Menu item/coupon special discounts

[Doug]

How is everyone else handling these discounted items ? Do you show full retail on the invoice then charge off the difference to advertsing (or some other account)or do you take the discount "off the top" and edit the parts and labor to match the discounted price.

We used to write off discounts to advertsing but don't anymore.We take discounts off the top. Example, minor tune retails for $125 and we have special for $100. Parts charges parts a cost plus 25% and then labor billing amount is adjusted to yield an RO price of $100. As a result, naturally, our RO sales figures went down (so did our advertsing account, of course !)but they are TRUE numbers, not skewed.

So when comparing dealer to dealer numbers, or dealer to national numbers, it is important to consider the possible variances in how we accomplish the same thing.

So, what is everyone else doing ? Thanks !

[LRobinett]

we have a menu priced labor rate and parts m/u % so our menu price can be achieved. Any special discounts , etc. we normally take right off the top by configuring our system to take the discount from the sale. This allows us to show our customers the benefit of the discount they receive.

[Michael Franklin]

With specials generally my Parts Manager and myself will get together to discount the parts involved first. The Service Advisors will then adjust labor as needed to achieve the numbers. Writing off discounts only manages to create direct expense. Menu item discounts are handled in the same manner.

[Gary J. Naples]

Hi Doug,

If your computer system allows, which I'm sure it probably does, create labor op (operation) codes for each menu item as required. When the work is completed and the work order closed, this will automatically adjust the time and price allotted to that operation and create a record of the sale specific to the menu item.

In order to show customers the benefits of specials, as LRobinett pointed out, consider configuring the system to discount the sale. Most if not all systems have this capability.

Obviously the parts department will charge out the requisite parts, of the special or menu item(s), based on the total target price you want to achieve.

Hope this helps.

Gary J. Naples

[Mike Vogel]

We have adjusted labor and parts prices for coupon specials as applicable. If the coupon/discount is a percentage off coupon or $dollars off coupon we put that amount into the misc column (R&R) so the customer sees it. That amount gets charged to the cost of sale so we get a true number on the statement. These amounts are also deducted from service advisors sales so they participate. In my opinion discounts/coupons should never be charged to advertising.

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Mike Vogel
Claremont Toyota/Ford
Claremont, CA