Reasonable Parts Markup?

[2ndGearRubber]

Never said parts store no names were better. Although they're typically acceptable for most cars, they won't perform and have the life of OEM suppliers.

But I can tell you when Bosch, continental, and Denso cost $50+ each paying <$10 a pop isn't getting you a quality product.

Assuming they work out of the box,the primary issue I see with cheap coils are shorts in the primary circuit which can melt them down or cause fires. I've made a lot of money throwing no-name parts in the trash. Just be sure if one fails, to get them all swapped out as they will typically fail in short order.

 

[toolenthusiast]

I've made a lot of money throwing no-name parts in the trash.

Don’t you love when the new part is demonstrably bad and the customer just can’t believe that their parts shotgun had a squib fire?

 

[ctandc72]

Lots of generalizations on both 'sides' in this thread. The thing with auto parts, there are only so many manufacturers actually making said parts. Many examples across many models / makes and parts. OEM O2 sensor? Local Dealer: $125. Online OEM parts dealer (same exact part): $100 shipped. Find out that the "Insert Auto Maker here" O2 sensor is made by company XXXX, order the part with the actual manufacturer's name on it from RockAuto $75 shipped.

Many examples of this out there.

From the shop perspective, warrantying customer bought parts is a time bomb. I'm talking normal 'off the street' customers. The shop is filling their bay with a customer's car, using labor time of one of their mechanics, only to find out the customer bought the wrong part. That's wasted $$$ on the shop's part. Customer buys cheapest part. Shop charges to install it. Part fails. Shop is on the hook for providing labor and time and shop space to replace failed part. From that perspective I understand the shop's stance.

Certain shops / mechanics also have certain preferences when it comes to certain types / brands of parts as well. Sometimes that's experience, as in they trust those parts more, sometimes shops have a higher margin on certain brands and some shops simply have a jobber account at the local parts house who will deliver to them, so there is no real brand preference.

The prices differences can be ridiculous on the SAME EXACT parts sometimes as well. Recently replaced a sensor on someone's vehicle. The local chain parts house wanted 3X the price of what Rock Auto / Amazon was selling the EXACT SAME part for. Got the OEM part online for HALF what the local parts house wanted for the replacement brand.

That's why I wrenched for a living for a very short amount of time when I was young. Not all - but a lot of customers have had a bad experience with mechanics and figured we were all out to rip them off and this was at a dealer that had a great reputation (small town). Not to mention the good old "My brother's girlfriend's father's landscaper's son is a mechanic and he said it was a head gasket!"

 

[Wrench97]

I almost always bring my own parts to the shop. I have no time arguing about what the best oe equivalent is, or that they cannot find my prefered brand. No, you won't install a delfi on my bmw, ever! I don't care about the warranty they claim. Also, they get the part numbers wrong sometimes. Now, I am a special occasion,I am very particular, I know exactly what needs to be done, most of the times I have done the diagnosis by myself. Of course, I won't expect them to guarantee the parts, but I expect them to make things right if they mess the repair. This doesn't happen though because I am there, even help with the wrenching. This is not representative of typical shops I understand and keep in mind that we are almost friends and I am in Greece, hourly rate usually does not apply here. Now for the markup(if i buy parts from the shop,or oil), it depends. 15% is okay, 100% is not. I don't care even if you starve, it's free market, the one the Americans seem to adore so much. So don't expect sympathy for the sake of sympathy

Take your eurocrap and hit the street bud.

 

[Wrench97]

Lots of generalizations on both 'sides' in this thread. The thing with auto parts, there are only so many manufacturers actually making said parts. Many examples across many models / makes and parts. OEM O2 sensor? Local Dealer: $125. Online OEM parts dealer (same exact part): $100 shipped. Find out that the "Insert Auto Maker here" O2 sensor is made by company XXXX, order the part with the actual manufacturer's name on it from RockAuto $75 shipped.

Many examples of this out there.

From the shop perspective, warrantying customer bought parts is a time bomb. I'm talking normal 'off the street' customers. The shop is filling their bay with a customer's car, using labor time of one of their mechanics, only to find out the customer bought the wrong part. That's wasted $$$ on the shop's part. Customer buys cheapest part. Shop charges to install it. Part fails. Shop is on the hook for providing labor and time and shop space to replace failed part. From that perspective I understand the shop's stance.

