14 Jun 10 Important Business Metrics for Heavy Equipment Dealers to Track and Measure
Industries across the globe are overloaded with information today. They generate huge volumes of data from their day to day business operations. One major challenge faced today in the Heavy equipment dealer industry is the inability to capture some of the key business metrics which can be a huge differentiator to the business.
Although not all pieces of information are critical for making crucial business decisions, there are a few metrics in this industry which we should regularly measure and monitor. Heavy equipment dealer industries leverage software to capture these metrics. And this software includes ERP systems, BI and analytics, CRM, etc.
In this article, we will discuss the most important metrics that we should measure and monitor to make informed decisions to manage the parts and inventory department.
Machine Inventory Status
Salespersons and marketers in your organization should be aware of the available units for each make and model. It will be helpful if the heavy equipment management software displays the book value and sales price of each make and model along with its availability.
Parts Inventory Status
The parts department of your organization should be aware of the performance of individual machine parts with their turnover over time. This information is valuable in making decisions regarding which parts should be stocked and promoted more and which should be immediately sold.
Organizations must have a mechanism to keep track of the revenue that has invoiced over time for each customer, store, and model. This data helps dealers to drill down to the transactional level details and make informed decisions.
Understanding the revenue generated from each customer, how often they’ve been invoiced and their gross profit percentage will be of immense help to the dealers. This information can be used to compare customer segments and locations for gross profit percentage.
Department Gross Profits
Track gross profit generated by parts, rental, services, and sales department. The software used in your organization must be able to drill down the department-wise information to store and locations.
Track core financial ratios like ROA, current ratio, debt to equity ratio over time to compare the financial position of the organization to the past history or to other businesses in the heavy equipment industry.
Due Amount by Customer
This metric helps to identify the receivables and due amounts of each customer . If this metric is displayed along with the salesperson servicing each customer, organizations can manage the receivables by customers in a systematic and hustle free manner.
Seasonal trends are bound to appear in any business. The software used in your organization must be able to track seasonal trends observed in the Balance Sheet and filter the same by department, accounts, and stores.
Organizations should be able to track down how many days they have rented out machinery by the model of machine, store, and customer. It will be useful to have a time segment along with this feature in your software, to drill down to a specific time period of your choice.
Rental and Service Metrics
These are few metrics useful for rental and service departments like Invoiced Rental Revenue, Rental Revenue, Maintenance-to-Income ratio, Potential Rental Days, Maintenance costs allocation
If you are in the heavy equipment dealership, rental or service industry, redefine your business model by using advanced heavy equipment dealer software to manage the day to day activities and make informed business decisions. Nuvento is the frontrunner in developing advanced business intelligence solutions in the United States. Contact us to find our customized solutions to manage the business.