mmotley

Perhaps we could connect the dots in this thread, with the thread about aftermarket parts not being up to par, and come to the conclusion aftermarket is cheap. Or that you get what you pay for.

Edit: Removed comment

Agree with xrac. I'd be shopping for something to buy, or purchase the place you are currently renting.

^^^^^^^^^^^^^This right here^^^^^^^^^^^^^^^ Perfect example. Customers usually won't argue about how long it takes to do a job, or ask you to justify why your labor rate is what it is (if they do, you should probably have some ASE's hanging on the wall or other certs to justify). But you better believe people will price shop parts. Especially when you are getting them from Napa, Oreilly, Autozone, or wherever down the street that they can get them from too. Plus, if your state doesn't require you to tax labor, you can argue that you are helping out your customer by keeping parts prices as low as possible to help them avoid taxes!

Numbers are for last month: Parts profit - 25.47% (maybe a little bit higher due to flat rate pricing on some jobs (i.e. I charge the same for all brake pads, regardless of what they actually cost, same with timing belts)) Labor profit - 79.95% I fudge this number a little due to the way I pay my help, but it consistently runs 70-90%. The busier I am, the higher the profit percentage since my help is paid hourly, not commission.

I wouldn't mind sharing my numbers. I will post them up tonight after work has slowed down for the day. However, know that I am a small shop. I am not a shop with 7-10 mechanics, a receptionist, and 2-3 service advisers. It's just me and 2 other guys. I implement what I discussed loosely. I have a price matrix built loosely around the discount I receive. I.E. Sometimes after I mark a part up, I still sell it for less than what a customer can buy it for. Other times, after it runs through the parts matrix, I sell it for a little over what the customer could go buy it for. In some cases where the price goes over retail, I bring it back down to match the regular 'walk-in' price (just case by case, depending on the job, how I feel, the customer, etc.) Let me be clear, I am not referring to 'list price.' I know that list is not what a regular customer pays. I get 2 prices before I try to sell parts: My discounted price, and the regular prices (NOT LIST). I will post up some actual figures from last month later on, and maybe a few specific examples.

All the more reason to stop marking up parts so much! Why should someone pay you double for a part just because you got it? Especially when you are getting parts right down the street from a store your customer can walk in to and get the same part. If you make $1000 profit at the end of the day, does it really matter if it came from parts or labor? If anything, I would want more profit to come from labor than parts. Why? Because then I can argue that I don't mark up my parts like shop 'B' down the road. We live in a day of smart phone, tablets, amazon, and rockauto.com. If your customers know you get brake pads from Autozone or Oreilly and they see you double the price of them, of course they are gonna be mad! So why not just raise your labor up, lower your parts mark up, and keep the customer happy? And now your customers have no reason to try and bring in their own parts... Why not just make 10%-20% on parts, and make 80%-90% on labor? I still cannot understand why some folks on here feel they HAVE to make large profit on parts. WHY???? WHYYYYYY? If I don't mark up parts and my ticket comes to $200 and you do mark up parts and your ticket comes to $200, the only thing you have done is created an opportunity for the customer to get upset about you marking up parts for more than what they can get them for (and depending on your state, increase in sales tax). You can say I'm leaving money on the table, I say your getting your butt caught in a crack when the customer gets their invoice.

Take the key you have and go steal the car back and lock it up in your shop. You should have a signed estimate or RO, with the proper disclaimer on it. Seriously, why do people tolerate this behavior? A grown adult who is responsible enough to purchase and operate a vehicle should know how vehicle repairs work and should also know that stealing is wrong. Back in the day, when people respected the law, they would hang horse thieves... Just saying.

Cannot disagree more with this statement. It seems like there has lately been quite a few people who are obsessed with profit percentages, particularly on parts. I understand everyone wants to make money, and I know everyone sees profit on parts as free money. You buy a part, turn around, and sell it for more. But spending so much time worrying about percentages and matrices and discounts for 1 section of your business doesn't make sense. If at the end of the month, your OVERALL percentage is where it needs to be, who cares about your parts markup or whatever (within reason). If you make 300% on a hose clamp and I make 20% on a transmission, who is going out to eat tonight? When you get your electricity bill, do you pay it with percentages or dollars? Instead of chasing a better parts discount, maybe you can look into better advertising to bring in more customers. Or perhaps send a few employees to do some sales training, converting more oil changes into big tickets. Again, I understand how it is easy to get excited about selling some brakes pads for $50, when you only gave $20 for them. It just seems like there are a lot of guys obsessing about it and missing a whole other aspect of the business.

Curious where you got these numbers from?

