Proudly serving the industry for which it was named for more than 50 years, Outdoor Power Equipment provides dealers who sell and service outdoor power equipment with valuable information to succeed in a competitive market.
Issue link: http://read.dmtmag.com/i/120369
FEATURE STORY By Jim Yount F orecasting for the technical service department is essential to your annual Strategic Business Plan, Two-Part Evidence Based because developing a forecast for the total business is like mapping travel plans for a vacation. It says: "This is where I want to go and how I'm going to get there." Contrary to popular belief, forecasting is not giving it your best guess. The first step in the forecasting process is to research and chart historical performance of the company by department, including your service department. After charting sales revenue dollars, the cost of sales and/ or cost of doing business, and analyzing the numbers to determine their meaning, only then: "It is possible to develop a realistic forecast by making informed decisions." For an existing business, forecasting 18 provides the owner with a planned vision of the future. And a service department forecast is an essential part of your business plan, but forecasting must be realistic: • TOO LOW, and we will not stretch and grow to improve management skills. • TOO HIGH or out of reach based on our belief system, and we'll become discouraged. Forecasting has many benefits when managing a business for profit and growth. Three major benefits are: 1. Forecasting for the service department provides the critical information that says: This is how many hours of labor we plan to sell/bill to customers, and how many revenue dollars we expect to generate. 2. Forecasting creates a sense of urgency for achieving a daily sales goal and profit objective, including service department labor revenue dollars. 3. Forecasting establishes the number of OUTDOOR POWER EQUIPMENT Keys to forecast Technical Service Department Forecasting for each technician, by name, is the first step in holding that person accountable for the number of hours billed to customers and the amount of labor revenue dollars generated during a payroll time frame and annually. I call your attention to the following chart (see page 19). First is an example-model of an actual case history from our files. Names are not those of the actual technicians. Let's review example-model. STRATEGIC BUSINESS PLAN – Part 2 Evidence-based Planning Forecast Technical Service Department (FTSD), by Technician www.outdoorpowerequipment.com Image above ©istockphoto.com/ jamievanbuskirk Increasing Shop Profitability (Part VII): Forecasting employees on company payroll, including technicians and other service department personnel. One of the measures of company efficiency involves the total number of employees on the payroll. Too few employees, and customer service diminishes. Too many employees, and the bottom line will suffer.