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Parts mark up at mechanic shop

Me2carcrazy1

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Jan 11, 2019
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I was going to have a mechanic put in a new radiator in my Bronco while the engine is out for rebuilding. He quoted me $750 for a new copper radiator. I asked why so high. They have a 30 percent markup on all parts they install. So a $550 radiator plus their $150 mark up (30%). He said it covers their shop warranty for the part. I was shocked. He told me I was lucky they decided to not charge the 30% on my rebuilt engine I am having them install. They know the engine builder and his engine comes with a 12 month warranty so they didn't feel it needed their warranty on top of that warranty. Is this usual for garages now?
 

Broncobowsher

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Jun 4, 2002
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33,057
Yes, been that way for decades. I remember looking at the O'rielly reciept back in the early 90s. There was my cost, and retail. Retail was usually double. The repair shops sell the parts at retail. They make profit on the markup of parts from the parts stores.

Completely normal stuff. You just never noticed until now.
 

Eastwood

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I worked at O’reilly’s for years, I actually was a general manager of a store for a few years. We gave most of our shops a discount based on how much we marked up the part. So if a radiator cost a regular customer 300 dollars, I might charge the shop 250. I had no control over this, the computer calculates the discount. I could override the price but then I had to answer for it to the accounting department. Anyway most shop would mark it up past the 300 that I shop it retail for. Even though I got out of the business 16 years ago, I still almost always supply my own parts when I have a shop work on my vehicle. They always agree that they will warranty their labor, but the parts on me. Whether or not shops should mark up the parts is whole other debate.


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billtammy

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Mar 24, 2014
Messages
76
guess i still use old math but 550 plus 150 is 700, besides that i have been in business over 30 years and any company that sells a product for what it pays be it the supermarket your plumber mechanic or gas station will not be in business the following year. if you need reasons think of taxes credit card fees sales tax etc etc.
 

Eastwood

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guess i still use old math but 550 plus 150 is 700, besides that i have been in business over 30 years and any company that sells a product for what it pays be it the supermarket your plumber mechanic or gas station will not be in business the following year. if you need reasons think of taxes credit card fees sales tax etc etc.

Shops add labor which is usually more hours than it actually took because they use a labor guide. Also they usually charge a fee for shop supplies and such. They aren’t just a parts reseller.


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bmc69

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I worked as a machinist and counter guy in a couple different auto parts stores/shops back in the 70s and early 80s. The cost listings for ALL parts have multiple price levels. I don't recall exactly what they were but it went something like : List, Net, Dealer Net (or Jobber) and Cost. We typically sold to counter customers at the Net price. Shops and very regular customers got the Dealer Net price. Those same shops nearly always sold the part to their customer for the List amount. Been that way.....forever.

I've owned a marine controls engineering company since the late 80s. We deal with the gummint as well as commercial and foreign military. We have to calculate every year what our General and Administrative (G&A) overhead is as a percentage of gross sales and are required by FAR to apply that as a minimum markup to literally everything we sell. Our G&A hovers between 13 and 14% typically.
 

armynavy17

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Jan 9, 2010
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The mark up also covers the shops time sourcing the part and travel to go pick it up/delivery. Small time shops especially can spend most of a morning running around trying to source parts from various locations that claim to have parts in stock.
 

Eastwood

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In our town we had four auto parts stores. Some shops would order a part from each one and who ever delivered it first got the sale and the rest were sent back. Another good one was they would buy the part from me because I had it in stock and get their customer out the door. Then they order it cheaper online and put the cheaper part in my box and send it back for a full refund. We had to start discreetly marking parts that we sent to certain shops.


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Me2carcrazy1

Me2carcrazy1

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Jan 11, 2019
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The mark-up is just the radiator price. No labor. Then taxes on top of the radiator with mark-up. If you charge it they add 3% to the total price. I could understand 15% for time to look-up and order but 30% seems high. Our town is 5 miles from one end to the other and only one radiator shop where it can came from. Anyway, once the engine is in I will be done with using any mechanics for a long time. It's time to get this Bronco back on the road !
 

Madgyver

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The commercial stuff mark ups can go up 100% and up over jobber prices. Those that do billings for commercial AC jobs knows this as many make profits from mark ups and not much from labor.
 

jamesroney

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Sep 11, 2007
Messages
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Loc.
Fremont, CA
Uhm...yeah, but no. Someone is double dipping.

A repair shop should be paying Jobber on the radiator and charging you List. So the $550 radiator should cost them $440, and they add 25% to get to your $550. If they are paying $550 for a $550 radiator, then the store is carrying the warranty expense, and you are paying for it twice.

Something doesn't add up.
 

thegreatjustino

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Jan 23, 2002
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14,907
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Stockton, CA
I still almost always supply my own parts when I have a shop work on my vehicle

Try doing that here in CA. Most shops have a sign stating "we will not install parts you supply" because they don't want to lose the profit they make on parts markup.
 

