KPI Guide - New Vehicle Department

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Gross per New Vehicle Retailed

Calculation: (Retail Gross Profit + Aftermarket + Holdback + Incentives) ÷ No. of Retail Units Sold

What does it measure: How much gross profit was earned on average for each retail new vehicle sold by the dealership.

Gross per New Vehicle Sold

Calculation: (Retail Gross Profit + Fleet Gross Profit + Government Gross Profit + Aftermarket + Holdback + Incentives) ÷ No. of Retail, Fleet and Government Units Sold

What does it measure: How much gross profit was earned on average for each new vehicle sold by the dealership.

Aftermarket per Unit

Calculation: New Aftermarket Income ÷ No. of Retail Units Sold

What does it measure: Indicates the amount of aftermarket generated on each retail new vehicle sold by the dealership.1

Why is it important: Indicates how much aftermarket opportunity may exist for a dealership (opportunity may be measured as the difference between the dealership result and benchmark for this KPI).

Incentive Payment per Unit

Calculation:  New Vehicle Incentive Payment Income ÷ No. of Retail Units Sold

What does it measure: How much target achievement and other new vehicle incentive payment related assistance from a factory is received on average for each retail new vehicle sold by the dealership.

Why is it important: Comparing this figure to Gross Profit per New Vehicle Retailed indicates how much gross profit generated from vehicle sales can be attributed to incentive/bonus income.


Holdback per Unit

Calculation: Holdback Income ÷ No. of Retail Units Sold

What does it measure: How much holdback is received on average for each retail new vehicle sold by the dealership.

Why is it important: Provides an indication of how much of gross profit generated from vehicle sales can be attributed to holdback.


Units Sold per Sales Employee per Month

Calculation: (No. of Retail, Fleet and Government Units Sold) ÷ No. of New Vehicle Sales Employees

What does it measure: The average number of new vehicles sold by each member of the new vehicle sales team.

Why is it important: A measure of salesperson's ability to sell vehicles and indicates the level of throughput at the dealership.

Gross per Sales Employee per Month

Calculation: New Vehicle Gross Profit2 ÷ No. of New Vehicle Sales Employees

What does it measure: The average gross profit generated by each member of the new vehicle sales team. 

Why is it important: A measure of salesperson's ability to be profitable when making vehicle sales. 

Total Selling Expenses % Gross

Calculation: (New Vehicle Department Variable Expenses + New Vehicle Department Semi-Fixed Expenses) ÷ New Vehicle Gross Profit2

What does it measure: How much it costs to sell new vehicles as a proportion of how much profit the new vehicle department makes on the same sales. Note, this KPI does not reflect overheads but only those expenses that are considered directly related to the sale of vehicles i.e. 'selling expenses'.

Why is it important: Observing this total figure indicates if the costs are too high in the department given the level of sales at the dealership. Drilling down into the particular expense categories enables effective expense management and control.

New Vehicle Selling Gross % Gross

Calculation: (New Vehicle Gross Profit2 - New Vehicle Variable Expenses - New Vehicle Semi Fixed Expenses) ÷ New Vehicle Gross Profit

What does it measure: How much gross profit is actually retained by the new vehicle department.

Why is it important: Selling gross % gross profit is the measure of departmental profitability in ProfitFocus reports. Even if a dealership manages a high level of sales volume, a low selling gross % gross figure indicates that the new vehicle department is still not that profitable. Often this may require a dealership to investigate the expenses of the department or the grosses required to sustain the current level of expenses. 

Selling Gross per New Vehicle Sold ($PNVS)

Calculation: (New Vehicle Gross Profit2 - New Vehicle Variable Expenses - New Vehicle Semi Fixed Expenses) ÷ No. of Retail, Fleet and Government Vehicles Sold

What does it measure: How much gross profit was retained on average for each new vehicle sold by the dealership.

Why is it important: It is useful to compare this KPI to Gross Profit per New Vehicle SoldIf this figure is low, but 'gross per unit' is high - the dealership should investigate the department's expense control.

Selling Gross per New Vehicle Sales Employee

Calculation: (New Vehicle Gross Profit2 - New Vehicle Variable Expenses - New Vehicle Semi Fixed Expenses) ÷ No. of New Vehicle Sales Employees

What does it measure: How much gross profit was retained on average for each new vehicle sales employee.

Why is it important: It is useful to compare this KPI to Gross per Sales Employee per MonthIf this figure is low, but 'gross per sales employee' is high - the dealership should investigate the department's expense control.

New Vehicle Days Supply

Calculation: (No. of New & Demonstrator Vehicles on Hand ÷ No. of New & Demonstrator Vehicles Sold) × No. of Days in Month i.e. 30.4 days

What does it measure: How many days worth of used vehicle stock the dealership will need to meet the sales level.

Why is it important: Indicates how well new vehicle stock levels are controlled. Consistently high days supply figures should be addressed as there is a direct correlation to stock holding costs of the dealership e.g. floorplan interest.

Ageing of Stock

Calculation: Value of Stock Held for 0-30* Days ÷ Value of Total Stock Held
*Ageing categories are 0-30 days, 31-60 days, 61-90 days, 90+ days.

What does it measure: Measures the mix of stock based on the date they were brought into stock.

Why is it important: Indicates how long dealers are holding their stock (i.e. being unable to sell them).

ROI (Gross ROI)

Calculation: (New Vehicle Gross Profit2 ÷ New Vehicle Cost of Sales) × (365 Days ÷ New Vehicle Days Supply)

What does it measure: A measure of the efficient utilisation of current investment in inventory. The higher the figure for the KPI, the better return a dealership is getting from holding stock.


1Aftermarket relates to the income from the sale of products such as extended warranty, tinted windows etc.

2New Vehicle Gross Profit includes the gross profit earned on retail, fleet and government new vehicle sales as well as aftermarket, holdback and incentive income.