Used Vehicle Reconditioning

[SantoC]

Currently re-developing our Used Recon Process. Want to eliminate overselling by Advisors, reluctance to R&R by Sales Mgrs., and minimize documentation necessary. We currently and plan to continue to charge door rates on all internal P&L. Anyone willing to share their effective, positive experiences? Thanks.

[sheri01]

YOU DON'T DEFINE THE PROCESS YOU USE, BUT A GOOD STARTING POINT WOULD BE TO LOOK AT THE INSPECTION SHEETS USED BY YOUR MANUFACTURER-SPONSORED CERTIFICATION PROGRAM. HAVE THE SALES AND SERVICE MANAGERS AGREE ON THE ITEMS TO BE INCLUDED IN THE INSPECTION, USING THE LISTS AS A GUIDELINE. APPEARANCE ISSUES WILL NEED TO BE DECIDED ON BY THE SALES MGR BEFORE LARGE DOLLARS ARE SPENT ON MECHANICAL RECON BERFORE EXPENSIVE COSMETIC REPAIRS BURY YOU IN THE VEHICLE. SET A MINIMUM BRAKE PAD SPECIFICATION, AND INSIST THAT PAD THICKNESS MEASUREMENT IS ON ALL INSPECTION FORMS. SPECIFIC GRAVITY ON COOLANT, TIRE TREAD DEPTH MEASUREMENTS, ETC.. YOUR USED CAR/RECON MGR WILL NEED TO KNOW THE MINIMUM REQUIREMENTS. IF THE SERVICE DEPARTMENT IS GETTING DOOR PRICE, YOUR USED CAR DEPT. SHOULD BE LIKE RETAIL CUSTOMER, GIVE DETAILED, PRIORITZED ESTIMATE, THEN LET THE CUSTOMER(YOUR USED CAR DEPT) DECIDE. I WOULD SUGGEST THAT AN EXTERIOR/INTERIOR EVALUATION BE DONE, WITH THE BODY SHOP MGR, IF NECESSARY, BEFORE YOU SEND THE CAR FOR MECHANICAL INSPECTION.. THIS WILL GIVE YOU A GOOD IDEA WHETHER THE CAR WILL BE WORTH SINKING THE RECON DOLLARS IN, OR IF IT IS BETTER TO WHOLESALE THE VEHICLE. IF YOU ARE HAVING MAINTENANCE OVERSELLING CONCERNS, LOOK AT THE MAINTENANCE SCHEDULE IN THE OWNERS MANUAL, OR SHOP MANUAL. THE SERVICE DEPT SHOULD BE WILLING TO SHARE THIS INFO, IF WHAT IS RECOMMENDED IS REALLY NECESSARY.

[jazdale]

I've been in several dealerships and seen just about everything. Here's some of what I've seen/heard.

Door Rate - this makes sense to me since its the customer that ultimately pays for these charges.
However, I've seen many u/c managers sublet the recon out because its cheaper than doing the work internally.
In some cases, the service was better because we are a paying customer to the sublet shop vs. trying to work with our service department that puts these type of jobs at the bottom of the priority list.

Realize this relationship is a constant flow of work like a fleet customer. Maybe a discount is appropiate.

If there's enough work, I've seen a mini-service department solely devoted to the used car department.

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Cutting down on paperwork.
You mean the AVO to write the RO which is necessary for the PO? - Not to mention the washout sheet, and multiple copies of stock cards. Consider going 100% electronic. Its a change-over that is definitely worth the effort. Realize that any keystrokes will update everybody's view of the used car immediately.
Conversely, each and every stock card must be manually updated - typically with severe lag time.

Consider making the u/c manager a writer and let them write their own RO - just don't let them book the tickets too.

Regardless of who writes the RO. Always, always, always put the estimate on the RO. Many systems today will allow the u/c manager to see a 'projected' cost of the vehicle (when quoting deals) which includes the estimate while the RO is 'in process'. This also allows you to see which ROs had cost overruns from initial RO creation.

Dale

[bets]

Here is my system for u/c recon. I insist on a minimum of a 27 point check that includes brakes. Any vehicle that comes from the auction or is late model gets a 101 point check. I have authorized my Service Dept. to do up to $500 without clearance from the Sales Mgr., unless there is unusual or major work involved that may haunt us later on. I do lots of policy work in the name of customer satisfaction, which has proven to help our reputation and has helped in customer retention but is very costly and annoying. My sales staff has access to the ROs for recon and they use them to build value for the vehicle, leading to a good gross average. As a dealer, if I can make money for my Service department with recon, then hold more gross because of it, what could be better? I try to keep the process as simple as possible to avoid problems between the two departments, but there is the inevitable bickering. I have begun a weekly review of all policy work to find trends, such as certain problems that get overlooked, certain technicians that have more comebacks on policy, and anytime the Sales Mgr. declines work in excess of $500 that comes back later for policy. I also chargeback the Sales Dept. for policy work within 90 days if they did not sell a service contract, and the technicians get charged for used car policy work if they missed something on the checklist. In short, I want the mechanical problems found and fixed before the vehicle is sold, so we can recover the cost and reduce our out of pocket policy work. Sounds great - takes constant effort to implement and mediate. That's my job as dealer!