I'm sure I'll come off as being rude, but seriously? Complained to the state, county, and local govt? Did you try your parents too? I guess that attitude comes with living in a state that 'licenses' repair shops. Much like XRAC said, just outlast them. If you are fixing other shop's screw ups, you should be earning customers at that point. I don't have any customers that like getting something fixed twice, so most come to me to get it fixed right the first time. With that reputation, you can charge what you want (within reason). I would make sure to tell every customer 'This is what you get for price shopping'. Being nice and cutting them a break doesn't educate them at all on choosing a quality repair center over the 'shade tree mechanic' down the road.

I have a business owner next to me who is a 'nice guy'. He can barely pay the bills because he lets people go on payment plans and 'promises'. The quicker you realize that you didn't open up a charity, but a business, the better off you'll be. If you feel like helping someone out financially, go donate to your local church or the wounded warrior foundation... It really is simple as that. No if's, and's, or but's.

This is a great video to remember when you might be having a bad day! I hate to think what that helicopter costs to replace!

Yup^^^^ I was a tech for years, and I thought all I needed to do was buy my own lift, rent a shop, and roll my toolbox inside... Turns out, that's not half the story of an auto repair shop. Something can really be said for working at another Indy though! You can learn a lot of their procedures and processes.

5 of the top 10 makes were luxury brands, all with plenty of extra systems and equipment (not to mention, Land Rover has consistently been at the bottom for the past few years)... HAHA I gotta side with Wes on this one, either they need to seriously upgrade the owners manual and invest heavily in salesman training, or work on putting out a better product... Interesting none the less

PJ, no need to be embarrassed! Everybody starts somewhere! We don't all start of with a multi-million dollar facility.

I would like to hear how others are selling tire rotation services when places such as 'Discount Tire' and others offer free tire rotations when you buy tires from them? I try to sell a tire rotation every 5,000 miles with their oil change, and offer at '5K mile service' which includes the oil change, tire rotation, and vehicle inspection(measure tires, brakes, test battery, fluids, etc.) and stamping their maintenance book. 75% of the time I get the response 'Oh, I get my tires rotated for free down at [insert business name here]. How much for just the oil change?' How are you guys competing with this? Is it just my inexperience with making sales? Should I press on and mention 'you wont have to wait in line' or 'we already have it on lift, are you sure?' I don't want to come across as a pushy salesman, but it's really starting to get under my skin. UPDATE: I just phone shopped one of these chain stores locally and they told me they offer free lifetime tire rotation AND spin balance! Is there this much profit in tire sales?

world pac offers some for european models, focusing on electrical... they offer a few others, check their site

Not disagreeing, just curious. Where did you get that figure from? Also, is there a rule of thumb given for parts from the same source?

Dymo 450 label printer

OTC Tamer, hands down. I used the Branick at the dealership, and I have a OTC Tamer now in my shop. I cannot express how much better the OTC is, especially the safety aspect of the OTC design... I'll put it this way, if I was a tech in a shop and my boss was buying a new strut compressor and he picked the Branick over the OTC... I'd be pissed. Seriously is that much better. I used to HATE doing struts. Now, I love it.

Wes, in short, the guy would present a customer with a $1000 estimate. To qualify for his credit program, he would require half down ($500), then take 3 checks from the person that day. All the checks would be dated 1 month apart, all amounts being 1/3 of the remaining balance = $200 each. Thus the $500 down + $600 in checks = $1100. Before he would take the checks, he would simply need the customers full name, a pay stub, and one other piece of information (I can't recall), and he was able to see if they had ever written any bad checks in the past or had overdrawn bank accounts. Once he had a current pay stub and saw that they had never written a bad check, he would take the 50% down and 3 checks and perform the repair... Key word here is 'HE'. It's all up to him! If he didn't feel like he was going to get his money, he doesn't have to bother.

The article also covered a woman I think who was using some form of credit card from a 3rd party (I'm assuming that's what you were referring to in your original post). I did like the fact that the cards allowed you to put your business logo on them! Yes, the guy doing it in house is probably making a good bit of extra money charging 10%. Remember, I think he had them pay half up front, then financed the remainder... That should be covering your parts I would think, so essentially you're not taking money our of your own pocket (just labor at that point, which is free if you're the one doing the work). I don't recall that article mentioning what company he used to see if the person had ever written bad checks before though. A strict diet of hot pockets, hungry man tv dinners, and no sodas will help line those pockets with some extra money... Only speaking from experience

Holy cow! All I can say is price shop that neutronics kit!!!! Ebay has quite a few for MUCH cheaper than their website.

Hmmmmm, I've never thought about this type of situation... Can't help but feel you have gone through this before. GRRRRRR, sounds like I need to loosen my grip on my wallet and buy a freaking leak sealant detector kit