DealersEdge Professional Forums

As always, we are watching every expense. A question has recently come up. How do you base your Service Advisor pay? I read the DealersEdge Pay Plan book & we really didn't fall into any of the categories. We have 4 full time techs & average 600 RO's per month...this includes retail, internal, & warranty. Any suggestions??

A couple fo quick questions - Do you have just one advisor and a working (writing) manager for the shop? Does the advisor have other duties (warranty admin, etc.)?

Base pay is often a function of how steady the business is for the shop. Obviously the more steady the more possible it is to do away with a portion of the base. I have always leaned towards a 40% base, but in some shops I see it down to 25%, or even down to what is considered a draw of commissions.

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** Rob, Editor Dealersedge/WD&S **
Help is only a message post away!
robc@dealersedge.com

ugh ... I am dumb. I need to reread questions before I answer them - it wasn't about base pay, it was about what to base pay on.

Here's my ranking list of commissionable items:

1 - gross sales
2 - flat rate hours
3 - effective labor rate
4 - CSI

One and two are almost universally true for a majority of shops, each has pros and cons.


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** Rob, Editor Dealersedge/WD&S **
Help is only a message post away!
robc@dealersedge.com

Right now, we have 2 advisors & a working service mgr. Our warranties are done at one of our other dealerships. Does that help any??

I have tryed many different pay plans, ranging from salary and a % of net to hourly pay and a % of sales (labor). I am now using a pay that is set up with 1. Salary. 2. Dollar amount for every hour turned.( I like this way better than gross proffit for a couple of different reasons. 3. CSI Bonus each month. 4. Spiffs for (tire sales, 30k,60k,90k services and flushes) Hope this will help and if you want reply and I can email you if you have more questions. By the way I have 13 techs with 2 advisors. Will be going to 3rd advisor in near futer. Let me know if you have any questions.

Our Advisor's are compensated based on hours produced multiplied by a dollar figure that varies based on their individual SES score. We arrive at the hours produced by taking their total labor sales and dividing it by the effective labor rate that we expect them to achieve. In addition, they can earn spiffs for menu penetration, tire sales (only sets of 2 or 4), certain services, etc.
Our overall budget is no more than 5% of their total sales of parts and labor. At the conclusion of each month, we divide their total income by their total sales and come up with what % of the sales we are paying. Although from time to time an individual may be over 5%, the overall average stays in the 4% range.
We are a Mercedes Dealer in the Southwest.

I use a pay plan created by AtCon. It is a Gross profit plan.
This plan is a commission for Gross profit on the repair order for each advisors individual sales. It is CSI sensitive.
here is the breakdown.
Above region.....8%
At region........7%
Below region.....6%
3 continuos months below region..replace advisor.

Then it has a matrix grid for ELR & HRS/RO

This pay plan give you the gross, elr and hrs/ro that you will want to achieve.

I have worked most of the plans on the market and I see this one accomplishes the goals that we need to create a profit and it falls within the 12-14% of Advisor pay that is needed.
Hope this did not confuse you too much. Contact me if you would like to know more.

The best pay plan is a percentage of Parts and Labor GROSS profit. Be careful paying on ELR and hours/RO because they can both be manipulated. ELR causes a Service Advisor to run from maintenance and oil changes. You can use labor dollars per RO, total dollars per RO, or CSI for bonus but not ELR. They will learn how to cut back to make more. Make sense? Just try to stay in the 10 to 12% of labor gross profit for your total Advisor payout.

We are a small shop, 4 techs, 1 advisor and a writing manager. Advisor gets 5% parts and labor that she writes, with monthly bonuses on ELR, CSI, and Hours/RO, each bonus being $200. We are in a rural area.