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I was talking with a shop owner near us, and the topic of Parts Matrix pricing came up. I casually asked him what type of margins he typically got on parts. He replied, "we just charge list price on all parts. Whatever the customer would pay at the parts store, we charge." Shocked, I asked him how he kept the doors open with such low margins (15% roughly). He replied, "well, you know it's illegal to markup more than 50%, right?" I said, no, I've actually never heard of that in my life. I asked him where he heard that from, and he looked at me like that is common knowledge to everyone, and I should be in jail right now for matrixing our parts.....!

 

Has anyone ever heard of this law, ever, anywhere??

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That is one of the dumbest things I've ever heard. You can charge whatever I want. You think the bottle of water you buy at the store really costs them $1.00 and they sell it to you for $2.00? I bet it costs them around $0.05, maybe! Almost every business owner would be in jail.

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The other shop owner is more then likely mistaken. However, I have seen odd things pushed on auto repair shops/dealers.

 

In my state the used car dealers have to clearly mark a car As-Is or with a full or limited warranty on the window. I had a dealer (one of our frequent customers) sell a used Ford Escape (2003ish) to a customer As-Is. The customer who bought the car compalned months later that the rear shock towers were rusted. These shock towers are covered up by plastic and carpet on the inside. They are not visible from inside or outside the vehicle without disassembly and removal of the plastic componets. The State Att. Gen. Office sent him a threatening letter that if he didn't refund the money for the vehicle they would take legal action against him!

 

After I was told this I jumped on the State AG website and they have a lot of harsh media programs going towards used car dealers. I don't believe the used car dealer did anything legal, and he honestly didn't know about the towers. The vehicle was not inspected by the buyer at a shop before the purchase, and honestly which shop removes plastic panels on an inspection, especially on the rear of the vehicle?

 

I wouldn't throw it past our state AG to threaten a shop owner if they charged "excessively" for auto parts.

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      It always amazes me when I hear about a technician who quits one repair shop to go work at another shop for less money. I know you have heard of this too, and you’ve probably asked yourself, “Can this be true? And Why?” The answer rests within the culture of the company. More specifically, the boss, manager, or a toxic work environment literally pushed the technician out the door.
      While money and benefits tend to attract people to a company, it won’t keep them there. When a technician begins to look over the fence for greener grass, that is usually a sign that something is wrong within the workplace. It also means that his or her heart is probably already gone. If the issue is not resolved, no amount of money will keep that technician for the long term. The heart is always the first to leave. The last thing that leaves is the technician’s toolbox.
      Shop owners: Focus more on employee retention than acquisition. This is not to say that you should not be constantly recruiting. You should. What it does means is that once you hire someone, your job isn’t over, that’s when it begins. Get to know your technicians. Build strong relationships. Have frequent one-on-ones. Engage in meaningful conversation. Find what truly motivates your technicians. You may be surprised that while money is a motivator, it’s usually not the prime motivator.
      One last thing; the cost of technician turnover can be financially devastating. It also affects shop morale. Do all you can to create a workplace where technicians feel they are respected, recognized, and know that their work contributes to the overall success of the company. This will lead to improved morale and team spirit. Remember, when you see a technician’s toolbox rolling out of the bay on its way to another shop, the heart was most likely gone long before that.
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