This KPI produces a monetary figure that is the average value of parts sold to the workshop for every labour hour that is sold during the same period. This statistic is influenced by many different areas in the department and it is therefore far too ambiguous to be conclusive. You must study your own trends very carefully for it to have any real meaning and comparison with other dealerships can be misleading and dangerous; take care!
Hypothetically, let's say that the national average for this KPI is R30. The example below might suggest that your Technicians are finding additional work when vehicles come into the workshop and parts are being replaced as opposed to being repaired.
On the other hand if the national average is reported at R65 the example below might suggest that your Technicians are failing to find additional work and parts are being repaired as opposed to being replaced.
Example:
A) Parts Sales to the Workshop = R42,240 B) Hours Sold = 870 C) Parts Sales per Labour Hour = R48.55 (A ÷ B)
Discussion:
Factors that influence this statistic are the type and mix of work that you are undertaking and in order to gain any meaning, this KPI must be calculated separately for Retail, Internal and Warranty.