This KPI is generally used for budgeting purposes. The calculation simply takes the Annualised Parts Turnover and divides it by the total number of people employed within the Parts department to provide an Average Parts sales Value Per person.
It is important to note that the number of employees in the calculation includes everyone within the Parts Department including the Parts Manager, and not just the people who sell parts.
Example:
A) Annualised Parts Sales = R695,688 B) Number Parts Employees = 3 C) Annual Sales per Employee = R231,896 (A ÷ B)
Discussion:
It is a useful statistic for ascertaining the overall utilisation of your parts personnel compared with the national average of your franchise.
You may also use it to place a sanity check on your budget. For instance, if your budget requires this KPI to be something in the order of R579,740 per person, then you may question whether you have sufficient people to deliver this result, or you may even question the viability of your budget.