Dealership owners let vendors like BG and Valvoline control their service menus and labor rates, often without calculating their own profit margins. Chris Collins says dealers need to compute their Effective Labor Rate and parts margins independently, build their own menus, and stop letting vendor incentives bypass the dealership.
And we see this a lot is your, your menus have been done by the BG guy or the Mach guy or the Valvoline guy. And you're just doing what they tell you to do. And you've never really done the math on what your ELR is or what your margins are on parts. And most of the time, those guys tend to overpay the techs. Because they, you know, they, they just do. I don't know. I actually don't know why. I don't know. If I was a BG guy, I would want to design the menu to make the dealership profitable and be fair to the tech. But, you know, a lot of times something that pays 0.8 is paying an hour. And, um, you know, you got to run your own business. Don't let somebody else do that. You can ask them what other people are doing and use their their reference as a starting point, but you should be creating your own menus. Also, like, I would be taking all the packs and the spiffs out. I want all that coming back to me. I don't want them paying my people. I want to pay my people. So a lot of times there's a spiff in there and they go around and pay the techs, they go around and pay the advisors. I want all that coming back and I want to be the one spiffing. We still want to spiff, but we want to control that part of it.
