Data-driven decisions can drive optimization, operational efficiency, and strategic growth for businesses. According to a global data and analytics survey conducted by PwC, highly data-driven organizations are 3x more likely to report significant improvement in decision-making. Auto reconditioning business leaders make a significant number of decisions in their day-to-day. Maybe one day you decide to change your advertising strategy, give an employee a raise, or implement a new technology. Let me ask you something. When it comes down to it, are you making the smartest auto reconditioning business decisions possible?
If you’re not using data to influence your decision-making, then that answer is ‘no’. Good decisions stem from being informed, and being informed stems from capturing the data from your business. Here’s why you should start using data and analytics to help you understand your auto reconditioning business:
Get a holistic understanding of your business.
Every piece of your business – from information about your customers, to the activity of your employees, down to the type of vehicles you’re servicing – can be valuable to you if you can capture it in the form of data. Once you can capture your data, you can start to track every action you take, review it holistically at a high level, and even drill down your focus onto something really specific. This ability to capture business data will allow you to not only view your operations from every angle, but it will also allow you to come up with what factors you will use to measure your performance and make decisions.
Measure the ROI of new initiatives and investments.
How do you know if the money you’re spending is actually making a difference? It’s important in operating an optimized business that you don’t just throw money around, making your best guess on what will work and hoping for the best. You can use analytics to help you track your expenses on a certain investment and then follow the outcome and what you get out of it.
For example, if you run an auto reconditioning business, maybe you’re running different types of advertising campaigns on Google Ads, radio, and print. If you set up these campaigns with specific goals and metrics in mind, you can track the costs of running each ad campaign and their respective performance then compare the results against each other. Once you run a few tests like these and analyze the results, you’ll be able to measure their effectiveness and make smarter advertising decisions.
Track your performance and find outliers to help you improve.
If you have the ability to capture all of your business data, you start laying down baselines and standards for how your business operates. When you look at your operations over a long period of time, you’ll start to see trends and averages. Once you have baselines set, it’s easy to track your progress or catch any outliers that are either abnormally low or high performing.
For example, let’s talk about tracking employee performance. In the auto reconditioning world, it’s very difficult and near impossible to know how each of your technicians are using their time, if they are estimating cars correctly, and doing their work efficiently. You personally can’t be out with all of your technicians regularly to get a good sense of their performance. But when you have data, you can judge their performance on real numbers and metrics, pinpoint their strengths and weaknesses, and then follow up with bonuses or specific types of training.
This also applies to your business on a broader scale. When you capture data and use analytics, you are able to pinpoint your strengths and weaknesses as a company, like identifying key sources of revenue. This could help you find a specialization you want to focus your services around, or maybe even encourage you to cut out services that aren’t doing you much good.
Smart business is about making smart decisions. If you make a point to capture the data behind your auto reconditioning business, you will have a better view of your operations and have every piece of information possible to make the best decisions.