Certain shops / mechanics also have certain preferences when it comes to certain types / brands of parts as well. Sometimes that's experience, as in they trust those parts more, sometimes shops have a higher margin on certain brands and some shops simply have a jobber account at the local parts house who will deliver to them, so there is no real brand preference.

The prices differences can be ridiculous on the SAME EXACT parts sometimes as well. Recently replaced a sensor on someone's vehicle. The local chain parts house wanted 3X the price of what Rock Auto / Amazon was selling the EXACT SAME part for. Got the OEM part online for HALF what the local parts house wanted for the replacement brand.

That's why I wrenched for a living for a very short amount of time when I was young. Not all - but a lot of customers have had a bad experience with mechanics and figured we were all out to rip them off and this was at a dealer that had a great reputation (small town). Not to mention the good old "My brother's girlfriend's father's landscaper's son is a mechanic and he said it was a head gasket!"

The shop is not on the hook for installing your bad part, you want it swapped out fine bring another and pay me to install a second one.
Also you bring the wrong part it's getting pushed out the door if you do not want to buy mine you get your car back unfixed when you pay for the time I have in it.

I worked for a guy many years ago that always said "If the customer walks in the door and says "My car needs a fuel pump" do not argue with him just ask if he wants us to check out first or just put a pump on it. If he says no I know the pump is bad put a pump on it and if it doesn't start push it out the door and call him up and ask what he wants to change next." We got one or two a year that always knew more then we did one guy had us change the fuel pump, carburetor, fuel filter we finally talked him into the $25 diag charge(1975 money) when wanted to drop the fuel tank and change the sock on the pick up tube..........................guess what no spark one OEM mopar ballast resistor later it started right up and ran good.........................................

 

[2ndGearRubber]

Don’t you love when the new part is demonstrably bad and the customer just can’t believe that their parts shotgun had a squib fire?

On the one hand, I hate the waste as a society to be producing such things. On the other, it pays pretty good to fix that kind of stuff.

That said, I got a radiator today where the trans cooler fittings weren't screwed in all the way. Like an idiot, I didn't check. Fun to clean up.

Take your eurocrap and hit the street bud.

Hey now, those VW TSI motors make me a lot of money.

 

[HannibalLecter]

Take your eurocrap and hit the street bud.

After you

 

[GX460DIYguy]

One of the rear axle seals on my Lexus GX460 is currently leaking and the local Toyota dealership quoted me close to $600 for just the bearing. Ordered the seal, bearing, o ring, snap ring, retainer, parking brake shoes, and new brake pads for $528 from Bell Lexus. I personally think that dealership parts departments shouldn’t be wildly different in pricing for the same part. The 4Runner bearing is the exact same but they wanted $250 more.

 

[2ndGearRubber]

One of the rear axle seals on my Lexus GX460 is currently leaking and the local Toyota dealership quoted me close to $600 for just the bearing. Ordered the seal, bearing, o ring, snap ring, retainer, parking brake shoes, and new brake pads for $528 from Bell Lexus. I personally think that dealership parts departments shouldn’t be wildly different in pricing for the same part. The 4Runner bearing is the exact same but they wanted $250 more.

That's pretty standard.

VAG will sell you the same part, same part number, in the same box that says VW AUDI SKODA on it for 2 different prices. Buy the luxury car, pay the luxury price. Sometimes this will work out though since the dealers, if they're helpful, can cross parts for a given engine.

Labor rate is higher per hour on an Acura than a Honda, and it's the "same" k24 starter under the intake.

 

[GX460DIYguy]

That's pretty standard.

VAG will sell you the same part, same part number, in the same box that says VW AUDI SKODA on it for 2 different prices. Buy the luxury car, pay the luxury price. Sometimes this will work out though since the dealers, if they're helpful, can cross parts for a given engine.

Labor rate is higher per hour on an Acura than a Honda, and it's the "same" k24 starter under the intake.

But the part from Lexus was cheaper. The 460 shares a lot with the 4Runner so I usually just order 4Runner parts for it as long as they match. Even without the Lexus dealer discounting it like they do, the msrp on it is around $450. Stuff like this is the reason I’m here though. The insane prices on parts and labor or driving hours to get work done is just getting old and I used to really enjoy doing stuff myself.

