DealersEdge Professional Forums

Just a quick question if you know ...

Is the effective labor rate on your menu items higher, lower or about the same compared to your standard repairs?



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

our eff. rate for repair work is about $10 more than our menu priced work.

In my case Menus ELR and Repairs are about the same. Menus get no discounts at all and repairs do, even with repairs at higher Rate ends up very close.

We look at customer pay in three seperate areas; Menu, Competitive and repair. Our menu runs about $10.00 less than prevailing market (dealer), but our basket of menu operations is within $75.00 of the competitive market. Our competitive type op's are about $5.00 below market (dealer). Our repair rate however is $3.00 above market average(dealer). This is due to the type of grid pricing structure that we use.

My opinion is Menu Effective Labor Rate should be as high as your highest repair rates.

The reason it isn't in many cases is Service manager's try to gain hours per RO in menu sales at the expense of ELR. They also over pay the tech's by having the time too high on menu's, then to be "competitve" they lower the labor rate.

Time and again I have seen service managers add the individual items hours on a menu, then give the entire time to the tech. When In actuality, the tech only made one trip to get the car and one trip to parts, and no diagnosis or pricing is involved like repair work. It should be hour highest profit area.