HOW TO MAXIMIZE SUBLET PROFIT

• Published in: Automotive Body Repair News 2011-10, Vol.50 (10), p.78
• Main Author: Shoemaker, John
• Format: Article
• Language: English
• Subjects: Automotive repair services; Corporate profits; Discounts; Gross income; Guidelines; Insurance companies; Profit maximization; Profitability; Purchasing; Subleases; Tires
• ISSN: 2166-0751; 2166-2533

One area that is often overlooked is sublet repairs. It is an area that is most of the time gray on an estimate with pricing based on an "average" for your particular market. If you look at sublet repair closely you will find it is an area with great potential for increased gross profit. There are two ways to increase your gross profit on sublet repairs - one is doing the work yourself and the other is through smart purchasing. Think about the items you sublet, determine how long you have used the same vendor and use that information to negotiate your discount. Arm yourself with the monthly or annual purchase average when you approach the vendor. The bigger the number you can show the vendor the more leverage you will have to negotiate a discount. If you use a management system you can track purchases within the management system by identifying the vendor and printing a report with the purchase information. If you don't have a management system a simple spreadsheet will work. Among the first areas I would look into are your towing purchases. Towing is the most common sublet purchase you make, so the volume should help you earn a loyalty discount and it has a zero profit expectation from the insurance company.