 

[K13]

I really wonder how many people who complain about the cost of things think they are overpaid. Everyone makes too much other than themselves.

 

[428PI]

Certain shops / mechanics also have certain preferences when it comes to certain types / brands of parts as well. Sometimes that's experience, as in they trust those parts more, sometimes shops have a higher margin on certain brands and some shops simply have a jobber account at the local parts house who will deliver to them, so there is no real brand preference.

And sometimes their preferences are full of ****. They wanted to put a Carquest fuel pump (which is made by airtex) in my son's Mark VIII. They refused to put in my Bosch which I had in the box. Even at first refused to buy a Bosch from local Carquest dealer to get their markup. Finally convinced them but had to pay a higher labor rate and than tried to pad the labor. All around a disappointing experience. I have been a mechanic for 40 years and couldn't believe what they were trying to do. They even tried to charge another .5 hr to test drive vehicle after fuel pump was installed. And to top it all off they crossthreaded all of his air cleaner lid screws and refused to acknowledge it.

 

[2ndGearRubber]

But the part from Lexus was cheaper. The 460 shares a lot with the 4Runner so I usually just order 4Runner parts for it as long as they match. Even without the Lexus dealer discounting it like they do, the msrp on it is around $450. Stuff like this is the reason I’m here though. The insane prices on parts and labor or driving hours to get work done is just getting old and I used to really enjoy doing stuff myself.

Gotcha, I misunderstood.

DIY is awesome if you enjoy it, and buying tools.

 

[Wrench97]

That's pretty standard.

VAG will sell you the same part, same part number, in the same box that says VW AUDI SKODA on it for 2 different prices. Buy the luxury car, pay the luxury price. Sometimes this will work out though since the dealers, if they're helpful, can cross parts for a given engine.

Labor rate is higher per hour on an Acura than a Honda, and it's the "same" k24 starter under the intake.

Motorcraft did that for years, there were 2 part numbers on the box the Motorcraft # and the Ford part # the Motorcraft # was always cheaper but the Ford dealer would sell it to a walk in under the Ford #............................

 

[Wrench97]

On the one hand, I hate the waste as a society to be producing such things. On the other, it pays pretty good to fix that kind of stuff.

That said, I got a radiator today where the trans cooler fittings weren't screwed in all the way. Like an idiot, I didn't check. Fun to clean up.




Hey now, those VW TSI motors make me a lot of money.

Spent most of the afternoon under a Mini pulling the clutch out..........................................

 

[2ndGearRubber]

And sometimes their preferences are full of ****. They wanted to put a Carquest fuel pump (which is made by airtex) in my son's Mark VIII. They refused to put in my Bosch which I had in the box. Even at first refused to buy a Bosch from local Carquest dealer to get their markup. Finally convinced them but had to pay a higher labor rate and than tried to pad the labor. All around a disappointing experience. I have been a mechanic for 40 years and couldn't believe what they were trying to do. They even tried to charge another .5 hr to test drive vehicle after fuel pump was installed. And to top it all off they crossthreaded all of his air cleaner lid screws and refused to acknowledge it.

They sound like a bunch of goobers.

While I can't really get behind a carquest fuel pump, I get needing to make margin on a part or ticket. Instead of just declining the job, they caved and then tried to right the ship by messing with the ticket. Had they just refused and said "this is our offer take it or leave it", I think you both would have been happier.

There are certainly people like yourself insisting quality. Personally I find that kind of client super easy to work with and you can stick one of those jobs in every few.months and it's not a big deal. That said, for every one of you, I got 99+ with an airtex pump wanting it installed. No thanks.

 

[2ndGearRubber]

Spent most of the afternoon under a Mini pulling the clutch out..........................................

Gross. Crazy it even sold.

Other than brakes or a basic misfire, most major stuff on those I end up sending off to the ghetto shops for hackery.

With Mini- the labor is always high, the parts expensive, the customers butthurt.

 

[Wrench97]

Gross. Crazy it even sold.

Other than brakes or a basic misfire, most major stuff on those I end up sending off to the ghetto shops for hackery.

With Mini- the labor is always high, the parts expensive, the customers butthurt.

