Deal Pack Blog
How Can My Service Department Save My Dealership Money?
In the current economy, every area of savings is vital to the operations of a BHPH dealership. Having A service department aids in the profitability of the dealership due to the low costs of doing the work in-house. However, the costs of the parts are still significant and need to be reduced. One effective way a service department can reduce their parts costs is returning core parts to the manufacturer.
For those that don’t know, a core is the part removed from the vehicle and replaced by the new part. The credit received for the core is known as the core charge. There are two main reasons why it is beneficial to return these parts. Some states require there to be a minimum core charge on parts to promote environmental health. For example, in the state of Washington, there is a $5 minimum core charge on batteries. This is to promote the recondition or proper disposal of the batteries. Check with your state and be aware of the regulations on core parts. Many other parts can be sent back to the manufacturer for a credit on the next purchase. Returning a core part may seem trivial to the financial development because of the low credit gained by the parts. However, over time, returning multiple parts can have a material impact. This impact can range anywhere from $1,000 to $20,000 annually depending on the size of your operation. Any cost reduction in today’s environment is important. If it can easily be implemented, then not taking advantage of the opportunity is just bad business.
Fortunately, Deal Pack Pro has a Service and Parts module for returning core parts that is easy to use and completely integrated with the dealership. While creating service tickets, one takes in the core and adds it to the list to be returned. When returning the parts, a credit is automatically created for the appropriate vendor. When receiving in more parts, this credit is included with the invoice, reducing the cost of the parts. Take advantage of this savings and increase the profitability of your service department. If you have any questions about core parts or owning a service department feel free to give our friendly Support Team a call, toll free at (800) 526-5832.