our markup on tires was 23%
Opening a shop has become a large leap to make. Our average cost to open a shop, 3 years ago, was $2.3 million, and that did not include the real estate as we rented our locations.
Here in NH and MA (and every other place Iâve lived in) we have parts suppliers that only deal with mechanics and dealers (yes dealers buy aftermarket parts too). They donât have a retail store. Mechanics buy parts from them a lot cheaper then what you an I can buy that part for. The mechanic then marks up to the price to what you and Iâd pay if I walked into a good independent store.
We also have a few independent chain stores that have different pricing for retail customers and mechanics.
Both of these places deliver parts to mechanics. Very few if any buy their parts from a retail parts store. Only one I know who did was because they were 100â away so it was convenient.
I really donât understand goodguyâs example . It makes you wonder if he even knows how the business and repair world function.
I own a shop and have been in this business since the mid-70âs, we have seen a lot of changes. Just read an above post about needing 2 million to open a shop, before real estate, very true, and you then have all the expenses to go along with that. wages, utilities, insurance, workmanâs comp, pay roll taxes, benefits, tools, equipment, software subscriptions, maintenance on the building, office supplies, paid holidays and vacations, sick days, family leave act in Mass., etc, etc, etc!!Training at 600 a day per man. Yes we mark up parts, and if we do not get a good margin it is very simple, we are going to close. Bringing your own parts to a repair shop is the same as bringing a steak into a restaurant. There has long been little respect for the mechanic by the motoring public, and that combined with low wages have created an enormous shorted of qualified help in this industry and the end result is the motoring public is going to find it harder and harder to find quality auto repair. This is a very hard to keep up with industry that is getting more technical by the day and very expensive as well. Shop rates and pay are going to go up a lot in the coming years, and the technicians are going to be paid like the gym teacher who earns 90k a year , and the electrician and plumber and local cop. It is long over due, and why should anyone want to do this very hard job, that requires a ton of training after a long work week, for a lot less than other professions, and have people not want to compensate them fairly?If we continue down the path we are currently on, and you have to go out and buy a professional diagnostic tool, and pay for a software subscription to turn it on, in a wireless network, you still need years of schooling and experience to fix your car, maybe you need a lift and an air compressor, or maybe it is something easy and you just need a lift and an air compressor and a 12k tire machine to change a run flat tire, sounds easy hey, ever try to change a 35 series run flat? These mechanics have a home, family, need food and insurance and certainly deserve to be paid so they too can enjoy a life outside of work, without struggling to get by. Yes parts are and will continue to be marked up, and amazon is not going to be an option to bring your own parts to the repair shop, unless you want the labor rates to double, and if you think that I am wrong, all the shops that cave to allowing parts to be brought in will most likely go out of business, and the dealer will never let you do that. Folks , this is all about professional courtesy, every person who buys a car knows on day 1 that sooner or later it is going to break down and cost money to get it running again, when you break your arm do you call around looking for the cheapest dostor or the best one??
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Well, thatâs pretty much true of any service industry position. I have known people that had blue collar jobs themselves and spoke poorly about other professions that were similar to theirs. Itâs not just a mechanic thingâŠitâs an overall erosion of respect for other people IMO.
Not really. What will happen is that the choices will diminish drastically. The smaller shops will fade away and weâll be left with the dealership shops. Then prices will rise accordingly.
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Thatâs true of any position at all.
Mechanics? Crooks. Lawyers? Shysters. Doctors? Quacks. Teachers? Overpaid leeches. Scientists? Ivory-tower intellectuals. Construction workers? Morons. Journalists? Partisan hacks.
Humans are a particularly malignant species of ape in that we tend to be exceedingly tribal, and people not in our specific tribe are to be pilloried until they either join us, go away, or die.
Most folks donât understand all the costs that go into running any kind of business. I taught a âpractical economicsâ course to 8th graders, one exercise was to find out how much it really cost to make a hamburger at the fast food place. They were surprised that it cost a lot more than the beef and bun!
My son wanted a video game called Jurassic Park Evolution. I figured it was just another dinosaur video game. A few days after he got it, he showed me what he had accomplished. Itâs actually a business simulation game where you construct and run a jurassic world theme park. Itâs quite involved with building infrastructure, hiring workers, growing and maintaining creatures etc. He is quite proud to show me all the people attending his hotels and attractions and that he is running a significant profit. I was quite pleased. BTW- he is 8.5 years old.