Good customer, belongs to the kid of the guy in charge of maintenance at our fav local utility, I have 3 of their trucks in the shop now with more scheduled behind them.
F550 for a Evaporator core, Diff rebuild on a F350 and a Silverado 1500 with com issues, water pump, and blend door motors....................hard to turn this one away.

 

[unslow1]

And sometimes their preferences are full of ****. They wanted to put a Carquest fuel pump (which is made by airtex) in my son's Mark VIII. They refused to put in my Bosch which I had in the box. Even at first refused to buy a Bosch from local Carquest dealer to get their markup. Finally convinced them but had to pay a higher labor rate and than tried to pad the labor. All around a disappointing experience. I have been a mechanic for 40 years and couldn't believe what they were trying to do. They even tried to charge another .5 hr to test drive vehicle after fuel pump was installed. And to top it all off they crossthreaded all of his air cleaner lid screws and refused to acknowledge it.

I'm curious if Airtex is currently making Carquest pumps. We used to get bad Airtex pumps all the time and I can't remember when we last got a bad Carquest pump. I do know some people that I'll have to ask. They change suppliers of their parts a lot.

 

[428PI]

I'm curious if Airtex is currently making Carquest pumps.

I know they were 6 years ago. I haven't installed any in the last 6 years. The manager at Carquest at that time said don't use them.

 

[toyotadriver]

The shop is not on the hook for installing your bad part, you want it swapped out fine bring another and pay me to install a second one.
Also you bring the wrong part it's getting pushed out the door if you do not want to buy mine you get your car back unfixed when you pay for the time I have in it.

I worked for a guy many years ago that always said "If the customer walks in the door and says "My car needs a fuel pump" do not argue with him just ask if he wants us to check out first or just put a pump on it. If he says no I know the pump is bad put a pump on it and if it doesn't start push it out the door and call him up and ask what he wants to change next." We got one or two a year that always knew more then we did one guy had us change the fuel pump, carburetor, fuel filter we finally talked him into the $25 diag charge(1975 money) when wanted to drop the fuel tank and change the sock on the pick up tube..........................guess what no spark one OEM mopar ballast resistor later it started right up and ran good.........................................

Reminds me of a funny story....not trying to make any point with the story it's just funny. Friend of mine was having an issue with her Mustang. It ran but very poorly. Appeared to be missing on several cylinders. I diagnosed it and figured out the PCM was bad. I was just trying to help her out with figuring what the problem was. I wasn't fixing it just looking at it for her. She took it to the local Ford dealer. She told them what I found out. They told her there was no way the PCM was bad and they were 100% certain. She told me that and I shrugged and told her I wanted to know what they found out was wrong with it just so I could learn even though I was pretty sure it was bad. They called her and told her kinda sheepishly...."your PCM is bad".

I get it though. Many years ago I was a mechanic and the majority of customer diagnosed problems were not what they claimed the problem to be.

 

[toyotadriver]

I have nothing against mechanics making money but since I can do the work myself, I don't pay them any. Works out quite well for me. But, if you can't fix your own stuff, you will have to pay someone. I still don't get why people are upset at the parts markup. Total cost is all that matters. If it's too high...take it somewhere else or fix it yourself. No one else can fix it and you can't fix it yourself?....guess you are paying their price...like it or not.

 

[mepstein]

At my shop, we work on air cooled Porsche’s. 1960’s-mid 90’s. We tell the customer something like this. Your car might have had a couple owners and more than a couple mechanics. It’s 30-60 years old. We’ll give you an estimate but we don’t know for real until we get in there and do a proper diagnosis. Even then, more things might be wrong than we first thought. Things might break just getting other parts loose. We didn’t do the work over the last 30-60 years so we are going into the unknown. We’ll do our best. We charge parts and labor and we definitely price the parts and work to make a profit, otherwise, why do the job? Why even be in business if not to profit? Most of our customers are repeats and many refer friends. The people who might complain about a part markup probably aren’t a good fit for our business and we welcome them to go elsewhere. No hard feelings.

Bring in your own parts, sure but it better be something really cool that we can’t get ourselves, otherwise, it’s just a waste. It’s not like we can warranty a customer supplied part. And yes, we are going to charge more for labor if it’s a customer supplied part. I still have to pay my guys, pay my bills, pay myself. Otherwise, I’d just decline the job and work on the cars that get billed for parts and labor.

