# Calculating the efficiency of a car salon

** The clock tries **

"Time for money" in workshops and repair shops. Essentially, these operations buy and sell panels, painters and technicians. For example, a workshop can buy one hour from a technician for £ 10 and sell it to £ 40 for the customer and earn a $ 30 profit. (These figures are naturally imagined.)

Purchasing and selling time is the biggest source of income and profit for turnkey and repair shops. Profit from the sale of spare parts; oils and lubricants; paints and materials; and the rental and the various products contribute to the purchase and sale of both the purchase time. If you do not give up time, you will not sell anything out of these things either.

As you carefully take care of buying and selling a spare part, you must pay equal attention to purchasing and selling your purchase time – or even more so because you can not "store" your products. In other words, if you do not sell your time today, you can not sell it tomorrow.

** Selling Time **

So once you disappear, it disappears while a spare part is still in stock. So it's a good idea to know how much time it takes to sell it. That sounds pretty simple. If we have six products and there are eight hours a day, are you sure there are 48 hours for sale? Well, no, no.

Initially, products can be in the workshop every eight hours, but they do not work for eight hours. For example, a client can return to a car he has repaired yesterday and complain that he is stuck. Then it is necessary to remedy a productive problem and of course not rely on the client. If you have two hours, you only have 46 hours to sell in our example.

** Selling Time **

To make things more than 48 hours more. For example, imagine that a vehicle manufacturer's usual time for a larger service is two hours, and this is referred to by the customer. If the technician completes the service within an hour (probably not), he would still spend the client for two hours.

If it's been done all day, you could sell less than 96 hours, one of the technicians did not spend two hours in the engine down. (It's four o'clock, because you're evaluating two hours in every instance.) So if your products cut the whole day by half, 92 hours instead of 48 hours.

** Three Times **

Here we talk about the three times available in a workshop or a workshop:

Time Limit – This is the time when panels, painters or technicians are at work work. ] Working Time – This is the time you spend, actually working at workplaces that the customer pays at the end of the day. It is obvious that "working time" does not include the time to settle problems or anything else that does not have a paying customer at the end.

Selling Time – This is the time when customers are eliminating. It is possible that an insurance company or an estimate of the price of a menu service is available.

It can be said that "participant time" and "working time" are all "real" because they will almost see it. You can see if a producer is in the workshop and see that they are doing a productive job when paying for the job. In addition, you can measure the "time spent" and "working time" using a clock

. On the other hand, "sold time" is not "real". You can not see it and you can not measure it by hours. But you can end up with it every day when you sold your customers from your work cards or accounts.

** How fast and how long **

When you measure time and work time and add time sold at the end of the day, you can see how fast and how long your products have worked during the day

How fast they worked , divided by hours divided by hours worked. In our example, it sells 92 hours compared to 46 hours of work, ie 200%. That is, the product line is twice as fast as usual.

How long have working time divided by hours. In our example, 46 hours 48 hours or 95.8%. That is, its products paid 95.8% of the time during their work.

** Efficiency of Work **

Our Percentage of Work is Two "Labor Efficiency":

Productivity Efficiency says how fast they work compared to normal times or estimates of body repair jobs – how many hours sold

Employee recruitment (sometimes "sales efficiency") tells you how long products have been processed compared to job payouts

According to the formulas, the productivity of productivity and the labor force its use is calculated as follows:

Production efficiency = (Hours sold / working hours Hours) x 100%

Working use = (Working time / Hours) x 100%

** Full work savings **

Another measure of work efficiency which is called general efficiency. This is a simple combination of production efficiency and labor utilization combined with these:

Full effectiveness = productive efficiency x labor utilization

Or, another way to look at overall efficiency:

Performance = (Sold hours / hours) x 100%

** How does work efficiency affect profit? **

It is obvious that you will generate more profits when you spend hours out of that hour,. We've already said that if you buy an hour from a workshop for £ 10 and sell it to a customer for £ 40 you will win $ 30 in profit. But if you bought an hour from the technology, then you sold two hours, you will get far more profits – £ 70. Equally obvious is that if you buy an hour from a workshop for £ 10, then spend the entire hour and repair the returning job for which you can not pay a fee, you've lost € 10. It is less obvious that you missed the opportunity to give two hours (in our example) and thus lost the opportunity to profit 70 pounds

So measuring the time in a workshop and then labor efficiency is very clear. This is about profits. And if you do not measure time and calculate the efficiency of your work, you are absolutely certain that you will not maximize your profitability because you will not know: How fast they work as teams and individually and are able to work faster if they are better educated or have better equipment.

