Service Pay Help!!

[jenm]

As always, we are keeping a close eye on every expense. One issue has recently been brought up...Service Advisor Pay. We currently have 4 full time techs with an average of 700 repair orders monthly.(retail, warranty & internal). How many advisors would you carry for this amount of sales? & what type of pay?? I have read up on the DealersEdge PayPlans & none of them really pertain to a Service Dept. of our size. Any suggestions??? Please Help!

[2wheels4me]

There are plenty of options to be sure. How many hours are you selling on those 700 ROs? What percentage of the work is CP vs WARR vs INT?
We pay our advisors flat rate, same as techs. Not my preferred method but it's not my call. I've seen many shops use commission based on gross profit, sometimes just on labor, sometimes labor and parts. There are a couple of advantages with this set up. 1)advisors will be more watchful about giving money away via discounts, etc., and 2)their pay is always consistent relative to profits. In a small store you may find you'll have to offer some salary as well.
Also consider this. Good advisors can be costly, bad ones are ALWAYS costly. You don't want to over pay but this is a dangerous area to "cheap out" on.

[texaslp]

Our advisors are flat rate also, and with a bonus on gross profit.

[jenm]

Approx. 53% is customer pay, 24% internal, 23% warranty. Again, do these numbers justify having 2 full time service advisors with a working Service Manager?? Another problem is our labor per RO (cust pay) is only $42.00 & parts $53.00. Room for improvement, don't you think? Help!!

[2wheels4me]

Lots of room......
Your RO count may suggest more than one writer but the $$$ per RO sure doesn't.
$42 per RO? That's 0.5 hr or less in most markets. Sounds like your svc mgr/writers need some sales training. You wouldn't have to sweat expenses so much if you could get the sales and gross up.

[BIG ORANGE]

With that ro count your advisors are writting and average of 15 ro's per day on a 23 day month. That is a good mix. You should try to keep your advisors between 14 and no more than 19 or 20 ro's per day. I have 13 techs with 3 advisors we are writting 1300 ro's per month. This is an average of 19 ro's aday.