I’ve taken my families daily driver cars to the same local shop for the past 25 years. Now run by the owners son. I ask for a ballpark estimate because I don’t know what some things cost to fix. I know Porsche’s, not Honda’s. I don’t really read the receipt. It doesn’t matter. I trust them and don’t want to go anywhere else. I hope they are making good money so they can pay their employees, themselves and continue to be in business.

 

[InjectorService]

Man this thread is full of gold. I can see both sides, but being in business myself, I really think people believe you are making a LOT more money than you really do. Customers seem to think you should make no money at all sometimes.

 

[toolenthusiast]

That said, I got a radiator today where the trans cooler fittings weren't screwed in all the way.

When the Chevy Cruze first came out, every single aftermarket radiator for the first 6 months or so ejected the cooler lines within a month of installation.

That’s not the crazy part. The crazy part is that even though we kept a file with every invoice for a Cruze trans replacement, the insurance adjusters would ignore them and just keep writing their estimates for aftermarket radiators and then paying us to swap the trans after a month

 

[visionguru]

Man this thread is full of gold. I can see both sides, but being in business myself, I really think people believe you are making a LOT more money than you really do. Customers seem to think you should make no money at all sometimes.

I think you got it wrong. It's the feeling about being billed fairly, not exactly the money amount.

For example, a shop needs to charge $200/hour to make desired profit, on the repair bill,
Shop A: labor is billed $200/hour, parts cost $100, billed customer 15% markup. Total $315
Shop B: labor is billed $100/hour, parts cost $100, billed customer 215% markup. Total $315

Shop B will make people feel been ripped off on parts. Exorbitant parts markups do make the shop look shady, not trust worthy. Perceived honesty matters.

 

[toyotadriver]

I think you got it wrong. It's the feeling about being billed fairly, not exactly the money amount.

For example, a shop needs to charge $200/hour to make desired profit, on the repair bill,
Shop A: labor is billed $200/hour, parts cost $100, billed customer 15% markup. Total $315
Shop B: labor is billed $100/hour, parts cost $100, billed customer 215% markup. Total $315

Shop B will make people feel been ripped off on parts. Exorbitant parts markups do make the shop look shady, not trust worthy. Perceived honesty matters.

While I don't think you are wrong.....your post also illustrates how stupid people really are.

 

[2ndGearRubber]

I think you got it wrong. It's the feeling about being billed fairly, not exactly the money amount.

For example, a shop needs to charge $200/hour to make desired profit, on the repair bill,
Shop A: labor is billed $200/hour, parts cost $100, billed customer 15% markup. Total $315
Shop B: labor is billed $100/hour, parts cost $100, billed customer 215% markup. Total $315

Shop B will make people feel been ripped off on parts. Exorbitant parts markups do make the shop look shady, not trust worthy. Perceived honesty matters.

A big problem with shops "needing" that markup, is improper billing of labor.

For instance, when I started at my current shop, labor rate was $90/hour, both alignment and diag time were also "package priced" at $90. Okay, whatever. Well now it's $140/hour, and guess what hasn't changed? Either of those jobs, still 90 bucks.

Diag now gets you 35min or so, rather than 60.

My first car today was a 2000 land cruiser, BRAKE ABS TRAC VSA lamps all on. Circuit code for an ABS solenoid. Solenoid is good on the ABS booster/master super assembly, uhh oh, wiring or module issue. Get to the module, find corrosion on a pin. Remove harness connectors, voltage drop between ABS block and module with 1/4 amp bulb, good at 25mv. Drag test pins and clean harness. Remove ABS module, clean with deoxit and diamond files. Reinstall, zero point calibration performed, fixed.

I charged "diag", $90, plus 0.5 for cleaning, removal, install of the module, that's $70. So $160 to find and fix a corroded pin on a module. Brake pad installation labor is $140. This is inherently flawed.

Had another car, EVAP leak. Where have you heard of a shop where pulling seats/panels/wheel liners for access gets you paid a dime? This is more unbilled time, which makes the labor $$$ equation worse, so markup on parts needs to rise to compensate. How many shops who are "by the book" flat rate actually charging the 0.2 per rotor to remove and clean the hub, or deactivate the electronic parking brake? Plenty will write up pads/rotors with electronic parking brake at 1.0, when it's actually 1.6 by the labor book. IMO the issue is often not on the $/hour of the labor rate, its giving things like test drives, pressure tests, partial tear down, etc away or at a reduced rate.

