Guides

How to benchmark your dealership when you are not in a 20-group

Most dealers benchmark. Very few of them benchmark against anything except themselves, and that is a much bigger problem than it sounds.

If you are not in a 20-group, your comparison set is your own dealership last month, last quarter and last year. That tells you whether you are moving. It cannot tell you whether you are moving fast enough, or whether the direction you have settled into is normal for a store your size.

This is a guide to getting real perspective on your numbers when there is no group meeting on your calendar. Some of it you can do this afternoon with the statement you already produce. Some of it you genuinely cannot do alone, and it is worth being honest about which is which.

Why your own history is a weak yardstick

Your history has one enormous flaw as a benchmark: it contains all of your own habits.

If your service department has priced warranty work the same way for nine years, nine years of history will tell you that is normal. If your F&I office has always presented four products, the trend line will look healthy while the store leaves money on the table every single day. Your own numbers are consistent with your own decisions, which is exactly why they feel reassuring.

The second flaw is that history cannot separate a market problem from a process problem. Used vehicle gross falls. Is that your market, your buying, your reconditioning cost, or your pricing discipline? Your own trend line shows the fall. It cannot tell you that eleven other stores held their gross in the same quarter, which is the fact that would change what you do on Monday.

What you genuinely can do on your own

Quite a lot, and it is worth doing before you go looking for peer data.

Trend, on a rolling twelve. Single months lie. A rolling twelve-month view of gross per unit, hours per repair order, effective labour rate and fixed absorption strips out the seasonality and the one big fleet deal, and it is usually the first time a dealer sees the actual shape of the business.

Seasonality, mapped. Two or three years of monthly data will show you your own seasonal pattern clearly enough to plan staffing and inventory around it. This is one of the few things you can do better alone than in a group, because your seasonality is local.

Department ratios rather than department dollars. Gross per repair order, gross per unit retailed, expense as a percentage of gross, technician productivity and proficiency. Ratios travel between months and between stores in a way that raw dollars never do.

Internal consistency checks. Does the parts department's internal sales line reconcile to the service department's parts cost? Does your used inventory schedule agree with the balance sheet? Half of the surprises in a dealership statement are not performance problems at all, they are posting problems, and they are visible without any peer data whatsoever.

A written monthly review. Twenty minutes, the same six numbers, every month, written down. The discipline matters more than the sophistication.

Where working alone stops

Three things you cannot get from your own file, no matter how carefully you read it.

What "possible" looks like. You can see that your service absorption is what it is. You cannot see where a store of similar size and staffing lands on the same measure, and that comparison is what turns a number into a decision.

Whether the problem is you or the market. Only a comparison against stores facing a similar month answers this, and it is the single most valuable output of any peer group.

A second opinion from someone with nothing to sell you. Your vendors will benchmark you against their own book, and their book is selected for stores that bought their product. Another dealer looking at your statement has no such incentive.

Two routes into peer data without a traditional group

Route one: join a group that is forming. New groups form more often than most dealers realise, usually when a handful of operators who already know each other decide they want the comparison without the overhead of the traditional arrangement. A forming group will typically take a store that arrives on its own. You do not need to bring anybody with you.

The one constraint that is not negotiable is that the members must not compete with each other. That is partly so the room will actually talk, and partly because a benchmarking group made of direct competitors is a legal problem, not just an awkward one. More on that in our guide to starting a group.

Route two: run a private group across your own rooftops. If you operate more than one store, you already have a peer set. Most multi-rooftop dealers compare their stores in a spreadsheet that somebody rebuilds every month, and the comparison is only as good as whoever last touched the formulas. Running your own stores through a proper composite gets you consistent definitions, a real ranking, and an audit trail back to each store's statement line.

It also has a side benefit that group members will recognise: once the stores are being compared on identical definitions, the arguments stop being about the numbers and start being about the operating decisions behind them.

What to ask before you hand a statement to anybody

Whichever route you take, you are about to give somebody your financial statement. Ask these questions first, of any provider, including us.

Reasonable providers answer all six without hesitating. Apex20's answers are in our published Terms, which is where answers like this belong.

Where Apex20 fits

Apex20 is a peer-benchmarking portal built by a dealer principal who got tired of the arithmetic being somebody else's secret. You upload the monthly financial statement you already produce, and the portal builds the group book from it: every line showing the group average, your rank in the room, and your Apex20 target with a badge saying where that target came from.

Two honest limits, stated up front. The statement parser reads the CDJR dealership statement today, so that is the franchise we can onboard right now. And a group needs members: if you are arriving on your own, we will talk to you about which forming group fits, or about running your own rooftops as a private group.

If either route sounds like it might work for your store, the fastest way to find out is to call and talk it through with a dealer rather than a salesperson.