How to easily increase your Dealership’s profits
Whether you’re a small single location dealership or a large automotive group, finding ways to increase profitability should always be at the top of your list. Because of the evolution of digital marketing and increased competition, the playing field has been leveled when it comes to sales and service. Since the dynamic of how people purchase vehicles has changed due to the internet age, dealerships need to adapt and find every possible means for more sustainable ways to increase profits.
Below we discuss ways in which you can do just that.
Your dealership can submit to your manufacturer for retail reimbursement for your warranty parts and labor to increase your warranty gross profits by multiple thousands of dollars, and knowing that information should motivate you to take advantage of that submission process. But you should also know the challenges that exist and why sometimes the best route to take is having a warranty solutions team like QB Business Solutions handle it from start to finish, not only to maximize your profits, but also so you can concentrate on the day-to-day operations. Listen, a lot of people know how to change their own oil, but by allowing professionals to handle it, you save time and peace of mind knowing it is being done in the best way possible – the same is true for the Retail Warranty Reimbursement Submissions for parts and labor.
The DIY Submission issue
So, you want to give it a go? We know what you’re thinking, you’ve built your dealership from the ground up, how hard can it be? Well, the short answer is that it is very hard, and even harder to understand and follow the guidelines and laws. Well before you jump in, you need to understand how the submission process really works. There are two types of submissions, statutory and factory, and you can either do them yourself or have a company like QB handle them.
One of the biggest issues is that the guidelines and rules are not well documented, so following them precisely is a big challenge, and oftentimes dealerships either won’t maximize their reimbursements, or they get so stuck in the weeds with compliance that the process stalls and fizzes out.
In addition to your manufacturer’s rules, every state has certain laws in regards to your retail warranty reimbursement submission process. And like most laws, they are written in a way that without a team of attorneys, you’re risking a lot of issues when going through the submission process. Keep in mind that even though you’re working with state statutes, this is not technically a “legal” process, its more about the proper marriage of those manufacturer guidelines and each individuals’ state laws, which is best accomplished by a combination of the right technology, solid internal processes, years of experience in the process, and the expertise to navigate through the rebuttals and other challenges that exist in the process.
Other Common Issues with DIY Retail Warranty Reimbursement Submissions on Parts and Labor
So let’s say you have all of the processes in place, a rockstar team to review the submission packages, and the extra time on your hands to do it yourself, here are a just a few other things to consider before jumping in. This is not about trying to discourage, its more about sharing our experience and being as transparent as possible to show you why a third party is typically your best route.
Beyond the guidelines and rules, we outlined above, there are a few other issues when dealers attempt DIY submissions:
- Human Resources: Who’s doing your submissions? The submission process is extremely time intensive. Whoever is handling this process will have no time for anything but this, if you want it done correctly and can take months to accomplish. Do you have people on your staff that you can afford to dedicate to this process? Remember that during this process they cannot focus on customers, operations, sales etc.
- Rebuttals: So, you’ve spent weeks putting together the package, how do you handle a manufacturer rebuttal? Manufacturers will only listen to certain types of responses which are based on their objections/clarifications—if you respond incorrectly, you can risk losing out on $.
- Optimal Rate: How do you know what the best rate is? Your optimal rate is based on the work mix and the different types of repairs that you perform and without the RIGHT professional guidance and information, you’re just guessing and decreasing your chances at more profits and submission success
- Technology: Do you have the right technology to pull the correct analytical database to make accurate calculations? Spreadsheets won’t work, you need concrete data to make the right calculations before submission.
IN our experience and given that information above, do you now see why utilizing a professional third party is probably your best plan of action?
Third Party Submissions
Automotive dealers lose thousands everyday by warranty claims not being processed correctly or on time. As state laws and brands constantly change, a third-party submission if your best bet. QB’s team of experts becomes your operational partner, staying up to date with and adapting to any new changes and training needed to obtain the best possible and sustainable results. Instead of taking on the complicated and time-consuming task in house, rely on us to take on your warranty claims and get you the results you’re looking for, so that you can focus on the more important things.
Our main objective is to make sure automotive dealers are getting the money they are entitled to with our retail warranty reimbursement and warranty claims processing service. For retail warranty reimbursement, our focus is getting your warranty labor rate close to your door date and parts to national average or higher. With warranty claims processing, we focus on first paid submissions being 86% or higher and 2.5 days to submission or less. We enjoy helping automotive dealers get back on track operationally and become sustainable for the future. We pride ourselves on integrity, accuracy, and sustainable results, ensuring the client is always first with satisfaction guaranteed.
In addition, because third parties are so versatile at performing a variety of reimbursement submissions, they can complete them much quicker than you’d expect—typically within 30 days, with little to no input required from you or your team. Furthermore, the results speak for themselves—dealerships that opt to outsource the submission process see a 10-to-30-point markup advantage over in-house submissions.
Still need more convincing. Before using QB, a client of ours attempted the submission process themselves, the time and energy dedicated was immense and put a lot of strain on their operations. The result? They got 52% on parts and were $20 off their customer pay door rate, both sub optimal results. When they decided to utilize QB Business Solutions, they we were able to increase their return to 85% on parts and got within $2 of customer door rate. Seems like a lot but these results are typical and a testament as to why letting a third party is best. Even when you have all of your ducks in a row, there are still ways to optimize your profits.
Before you choose to work with any third party, do your due diligence and check out their company, look at testimonials, endorsements, and their industry reputation. Make sure that there are no upfront fees, no monthly fees, and no service costs. A lot of third-party companies claim to have no fees and costs but bury them within their program to hide them from you. We guarantee results with no upfront fees or costs; We don’t get paid until you get paid.
QB Business Solutions is a team of dedicated professionals, who work one on one with dealers to receive retail compensation for warranty labor and parts. No two dealers are the same and that allows us to help anyone to achieve the best results.