Broncobowsher

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Jun 4, 2002
Messages
33,057
The cap on a home A/C system is about $10 if you know where to get one. Have the A/C guy come to the house and you will be paying the service call and the cap will cost you about $80. There is a lot of markup is the service industry.

You want an aftermarket readiator installed in a 50 year old truck? What are the chances it will fit right the first time? What about that bolt that breaks off and you have to fight to get it out? Dealing with the coolant? The trans cooler lines that are the other thread pitch.

If you had a shop that charged labor for what it should be and sold you parts at cost, everyone would be questioning why his labor rate is $250 an hour when all the other shops are $100, but the bill would be the same in the end.

Double dipping, no that is how you spread the costs so nothing is out of line with how all the other shops do it. And for a repair shop it is very common, to being the norm, not to install customer supplied parts. When you get to a fab shop is when customer supplied parts are pretty normal. Or a restoration shop where you found the box of hens teeth that just need to be installed. But a regular repair shop, very rare. And often you have to be buddies with the shop to pull that off.
 

El Kabong

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I work for a small construction company. We do almost anything that comes our way. Residential mostly, but some commercial. Kitchens & bathrooms, schools & parks. Our hook is that we build custom cabinets in house. As for people buying supplies on their own, sometimes that works out & sometimes not so much.

People used to buy appliances & fixtures thru us. Now they "save money" by finding & buying their stuff online & pay us for the labor only. But, if I sell it to you, I stand behind it. I have some markup in it & that pays for me to swap out a bad toilet or whatever. But if you buy it yourself, I have nothing in the price to cover you if the thing is bad. You'll have to pay for any additional work.

I recently installed a brand new bad toilet that the guy bought himself from the wholesale house. It would leak from under the base after 4 or 5 flushes. It looked like a bad wax ring at first (which would be my fault). But after setting it for the 3rd time I took it back to our shop, set it up on sawhorses so I could see under it, filled the tank & gave it a flush. It worked perfectly. For 3 flushes. But on the 4th flush the unseen void in the casting filled up & it started to leak up front (which was not my fault). The seller swapped it out easily when I showed him the video. But the homeowner paid for all the extra labor done that day. I don't know if he got any money back from the seller.

We had a lady who bought a built in closeout fridge & freezer (sub-zero style) online. They were designed to hold matching cabinet doors on the front. But the 2 machines were of different generations & the frames were different. There was no way for us to make them look alike. Even though she screamed at us about it. She had to chase down a replacement & deal with getting rid of the wrong unit. I have no idea on how much she "saved" by the time the dust settled. She screamed at us several times throughout that job. Free work that she wanted us to do that we wouldn't do & so on. She also wanted us to do more work after we finished our contract, but we passed on taking on anything new.

We had another customer who figured out who our window supplier was. She went directly to the supplier, lied, & told them she worked for us. And proceeded to order her own windows to cut out our markup. When you order windows, you give the width first & the height second. But if you are trying to cut out your contractor you might not know that. When her windows all arrived wrong, she called & wanted us to help force the supplier to replace them, since they didn't explain the industry standard to our "employee" when she placed the order. Uhhh... no.

Dishwashers burnt out by new garbage disposals installed without knocking out the plug. Microwave hoods installed at such an angle that liquid won't stay in a bowl. Fences built with the lumber installed wrong & sagging. Officials angry & plans "lost" due to bad behavior at the counter. Copper pipe not reamed & pinholes showing up years later. Wire run just below the surface of stucco burning when a shelf was hung. The same stupid wiring trick in a bathroom, with foil wallpaper, & a towel bar screw connecting the foil to the wire, lighting up anyone who touched wallpaper & the faucet. They are all going to save money. And we continue to get calls to undo whatever mess has been created.
 

sprdv1

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Mar 8, 2007
Messages
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I was going to have a mechanic put in a new radiator in my Bronco while the engine is out for rebuilding. He quoted me $750 for a new copper radiator. I asked why so high. They have a 30 percent markup on all parts they install. So a $550 radiator plus their $150 mark up (30%). He said it covers their shop warranty for the part. I was shocked. He told me I was lucky they decided to not charge the 30% on my rebuilt engine I am having them install. They know the engine builder and his engine comes with a 12 month warranty so they didn't feel it needed their warranty on top of that warranty. Is this usual for garages now?

Easy enough to just do it yourself..
 

904Bronco

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Sep 28, 2004
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San Martin, CA
Back in the the Day... When I turned a wrench for a living... A guy had a bad starter in his Chevy. Decided he didn't want to buy our $75 starter and went across the street to Kragen to buy a $30 starter. He complained that, I had installed the starter in 30 minutes, instead of the 45 minutes the book stated. The Salesman reduced the cost just to make him go away, he admitted to me.
A week later, the Owner came back with an intermitant starting problem. Stating that we screwed up the install. Nope, bad starter. Another 1/2 hour of labor to remove and install his 2nd replacement Kragen starter.
A month later, he came back with the same starter issue. This time he was really mouthy about it... The Owner took him aside and gave him a tune-up, said I am happy to take your money to replace your inexpensive starter, but we will not take your verbal abuse about the inferior product you chose to install. You have pretty much spent double the money and 3x of your time to fix the same problem. At what point, does it not make sense to you not to continue down this path? Dumbfounded, he finally said "Fine" install your starter, but I want the old starter to get a refund from the autoparts store. The Owner said sure, but you will have to pay the core charge on our starter.... $20. I didn't see him again for a starter R and R. :ROFLMAO:.