 

[egdede]

....guess what no spark one OEM mopar ballast resistor later it started right up and ran good.........................................

You just flashed me back to the mid 1980's, my 2nd car/first mopar was a 1973 dodge satelitte. I had no idea what one of those was. Learned the hard/slow way : ) At least I was working on the electrical system : )

 

[liliysdad]

I don’t have a problem with shops making money by marking parts up over their cost. I don’t even have an issue with shops choosing which brand part to use. Where I come off the rails, however, is when that part is marked up beyond retail.

Shops get price breaks from parts suppliers for a reason. Anything between that jobber vs retail price is unacceptable to me.

That being said…I know I’m wrong and this is why i refuse to use shops for anything not absolutely necessary. In those rare cases where I have to, I grin and bear it while being pissed of the whole time. Parts stores are parts stores, mechanics should be mechanics.

 

[mikedodge]

I don't have problem with Mark up on parts as long as it's reasonable. It used to be the same sort of mark up that you'd see buying from a parts store if they were giving you a discount.

I rarely provide shops the parts unless I already have them or it's something that they would have a hard time getting especisally if its something that might not fit right or is easily defective because i dont want to be on the hook for the labor to correct it. In some cases I've brought an old car in for something I couldn't fix and they would say they can't fix it because they can't get parts or will ask me to get the part probably because they know it'll take a while. That sort of thing I don't have a problem with.

You can't base parts prices on Rock Auto. Their stuff can be lower then retail depending on the part.

 

[mcj115]

As a customer, when I use a shop for service, I 100% expect to use their supplied parts unless they cannot source the part. I use mainly independent local shops that are two or three bays with two or three mechanics that are focused on the customer more than making the sale. As a known customer when I pay my bill I even offer to pay by check or credit card (ie I offer to them to avoid the 3% haircut on cc' interchange fees).

Now on the flip side I do most of my own work, I just had the HAVC resistor go in my Honda. Since I did the diag I went with a cheapie ebay part...that lasted one week, ordered one from Rock auto that was DOA. Finally a second rock auto part under a different brand has been working well. When doing my own work I am the warranty; I can adjust the speed of parts delivery to balance cost vs the criticality of the part on my own.

 

[nicks78camaro]

I don’t have a problem with shops making money by marking parts up over their cost. I don’t even have an issue with shops choosing which brand part to use. Where I come off the rails, however, is when that part is marked up beyond retail.

Shops get price breaks from parts suppliers for a reason. Anything between that jobber vs retail price is unacceptable to me.

That being said…I know I’m wrong and this is why i refuse to use shops for anything not absolutely necessary. In those rare cases where I have to, I grin and bear it while being pissed of the whole time. Parts stores are parts stores, mechanics should be mechanics.

I'll just say that often times the margin between shop's cost and retail price isn't that great. Like sometimes a few dollars.

That ain't enough to make a living.

That's why a lot of parts stores like NAPA show a "list price" on commercial parts invoices that is often 2-3 times the "retail price". They want you to buy it from them for 5-10% off retail then resell it for twice the retail price.

Then there's the argument of retail customer discounts/coupons sometimes allowing a retail customer to get a part cheaper than the shop's commercial price. How much should the shop mark up the part if their cost is higher than the retail customer can get it for?

 

[HannibalLecter]

I'll just say that often times the margin between shop's cost and retail price isn't that great. Like sometimes a few dollars.

That ain't enough to make a living.

That's why a lot of parts stores like NAPA show a "list price" on commercial parts invoices that is often 2-3 times the "retail price". They want you to buy it from them for 5-10% off retail then resell it for twice the retail price.

Then there's the argument of retail customer discounts/coupons sometimes allowing a retail customer to get a part cheaper than the shop's commercial price. How much should the shop mark up the part if their cost is higher than the retail customer can get it for?

Maybe they should strike a better deal with their supplier? How's this again a problem the end client must face? They are mechanics, the profit in my opinion must come from the work, not the parts. Now, many said they don't bill as much as they should for diagnosis, etc, I believe this is the thing they should change, not make the client bleed through the nose for parts. Id expect maybe a 15% markup for a part the body shop stocks, because this to me is added cost and added value (don't have to wait) but if the shop orders, i don't think so. Probably I'd still pay 15% more but no more than that.

