Workshop Efficiency is a hot topic in the automotive industry and Garage Hive has two methods of measuring it. Both methods are completely automated and require no input outside of the standard operations of a day. Today we are going to discuss the method that ignores hours sold and instead focuses on labour sales.
“Utilisation” allows you to understand how often your technicians are clocked onto jobs as a percentage of the time they are clocked into work. Utilisation on it’s own isn’t much use but it is a critically important measure when understanding a workshop’s overall efficiency. If Utilisation is low it could be due to not having enough work or your workshop being disorganised.
“Labour Recovery” measures your technicians but only whilst they’re clocked onto jobs. The key to this measurement is that it isn’t based on the quantity of labour sales but instead, the value or labour sales divided by your desired labour rate. From the business owners’ perspective understanding what your technicians are producing only whilst clocked onto jobs gives a clear understanding of technician performance.
The combination of “Utilisation” and “Labour Recovery” results in the overall “Efficiency” of your workshop. The “Efficiency” measurement allows you to understand how many hours your technicians are producing at your full labour rate vs the amount of hours they are at work.
The key to this method is understanding that this only considers an hour that has been sold at your desired labour rate, meaning you can always trust the data. If Garage Hive tells you that your workshop is efficient then it most certainly is.
The Penygroes Service Centre located in South Wales was founded in 2014 by Jonathan. He has extensive 17 years of experience in the industry. However, Jon found himself doing a lot of manual labour for data management to keep a finger on the pulse of the business. Therefore, joined Garage Hive's garage management software in March 2021 and has already seen a significant improvement in his garage, an increase in gross profit and has achieved a great NPS® Score.
Tom and Kayleigh runs their garage TR Autos in Yeovil, Somerset. They joined Garage Hive last year. Tom has two decades of industry experience , both practical and technician side and now business as TR Autos was founded in 2008; since then the team has grown, practices have moved away from paper diaries to garage management software, their productivity has increased and they also have moved into bigger premises.
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