When I speak to dealers or controllers, the two most common questions that I get are: “What is the best DMS system?” and “How many people do I need in the accounting office?” Both answers to these questions depend on your situation. The best DMS system for your dealership might mean instant failure at another dealership with different requirements. It is a rather complicated process to determine which one is the best.
The same is true for determining how many people you need in your accounting office. No two dealerships sell the same amount of vehicles, service or parts. Even if you do find some dealerships in your 20 group that are similar in size, the number of people that you need in the accounting office depends on your technology, skill levels of those people and the tasks that they perform.
Let’s take a simple example of a common task – a dealer trade. In my Taskmaster list, there are actually four or five tasks for dealer trades; get the paperwork ready, payoff the floor plan, post the transaction into accounting/update the DMS and floor the incoming unit. When I asked a recent audience who in their accounting office did these tasks, they responded with a question – “do you mean also calling the dealership to perform the trade?” For some dealerships, an accounting office person actually makes the trade! In other dealerships, the accounting office phones the dealership after a manager has picked the vehicles to trade, but then works out “the numbers” of who will pay for what (holdback, equipment, PDI, gas, etc.)
At a few dealerships, the office only does the four to five normal tasks, but the issue gets worse because at other dealerships, those tasks are performed by an inventory clerk or sales assistant. Some dealerships have better technology that fills in the amount for the floor plan when paying off a dealer trade and others have such horrible technology that it takes screen after screen to determine the cost, floor plan and other information required to prepare the paperwork. This all gets compounded by one dealership that might trade a dozen vehicles a month and another dealership that trades hundreds!
I surveyed only a dozen of the attendees at a recent seminar and didn’t find any two dealerships that were similar. How can we possibly say that each dealership needs 7.3 people in the office based on some other metric like employee count, gross profit, or sales – when no two accounting offices perform the same tasks? The “head count” measurement is further complicated if you have someone performing the task that has been in the business for years and can do the job in minutes compared to a new employee that has to think over and over, “okay, they get this car and we get this car…” That is what I consider skill level, similar to technician skill levels.
Last month, I discussed in my Digital Dealer Webinar, “Creating a Task-based Accounting Office” how you can use technology to track over 300 tasks that an accounting office must perform and how to classify your office staff by their skill level. The only true measurement of determining if you have the right enough of people in your office is to track those tasks, skill levels and watch when tasks were last performed. The worse time to find out that you didn’t have enough people in the accounting office or some with the wrong skill level is after deadlines were missed, deposits not made, or funds weren’t collected.