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I was watching the “Day at the Shop” video and it brought up one of my “pet peeves”. That is MARK UP on parts.
Case in point. I needed the catalysts replaced on my ’98 E150. No shock that they were no longer available and need to be fabricated. I also need a new exhaust manifold. The price I was quoted was high, but less than other shops so I had the work done. When I got the bill, I was charged “book time” to R&R the manifold and cats. There was no charge for the pipe and welding up the cats and pipes (?!!!). The manifold and cats were marked up about 400% over online retail. :angry:
Some of that mark up goes to the parts store (warehousing, handling, delivery, etc), but the rest goes in the owners pocket. Now I understand that no shop is going to order online parts for me, but also I have not found a local shop that would allow me to bring in my own parts. I am not talking bottom level odd ball brand parts. I only buy top of the line (Moog, Raybestos, etc). Shop owners/managers just don’t even want to talk about it. Yes, customer purchased parts have the risk of being incorrect and then the car would be out of service for a couple of additional days.
Now Eric’s shop is not your “typical” repair shop. Many (most ?) of his customers are friends and the rest (I am guessing is word of mouth). Customers bringing “dealer only” parts might actually be better because Eric’s low volume would likely mean dealers would not deliver so that would be time ($$$) out of his day.
I would love to get Eric’s feedback as well as feedback from other. especially shop owners/managers/
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I recently helped a friend with a 2000 Focus get back on the road, after she was scared to drive it because of “a loud clicking noise”. It was the CV axles. The boots had split, there was no grease left in them but plenty of road debris.
She took it to a local garage. They wanted $250 EACH, just for the axles. I bought them from Rockauto for $90 total. Putting them in just took a casual afternoon.
Markups are crazy if you let them be.
Those are pretty steep mark ups.
Either way though, pay the mark up or do it yourself. It’s a pet peeve of mine when people try to bring all the parts for their repair with them.
[quote=”CrazedAssassin” post=173119]Those are pretty steep mark ups.
Either way though, pay the mark up or do it yourself. It’s a pet peeve of mine when people try to bring all the parts for their repair with them.[/quote]
Would you be less upset if the customer asked permission FIRST instead of just walking in ?
A truly successful shop that is turning profit will have a 100-150% parts mark up. You can only make so much off of labor. The gm dealer I’m at has anywhere from 150-300% mark up depending on what it is.
If a customer wants to supply their own parts, that’s fine. We just let them know there is no warranty with install. I don’t mind it, I’m getting paid either way.
Just some food for thought
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[quote=”Cammed 05″ post=173125]A truly successful shop that is turning profit will have a 100-150% parts mark up. You can only make so much off of labor. The gm dealer I’m at has anywhere from 150-300% mark up depending on what it is. [/quote]
I would expect a dealer to make more on parts. He is getting them at true wholesale from the manufacturer.I can buy Motorcraft oil and a Motorcraft oil filter for LESS at Walmart’s full retail price than what most dealers charge when you buy an oil change from them.
[quote=”Cammed 05″ post=173125]If a customer wants to supply their own parts, that’s fine. We just let them know there is no warranty with install. I don’t mind it, I’m getting paid either way. [/quote]
I have no issue with the “No Warranty”, although I believe it should be a negotiable item if the customer purchases parts recommended/approved by the shop.Some of the markup contributes to the operating expenses (overhead) of the shop too.
I recently replaced my tires via TireRack. Before I placed the my order, I called my trusted shop (who wasn’t on TR’s list of installers) to check if there were any issues with an external supplier. They said it was completely fine, and they requested that I ship the tires directly to the shop (although this instance may be more of an exception than a norm).
[quote=”Cammed 05″ post=173125]If a customer wants to supply their own parts, that’s fine. We just let them know there is no warranty with install. I don’t mind it, I’m getting paid either way.[/quote]
Tangent: I always wondered how part warranties worked. If a shop receives an unknowingly defective part from their supplier, what does the warranty cover – ie just the part? Does the shop absorb the time and labor costs for diagnosing and replacing the defective part?
[quote=”Cammed 05″ post=173125]If a customer wants to supply their own parts, that’s fine. We just let them know there is no warranty with install. I don’t mind it, I’m getting paid either way.[/quote]
Tangent: I always wondered how part warranties worked. If a shop receives an unknowingly defective part from their supplier, what does the warranty cover – ie just the part? Does the shop absorb the time and labor costs for diagnosing and replacing the defective part?[/quote]
It usually depends on the supplier. Some will cover labor costs for R&R some will not. And some will offer to split with either the shop or customer depending on the circumstance. We have had some cases where my manager has internally paid me and he ate the labor costs to keep the customer happy.
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[quote=”theoldwizard1″ post=173146][quote=”Cammed 05″ post=173125]A truly successful shop that is turning profit will have a 100-150% parts mark up. You can only make so much off of labor. The gm dealer I’m at has anywhere from 150-300% mark up depending on what it is. [/quote]
I would expect a dealer to make more on parts. He is getting them at true wholesale from the manufacturer.I can buy Motorcraft oil and a Motorcraft oil filter for LESS at Walmart’s full retail price than what most dealers charge when you buy an oil change from them.
[quote=”Cammed 05″ post=173125]If a customer wants to supply their own parts, that’s fine. We just let them know there is no warranty with install. I don’t mind it, I’m getting paid either way. [/quote]
I have no issue with the “No Warranty”, although I believe it should be a negotiable item if the customer purchases parts recommended/approved by the shop.[/quote]Sorry, I haven’t learned how to multi quote from my phone yet lol. Or maybe you cannot. I’m not sure.
