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Best Labor Claim Program


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Hey Everyone!

I have recently (about two years ago) gone into business for myself (no longer a dealer tech) and have actually not had to file any labor claims until this past month and it was quite a bit of a hassle.

I was wondering what your experience has been with what auto parts store has been the most user friendly and reasonable reimbursement process?

The places I have access to are:

Advance Auto
AutoZone
O'Reilly Auto
Napa
Action Auto Parts
Federated
WorldPac

I don't want to say which of those I am frustrated with after this go round, because I am more interested in hearing your experiences rather than any defenses of a preferred brand. I am told that Advance and Napa supposedly offer full labor rate reimbursement, but I am not sure I believe this, there must be a catch. I don't expect a full labor rate reimbursement, I understand they are paying us for the costs of replacing the part and not to profit a second time, but I also believe it needs to be a fair valuation.

Thanks for any feedback!

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After nearly 40 years in business, I can tell you that there is no real solution to this problem.  I gave up on labor claims years ago.  I would wait months to hear back from an engineer's report, only for the report to say that somehow my tech installed the caliper wrong and that's why if failed. I don't want to sound negative, but that is a reality.

Joining a program group, like TECH NET, that pays labor is perhaps the best option.  Also, document all comebacks: The brand, the store you bought it from. Look for trends. Then, sit down with your parts supplier and work out a deal.  No one wants to get rich over a comeback, but the truth is comebacks kill.

Lastly,  make sure your gross profit on parts and labor is in line and factor in a percentage for warranty issues.  No company is perfect and no tech is perfect.  

Hope this helps.

 

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44 minutes ago, Joe Marconi said:

After nearly 40 years in business, I can tell you that there is no real solution to this problem.  I gave up on labor claims years ago.  I would wait months to hear back from an engineer's report, only for the report to say that somehow my tech installed the caliper wrong and that's why if failed. I don't want to sound negative, but that is a reality.

Joining a program group, like TECH NET, that pays labor is perhaps the best option.  Also, document all comebacks: The brand, the store you bought it from. Look for trends. Then, sit down with your parts supplier and work out a deal.  No one wants to get rich over a comeback, but the truth is comebacks kill.

Lastly,  make sure your gross profit on parts and labor is in line and factor in a percentage for warranty issues.  No company is perfect and no tech is perfect.  

Hope this helps.

 

Hey Joe thanks for the response. I should have clarified I am looking into the various Tech Net like services each offer to find the most shop friendly one since they all require you be in either or and use them as your first call with a specific volume requirement per month to wave additional service fees.

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Banner programs are good.  And the strategy behind having a few main suppliers is not a bad idea.  And don't forget, being part of a program does not limit you to buy from whom you choose to, just as long as you adhere to the program guidelines.

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  • 2 weeks later...

I joined the NAPA AutoCare Center program as soon after opening my shop as I could.  There is an annual membership cost but the quarterly volume rebates usually more than pays it back.  Add to that the Nationwide Peace of Mind warranty that is recognized as the gold standard and you have real value for your customers.  The local shop reimbursement program pays 75% of the labor guide at your current shop labor rate up to $250.00.  It's not great, but it's better than nothing.  Meanwhile I refuse to utilize anything from Advance Auto Parts because of their "Warranty" reimbursement, which was a joke at best.  Meanwhile, my experience with the labor warranty reimbursement from my local independent parts suppliers is like yours.  Wait for months, then get denied because it's "never" the part's fault.   Or like the last name brand fuel pump installed in a P30 van there was only one labor guide time and then it was for a van with an access panel in the floor. The labor time to remove the tank was more than to replace the fuel tank.  And guess what the parts manufacturer wanted to pay?  With NAPA it's no problem.  Well, almost.  I have had only one, a clutch and the labor time was something like 4.5 hours.  My first call was answered by someone who was either new or didn't want to be bothered.  He flat out denied the claim because the labor amount was above their limit.  I called back and asked for a supervisor.  He wanted to find a solution.  He told me that they had the $250 limit, that 75% of the labor rate I was requesting was something like $272.  If I was willing to accept the $250 he'd approve it without a problem but that was all he could do.  Well $250 was a lot better than $0 so I agreed and thanked him for trying to find a solution instead of simply saying "no" like the first guy.  Add to that, Sonsio, the company that administers the NAPA Peace of Mind Warranty also administers the CarQuest warranty as well as Federated and other warranties.  Since none of those brands have a presence in my area, when they have a nationwide warranty claim, Sonsio calls my shop to ask if I will help, which I always say yes to. 

 

But like Joe said, make sure your profit margins are sufficient to absorb the costs of the inevitable warranty claims.  No matter what supplier, no matter how skilled your technicians are, mistakes happen, defects slip through, that is why there is warranty. 

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  • Have you checked out Joe's Latest Blog?

    • By Joe Marconi in Joe's Blog
         5
      Typically, when productivity suffers, the shop owner or manager directs their attention to the technicians. Are they doing all they can do to maintain high billable hours? Are they as efficient as they can be?  Is there time being wasted throughout the technician’s day? 
      All these reasons factor into production problems, but before we point fingers at the technicians, let’s consider a few other factors.
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      Maintaining adequate production levels is the responsibility of management to create the processes that will lead to high production while holding everyone accountable. 
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