Quantcast
Jump to content

Parts margin legality

ATLAuto

By ATLAuto
in General Automotive Discussion

 Share

Recommended Posts

ATLAuto Rising Star

ATLAuto

Posted
Posted

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??

Link to comment
Share on other sites


KMS Collaborator

KMS

Posted
Posted

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.

Link to comment
Share on other sites
Mario Collaborator

Mario

Posted
Posted

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.

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share
Go to topic listing

  • Have you checked out Joe's Latest Blog?

    • Joe Marconi
      Want to End Your Technician Shortage? Focus on Retention!
      By Joe Marconi in Joe's Blog
         5 comments
      I recently spoke with a friend of mine who owns a large general repair shop in the Midwest. His father founded the business in 1975. He was telling me that although he’s busy, he’s also very frustrated. When I probed him more about his frustrations, he said that it’s hard to find qualified technicians. My friend employs four technicians and is looking to hire two more. I then asked him, “How long does a technician last working for you.” He looked puzzled and replied, “I never really thought about that, but I can tell that except for one tech, most technicians don’t last working for me longer than a few years.”
      Judging from personal experience as a shop owner and from what I know about the auto repair industry, I can tell you that other than a few exceptions, the turnover rate for technicians in our industry is too high. This makes me think, do we have a technician shortage or a retention problem? Have we done the best we can over the decades to provide great pay plans, benefits packages, great work environments, and the right culture to ensure that the techs we have stay with us?
      Finding and hiring qualified automotive technicians is not a new phenomenon. This problem has been around for as long as I can remember. While we do need to attract people to our industry and provide the necessary training and mentorship, we also need to focus on retention. Having a revolving door and needing to hire techs every few years or so costs your company money. Big money! And that revolving door may be a sign of an even bigger issue: poor leadership, and poor employee management skills.
      Here’s one more thing to consider, for the most part, technicians don’t leave one job to start a new career, they leave one shop as a technician to become a technician at another shop. The reasons why they leave can be debated, but there is one fact that we cannot deny, people don’t quit the company they work for, they usually leave because of the boss or manager they work for.
      Put yourselves in the shoes of your employees. Do you have a workplace that communicates, “We appreciate you and want you to stay!”

  • Similar Topics

    • Changing The Industry
      Shop Marketing Pros Live at L&N Auto
      By Changing The Industry
      Shop Marketing Pros Live at L&N Auto
    • carmcapriotto
      A Better Road to Success: Navigating Your SMS and Customer Rapport [RR 945]
      By carmcapriotto
      Thanks to our Partners, AAPEX, NAPA TRACS, and Automotive Management Network By leveraging tools like digital vehicle inspections (DVI) and customer relationship management (CRM) systems, businesses can significantly improve their operations and customer experience. These integrations allow for a more streamlined process, from diagnosing vehicle issues to maintaining consistent communication with clients. Ben Dexter, National Training Manager, NAPA TRACS Show Notes
      Ben's journey in the automotive industry (00:00:55) Ben's progression from service writer to National Training Manager and his experience in the automotive industry. Importance of shop management systems (00:02:04) The critical role of shop management systems in the automotive repair industry and the support provided by NAPA TRACS. Value of training (00:03:21) The significance of investing in training and the impact of leadership participation in training programs. Building customer rapport (00:11:22) Ben's approach to building customer rapport and the importance of effective communication and attention to customer needs. Significance of scheduling (00:13:12) The shift from reactive scheduling to a coordinated approach, addressing the issues of timely and accurate repairs through effective scheduling. The power of software integrations (00:15:37) The commitment to utilizing shop management software and the potential of integrations with other tools like DVI and CRM for business growth. Utilizing shop management systems (00:19:08) Encouraging the use of shop management systems and the availability of resources for business advancement. Role of technology in DVI (00:20:42) Discussion on the coordinated effort required for effective Digital Vehicle Inspections (DVI) and the benefits of real-time communication. Challenges in utilizing software (00:22:32) Exploring the reasons behind the underutilization of software tools and the need for effective leadership and training. Importance of testing and measuring (00:25:13) Highlighting the significance of testing and measuring business performance for improvement and growth. Communication and customer service (00:28:27) Emphasizing the importance of effective communication with customers to prevent unexpected breakdowns and enhance customer satisfaction. Impact of scheduling on service advisors (00:30:07) Discussing the influence of scheduling on service advisors' decision-making and the need for consistent customer recommendations. Rethinking business analysis (00:32:47) Encouraging a reevaluation of business statistics and reports to identify missed opportunities and improve overall business strategies. Morning Meetings and Reporting (00:33:21) Discussion on the importance of morning meetings, sales reporting by service writer, and constructive performance discussions. Maximizing Existing Resources (00:34:55) Emphasizing the significance of making the most of existing resources before seeking more car count. Linear Quantity Opportunities (00:36:32) Exploration of the linear quantity opportunities in parts matrix, addressing traditional matrix problems and opportunities for improvement. Commitment to Lifelong Learning (00:38:54) Highlighting the importance of lifelong learning for success in shop management and overall strategy. Thanks to our Partners, AAPEX, NAPA TRACS, and Automotive Management Network Set your sights on Las Vegas in 2024. Mark your calendar now … November 5th-7th, 2024. AAPEX - Now more than ever. And don’t miss the next free AAPEX webinar. Register now at http://AAPEXSHOW.COM/WEBINAR NAPA TRACS will move your shop into the SMS fast lane with onsite training and six days a week of support and local representation. Find NAPA TRACS on the Web at http://napatracs.com/ Get ready to grow your business with the Automotive Management Network: Find on the Web at http://AftermarketManagementNetwork.com for information that can help you move your business ahead and for the free and informative http://LaborRateTracker.com Connect with the Podcast: -Follow on Facebook: https://www.facebook.com/RemarkableResultsRadioPodcast/ -Join Our Private Facebook Community: https://www.facebook.com/groups/1734687266778976 -Subscribe on YouTube: https://www.youtube.com/carmcapriotto -Follow on LinkedIn: https://www.linkedin.com/in/carmcapriotto/ -Follow on Instagram: https://www.instagram.com/remarkableresultsradiopodcast/ -Follow on Twitter: https://twitter.com/RResultsBiz -Visit the Website: https://remarkableresults.biz/ -Join our Insider List: https://remarkableresults.biz/insider -All books mentioned on our podcasts: https://remarkableresults.biz/books -Our Classroom page for personal or team learning: https://remarkableresults.biz/classroom -Buy Me a Coffee: https://www.buymeacoffee.com/carm -The Aftermarket Radio Network: https://aftermarketradionetwork.com -Special episode collections: https://remarkableresults.biz/collections            
      Click to go to the Podcast on Remarkable Results Radio
    • Changing The Industry
      The Basics of Owning An Auto Repair Shop - Part 6
      By Changing The Industry
      The Basics of Owning An Auto Repair Shop - Part 6
    • carmcapriotto
      Using Dealership Weakness to Build a Strong Auto Repair Shop - Chris Cotton Weekly Blitz
      By carmcapriotto
      The Weekly Blitz is brought to you by our friends over at Shop Marketing Pros. If you want to take your shop to the next level, you need great marketing. Shop Marketing Pros does top-tier marketing for top-tier shops.
      Click here to learn more about Top Tier Marketing by Shop Marketing Pros and schedule a demo:https://shopmarketingpros.com/chris/
      Check out their podcast here: https://autorepairmarketing.captivate.fm/
      If you would like to join their private Facebook group go here: https://www.facebook.com/groups/autorepairmarketingmastermind
       