How much time do you work for as a team and individually, and how much time you spend on your work that your customers do not pay.

measured

The simplest way of timing in the workshop is by using an "hour" that timing the "working time" in "open time" and working day. Time intervals are manually corrected on a "daily operational control" page and calculate the efficiency of your work.

However, computers have largely eliminated this basic method by using "clocking" barcodes or magnetic slider cards. The computer then performs all the correlations and calculations immediately.

** Typical Workforce Efficiency at Top 25% **

Over the past few years, workforce efficiency gained by workshop sales and service centers has declined, "norm" a decade ago. The reasons for this are complex. However, the largest 25% of franchisees and service shops still have a reasonable level of performance, typically

For a bodybuilding efficiency productivity of 106% on average, occupancy is 88%, so overall efficiency is 93.3% (106% x 88%)

For a workshop, production efficiency is 115% and occupancy is 92% so aggregate efficiency is 105.8% (115% x 92%)

productive for 40 hours within one week, such as: [19659003] For a workshop – 40 hours, 35.2 hours of workplace salaries and 37.3 hours of sales or billing for customers

For a workshop – 40 hours, 36.8 hours work and 42.3 hours to sell or invoice Customers

** Why Service Jobs Are Generally Labor-Efficient Like Workshop **

Workshops are definitely less effective, but why? First of all, jobs are moving between products in the workshop – starting with the ribbon, then the panels, then preparing, painting, assembling, and decorating. In general, this means that the vehicle is physically moved around the vehicle building, which is far less effective than in a straight bay at work and in a straightforward location of the workshop. Job performance is lower than the labor utilization rate than at a workshop

The service efficiency of the service centers was higher than in service shops, as the hours sold were discussed with the insurance reviewers – so-called "opinions". The workshop can get 20 hours to work and finish the products within 15 hours, resulting in a 133% productivity. Nowadays times in the workshop are set up with computer estimation systems, there are virtually no negotiating or "opinion formatting" locations

. Service shops, such as workshops, go to normal times. But they have millions of drivers and not dozens of insurance companies, so service managers can always set time – for the reason and of course for the race as well.

** Lost Time **

Be great if you only pay the technicians when they pay for jobs but can not do it. What you actually pay for them is participation or "timely" and not "working" when you are paid for work when they are involved.

The difference between time spent and working time is "lost time" which is also termed as a productive time – a few hours a week when professionals pay when they do not work at workplaces. There are three common things that make up for lost time, repair faulty jobs, collect and transport your car, and clean up and maintain

You can pay off your time and pay overtime and pay for technicians on holidays, sick leave and training. Then there is the employer's contribution to the National Insurance and the costs of any auxiliary technicians such as pension or health insurance contributions.

It is tempting to spend all of these payments by purchasing the technician's time in our example and calculating what can be seen as "real" profit. If you would, the cost of purchasing the watch would probably be about 13 pounds, so the gain was 27 pounds.

** Time Management **

The facts presented so far seem to quantify profits when technicians are timely buying and selling very simple. It is obvious that for every period – for a day, a week, a month, or a year – to add up all the labor, and deduct the costs of all technicians (including fund, bonus, overtime, holidays,

It may be much better to identify the costs of each technician separately in the management accounts because you can see how much you are paying for. By dividing these payments by technicians, you can better examine the effects of work efficiency on your operation , regardless of how much service, repair, or repair of the body is required.