He buys this kind of stuff out of his own savings. I pay him interest on his savings so he sees the value in saving and spending judiciously. He gets a pretty good rate so it has more of an impact 
We hire young adults right out of school that donât understand withholding on their paychecks.
When I wanted my first car, my parents made me sit down and figure out if I could actually afford it. Not just the purchase price but all the other costs associated with owning a car. I know people who bought their kids cars, paid all of the other bills and ongoing maintenance for them. They havenât learned anything and have no appreciation for what they have been given. They think theyâre doing them a favor but personally, I think this is a disservice to their kidsâŠ
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RE: goodguy. Some people will never get it. Would they work 40 hours + per week for free?
The late, great screen writer Harlan Ellison said it best in his typical, shall we say, blue-tinged style (adult language):
So basically the same of virtually every other business is what youâre saying.
I"m not saying itâs right. But the cliche of the shady mechanic continues to endure for a reason.
This is probably not the best example you couldâve used, Thereâs about a 50% margin for a steak at typical steakhouse. Granted things like appetizers, drinks, fries, etc. have a much higher margin, but weâre talking about steaks here. Meanwhile, we have some shops marking up parts well over 100%. About two weeks ago I took my car to the dealer to have the A/C fixed, a section of A/C line had a leak and that section needed to be replaced. I looked up the cost of the part number at a well known online parts vendor. The dealer charged me about 120% over what the same OEM part cost online, when you figure that the online retailer is making at least some margin at the price they sell it at, and the fact that I was at a dealer who presumably getâs OEM parts at cheaper or similar prices, the markup to me seems a bit excessive especially when you consider the already high shop rate. Your steak analogy kinda falls apart when you get down to the percentages involved.
Try being an I.T. professional
I donât know a single teacher in the entire school system I work for that makes $90k a year. Maybe in a high cost of living area they make that much, but in semi-rural central VA, teachers make around $38k to start in primary education, and tend to top out around $70k-ish after 20+ years on the job, with a national board certification. Around here, the administrators, and county-wide personnel are the only ones making six figures.
The way youâre describing things, it may end up being cheaper to do that.
I know at least a half dozen mechanics personally,and have been acquaintances with many more over the years. None of them are destitute, all of them maintain a middle-class or better lifestyle, most of them have newer F-350âs or Silveardos, have nice houses, some of them have boats, some of them have chromed-out Harleys, a couple of them coach their kidâs little league teams, etc. The outward appearance is that they are doing fine. Even the guy with three kids and a wife who feels she doesnât need a job, isnât rolling pennies for gas money.
You want to hear something crazy? The shop that I use the most, a shop that Iâve been using for almost 20 years now, a few years ago had to expand their operation, their old shop simply couldnât keep up with the kind of business they were doing. So they built a brand new shop about a mile and half down the road from their old shop. This new shop is roughly twice the size of their old shop, I want to say it has eight racks plus another 2 bays without lifts. They are still typically booked out by about a week no matter when you call. The crazy part is that they allow you to bring in your own parts, of course itâs understood that they wonât warranty the part obviously, but Iâve brought in my own parts regularly and they have no problem with it. Just recently I had them put a set of lowering springs on my car ( I supplied the springs, hardware, and camber bolts), they did the install and did an alignment. Also they tend to have lower than average (for the area) labor rate. Whatever theyâre doing itâs been working for them as they are constantly busy. But yeah, I think youâre wrong.
Excellent points.
I donât know about dealer pricing, but it is possible the dealer doesnât enjoy the discount you can find online for OEM parts. Some dealers give discounts to employees close to their cost. When I talked to one parts dude (2 years ago?) he said he could find OEM parts cheaper online than the dealer paid, but it wasnât worth the hassle.
Iâve heard similar with some tires. I gave Firestone a chance to match my tire shopâs price. He looked them up, got a puzzled expression and told me they were cheaper than he paid for the same.
Like you, all independent shops I work with are willing to install aftermarket parts, if they donât think they are substandard. They donât have to deal with redoing a job, unless they determine it was a fail in workmanship. The local shop mostly insists on that arrangement for custom parts, not supplied by his parts house. That makes sense. He has no idea of the quality or suitability of the part.
I ruined a tire on my new car and I needed an exact match to the other three. My normal tire dealer didnât have one in stock but the Acura dealer did. Plus the tire dealer said the Acura dealer was cheaper than what they could get it for. Price wasnât the real object since I needed it right now, still it was interesting.
