Understanding Profit in our Business
"Gross profit is the difference between revenue and the cost of making a product or providing a service, before deducting overhead, payroll, taxation, and interest payments."
What is a reasonable Gross Profit?
Industry standard on PARTS is 45% to 55%
Shops that are doing very well will be in the 55% to 65% range
Net Profit defined:
Gross profit dollars minus all other expenses
Taxes, payroll for everyone, building & equipment costs and everything with the exception of your parts
Net Profit is often described as Operating Income
For the next several months, I will talk about Understanding Profit & give examples how to increase profit in your shop
If you are interested in consulting services for your Auto Repair shop give me a call / Don 412-874-1873