest my feet more than the chain-store runners I usually wore. I was struck by how much better a shoe they were — leaps and bounds ahead of some other well-known runners I’d sworn by for years. Yes, this shoe fit — and I’m grateful I listened to that recommendation.

Simply recon alone can’t provide what will be essential to navigating the fluctuating automotive retail market coming at
us fast!

Regardless of how you get your used cars from acquisition to sale-ready, you can do better for your dealership. And who doesn’t want to do better? Who doesn’t wish to have their processes and procedures prepared for whatever the market throws our way?

Which is, recon itself can help you accomplish only so much. 

“There is always something that can be maximized,” said Dustin Jones, a former Nissan award-winning service advisor who is now a dealership performance consultant for our customers. 

The miss in so many dealerships is no one’s thinking about how strategic recon creates and pushes efficiency improvements and savings throughout the organization beyond recon.

Being stuck in an attitude or conclusion about the importance of reconditioning is like continuing to wear shoes that might have been fine. Because they’re still familiar, why try something different? 

If recon — or the lack of a predictable plan and method — isn’t strategic, your second quarter could get bumpy. Strategic T2L (time to line) means being intentional in what you do. Improved efficiencies, collaboration, job satisfaction and value from reconditioning operations arise from purposeful, mindful and deliberate planning and implementation — and ongoing accountability to time-to-line results.

To make these advantages measurable, two key metrics were developed. Average Days in Recon (ADR) is when a vehicle is worked out through inspection, mechanical, cosmetic and other staff “touch” points once it enters the recon process. ADR is a critical information metric, but it is incomplete for detailed time-cost analysis. T2L adds this detail. T2L measures time in days from acquisition through ADR to a vehicle’s sale-ready status. ADR is a complex metric — how long did Dave need to recondition the car’s mechanicals, how long did Carla need to detail and cosmetically recon it and how many hours did the glass replacement vendor take to replace the windshield? 

What is your “real” ADR? Be sure you count all ADR workflow steps. If you exclude any, do so only temporarily; not counting necessary steps promotes accountability problems.

If recon accountability is inaccurate, then profit expectations will not be realistic. And specific problems are sure to arise — parts delivery delays, increasing technician unapplied time, workflow delays and higher holding costs, which kill sale margin.

“When I was asked who’s accountable for our Average Days in Recon, the answer led to the most dramatic change in our reconditioning profitability,” said Matt Sodikoff, director of fixed operations at Steven Toyota in Harrisburg, Virginia.

Accountability translates into higher usage and faster ADR and T2L.

As the GM, how do you keep your recon speed-to-sale train on the track? The old test for average days in recon is to divide the number of cars through recon by the days in the month. If the answer you’re given is less than five days, ask for the data. If more than five, you should want to know why so you can fix that inefficiency.

You May Also Like

One of the Best Kept Secrets to Building Wealth & Creating Passive Income

The collaborative nature, diversification opportunities and potential for accelerated wealth creation make syndications an attractive option for investors seeking to harness the power of real estate.

One of the Best Kept Secrets to Building Wealth & Creating Passive Income

Real estate has long been heralded as a steady and lucrative investment avenue, but within this realm lies a lesser-known path — real estate syndications. Often considered one of the best-kept secrets to building wealth and creating passive income, real estate syndications offer investors a unique “hands off” approach to property investment. Real estate syndications can help investors achieve the benefits of owning an investment property (cash flow, appreciation, tax breaks) without the work or stress of being a landlord themselves.

Critical Thinking for Great Success

Articulate people whose thoughts and ideas are well organized are the most powerful, important and successful people in the world.

Critical Thinking for Great Success
Paving the Way for Self-Discipline

Self-discipline is like a muscle, where the more we use it, the stronger it becomes. By being smart about how we use it, we can develop this key attribute and get the best return for our energy.

Paving the Way for Self-Discipline
Elevating the FTC Safeguards: Embracing a Defense in Depth Approach

In a serious cyberattack, a single security control may not be able to mitigate all the damage, but multiple controls working in unison can.

Elevating the FTC Safeguards: Embracing a Defense in Depth Approach
How Women In Automotive Benefits the Auto Industry

WIA seeks to break down old stereotypes in a way that truly creates channels of opportunity where both women and men can participate.

Women In Automotive

Other Posts

Cybersecurity for Dealerships

Now is the time to take a proactive approach to protecting your dealership’s and customer’s most sensitive information by adopting a comprehensive approach to your cybersecurity.

Cybersecurity for Dealerships
Data Is the New Oil: Revolutionizing the Automotive Industry with Integrated Solutions

Dealerships that harness the predictive power of data can anticipate maintenance schedules, predict the optimal time for car replacements and personalize marketing to reach customers with the right message at the right time.

Data is the new oil - Velocity Automotive
High-Tech Solutions: A New Way of Thinking About Paint Touch-Up Products

The automotive paint chip repair products’ journey from simple touch-up solutions to sophisticated repair kits reflects not only the technological progress the industry has made, but also the changing demands of today’s consumer.

Dr. ColorChip paint repair
Understanding Your Market: Insights on Customer Retention and Conquest Opportunities

Brand retention and defection numbers can be tough to look at, but they can be a great guide to finding new customers.

Insights on Customer Retention and Conquest Opportunities