I think talking about parts markup and so on doesnât really matter much unless you are going to do the work yourself. If you take it to a shop or a dealer, the bottom line cost is the bottom line. No point arguing what percentage of their charge relates to HVAC costs to be silly. They have their pricing model to stay in business and we have the ability to use it or not. I can go to two different restaurants and one will charge $10 for a hamburger and the other will charge $20. Itâs my choice. I donât know or care what they paid for the beef (assuming it is beef).
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Keeping an inventory ties up money. Tracking down parts takes time, even if it is time on the telephone. When I take a car to a shop, I want the shop to do everything. When I did a lot of my own work, I shopped for the parts. That was part of the time I had to spend doing a repair.
I was glad to finally have an income where I could pay a mechanic to maintain my car.
I think I got along better with the service staff at the university where I was on the faculty than 80% of the administration. I was pleased when they would call me by my first name.
I got to know some of the mechanics in the motor pool. They were a good source of information when I was going to buy a car. These mechanics serviced different makes of vehicles in the fleet and knew which ones had more than the usual problems.
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I did bring my own parts a few years ago. I had bought a new OEM thermostat and all of the little special hoses for the cooling system. I think there were about ten of them and it was not easy figuring out which hose was which. I had planned on doing the drain and fill myself and then chickened out due to the limited access. So we were going to be gone for a couple weeks and I needed the wheel bearing looked at so just asked him to do everything. I didnât think it was a problem and maybe saved a little aggravation trying to find all the parts. I didnât ask for an estimate and he just sent me an email asking if he should go ahead with a new bearing. I donât remember the bill but it was reasonable and I wouldnât have minded if he tacked on some additional profit. I couldnât return the parts anyway. He didnât want my $30 hose tool that I bought for the job so I suppose itâll go for about a dollar at auction sometime.
Now if I were to get an oil change at one of those places, I would bring my own AC filter and Mobil 1 just because thatâs what I want and they wouldnât use it. OTH I wouldnât expect a discount for it. So I guess Iâm flexible but wouldnât go to NAPA and buy the part and then expect them to put it in, unless I were working with them on it, like with my air shocks.
We are in the berkshires of westernmass where the town has a population of 6k and 10 repair shops, everyone is busy in the summer and then we go back to reality where the pie gets cut into very small pieces, houses in our town are 350 to 600k, and the towns 5 miles away homes are 1 million plus. with this small population, shops with 3 employees just do not have a big enough revenue to allow customers to bring their own parts, we are in a very expensive area where everything is exceeding the wage if the average earner, tech in any industry are impossible to find and all the young people are leaving, we have 2 3 of the oldest average age of residency communities in new england with in the surrounding 10 miles.I guess mass is the place to be a school teacher, lots of them make 90k, and plumbers and electricians are near 40 an hr, even for travel time. Mechanics are earning half of that here and simply are scrapping by with 2 household incomes to pay 1200 plus for apartments. Many apartments go to 2k a month, for all those who are naysayers, come here and see for yourself, and the guy who thinks the dealer can handle it when independents go out, there are 20k dealers in America, and 200k independent shops. They in their wildest dreams cannot do the repairs for the motoring public, not even close to possible. I have spent 5 decades in this industry, served on boards and stayed current with training classes all over the country, I seen all the changes , and you can google what I wrote or consult some of the professional publication and see that the most prominent people industry wide feel the very same way.
A recent article in the Buffalo News relates a story about a Niagara Falls school teacher making $107000 plus lots of benefits. She had been there 22 years and was fired for not living in the district. The median home price in Niagara Falls is $74000. Some if the poorest districts in our state have the highest teacher salaries. The teacher rented a cheap apartment in Niagara Falls but nobody with her and her husbands combined incomes would want to live in the Falls. The school board had he followed for almost a year to prove where she lived.
That is weird. She had a residence in the town.
Heck, Iâll bet 2/3 of Congress wouldnât be able to run for office, if they had to live only in their home district.
Years ago the school system here wouldnât allow two people to be married and teach in the same district. This was before two people would dare live together without being married. I never did get a good reason why except one person tried to explain it was for their own good in a budget shortfall where both wouldnât lose their jobs at the same time. Minneapolis used to require the police to live in Minneapolis and that didnât work out very well then changed it and I think they tried to change it back again. Yeah people have been getting voted into office with weird ideas for decades and probably centuries to make up rules like this.