Calculating Labor Inventory
For example, if you pay a technician for 40 hours a week, 52 weeks a year, that means you’ve “purchased” 2,080 labor hours. But realistically, a technician isn’t going to be fixing equipment for those full 2,080 hours. They’re going to go on vacation, lunch breaks, and sick days. That means that your actual labor inventory is more likely around 1,900 hours.
To try and close the talent gap, many dealers are putting more focus on employee skill development. Because technology is advancing so quickly, some dealers are partnering with technical colleges to train new talent and to re-train existing talent. INVEST IN EMPLOYEE DEVELOPMENT
Investing in automation and enhanced training for personnel are the keys to improving dealership performance looking through 2022. Labor shortages and higher labor costs are here to stay. Automation and improving labor productivity (partly to justify the higher cost of labor) are essential for improving physical performance and financial performance. Being prompt, reliable, and having a solid track record for ‘delivering’ on time will be important differentiators in 2022.
BRIAN BEAULIEU CEO at ITR Economics
To try and close the talent gap, many dealers are putting more focus on employee skill development. Because technology is advancing so quickly, some dealers are partnering with technical colleges to train new talent and to re-train existing talent.
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