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Survive The Recession

 Increase After-Sales Profits


In today’s economic climate with new vehicle sales declining and profits declining even faster it is VITAL to increase profits from your Service and Parts Departments.

The CIP Programme (Continuous Development Process) will assess the current situation in YOUR Dealership and then make recommendations (agreed by your own personnel) which will much more than cover the costs of the exercise within 3 ~ 6 months of our visit ~ GUARANTEED ~ if they don't we will refund the consultancy fee!! You can't lose!!

 Programme successfully completed by us at well over 100 sites in Africa, Australasia, Middle East & UK/Europe.


THIS is a system which is designed to highlight areas within a business where policies, procedures and current practices may benefit from modification resulting in significant cost savings, improved customer satisfaction and enhanced profit potential.

CIP differs from many consultants in that it believes that a broad overview of an operation, whilst useful, seldom uncovers the many small areas of lower efficiency which, when added together, make a very significant overall drain on profitability and reputation.

The CIP system, as the title suggests, presents clients’ senior management with a series of check lists so that line managers can monitor progress, evaluate improvements and continually amend the action plans in line with changing parameters. Over 100 dealers and manufacturers of varying size and location have benefited from the system. For instance, in dealership service operations alone, the average increased turnover per department developed by this PROCESS has considerably exceeded $600,000 a year.


This is a structured PROCESS with the unique computer based programme left with the client to permit CONTINUOUS updating to ensure the full value can be exploited by the client's own personnel over the years ahead. Thus the actions to be taken are always relevant to current and anticipated circumstances. wpe2.jpg (31657 bytes)

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Let us illustrate this PROCESS, not with hypothetical situations exaggerated to prove a point, but with three true stories experienced during actual client studies.

Example 1 - Dealership ‘A’ holds two prestige franchises. It employs one highly qualified technician who is an ‘ace’ performer on diagnosing electronic faults on vehicles with sophisticated on-board computer systems. The average retail labour rate is about £60 ($120) per hour and there is a long waiting list of customers’ cars requiring attention - so much so that some previously loyal customers have been losing patience and taking their business elsewhere. Due to staff cut backs to reduce overheads, the position of Dealership Premises Maintenance man no longer exists. As a result, every month, this expert, trained automotive electrician has an additional duty - to check all light bulbs on the premises and replace them as required - this operation takes about three hours due to the poor accessibility of many of the light fittings. Obviously, to hire in an outside domestic electrician would cost money but since the Service Department electrician is ‘on hand’ he was considered to be free!! Of course he is not free - he is losing three opportunities for the company -

1. a labour income of £180 per month (3 hours x £60 per hour - task carried out monthly)

2. the parts sales which would have been associated with that additional labour revenue (at least £200 per month)

3. potentially lost loyal customers - difficult to quantify, but likely to be significant since long lead times are normal

Would it have been cheaper to contract out to a local domestic electrician? - OF COURSE!!

Example 2 - Dealership ‘B’, located in a congested city area, has very restricted parking availability. As a result cars are parked two or three deep and, in some areas, just crammed in to use every available inch. When a technician is given a new repair order he has to first find the car requiring work, then note all the cars he needs to move to get to ‘his’ car. He must then find the keys to all those cars (which may be on the service key board, or in a salesman’s drawer, or . . .??!) and, finally, solicit the help of other technicians to move the offending blocking cars out of the way and then quickly back in again in order not to block the street, while he obtains ‘his’ car. On one occasion CIP witnessed this operation take 9 technicians over half an hour - 5 man hours wasted. Could a solution (system) have been found to reduce this aggravation without increasing the available space and which would offer an overall saving to the dealership? Yes, CIP devised a solution which, it is calculated, gave the operation a net revenue increase on labour alone of over £50,000 per annum - and since this represented incremental business (fixed overheads having already been covered by existing business) approximately 90% of that increased revenue went directly to the bottom line!

Example 3 - A discussion covering examples such as these took place with the Chief Executive Officer of a large dealer group. He suggested that he, himself, could have visited any of his outlets and found similar anomalies so why did he need to retain an Advisor (CIP) to assist him? Is this not akin to him changing light bulbs himself? He is ‘employed’ for his expertise in developing and monitoring overall group strategy and for his management skills. He could not (or should not) afford the time to survey in such detail each department in each outlet to ensure they are running at optimum efficiency. Could he have directed the relevant Department Managers to review their respective departments in this way? Of course, but how objective would they be - are they not too close to the business and thus likely to miss some potential problem areas because theywpe5.jpg (2984 bytes) have become so familiar with the existing situation? It is the outside pair of eyes which see the greatest proportion of these waste areas and the CIP PROGRAMME which can evaluate them so that senior management can see the priorities required to implement the solutions recommended in order to improve the 'bottom line' figure as quickly as possible. 

CIP estimates that the cost of the exercise is recovered within less than three months and from then on net profit increases rapidly and, importantly, Customer Satisfaction is also enhanced.

What is the common denominator in these three examples (and we could quote many more from our files but don’t wish to labour the point - by now you have the picture!)?

We would suggest that it is not incompetent or negligent management but current situations are due to practices which may have ‘developed’ to this stage over a period of time due to a variety of reasons, some of which might be:

1.   Down-sizing, resulting in jobs previously handled by an employee (who has been permanently down-sized!) being re-allocated to other personnel who were probably already busy. Often these functions are either above or below the capacity of the person now responsible - if they are above his ability they will not be competently handled (the Peter Principle!); if below, another, cheaper, solution might be available without necessarily replacing the previously responsible person.

2.   The ‘wood for trees’ syndrome - familiarity with existing practices may not allow management to recognise and quantify the cost to the business of these potential shortcomings. "We've always done it that way, so we accept it as it is!"

3.   Pressure of work. How often has an employee recommended to an already overworked manager that a job could be tackled more effectively only to be advised: "It only takes you a few moments, just get on with it!". After receiving this type of response two or three times the employee stops showing initiative and he, himself, adopts a less-than-caring attitude by example. BUT, does that task only take a few moments? How often is it performed per day and by how many people? A task that only takes two minutes longer by the existing method but is carried out on average twice a day by each of, say, ten productives, when multiplied up on an annual basis probably costs the company £5,400 in potential additional revenue if the retail labour rate is £40 per hour. Add to that the additional parts that would be sold as a result of that additional labour, reduced lead times and increased Customer Satisfaction and "just a few moments" adds up to a significant situation worthy of deeper investigation.

Of course none of these examples, or other similar ones, could happen in your operation . . . . or could they?

Of over 100 dealers and manufacturers surveyed, an average annual potential increased revenue through dealership service department alone (labour and parts sales) is in excess of £300,000 ($600,000). This covers a wide cross section of franchises, locations, individual Dealers and large Dealer Groups including outlets with as little as six working bays in the service department up to the largest multi-franchise operations and manufacturing facilities throughout the world.

So, perhaps there could be some opportunities for improvement in your operation. Would it be a ‘Waste of Time’ to review the situation?

Why not take a step back and review your operations, quantify any wasteful procedures and then calculate what they might be costing the company over a one year period in terms of lost revenue, lost customer loyalty and reduced Customer Satisfaction. Or, better still, ask us to assess your company's situation and suggest whether it would be worth your while for us to carry out the PROCESS for you.

Is this ‘waste’ worth investigating?

It makes you wonder if it really is all a waste of time !!

For further information on this subject or for a preliminary feasibility review of your operation (free in the UK, at cost elsewhere) please contact CIP at

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