      In this podcast episode, Chris Cotton from Auto Fix Auto Shop Coaching examines the JD Power 2024 US Customer Service Index Study. He offers strategies for auto repair shops to outperform dealerships by focusing on immediate service, convenience, and the smart use of technology. Cotton emphasizes the need for shops to educate customers and offer value through quality service rather than just competing on price. He advises shops to enhance their online presence and local advertising to attract customers. The episode is a guide for auto repair businesses to improve service and capitalize on dealership shortcomings to gain customer loyalty.
      The JD Power 2024 US Customer Service Index Study (00:01:10) Insights from the study on dealership customer service, wait times, and technician retention.
      Dealership Wait Times and Technician Retention (00:02:14) Discussion on the impact of wait times, technician retention, and the influence on customer satisfaction.
      Customer Preferences and Technology (00:06:25) Customer preferences for immediate service, convenience, and the importance of technology in service updates.
      Rising Costs and Customer Satisfaction (00:09:02) Increase in the average amount spent on dealer visits, the impact of inflation, and customer satisfaction.
      Adapting to Market Landscape (00:13:18) The need to embrace technology, improve communication, and address wait times and cost concerns.
      Advertising Strategies for Auto Repair Shops (00:14:22) Tactical approaches to leverage speed, convenience, technology, cost-effectiveness, education, and tailored promotions in advertising.
      Implementing the Marketing Strategy (00:19:05) Guidance on assessing current advertising channels, revamping content, and staying responsive to market changes.
      Connect with Chris:
       
      [email protected]
      Phone: 940.400.1008
      www.autoshopcoaching.com
      Facebook: https://www.facebook.com/
      AutoFixAutoShopCoachingYoutube: https://bit.ly/3ClX0ae
       
      #autofixautoshopcoaching #autofixbeautofixing #autoshopprofits #autoshopprofit #autoshopprofitsfirst #autoshopleadership #autoshopmanagement #autorepairshopcoaching #autorepairshopconsulting #autorepairshoptraining #autorepairshop #autorepair #serviceadvisor #serviceadvisorefficiency #autorepairshopmarketing #theweeklyblitz #autofix #shopmarketingpros #autofixautoshopcoachingbook
      Click to go to the Podcast on Remarkable Results Radio
    • Joe Marconi
      Shop Owners: You are Only as Good as the People You Employ
      By Joe Marconi

      Premium Member Content 

      This content is hidden to guests, one of the benefits of a paid membership. Please login or register to view this content.



  • nptrb

    Spring Clean Your Finances: 5 Steps Every Business Should Take

    By nptrb, in Automotive Industry,

    1 comment 273 views
    nptrb

    Tax Season Preparation: A Comprehensive Guide

    By nptrb, in Automotive Industry,

    1 comment 406 views
    nptrb

    Understanding S-Corp Distributions and Draws | Are They Taxable?

    By nptrb, in Automotive Industry,

    0 comments 510 views

  • Our Sponsors

Main Sections

More Sections

Discussion Forums

×
×
  • Create New...