I agree, the dealer does get parts quite a bit cheaper due to wholesale pricing direct from the manufacturer. In my opinion it is raping the customers. I can honestly go online to buy the same part I would order over the counter cheaper than my employee cost would be. It’s ridiculous.
As long as the person is capable of performing the oil change I love saving money. I myself rather buy my own oil and a quality filter than use bulk unknown oil with a filter that’s quality is probably marginal at best. Though I have cut open quite a few motorcraft filters and have thoroughly been impressed. But remember, with the oil change at a dealer or quick lube you are also paying for disposal, chemicals such as brake cleaner and also the labor time for the guy performing the work. Factor all that in, I have no clue how any 15.99 lof place stays open. Though usually that’s just to get you in their door, which they proceed to go for up sells after. That’s how they make their money to keep the doors open typically.
I would think if the shop has an agreement with the customer, and they buy from a recommended supplier somehow they would work it out if it were deemed a bad part from the supplier. Who knows though. Many ways that deal could go for sure
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Sure bring your own parts no warranty on installation or the part and we will up the labor rate for installation too.
[quote=”Cammed 05″ post=173149]
I agree, the dealer does get parts quite a bit cheaper due to wholesale pricing direct from the manufacturer. In my opinion it is raping the customers. I can honestly go online to buy the same part I would order over the counter cheaper than my employee cost would be. It’s ridiculous. [/quote]
A couple of years ago I needed some serious front end work on that same ’98 E150. Inner and outer tie rods and adjusters, and idler arm. I bought Moog parts from Amazon (I have Prime) and saved over $200 in parts alone (I saved >$100 over “generic” parts). I saved >$100 installing them myself. It drove pretty wonky when I took it to get aligned !Ford is now offering direct sales through FordParts.com. Also, a lot of dealers are starting to sell surplus parts inventory online at incredibly cheap prices.
Auto repair is not the only business “enjoying” a huge markup over retail ! I got a quote for some electrical work around the house. Parts were 200-300% more than Home Depot !
The online market is hurting retailers big time. Walmart, Target and Kohl’s are all taking the “adapt of die” approach but are having a tough battle against Amazon.
I am not sure where all this is going, but a smart consumer can save a bundle.
[quote=”theoldwizard1″ post=173123][quote=”CrazedAssassin” post=173119]Those are pretty steep mark ups.
Either way though, pay the mark up or do it yourself. It’s a pet peeve of mine when people try to bring all the parts for their repair with them.[/quote]
Would you be less upset if the customer asked permission FIRST instead of just walking in ?[/quote]
That’d be better.
People that just bring parts though just want a parts changer and then, who would’ve thought? Their car still doesn’t work.As long as the person is capable of performing the oil change I love saving money. I myself rather buy my own oil and a quality filter than use bulk unknown oil with a filter that’s quality is probably marginal at best. Though I have cut open quite a few motorcraft filters and have thoroughly been impressed. But remember, with the oil change at a dealer or quick lube you are also paying for disposal, chemicals such as brake cleaner and also the labor time for the guy performing the work. Factor all that in, I have no clue how any 15.99 lof place stays open. Though usually that’s just to get you in their door, which they proceed to go for up sells after. That’s how they make their money to keep the doors open typically.
I worked at a mom-pop garage in St. Pete as a mechanic. We did oil changes for cost of oil and filter only, no labor charge. We did of course mark up the oil and the filter a little bit, but had to stay competitive with the garage down the street, so not enough so the customers would drive the extra mile to go somewhere else. Since the car was already up in the air for the oil swap, we would inspect the underside. Inevitably we’d find something that was either ready for replacement, or very close. We’d bring the customer out and show them. Sometimes they’d say fix it, sometimes they said they’d be back (some came back and some went elsewhere), and sometimes they’d say “I’m broke” (often saying it like “oh I’m selling the car soon anyways”). It was the ones we did the oil change only for cost where I think we lost money. There’s time involved, although I had nothing to do with the books so I don’t know if the markup on the ones we did reel in covered the work for free time or not. Myself and the other mechanics were lucky though, the owner was a honest man and would NOT rip off a customer in any way. We felt good at the end of the day knowing we helped and never stuck it to anyone.
Cammed05 I apologize, I quoted you but somehow I lost whatever it is that shows I quoted you. NOOB mistake. I’ll get it eventually. 🙂
[quote=”Johnny Stang” post=173174] We did oil changes for cost of oil and filter only, no labor charge. We did of course mark up the oil and the filter a little bit, but had to stay competitive [/quote]
In the case of more expensive repairs (say front ball joints), I would feel better if, up front, the shop owner said “There will be a $xx surcharge to cover the cost of the bay and other consumables (rags, electricity, etc.)“
Agree. Telling the customer there will be additional charges for things like that would avoid some of the sticker shock when they get the final bill. We would always get the “What is this shop supplies charge? Isn’t that stuff part of doing the work anyway?”
I had wheel bearings pressed out of knuckles at a tire shop a couple months ago. Would really love to have a 20 ton press in my garage at home but don’t have room for one. They charged me for “shop supplies”. All I could figure was they had to use rags to clean the press after the work, maybe a shot of PB to get things sliding easier. It was only five bucks so I just grinned and paid it. They’re good people and I don’t mind helping them stay in business.
I usually do most of my own repair work unless it is covered under warranty. Other than alignments, the last time I paid a shop to fix a car was almost 15-years ago when the in-tank electric fuel pump died in a city 200 miles from home. They wanted $600 for the replacement fuel pump! I told them I could get a factory pump supplied to them and asked if they would just charge me the R&R labor. They said yes.
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