Are you prepared for your 2024 submissions? What are some ways to move the needle and amplify your warranty rate in 2024?
Labor Rate Market Study – Ensure your door rate is maximized and in line with your competition.
Repair Order Discount Analysis – Ensure Best Practices when using coupons and manufacturers promotions.
Labor and Parts Matrix Analysis – This is instrumental for dealers that have low rates. The matrix helps with increased percentage pricing on parts, (larger markups), especially on lower and mid priced items and the labor grid helps with increasing the effective labor rate (ELR).
Price Override Analysis – Ensure Advisors are using the correct method when charging for parts and service work. In some instances, Advisors simply change a price on a part, rather than using manufacturer coupons/promotions. If an Advisor doesn’t document correctly, we will never know the original markup and the low rate will be calculated in the average, bringing it down.
Repair Order Review and Quality Control Check – A Review of RO’s and a check for “upselling” or missed opportunities on interval services, flushes, missed maintenances etc. This helps add profit to each ticket.
Compliant, Cause and Correction Review – This is instrumental for not only the service and fixed ops directors but also for warranty admins and claims. Sometimes claims are kicked, or not fully reimbursed because of missing or incorrect information, due to negligence or operator error.
Op Code Analysis – Helps optimize ranges and provides better reporting overall. Ensures correct use of specified Op Codes setup by the Director.
A RECENT CLIENT WIN
A Mid-Sized group consisting of mainly domestic brands transitioned to Formula Automotive after using another warranty provider for a number of years.
Our analyses and subsequent increase submissions realized additional warranty rate increases averaging over 16% higher for parts, and 15% higher for labor.
These increases equated to an additional 18% overall warranty parts and labor gross profit for the group.
The data also exposed a number of instances where the opportunities for increase were not leveraged each year (according to eligibility timelines provided by state statutes), equating to many hundreds of thousands of dollars of missed gross profits for this group.
Any of these analyses would be beneficial in helping you move the needle on your next submission. If you’d like assistance, please reach out.
Warranty Reimbursement Done Better