7 Auto Repair KPIs for your Body Shop

Meeting deadlines, keeping customers satisfied, and checking that your processes are efficient – these are all things you should be keeping an eye on within your body shop. One of the best and easiest ways to do this is to select the auto repair KPIs most relevant to you and use these ratios to measure your performance in these areas.

What is a KPI?

KPI stands for key performance indicator, which is a term that’s widely used across many industries for measuring performance. When you have specific objectives and want to quantifiably measure your success, using calculations linked to specific metrics is the best way to do this.

Why are KPIs important in auto repair?

When you’re already juggling so many other aspects within your body shop, including stock control and handling repairs, it can be helpful to have and track relevant KPIs rather than trying to manually measure your growth and success.

Monitoring relevant metrics allows you to see how different parts of your body shop operations are working, alongside showing you areas that could be improved. 

KPIs for auto repairs

So, what are the most common KPIs in the auto repair industry? From cycle time to net profit, here are some of the ones you could consider using to measure your business’ success and why they can be beneficial for your team.

Cycle time

Cycle time refers to the total amount of time that a job takes you to complete. This includes the amount of time that a vehicle might be with you without you physically working on it. Measuring this metric allows your body shop to compare the cycle times of different and similar jobs, which means that you can more accurately predict lead times for customers. It can also be used to spot any inefficiencies in your cycle time when compared with touch time.

To work out your cycle time, simply decide the point at which a job starts and ends and track this time. You should use the same rules for each job, so if you track it from the moment the car enters your body shop to the customer’s collection time, do this for all your repairs to keep it consistent and get the most accurate results.

Touch time

This can sometimes be confused with cycle time, but touch time is a KPI that tracks how much time is spent actually working on a repair rather than the total time spent with a vehicle. This is an important metric to look at alongside cycle time because it gives you an insight into how long is being spent working on a repair versus the amount of time you have the vehicle in your body shop.

To calculate this, simply divide the total labour hours by the number of days taken to complete the repair. For example, if it took 20 hours to complete the job over 5 days, your touch time would be 4 hours per day. By doing this for each job, you can compare similar repairs to see if your average is similar, and you can use it to see whether touch time could be reduced. 

Efficiency rate

The efficiency of your body shop can affect other KPIs, including cycle and touch time. The goal with this metric is that the number of hours billed for initially is always higher than the number of hours actually taken to complete a repair. This can improve your body shop’s profitability. 

To calculate the efficiency rate, you’ll need to divide the number of hours originally billed by the number of hours worked. For instance, if your team bills for 10 hours but a job ends up taking 8 hours, your efficiency rate would be 125%, which means that the job was completed efficiently.

Utilisation rate (for technicians)

Utilisation rate is a metric that can be used to determine the productivity of each of your technicians. It can be worked out by dividing the number of hours your technicians have worked by their available hours. So, if your technician has 42 hours available and registers 36 hours of working on repairs, they will have a utilisation rate of 85%.

Alongside showing the productivity of your technicians, this metric also indicates the current capacity of your body shop. This can be used to make hiring decisions based on the availability of your current team. If your utilisation rates are lower across the team, this could mean that you have too many technicians, and if the utilisation rates are higher, you might need to hire additional technicians to keep up with the demand.

Revenue

Revenue is a KPI that evaluates the average amount of revenue being brought in by each of your technicians. By including this metric, you can see how much value your technicians are bringing to the business as a whole.

By dividing the total revenue for a period by the number of technicians, you can work this metric out and track it over time. Ideally, you want to see this figure increase over time.

Net profit

Profits are undeniably an important part of running a successful body shop, which is why net profit is a KPI you shouldn’t ignore. This metric includes operational and non-operational expenses, including taxes, loans and material costs. Working this out can show you your current profit margins and help you decide on your profit goals for the future, which ultimately dictates the success of your business over time.

To work this out, you’ll need the figures for turnover, cost of goods sold (COGS), operating expenses and non-operating expenses. You’ll need to minus all of these figures to be left with net profit. 

Average repair order (ARO)

This KPI provides you with the average total of money made per order. By maximising this metric, you can boost net profit and, in turn, improve the success of your body shop.

To work this out, simply divide the total money made  from sales in a period by the number of vehicles repaired during that time frame. For example, if you made £5,000 from working on 100 vehicles in a month, your ARO would be £50.

This metric can help you see where value could be added for your customers to increase the ARO without overworking your technicians. It can also help you decide when to prioritise bigger and smaller jobs to give you a higher profit margin with fewer orders, maximising efficiency.

Tracking KPIs in auto repair

The method you use for monitoring each KPI is likely to differ since some offer ratios, and others have calculations that must be made. Regardless, you can use software and technology to support you with the tracking.

Collision repair software can be used to improve the efficiency of your KPI tracking since you can set up reports and insights into the metrics that matter most to you. This means that you won’t need to manually handle the calculations, which could affect your efficiency and productivity if other team members needed to step in for these. The automation available with this software also means that it can automatically pull the relevant figures needed to create the insights you’re looking for.

Whether your goal is to improve efficiency or boost revenue for your body shop, it’s worth considering tracking some of these major auto repair KPIs. For further insights and advice on the auto repair industry, check out the JTAPE blog.