Forecasting 2009

[Lexusmgr]

What is everyone doing for your 2009 service forecast? The turn in the economy this last quarter makes me want to turn in a very weak 2009 forecast. Ive never turned in a forecast less than the previous year but its tempting the way things are looking.

[RKing]

I am challenging my fixed op's managers to plan for success in 2009 and create specific action plans w/ timelines that support the budget. Once we look over the forecasts I will ask what are they willing to do to support the forecast or what are they unwilling to do to get the results. My point is we must change our behavior if we expect an increase in traffic or increases per ro.

[Chas]

Personally I believe a forecast should always be as close to actual reality as possible. For many years I have watched management turn-in unrealistic projections simply to please the owner. This type of approach simply boggles my mind. How can you proper construct a business plan when youre only wearing rose color glasses?

My approach which probably wont be appreciated would be to create 2 individual forecasts solely due to the fact that automotive sales and service will have to endure unprecedented and excessive volatility within the upcoming year.

One would mirror 2008 sales and one would be a disaster, survival plan. Now Im not going to tell you how to construct your plan but keep in mind, if vehicle sales collapse - there goes internal and accessory sales, wholesale accounts start folding - some more profit gone, dealership starts cutting personnel and advertising - service traffic, consumers broke forget up-selling, etc, etc, etc.

Bottom-line, if you want to survive, remove the rose color glasses and be prepared to work hard and draw on every bit of your automotive experience in 2009.

Good luck to all from a bean counter ready to do the shuffle

[zsmith]

There always seems to be some confusion between "forecast" and "objective". I agree with Chas regarding forecasts, if what you're looking for is an objective the numbers would normally be higher. Unless I make it clear, my supervisors usually think my forecasts mean my objectives are too low.

[X476]

My dealer looks at the numbers and say thats good now more importantly whats the plan. Forecasting shouldn't be about the numbers it should be how you are going to do it. As my fixed ops manager says "swing for a home run, even if you only hit a double its better than where you were." If you acclomplish a good plan the numbers will follow.

[topshop]

Frankly, I don't know how one could even begin to do forecasts or set goals for 2009 considering all that is going on.

The Big3 are broke.

Domestic dealers could literally all be gone a year from now.

The true need for new cars is currently little more than zero. If there were no car sales in the US for the next few years, the massive glut of cars (almost one car exists today for every man, woman and child in the country) could easily take care of transportation needs.

Money for broke people to buy cars is gone and is not coming back (unless the fed decides to give them out...not impossible!).

Consumer mentality has changed and is not coming back to where it was for decades, if ever.

Competetion for service is getting more fierce daily and will get more intense.

The number of underground repair shops will explode.

The need for service will also explode as cars are not replaced.

The US economy could well be wiped out in the not too distant future.

I cannot see how one can plan for 2009 other than to take it one day at a time.

We've only seen the pregame show...the real game is about to get underway.



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Tom Ham
AutomotiveManagementNetwork.com

[X476]

Tom

No offense but from an automotive management group I am surprised that you would suggest taking one day at a time. If we don't think outside the box and look at ways to keep our customers from using these "underground" shops we will get what we deserve nothing.We have to be proactive and find ways to keep our customers coming back. As some Ice cream guys said "Give them the Pickle" If we don't someone else will. Customer retention and customer loyalty is our focus and right now we are the busiest dealer of the 9 dealers in town. One day at a time will not go very far. IMHO

[BestPartsManager]

Forecasting for 2009 will be difficult. Forecasting is part of the planning process. Of course the catchy statements abound about failing to plan ..........!

We are planning for increased back end sales in 2009. Those persons that did not replace their vehicles the past year will be needing repairs. If GM should shut down those cars will still be on the road for a few years. The older the car the more likely it needs repairs. In the past we have taken care of our customers fairly and they have remained loyal, sure not 100% there will always be some erosion good times or bad.

Now we are not going hog wild and doubling the shop or adding high end new equipment but will look at the ROI on any new equipment we might need. In our area no one has any modern alingment equipment so we ae looking into it, but some pretty signicant dollars. Be curious to hear from someone that has recently expanded in this direction.

Tom Ham - you are usually pretty optomistic on this forum, it is not that bad. I realize Michigan is one of the harder hit states but the whole country is not in a free fall.

And of course we will all be enhanced by the new regime in Washinton DC!!!!!

[westover6]

Our forecast, budget is a responsibility. We in fixed ops will set it as reasonable in light of current economic conditions. it is our job as managers to do everything in our power to be successful. unlike in previous years we have actually changed our "responsibility" due to lower car sales. We are "relentlessly positive" that we will attain our responsibility and weather the economic storm.

As far as the new regime...it didn't get screwed up in 30 days and it sure as heck isn't going to get fixed that quickly.

[robc]

Wow, Tom I always liked all your comments but who spit in your Cheerios this morning. It's gone and not coming back ... for decades if ever??? Domestics are gone??? Look all possibilities, nothing is guaranteed in life which is what makes it great, but if the US Gov't bails out banks, you don't think they will do the same to make sure all three domestics don't go under?

How did you survive 1982, 1987, 1992?

Let me put it this way in August, just three months ago, Goldman Sachs said when oil got to $145+ a barrel that it would be to $200 by year's end. Today when oil dipped to $65 they said it will go to $50 by year's end. Nobody knows what the market is going to do in two months let alone years from now.