Puente Hill Toyota
Puente Hills Toyota (PHT) is a large Toyota dealership which is owned by the corporation Hitchcock Automotive Services. PHT is situated in city of industry, California, about 25 miles east of Los Angeles. PHT offers a wide variety of new and used cars (this is unique in the industry). Furthermore they offer Toyota incentives, service specials, and Toyota parts savings. The annual profits of PHT totaled about $1.8, with annual sales of $ 85 million. PHT had a total of 145 employees. The employees are very valuable to PHT due they are the ones who have to advise the customer, sell the vehicles and repair them. But it is hard to keep them al motivated. As said by Howard Hakes; "It's people who give us our biggest successes …show more content…

Secondly the desk sales managers en de general sales manager and the vehicle sales manager get a bonus based on a percentage of departmental profit after overhead expenses before tax. The general sales manager gets a bonus of 2,5%, the sales desk manager gets a bonus of 1,2-1,5% and the used vehicle sales manager gets 5% but this is only from the used vehicle department. It is good that the bonus is based on the departmental profit after overhead expenses. Because in this manner you create an entrepreneurial way of thinking. The better you do your job, the higher your income will be. This for example can also reduce 'on the job consumption' because, if the expenses are high net income will be lower and this will influence the bonus of the managers. In our opinion it is good that managers get an entrepreneurial way of thinking. They should have the idea that they own the company a little bit.
Service departement:
Service technicians salary are based upon flag hour. 'Flag hours are standards set by the manufacturer to complete a specific task' They receive $ 10-23 per 'flag hour'. Average Technicians at PHT need about 45 minutes to do one flag hour of work, but the top technicians could it do much quicker As said in the case service technicians are paid but the job and so they incentives to 'cut corners'. By completing the task in less minutes then is set standard they receive more salary.

Control mechanism:

1. If time spent