The following example shows the traditional treatment accounts service workshop or workshop where the results for a technician were taken over for 12 months, that the basic payment is 12 pounds per hour and per hour the average price is 60 HUF / hour. We also assumed that the technician would take hours worked for 44 weeks and 40 hours per week 40 hours a week, which had a wasted time of 3 hours. Thanks to the technician's efforts, the workshop sells 42 hours per week (ie 1848 hours sold at 4448 x 42 hours per year) and is available without overtime or bonus payments

** Management Accounts [19659002] Sales of the Workforce 1,848 Hours Sold @ £ 60 = £ 110,880 **

Pay less technician's salary 1,628 hours @ £ 12 = £ 19,536

Payout technician bonus (all paid bonuses are earned) = NIL

Overtime payment technician (all overtime over) = NIL

Gross Profit on Job Sales (Gross Labor Profit) = 91,344 £

Direct Releases

Paying Technician for 132 Hours Loss @ £ 12 = £ 1,584 [19659003] Paying Technician for Hols, Patients and Training (40 Days 8 Hours) @ £ 12 = £ 3,840

Technician National Insurance and Perks = £ 3744

Direct Profit on Labor Market Value = 82 176 £

** Working Gross Profit **

In this traditional management account, the cost of the technology is not less than six rows. The first three lines appear immediately after the sale of the workforce and include all payments to the technician, which actually make a job that will then be sold to the customer. This includes the payment of "working time" and all bonuses and overtime. Accountants call this "sales costs".

By subtracting the three lines, sales will ultimately get gross profits purchased and sold during the technician – this is usually "gross income". Gross labor gains are often expressed as a percentage of labor sales, which is 82% in this example (91,344 pounds, divided by 110,880 pounds).

The remaining three lines include direct payments of management, including bills, non-productive payouts, trainees, consumables, courtesy cars, advertisements, etc. costs. The idea, as mentioned above, identifies what you pay for technicians not to work. In this example, the technician's total cost per year is 28,704 pounds and 9,168 pounds does not work. This is almost one third, and it is not far from unusual.

** Splitting the payer of a technician **

Splitting a part of the technician's salary is obvious – bonuses, overtime, holidays, etc. and national insurance and perks. It only leaves the technician's base payout divided by "working time" and "lost time":

In our example we know that the technician takes 40 hours each week and works 37 hours, which means that the technician 1628 hours work a year (37 hours x 44 weeks), £ 12 per hour £ 19,536

It takes 3 hours each week or 132 hours (3 hours x 44 weeks) or £ 1,584 £ 12 per hour .

In fact, this sharing corresponds to one of the efficiency measures discussed earlier – labor recycling. Labor utilization is expressed as a percentage of "working time", or 92.5% in this case (37 hours divided by 40 hours). The distribution to management accounts gives you 92.5% of the basic salary for the work. The remaining amount (7.5% of the basic salary), which corresponds to the technician's fee for the wasted period, is allocated as a cost

It must now be made clear that labor utilization has a direct impact on how much gross profit is profitable sells the technician's time and the amount paid to the technician does not work

** Calculation of Labor Sales **

In our example, the workshop sold 42 hours a week for 37 hours from the technician for 40 hours. We have already seen that the utilization of the workforce here is 92.5% (37 hours divided by 40 hours). Productivity efficiency can also be estimated at 113.5% (42 hours sold divided by 37 hours), with a total efficiency of 105% (42 hours sold divided into 40 hours). All of these formulas have been covered in the past

In our example, labor sales are calculated by multiplying the hours sold over a year (1,848 hours) with the 60-pound hour clock. In total, this calculation is as follows:

Annual sales = 1 technician x 40 hours per week x 44 weeks x 105% full efficiency x 60 £ / hour labor = 110 880 £

** Increased Productivity Efficiency **

We can now see what happens to the profits of labor sales if the efficiency of the workforce increases. Let's say our experts are still working out for 37 hours in 40 hours, but they work faster (ie they are more efficient) and 43 hours sold. Usage is still 92.5% (37 hours divided into 40 hours), but productivity gains rose to 116.2% (43 hours sold divided by 37 hours) and overall efficiency increased to 107.5% (43 sold hour divided by 40 hours). The effect was (and we repeatedly assume that the bonus and overtime are zero):

Sales of labor

1 tech x 40 att. hour x 44 weeks x 107.5% full efficiency x £ 60 / hour = £ 113,520

Less

1 tech x 40 att. hour x 44 weeks x 92.5% recovery x £ 12 / hour = 19,536 £

Gross profit on labor (Gross Profit Profit) £ 93,984

Direct Releases

1 tech x 40 att. hour x 44 weeks x 7.5% lost time x £ 12 / hour = £ 1,584

Technician's salary for sick, sick and workout (40 days 8 hours) @ £ 12 = £ 3,840

Technician for National Insurance and Perks = £ 3.444

Direct Profit from Labor Sales 84.816 £

The small increase in productivity growth – by some three percentage points – resulted in an additional year's profit before labor: 2640.

