DealersEdge Professional Forums

Hi everyone, how's it going, today, just now actually, I've been given to task with drafting up a new return policy that will reflect our OEM's return policies and our dealerships parts departments return policies, I know of the basic terms and conditions that go through every parts department, but I would just like everyone's input on this too create a master list, something that is firm and can not be easily twisted around.

We have the standard 20% return fee for special orders, nothing on stock parts. No returns after 30 days but I do make exceptions for some wholesale accounts. I don't generally charge a restocking fee to my wholesale accounts unless it is a really expensive item and they usually don't argue. On service department returns, I charge him 35% of cost for everything that is either the technicians fault or the advisors fault which includes customers that won't come back. I have an absolute no guarantee on keys cut by code. But no matter how thorough you are the first person to raise hell won't pay the restocking fee either because I need to get them the hell away from my waiting room or they cry to the GM.

We do 35% on special orders (its what GM charges us) No returns on open electrical. No charges on stocking items. We do make some exceptions for our better wholesale customers

cville1987 wrote:We have the standard 20% return fee for special orders, nothing on stock parts. No returns after 30 days but I do make exceptions for some wholesale accounts. I don't generally charge a restocking fee to my wholesale accounts unless it is a really expensive item and they usually don't argue. On service department returns, I charge him 35% of cost for everything that is either the technicians fault or the advisors fault which includes customers that won't come back. I have an absolute no guarantee on keys cut by code. But no matter how thorough you are the first person to raise hell won't pay the restocking fee either because I need to get them the hell away from my waiting room or they cry to the GM.

How do you go about charging service? Do you just recreate a separate invoice for all those parts to be billed to them?

tmundal wrote:We do 35% on special orders (its what GM charges us) No returns on open electrical. No charges on stocking items. We do make some exceptions for our better wholesale customers

What do you think the limits would be for wholesale customers? How much is too much, when do you need to sit down with them and have a talk?

tmundal wrote:We do 35% on special orders (its what GM charges us)

I only do 20% because I am charging them 20% of what they paid which usually comes close to covering the 35% of cost that GM charges me.

dropdeaddart wrote:How do you go about charging service? Do you just recreate a separate invoice for all those parts to be billed to them?

I make a counter ticket and I bill the part and then credit the part on the same ticket so he can see what parts he's being charged for, then I figure all of the restocking fees and charge them on the restocking line on the ticket.

cville1987 wrote:We have the standard 20% return fee for special orders, nothing on stock parts. No returns after 30 days but I do make exceptions for some wholesale accounts. I don't generally charge a restocking fee to my wholesale accounts unless it is a really expensive item and they usually don't argue. On service department returns, I charge him 35% of cost for everything that is either the technicians fault or the advisors fault which includes customers that won't come back. I have an absolute no guarantee on keys cut by code. But no matter how thorough you are the first person to raise hell won't pay the restocking fee either because I need to get them the hell away from my waiting room or they cry to the GM.

What is your opinion on how to handle excessive returners from the wholesale side. When is it too much? Do you have a Returns Policy for wholesale alone, a flyer that you've given too them? Have you trained your driver to ask the right questions when they are there gathering the returns and making sure everything is correct?

dropdeaddart wrote:What is your opinion on how to handle excessive returners from the wholesale side. When is it too much? Do you have a Returns Policy for wholesale alone, a flyer that you've given too them? Have you trained your driver to ask the right questions when they are there gathering the returns and making sure everything is correct?

Well I have very little wholesale due to the big boy in the city and I also don't have a driver. Returns aren't as much the issue as them never picking up what they ordered. So if I think they are doing it too much I put them on prepay and then they stop using me. The shops that do call me are for the most part pretty easy to work with and if I ask them to they will pay the restocking fee.

Now if I did more wholesale and had abusers I would let them know what their return percentage was and if I could I would let them in a dollar amount how much they were costing me and tell them I am raising your prices to make up for some of this until the abuse stops. If you lose them then it probably is no great loss. You have to compare how much profit you make versus how much you lose and if it's worth making a stink over.

dropdeaddart wrote:What is your opinion on how to handle excessive returners from the wholesale side. When is it too much? Do you have a Returns Policy for wholesale alone, a flyer that you've given too them? Have you trained your driver to ask the right questions when they are there gathering the returns and making sure everything is correct?

I didn't rely on the drivers to get the reasons. Call yourself on the returns that were sent back. This will allow you to ease into your new return policies giving them the reasons for enacting it. It also reminds them that you are watching returns closely and gives them a chance to object. When they object (which they will) remind them that you are in business also and inform them your pricing structures are based on their performance as a customer. Give them a choice lower discounts or restock fee. Most will accept the restock fee and modify their behavior to avoid them.

I considered anything over 10% return rate to be excessive. If you do a monthly flier do something on it (gift card) that would reward your best performing shop. This will serve you in two ways. Reinforce the low return rate behavior and allow you to namedrop on your advertisements.

This is what I put together 5 years ago. PS it needs updating
To our valued customers:
With the launch of MOPAR’s new part return Terms and Conditions in July 2009 to the dealer body, (see below*) the following customer returns policy will take effect July 1, 2009. Your purchases and return percentage are what influence your sale discount percentage the most. Fewer returns from you equals better pricing.
* 120 Day returns will be capped at 1% of prior month’s Daily and Special Handling purchases for ARO-compliant dealers. Restocking fees will be increased to 10% or $10 whichever is higher for ARO-compliant dealers. For non-ARO or ARO non-compliant dealers the fees will be 20% or $20 whichever is higher.
Special Ordered Non-Stocked Parts:
• This policy takes effect once the part is ordered from MOPAR. Once the order is placed with MOPAR we cannot cancel the shipment.
• Returned parts must be in saleable condition (collision repair parts must have no damage unless reordered, be unpainted, and be returned in their original undamaged packaging*; mechanical repair parts must not have been obviously installed and be returned in their original undamaged packaging*; electrical parts must be in their original undamaged and unopened package).
• $10.00 per line restocking fee for parts with a purchase price of $100.00 or less.
• 10% per line restocking fee for parts with a purchase price of $100.01 or more.
• Non-returnable parts to MOPAR are not returnable to the dealership (roofs, frame rails. wheel wells, etc).
• All sales are final after 75 days from date of purchase.
• All returned parts must be unmarked*, undamaged* and in returnable condition to MOPAR.
Parts purchased from off the shelf Inventory:
• The parts manager may waive or reduce these fees at our discretion for any parts that were in stock.
*If you receive a part in a marked or damaged box or container please make note of it on the dealer copy of the invoice and have our driver sign the invoice at time of receipt.
Please feel free to contact us with any suggestions or questions you may have.
Thank you for your business,

Retail and wholesale customers are made aware that there is a 35% restocking charge on special order THAT ARE RETURNABLE. And the usual: parts must be unopened and in salable condition, yadda, yadda, yadda.