There is a cost of doing business, all the costs an owner pays to keep the doors open. And yes there is a cost savings to the Shop as they buy in bulk from their suppliers, which they do not pass on the Consumer to help pay for the above ^. That is why I typically do most of my own work, maybe because I am Anal retentive and don't trust a lot of people's quality of workmanship. Some shops are in a hurry and sloppy... But in your specific case, the Rad cost seems a little high. It could be that they have had poor experience from some of the cheaper "Off-Shore" products, and that they have found a good quality US made Radiator. I can say an American made Rad core, that still needed to be soldered to my tanks, was quoted to me at $400 vs a new $300 complete off shore unit, so maybe their price is reasonable? One of the many choices we consumers have to make these days... Good luck.
 

cannunz546

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Sep 2, 2017
Messages
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Everyone has to make a living. Most of the mechanics I know work very hard and where they make their money is their business. Not mine. If you don't like the way a mechanic charges for his work and parts then find another one. Just like any other business. In my opinion, you usually get what you pay for. I have been using the same mechanic for 35 years. He is getting up there in years and I am sure going to miss him when he turns his last wrench. He's always been fair to me. He's not the least expensive, either. He has a saying which I appreciate more and more as I get older. "Price is soon forgotten and quality is long remembered." I am sure he didn't invent that phrase but he stands by his work and charges a fair price for it....not the lowest price.

I was at my daughter's new home recently while three young guys from a moving service she hired were carrying in boxes and furniture in the hot Florida sun. They worked their butts off and were super diligent and careful (asking where things should go, offering to unwrap furniture, wearing booties to keep the floors clean, etc.). They were also very polite and respectful. When they were done they thanked my daughter for her business and started to leave. I followed them out and asked them if they owned the business. They said no but had worked for that moving service for over 10 years. I asked them for the owner's number and they looked scared but gave it to me. I called the owner in front of them and told him how lucky he was to have fellows like that working for him. He immediately told me he knew that and we exchanged pleasantries. When I hung up one of the movers was visibly emotional and thanked me. I also gave each of them a nice cash tip. They told me it was the largest tip they had ever received.

The moral of the story for me is that there are good and fair people in business everywhere. For those who are good and fair to me, I will establish a relationship with them and show my loyalty by patronizing their business and telling people about them so they get referral work. There is so much more to business relationships than cost. That's my experience, anyway. I too am in the service business.
 

Thumper63

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Mar 7, 2019
Messages
83
Everyone has to make a living. Most of the mechanics I know work very hard and where they make their money is their business. Not mine. If you don't like the way a mechanic charges for his work and parts then find another one. Just like any other business. In my opinion, you usually get what you pay for. I have been using the same mechanic for 35 years. He is getting up there in years and I am sure going to miss him when he turns his last wrench. He's always been fair to me. He's not the least expensive, either. He has a saying which I appreciate more and more as I get older. "Price is soon forgotten and quality is long remembered." I am sure he didn't invent that phrase but he stands by his work and charges a fair price for it....not the lowest price.

I was at my daughter's new home recently while three young guys from a moving service she hired were carrying in boxes and furniture in the hot Florida sun. They worked their butts off and were super diligent and careful (asking where things should go, offering to unwrap furniture, wearing booties to keep the floors clean, etc.). They were also very polite and respectful. When they were done they thanked my daughter for her business and started to leave. I followed them out and asked them if they owned the business. They said no but had worked for that moving service for over 10 years. I asked them for the owner's number and they looked scared but gave it to me. I called the owner in front of them and told him how lucky he was to have fellows like that working for him. He immediately told me he knew that and we exchanged pleasantries. When I hung up one of the movers was visibly emotional and thanked me. I also gave each of them a nice cash tip. They told me it was the largest tip they had ever received.

The moral of the story for me is that there are good and fair people in business everywhere. For those who are good and fair to me, I will establish a relationship with them and show my loyalty by patronizing their business and telling people about them so they get referral work. There is so much more to business relationships than cost. That's my experience, anyway. I too am in the service business.
This is how it’s done! Good on you. I’ve been in the service business for over 30 years and when my clients go out of the way to show appreciation I can’t tell you how good that feels...
 

73azbronco

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Nov 11, 2007
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7,141
My theory, you are having them install the motor, have them install the radiator, pay the fee. You get. Guarantee it won’t overheat, if it does, it is their problem.
 
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