Fixed Operations Manager in shop

Improving Your Reconditioning for the Coming Year

There are many answers to the question of how long a dealership takes to recondition a vehicle. Larger and better-performing dealerships may outperform others when it comes to timing; they often have reconditioning cycles that only take a day or two at most. Smaller dealerships and those that outsource their reconditioning often see turnarounds upwards of a week or more. The sad truth is that many dealerships may not even know why their cars take as long as they do to be reconditioned.

Winter and Spring are important seasons for the auto reconditioning industry. Particularly as the country emerges from lockdowns, your ability to make the best margins will define your own recovery. Now is the time to take a serious look at how used vehicles are made available to your dealership, and how long you actually own a vehicle before you have a chance to sell it. A strong process and team that can streamline your recon work is crucial to your success. Cycle-time is money; the time your vehicles spend in the reconditioning process has a strong impact on your potential profit. Being able to move vehicles to your front line faster will benefit your bottom line. To help you improve your dealership’s reconditioning process for the coming seasons, we put together a list of three quick tips:

  1. Carefully Determine Strategies for Vehicles at Acquisition

The most important tip is to exercise careful judgment when acquiring vehicles. Instead of rushing to find as many cars as you can when you discover a gap that needs filling, be picky. Without discipline during acquisition, you miss important information about the vehicle and end up with cars that need extensive reconditioning. 

With regards to repair and sales strategies for your lineup, you should gather your appraisal team at least once a day to review your new trade-ins and acquisitions. Your team will give you the information you need to make the decision between retail and wholesale for each vehicle. When vehicles lack market appeal, this decision is based on margin alone. Dealerships control trade-ins from end-to-end, which allows them to protect margins on each side of the transaction. 

  1. Establish Separate Teams to Ensure Quality

Many dealerships face mini battles everyday between sales managers and service directors that may prioritize customer pay/insurance work at the expense of reconditioning. If feasible, it is wise to create a separate team of managers and technicians to manage your reconditioning work. This will allow for focused and efficient reconditioning without sacrificing necessary customer work. As well, it’s vital to make adjustments to any parts of your recon process that inhibit your progress towards greater speed and efficiency.

You should also keep your employees excited about their tasks. Showing them reports about how their work affects the day-to-day success of your business is a good way to make your employees feel like vital and respected parts of your dealership. On the flip side, sharing reports about the holding costs lost each day due to inefficiency will help your team see how important each individual part of the process is towards overall success. 

  1. Ensure Rapid Approvals for Reconditioning Work

No matter how large your operation is, delayed approvals for reconditioning work can cost hundreds of dollars each day. The traditional process of using manual approvals, whether on paper or via text or email can inevitably lead to missed or delayed work. Automating this process will save your dealership time and money; an example would be establishing a baseline price for reconditioning estimates below which work is automatically approved, while requiring direct approval when above that line. Better options would be transitioning to a reconditioning management system like Repair360 to get timely information to your technicians faster. 

A commitment to efficiency and quality alongside smart processes management, and keen awareness of costs will keep you making money through the winter and beyond.