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You Must Read My Response To Being Accused Of Overcharging

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The son of a long time customer asked to speak to me. The mother brought her Lexus in for a check engine light issue. The car needed an O2 sensor.


The sons issue was over the diagnostic charges. He claimed that even the dealers dont charge for diagnostic testing. I let him speak, without interrupting him, until he was finished.


When he was finished I asked him why call me now after all the years the mother has been a customer? He told me that nothing seemed out of line before and as a matter of fact, we saved the mother a lot of money over the years because my services and oil changes are lower than the dealer.


So, I asked him: How is it, when I charged less money, you never called me to let me know that? He laughed, but I said, "I'm serious." He laughed again and he did not have much to say after that. I ended with, "The policy at the dealer or another shop has no bearing on my policy, but please keep checking my charges and I do expect a call the next time I UNDERCHARGE you."


The conversation ended on a happy note, thankfully!

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The use of such statements from the un-knowledgeable is a difficult one to deal with as we are all consumers and we all make purchases throughout our days weather a clothing purchase at a local store or a meal out, so the feeling of getting a deal or a good bank for the buck is in the eyes of that consumer.


Now should you have cost shifted by inflating one area higher or charge for something not needed "The impeded hoadie valve removal of built up carbon" perhaps would have been easier for them to understand then a professional working on my car utilizing the most updated modern equipment available to get the diagnosis right we need to be paid for this service needed and necessary, fairly honestly and ethically.


A local shop here offers the free use of any and all of their scan tools and folks actually pull in and play with them and I guess it works for selling work, and then the big independent tire store offers free diagnostics now they need to educate the staff on just how to use the darn stuff as not every car needs a forward O2 and Cat.


Oh well a lingering topic for most shops, but nonetheless a worthy one to start the day with!

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It is indeed a difficult issue. The problem, obviously, is the general public's (aka...consumer/customer's) lack of understanding about how the industry really works these days. The best way I have found to combat this misunderstanding is to explain it in as simple terms as possible to any customers who want to know and I also have found it most beneficial to not separate the diagnostic line item on my invoices. Instead I simply include the diagnostics as part of the repair.


For instance, under the labor charges section of my invoice it may say something like:



scan vehicle for diagnostic codes

replace oxygen sensor - bank 1 sensor 2 (post catalytic converter)



This way the customer can see that the labor charge is for the whole repair and will be less likely to question it than if I phrase it as a separate $100 "DIAGNOSTIC FEE" line item. It also helps to use big technical terms like "catalytic converter" that the customer really doesn't understand. It helps drive home the point that YOU are the expert and they probably could not have figured this problem out and repaired it themselves. This eases peoples minds about paying YOU to do it.


I hope this helps someone else. It has been very beneficial to me to do it this way.

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For years the value of our profession has been under attack and undermined from the inside out and the top down! You know the mass marketers have push the freebies for years now. (thanks AutoZone....EVERYTHINGS free there! Diagnosis, battery install, whatever...may be wrong but who cares it was FREE and they sold a part!)


I guess that strategy depends on the neighborhood. In my neighborhood, doctor visits (ER visit for a runny nose) are.....not paid for by the patient, typically, so it does not always register. I have actually tried that comparison in the past and realized it was absolutely no help.


Customer still just don't understand the concept of diagnosing todays cars and the complexity that can sometimes be involved and the need to recoup for that time as well as having no parts associated with that diag time to help with profit margins.


I think explaining it to them simply but phrasing it "together" on the invoice is a good idea. One less thing for them to nit-pick l after the fact when their brother in law looks at it and says "they charged you how much just to look at it?"


All depends on what buttons work for each customer base.

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I hear this complaint a lot. Being mainly an electrical repair shop it's hard to give an estimate on chasing a wire short or a draw based on, "My brother in-law is a mechanic." type response. I get at least one person a week who doesn't like the cost of diagnostics. I tell them about the same thing Joe told this last guy.

The big difference is the dealership DOES charge for a diagnostic fee, although some of them will hide the cost and not mention it at the beginning. But, you know... they'll get it.



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  • Have you checked out Joe's Latest Blog?

      Most shop owners would agree that the independent auto repair industry has been too cheap for too long regarding its pricing and labor rates. However, can we keep raising our labor rates and prices until we achieve the profit we desire and need? Is it that simple?
      The first step in achieving your required gross and net profit is understanding your numbers and establishing the correct labor and part margins. The next step is to find your business's inefficiencies that impact high production levels.
      Here are a few things to consider. First, do you have the workflow processes in place that is conducive to high production? What about your shop layout? Do you have all the right tools and equipment? Do you have a continuous training program in place? Are technicians waiting to use a particular scanner or waiting to access information from the shop's workstation computer?
      And lastly, are all the estimates written correctly? Is the labor correct for each job? Are you allowing extra time for rust, older vehicles, labor jobs with no parts included, and the fact that many published labor times are wrong? Let's not forget that perhaps the most significant labor loss is not charging enough labor time for testing, electrical work, and other complicated repairs.  
      Once you have determined the correct labor rate and pricing, review your entire operation. Then, tighten up on all those labor leaks and inefficiencies. Improving production and paying close attention to the labor on each job will add much-needed dollars to your bottom line.
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