 

[2ndGearRubber]

Maybe they should strike a better deal with their supplier? How's this again a problem the end client must face? They are mechanics, the profit in my opinion must come from the work, not the parts. Now, many said they don't bill as much as they should for diagnosis, etc, I believe this is the thing they should change, not make the client bleed through the nose for parts. Id expect maybe a 15% markup for a part the body shop stocks, because this to me is added cost and added value (don't have to wait) but if the shop orders, i don't think so. Probably I'd still pay 15% more but no more than that.

It's a problem for the end client, because the end client is price sensitive (as we all generally are) and doesn't want to pay the additional markup. If the end client doesn't pay the piper, the car doesn't get worked on. Simple as that.

This is the standard industry system which has evolved. I'd happily sell parts at retail and charge you the $250+ per hour for an all makes all models shop to cover the difference. Price wouldn't change out the door.

The ticket will be 65% gross profit, gross, between parts markup $$$ and what your effective labor rate is after costs. Which is often about 50% of the labor rate on the front end. You're gonna pay what you're gonna pay, move the numbers between the columns all you like.

 

[HannibalLecter]

It's a problem for the end client, because the end client is price sensitive (as we all generally are) and doesn't want to pay the additional markup. If the end client doesn't pay the piper, the car doesn't get worked on. Simple as that.

This is the standard industry system which has evolved. I'd happily sell parts at retail and charge you the $250+ per hour for an all makes all models shop to cover the difference. Price wouldn't change out the door.

The ticket will be 65% gross profit, gross, between parts markup $$$ and what your effective labor rate is after costs. Which is often about 50% of the labor rate on the front end. You're gonna pay what you're gonna pay, move the numbers between the columns all you like.

Good luck. Also, you should know, perception is a thing. I don't believe you would go to a shop that charges 1000$ an hour, but says the parts are free, would you? Also, I fail to see how the cost of an all makes all models shop should fall to clients of cheaper brands for example. Specialty tools and diagnostics for a specific brand , sure, but If you charge diagnosis prices for a Ferrari in a toyota and are proud of that, yeah, great business model

 

[dr_clyde]

Strange how some people can't grasp that the money has to come from somewhere.

This is one of those funny topics that seems to be split between people who know how businesses work and those who think they know how they work.

The "I'll do it myself and save money" crowd always forgets that their time has value and opportunity cost, and they act as though someone charging for the time it takes to procure parts via markup is somehow not ok. Nevermind the lack of warranty or confidence in customer supplied parts.

It's a problem for the end client, because the end client is price sensitive (as we all generally are) and doesn't want to pay the additional markup. If the end client doesn't pay the piper, the car doesn't get worked on. Simple as that.

This is the standard industry system which has evolved. I'd happily sell parts at retail and charge you the $250+ per hour for an all makes all models shop to cover the difference. Price wouldn't change out the door.

The ticket will be 65% gross profit, gross, between parts markup $$$ and what your effective labor rate is after costs. Which is often about 50% of the labor rate on the front end. You're gonna pay what you're gonna pay, move the numbers between the columns all you like.

 

[HannibalLecter]

Strange how some people can't grasp that the money has to come from somewhere.

This is one of those funny topics that seems to be split between people who know how businesses work and those who think they know how they work.

The "I'll do it myself and save money" crowd always forgets that their time has value and opportunity cost, and they act as though someone charging for the time it takes to procure parts via markup is somehow not ok. Nevermind the lack of warranty or confidence in customer supplied parts.

How exactly the diy guy connects to the discussion for an appropriate markup price? The money needs to come from somewhere, is it nessesary to come from markup? If you stock the part yes if not, why? Because you order it? Okay, bill it in the hourly rate.

 

[428PI]

The "I'll do it myself and save money" crowd always forgets that their time has value and opportunity cost, and they act as though someone charging for the time it takes to procure parts via markup is somehow not ok. Nevermind the lack of warranty or confidence in customer supplied parts.

So I should have gotten some of the money my boss got when I ordered the parts when I was on flat rate?

 

[dr_clyde]

So I should have gotten some of the money my boss got when I ordered the parts when I was on flat rate?

You did, it was negotiated in your rate.