The Profit Graph reflects the gross profit for the selected repair order while you are building it, while you still have the opportunity for changing your billing.
In the Reports tab you can quickly see profit visually in the graphs and charts, as well as also see your profit broken down invoice by invoice in the detail reports, but by then it is too late to do anything about it. In this display, found at the bottom of each repair order tab, you can verify profit in real time.
Here we see a snapshot of the line items on a typical repair order at the upper portion of the screen:
At the bottom of the screen you can view the Profit Margin Graph:
The icon, indicated by the red arrow #1 turns the graph display on and off.
TIP: Leave it on and use it! Review your profit before invoicing each job. Know what targets you need to meet. To be profitable a shop must consistently hit profit margin targets as well as sales revenue targets relative to operating costs.
Here's how the calculations are made in the example above:
The Labor portion of the graph shows profit margin at 71% which is billed amount-cost (that is, profit) divided by billed amount.
Here is the math:
billed amount = 1.2 X 115 = 138
cost= 1.2 X 33 = 39.6
billed amount - cost = 98.4 (profit)
profit / billed amount = 98.4 / 138 = 71% profit margin, the portion of revenue that is profit.
Parts profit is calculated in similar fashion.
NOTE: If you like, you can also view your profit as 'markup' on cost. This will be a percentage that reflects a multiplier on cost that sets the target price. In the
Split Pricing screen a Markup/Margin control button is near the top. The alternative you select there will also determine the way in which the graph calculates the percentage.
We recommend that you use margin for both split pricing and the profit graph display.
"My profit margin is negative! What happened?"
This is usually caused by improper configuration of service writer settings which allocates commission payment to technician for parts sales. If your profit margin is negative then you are probably posting commission when you don't intend to.
Here's how to correct this problem:
1. Go to Edit menu-> ServiceWriter/Workstation Settings -> page3 -> 3. Default Value for Tech qty for Parts Sales.
2. Change the setting to ' 0 (not credited by default)'
3. Return to your repair order and use the pop-up editor to change the Tech Qty to zero for all parts included on the R.O. . This is necessary insofar as changing the setting (step #2) will not make this correction for you.
