Strategic Results Hidden In Recon, Connecting Recon to the Hidden Strategic Results

By Dustin Jones, FixedOps Magazine

It’s good that your recon department knows that it needs to complete every service inspection in .5 (point five) days and detail in two days. That efficiency sounds good on paper. But the question arises, how do you get there?

Get to the efficiency

Using reconditioning software will help here to a point. This software allows the used car director, service director, and recon director to track reconditioning workflow times. It also helps them identify bottlenecks along with other days that can cost the dealership considerable money if not corrected promptly.

From a holistic perspective, there is always something in the recon process that can be maximized. In the most productive and profitable recon operations, managers and staff have been acclimated and sensitive to recon economics. They think about how strategic recon creates and pushes efficiency improvements (and savings) throughout the organization. The advantage goes way beyond getting used cars on the frontline faster.

These operators start by practicing a disciplined approach to the reconditioning process. They recognize the connection between reconditioning speed and variable operation’s benefit of seeing backward through the recon pipeline. This strategic advantage enables them to adjust the flow of vehicles through the recon workflow on the fly to better meet evolving sales opportunities.


The phrase “time-to-line” has become the efficiency standard for measuring vehicle reconditioning speed for these operators. They set a time mark to hold reconditioning to meet their determined “time-to-line”, car-after-car. For these dealers, the mark is three to five days for completing mechanical, detail, and cosmetic reconditioning, including sublet vendor work.

The phrase “connecting to what you expect” means having reconditioning processes drilled down so strategically that any delays or negative trends appearing in the workflow are causes for an immediate investigation. This only happens when a team knows it is accountable for meeting the time-to-line metrics that have been established for each phase, including outside PDR, glass, mechanical, or collision repair vendors.


Top performers hold their teams accountable for achieving established performance marks daily for a particular store, across similar sister stores – and storewide across today’s large, multi-state groups.

With each department being held accountable for its assigned performance metrics, specific patterns are prone to come to light:
  • How might a long-standing pattern of buying parts from the same vendor slow recon and cost you money?
  • What other parts acquisition strategies might contribute to faster time-to-line outcomes? Is paying more for a part you can get today an intelligent move when cheaper alternatives arrive tomorrow? How do you determine the better option? We must consider how each action is like a game of chess and how each move may cost net.
I talk to dealership management in variable and fixed departments. I’m always asking about processes, people, equipment movements, and why a particular task is done the way the dealership does it. This observation often brings opportunities to the surface to improve

time-to-line because I can see how tweaking something or retraining someone can help the store better connect to the results it seeks.


Two formidable obstacles to such improvement make me cringe each time I hear them spoken:

1. That’s how we’ve always done it.

2. We’ve been using them (a vendor) forever.

Consider an outside vendor handling detail work and their performance is consistently over your two-day time-to-line mark. Any time over that mark is an added cost to you.

A slow vendor can be justified by claiming that they are less expensive than some other competitors to tolerate a slow turn. That thinking gets a lot of dealers in trouble. Here’s how:
  • Each car you own going through recon carries a holding cost. The accepted daily per-car cost is $45. A two-day turn plan allows a total holding cost of $90. The cost of the vendor is $100 per car. This creates a total two-day turn cost of $190. That’s the budget.
  • However, if the vendor is slow and takes three days instead of two days to complete the job, an extra $45 in holding costs are incurred for that car. Your new total cost is now $235. This example is no longer on budget. It is losing $45.

Look at this math across the number of cars being handled by that particular vendor. Slow turnaround times can mount up, costing both time and money. Slow processes like this erode margin opportunities on vehicles when they sell.

Money is wasted when the recon strategy is not coordinated with recon
planning and expectations. Net cost is some of the hardest money to make up. Given that, it is crucial to have your reconditioning game plan dialed in.


Who’s responsible for managing this dial-in discipline? In most stores, it’s the General Manager. The GM has the most demanding role, as he or she helps everyone come together. If you recall the 2000 sports drama, Remember the Titans, you’ll understand my point about time-to-line discipline. This coach’s challenge was bringing two teams, the offense and defense, together to work as one. Dealers, too, have two teams in the locker room to be coached: Sales and Parts/Services.

One final example, which regular readers of my columns for Fixed Ops Magazine will recall, highlights how connecting recon speed to strategic results helps you keep net. This case involves a dealership looking at adding technician staff to boost productivity and profitability. As part of my analysis, I audited the service department’s payroll. I had my solution: an underperforming line technician cost the department $6,700 monthly in unrealized billable hours. The loss is called unapplied time.

Unapplied time loss can happen in different scenarios. Still, the primary cause here was service manager oversight. This encouraged at least one technician to be less productive than his potential. After detailing my findings to the service manager and technician, both saw their need to manage more closely and be accountable for production requirements. The service manager saw the loss in profitability, and the technician saw the loss in compensation.

Understanding your shop’s unapplied and applied times – and where that unapplied time is coming from — is such a vital managerial task it must be top of mind for the service manager.


So, let’s talk about that, staff inefficiency. When you look at a dealership’s financial statement, you see a section in the service department category called “Declared Unapplied Time.” Technicians producing at a 70% efficiency cost their dealership 30% less growth. These are stark details. To move to break even or 100%, questions must be asked:
  • Is the right recon staff in place?
  • Do we need more bodies?
  • Are we managing people and production to our stated labor efficiency?
Recon Average Days-in-Recon and Time-to-Line significantly influence these outcomes.

Parts management is a prime example of dealers finding efficiencies to move speed-to-sale forward. The average lag for getting parts for vehicle reconditioning ranges from six to fourteen days. Consider these tips:
  •  Start reconditioning from an immediate physical inspection
  • Push parts requirements, including parts for addressing recall situations, to the parts department from the technician in his or her bay
  • Focus on work in process – the flow of vehicles through recon and hold yourself and your team to meeting your stated Average Days in Recon or ADR
  • Understand how delays influence Holding Costs and sale margins
That is the biggest problem in recon today: lack of foresight. Can upholstery work make that downtime productive if a car is pulled out of a bay to wait for parts or other reasons? Everyone involved can develop a mindset of looking for and being ready to capture opportunities to keep workflow profitable.

One of the most significant efficiency, money, and time wasters for a car dealership is lax reconditioning management and accountability. As I said earlier, recon software helps improve these situations, but software alone won’t connect recon to hidden strategic improvements. You often need forensic-style scrutiny of your recon processes and people. Darkness called business loss lurks in shadows and routine thinking. When you shake those devils, light emerges that pinpoints ways to improve operational returns.

About Rapid Recon

Reconditioning workflow automation from Rapid Recon is the industry standard in time-to-line inventory turn and speed-to-sale vehicle revenue enhancement for automotive retailers. Benchmarking data based on 13 million vehicles processed uniquely positions Rapid Recon to advise dealers on how to improve their store’s profitability. Used by more than 2,000 dealerships, Rapid Recon ensures the accountability of processes, property, and people. Hence, dealers know answers quickly, find assets anywhere, and sell vehicles promptly to grow dealership profitability. CALL US: +650-999-0497