** and productive efficiency [19659002] So far we have explained how to measure time at a service or body repair workshop, how labor efficiency works, and how management accounts are handled to highlight labor gains. We have shown that productive efficiency affects profitability. We will then look at the impacts of improving labor utilization, both productive efficiency and labor utilization at the same time. **

** Increased Labor Utilization **

Assuming our technician works for 38 hours instead of 37 hours instead of 40 hours while productivity remains the same (113.5%) than in the original example. This means that utilization rises to 95% (38 hours divided into 40 hours) and if 113.5% production efficiency is the same, our technician produces 43.1 hours sold (38 hours x 113.5% ). Thus, the total efficiency of the technician increased to 107.8% (43.1 hours sold divided into 40 hours)

The impact on labor gain is as follows:

Sales of labor

1 tech x 40 att. hour x 44 weeks x 107.8% full efficiency x 60 pounds / hour = £ 113,520

Less

1 tech x 40 att. hour x 44 weeks x 95% recovery x £ 12 / hour = £ 20 064 Gross profit of work = 93 456 £

Direct releases

1 tech x 40 att. hours x 44 weeks x 5% lost time x £ 12 / hour = £ 1,056

Payroll technician hols, sick and workout (40 days 8 hours) @ £ 12 = £ 3,840

Technician National Insurance and Perks = 7744 £

Direct Profit on Sales of the Worker = 84 816 £

The improvement in an additional working hour is 2,640 pounds a week.

** Both of them! **

But what will happen if both utilization and productivity are improved at once? That is, the technician still takes 40 hours, but with 116.2% better productive efficiency, he works 38 hours in part 2, making 44.2 hours sold (38 hours work by 116.2%), making 110.5% (44.2 sold hours divided into 40 hours). The calculation looks like this:

Sales of labor

1 tech x 40 att. hour x 44 weeks x 110.5% full efficiency x £ 60 / hour = £ 116,688

Less

1 tech x 40 att. hour x 44 weeks x 95% recovery x £ 12 / hour = 20,064 £

Gross Profit on Job Sales (Work-Gross Profit) = £ 96,624

Direct Releases

1 tech x 40 att. hours x 44 weeks x 5% lost time x £ 12 / hour = £ 1,056

Payroll technician hols, sick and workout (40 days 8 hours) @ £ 12 = £ 3,840

Technician National Insurance and Perks = 7744 £

The direct result of labor sales = £ 87,984

The improvement is £ 5,808, multiplied by (say) seven technicians with a significant £ 40,665 a year.

** This shows a slight increase in labor efficiency. At the same time, labor gains can decrease as much as the efficiency of the workforce decreases with the same small amount. **

** Lost Loss **

If a slight improvement in the efficiency of a workforce results in significant improvements in labor gains, it means a profitable fall, you need to know what arms to pull to make sure that the big gain side. So what's the secret? Or is it about dealing with misery?

There is no secret. The trick controls all aspects of a workshop. Leaders must do everything to make sure technicians, panelists and painters work as quickly as possible in the shortest possible time. In other words, you have to do everything to minimize your lost time and with every tool you need to provide productive staff for faster work than training, power tools … and even the most experienced products. If you have a clutch job, please provide the clutch expert.

But there is a secret worth knowing, and this is the "hidden time lost".

As we have seen, the lost time is a killer. But lost time, when measured at all, is usually about the most obvious elements, such as correcting faulty work, collecting and transporting cars, and cleaning and maintenance. However, much more lost time is hidden in the workplace. It may seem that specialists are working hard, but they are too often waiting for spare parts at the rear counter of the shops. Or a technician may expect to use an equipment like a wheel adjustment device in a line

The "hidden time lost" results in a decrease in production efficiency, but labor utilization has no effect as it does not measure the loss. But as you can see, the impact on profit might be huge. Thus, apart from the apparent and direct effects of the efficiency of the work, the rapid work of the staff (productive efficiency) and the length of time (recovery), the workshop managers must also participate in those that can slow them down.

Source by sbobet