The Power of Small Gains – How a 10% Process Improvement Transformed Dealership Performance
Background
A mid-sized automotive dealership group with three rooftop locations was experiencing stagnation in profitability despite steady sales. While the leadership team was confident in their operations, they lacked visibility into the effectiveness of individual processes across departments—from sales and F&I to service and accounting.
Challenge
Without clearly documented workflows or performance benchmarks, the dealership operated with inefficiencies that were hard to pinpoint. Leadership suspected that while no single issue was catastrophic, the accumulation of small inefficiencies was slowing the business down, frustrating employees, and creating inconsistent customer experiences.
Approach
The dealership partnered with Monarch Dealership Resources to perform a full process audit. Each major workflow—CRM follow-up, recon timelines, parts ordering, deal jacket completion, repair order closeout, and month-end close—was evaluated and mapped. Using industry benchmarks and best practices, the Monarch team worked with department heads to identify opportunities to streamline, eliminate redundancy, reduce delays, and document SOPs.
Rather than attempt sweeping changes, the team implemented targeted process improvements with a goal of just 10% improvement in each function.
Examples Included:
- Reducing vehicle reconditioning time from 5 days to 4.5 days
- Improving CRM follow-up rates by 10%
- Tightening repair order documentation to reduce warranty claim rejections
- Decreasing time to complete month-end close by one business day
Results
Within six months of implementing incremental 10% improvements, the dealership saw measurable gains:
- Inventory Turn Improved by 12%: Faster recon and better CRM follow-up led to quicker retailing of used units
- Customer Satisfaction Scores Increased 15%: Due to better communication, follow-through, and reduced service delays
- Gross Per Deal Increased $275: From F&I process alignment and improved desk-to-delivery workflow
- Admin Costs Dropped 8%: More efficient accounting processes and less overtime at month-end
- Team Morale and Retention Improved: Staff had clear expectations, better tools, and fewer bottlenecks
Conclusion
What seemed like small process improvements—just 10% better—compounded into a transformative impact on the dealership’s bottom line and operational clarity. The key wasn’t massive overhauls, but consistent, measurable refinements guided by outside expertise.
Quote from GM
"We always thought we were doing fine, but Monarch helped us realize just how much potential we were leaving on the table. A few changes here and there added up to a major win for our entire operation."