Effective Labor Rate
Definition for canada automotive professionals.
Effective labor rate (ELR) is the actual revenue generated per labor hour in a dealership service department, calculated as total labor revenue divided by total labor hours sold. It is the single most important metric for evaluating service department pricing efficiency.
Canada Context
In the canada dealer market, effective labor rate operates within the context of Provincial dealer licensing (OMVIC, AMVIC, SAAQ, VSA) and Competition Act — transparent pricing. Dealerships running PBS Systems, Quorum DMS, CDK Canada encounter effective labor rate in their daily workflow. DealerInt captures the decision layer around effective labor rate that your DMS wasn't designed to track.
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