Auto Parts Markup?

Over the years more than one would be customer thought I should install parts and charge my cost plus labor and the conversation was always short as I would invite him/her to shop around and find a different mechanic.

It’s amazing that people who would never consider investing even $1,000 in hand tools and a shop manual to repair and maintain their cars thinks they have the right to tell a shop owner/mechanic how to manage their business. But it takes all kinds.

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I have saved a fortune on brakes by doing my own work. I saved about $600 on my 02 GMC full size 4WD but I wouldn’t have bothered if I saved only $300. Overhead and disposal regulations have driven prices up quite a bit and we who must drive must also pay more than the obvious price of the job. Some shops charge over $100 an hour for labor. I don’t want to know the markup on parts that those places charge! No, I don’t think the original poster got ripped off.

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I’ve had people approach me over the years with various requests or comments about furnishing their own parts, not marking them up, or whatever.

@basicbosch, if you approached me with that attitude I would politely inform you that it ain’t gonna happen.
If you became argumentative then my attitude would be a bit harsher while telling you to get bent.

You apparently have no idea how a shop works or of the plethora of expenses that a shop is faced with.
If the shop doesn’t mark parts up then odds are they will soon be heading for the bankruptcy court.
The fact that you’re comparing the cost of a DIY repair against the cost of a job done in-shop shows your lack of understanding in these matters.

If YOU were a shop owner with several employees and had to sit down at the end of every month and start cutting a pile of checks then odds are you might see things a bit differently.

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Oh this again? Auto shops just buy things and sell things. I buy a mechanic’s labor for $25/hr and sell it to you for $96/hr. No one complains. I buy a part for $25 and sell it to you for $50 and suddenly it’s a rip-off.

I think the real breach of ethics happened years ago when auto parts stores decided that they should sell a part to a walk-in customer for the same price they sell to a commercial customer.

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Rent, Gas, Electricity, Phone, Liability Insurance, Workmans Comp, Specialty Tools, Service Manuals, Subscriptions, for that matter, type in any 4 letters, and that’s probably an arm of the government that wants money.
I have often heard that some employees make more than the owners, and can sleep quite well at night, with no worries of meeting payroll or that bank note looming on the horizon.
Granted, a DIY can do a job cheaper; that’s a DUH. But for a business to stay in business, they need to make a profit somewhere. And, to cover the possibility that a part may need replaced during the warranty period, there has to be a couple points markup. And on, and on.
For those that need a service shop, they are usually OK with the fact that there is some profit in the transaction, thus ensuring that this shop will still be there the next time they need help.

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If they did good work you should be pleased. Markups are normal and justified, but good workmanship is getting less normal and should leave you happy.

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I used the dealer yesterday. The battery did not have enough power to turn the engine over on our 4Runner. Normally, I would have gone to Walmart and purchased a new battery. However, all my tools including my voltmeter were out at the church I attend because I am doing some electrical work there. The labor charge was $55 to install the battery and check the electrical system. The price of the battery was a little more than the equivalent battery at Walmart, but not a whole lot more. I charged the battery for a couple of hours so I could start the engine and drove the one mile to the dealer. My wife followed in our other vehicle and we left the 4RUNNER for the battery and alternator check. We went on about our plans for the day. Sure, there was a markup on the battery. Yes, I could have bought a new battery at Walmart, gone after my tools, checked the alternator output with my voltmeter, but it would have cut into our plans.One added benefit–when we picked up the 4RUNNER my wife started to write the check for the cashier and was told to take off $10 because Tuesday is “ladies day” at rhe dealer on service. My wife now feels comfortable taking the car there for service if something would happen to me.

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Forty years ago Pitt Hyde recognized the opportunity to sell auto parts to the DIYers at shop prices in the Memphis area and opened Auto Shack, stocking the shelves with the cheapest products available, and had the DIYers convinced they were getting the same parts as the shops at phenomenal prices. It was amazing that people thought they could buy a quality V-belt for $1.99 or a set of D-50 pads for $2.99. A lot has changed since then and along with the name change to Auto Zone the parts quality has seen some improvements. In some product lines they are selling the same products as NAPA but lately there isn’t much difference in the price. Occasionally NAPA’s price beats all the McParts stores.

But as I look around at the market it seems that these days it would be very difficult to open an auto repair business on a shoe string like I did long ago and be successful. The weekly fixed costs at my small shop here in a small rural town was over $1,000 when I retired. When I opened in the late 70s it was less than $200. I can’t imagine what it might be in Indianapolis or Philadelphia these days.

