This KPI provides you with the rate and direction of growth of the Service Department by understanding the relationship between the sale of retail hours and internal hours.
One of the factors that will affect this statistic is as a rapid growth rate in vehicle sales, which in the short-term will shift the bias to internal work. However in the following months the balance should be redressed as these vehicles return for scheduled servicing.
Example:
A) Retail Hours Sold = 870 B) Internal Hours Sold = 378 C) Retail : Internal Ratio = 2.3:1 (A ÷ B)
Discussion:
If the underlying trend of this KPI is demonstrating a high dependence upon internal work, it could mean that your dealership is losing its retail customers, there are no efforts in place to grow the retail sector of your business, or there is little or no control for invoicing procedures between the Sales and service department.
When you wish to measure the true growth rate and direction of your Service Department then this is the KPI to put in place.