NCM Associates calculates and produces dealership benchmarks based on the average of the top 50% of our clients by category. It reflects what's happening in the real world.

It's not a destination, but a real-time comparison tool.

We'd prefer to see a better performance than some current benchmarks indicate, but this is today's actual retail environment.

Review the information on the benchmark chart on page 57. Note, especially in asset management, a decline in performance vs the previous quarter in new- and used-vehicle days' supply, used-vehicle inventory turn, and % of units in excess of 60 days.

The industry must concentrate on improving their efficiencies this year. We must find methods of maximizing our results while minimizing expenditures. We must maximize employee productivity, while controlling expenses and inventories.

This year has profit potential if we focus on basics and use best practices.

Tony Noland (tnoland@ncm20.com) is the president and CEO of NCM Associates, Inc.

NCM Associates Key Benchmark Category Domestic Our Dealership Import Our Dealership High Line Our Dealership
Net Profit As % Total Sales 3.5% 4.2% 5.3%
Departmental Gross % Dealership Total
New Vehicle Department 33.0% 41.3% 47.6%
Used Vehicle Department 27.3% 23.1% 14.1%
Mechanical Service Dept. 19.5% 21.1% 22.6%
Body Shop/Collision Repair 7.8% 9.5% 4.5%
Parts Department 15.2% 13.1% 4.8%
Departmental Profit % Dealership Total
New Vehicle Department 33.7% 45.5% 62.6%
Used Vehicle Department 24.6% 13.1% 5.0%
Mechanical Service Dept. 11.0% 22.5% 13.8%
Body Shop/Collision Repair 2.0% 2.3% 0.8%
Parts Department 28.0% 16.7% 17.4%
Key Expenses % Total Dealership Gross
Employee Expense 34.9% 32.0% 26.3%
Advertising/Promotion 7.8% 8.1% 4.6%
Total Interest - 0.5% - 0.3% - 0.1%
Expense Category As % Total Expenses
Selling 27.0% 28.8% 26.8%
Employment 44.1% 41.5% 40.3%
Other Overhead 13.8% 14.8% 16.5%
Occupancy 15.1% 14.7% 16.0%
Employee Measurements
Gross Per Employee Average Month $6,989 $8,196 $11,054
Productive Employees % Total Employees 55.3% 57.1% 49.9%
Techs (Body + Mech) % Total Employees 23.3% 19.8% 22.7%
New & Used Veh. Sales Pers. % Ttl. Emp. 22.5% 25.9% 17.3%
Managers % Total Employees 13.7% 13.1% 10.4%
Clerical % Total Employees 12.4% 11.4% 12.8%
Asset Management
New Car $ Days Supply 56 35 28
New Truck $ Days Supply 52 72 30
Used Car $ Days Supply 57 44 42
Used Truck $ Days Supply 46 60 28
Parts Inventory 63 57 55
Used Vehicle Performance
Inventory Turn - Cars 0.5 0.6 0.6
Inventory Turn - Trucks 0.6 0.4 0.7
% Total Used Car Inv'y 61 Days+ 17.4% 9.9% 3.0%
% Total Used Trk Inv'y 61 Days + 16.5% 14.0% 25.8%