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Exactly!
Additionally, why would someone spend a lot of time noodling around with this site’s search feature in order to locate that topic, and then to respond to somebody who…left the building…many years ago?
:confused:

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Strike 1 - responding to a 7 year old post
Strike 2 - nasty tone throughout
Strike 3 - concluding that anyone who doesn’t change their own parts (shocks and struts, no less) is an idiot

@basicbosch - YOU’RE OUT!!

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As of last April, when I moved, $1000/week wouldn’t even cover rent for an empty 4-bay shop in the Seattle area.

As of last April, when I moved, $1000/week wouldn’t even cover rent for an empty 4-bay shop in the Seattle area.
[/quote]

I couldn’t sleep at night facing costs like that @asemaster. I can’t imagine what your liability insurance is costing. And the environmental regulations that were a pain here would likely seem laughable to a shop owner in Washington.

That is exactly the way I remember it working. An independent shop would purchase parts at what was then known as “Jobber rate” which was usually 40% less than retail. The shop would usually charge the customer retail (over the counter) price. Of course that was 40 years ago.

About 40 years ago, I used to patronize a parts store that didn’t charge anyone the state sales tax, on the premise that ALL parts they sold were supposedly being bought for resale by a professional mechanic. Because of this money-saving scam, they did an incredible business, and I can recall on Saturdays that people would be three-deep at the counter, trying to get the attention of the 6 or 7 clerks behind the counter.

When you paid your bill (cash only, naturally), they would ask for your first name. So, when Andy gave his name, the invoice was made out to “Andy’s Garage”. When Mike gave his name, his invoice was made out to “Mike’s Garage”. It actually took the folks from the state department of taxation a few years to figure out this scam, and when they did figure out the nature of the scam, that indy parts store went the way of the Dodo bird.

Oh, I don’t know about that @Rod_Knox. It’s all just numbers, isn’t it? I mean your overhead, wages, parts costs, etc. expressed as a percentage of gross sales is about the same, whether you’re talking a shop that does $20K/month or $100K. $1 million in liability coverage wasn’t that much, less than one month health coverage for one individual. As far as the enviro stuff, every shop is in the same boat.

These kinds of shop costs, Rent, utilities, waste disposal, healthcare, Social Security anon, anon are the real costs of running a business. I think customers that see $96 / hr for labor only compare it to their own hourly rate. They compare that rate to their trade, toolmaker millwright, whatever and think- Wow, why is that so high?? - with no consideration for all the infrastructure costs that goes with the business.

Good mechanics are difficult to find and my most profitable/stress free years were when I had one really good young mechanic and a helper. Warranty comebacks were less than 2% of the tickets and those were usually part failures. I enjoyed mechanic work and on average my income was about equal to the flat rate of the work that I actually did. Of course there was the incidental income from abandoned vehicles that were repaired and sold.

I guess I started at the bottom and worked my way up to the middle and retired. Looking back it seems I enjoyed more success than most. Likely more than I deserved.

[quote=“Rod_Knox, post:28, topic:30728, full:true”]

Forty years ago Pitt Hyde recognized the opportunity to sell auto parts to the DIYers at shop prices in the Memphis area and opened Auto Shack, stocking the shelves with the cheapest products available, and had the DIYers convinced they were getting the same parts as the shops at phenomenal prices. It was amazing that people thought they could buy a quality V-belt for $1.99 or a set of D-50 pads for $2.99. A lot has changed since then and along with the name change to Auto Zone the parts quality has seen some improvements. In some product lines they are selling the same products as NAPA but lately there isn’t much difference in the price. Occasionally NAPA’s price beats all the McParts stores. [/quote]Commercial customers at AutoZone get a significant discount on most parts compared to the prices offered to other customers. But they have to have a commercial account, and the discounts are based on monthly purchases with several different levels.

Not true. When I had my own place the local Autozone wholesale rep got us set up on a commercial account. My cost for even professional level parts like differential overhaul kits and transmission parts was within 10% of what Joe Public off the street would pay. Hardly a significant discount. Not to mention their inventory was geared to the DIY crowd and not professional shops.

Yup. It’s the industry’s own fault. You’ve got to love the work to enter this field. There are a lot more lucrative careers out there for an ambitious young person. Just think, you’re asked to provide your own tools, be proficient at tasks as varied as welding and computer operating, the work is hard on the body, and the average pay is a princely $20/hour! Who would sign on for that?