DealersEdge Professional Forums

I am getting some push back on shop supplies from customers especially with gasoline pices. Even if we tell customers up front. We are at 17% of labor with a max of 29.95 and min. of 3.00. Has any body thought about raising labor rates and going to a flate fee on every ro.If you have how in the world would you calculate what you would need to raise your rate.

17% seems like a lot to me. Especially as we push $100/hour labor.

I am at $100.00 with a bell curve grid. (Atcon) AutoNation in Denver is at $49.95 max on supplies. I was thinking about getting rid of this charge and basically hiding it in the Labor rate.

Holy cow. I gotta tell ya, I'd really have a hard time looking a customer in the eye at $49.95 for non-itemized "supplies".

We're at wimpy 7% with, as I recall, a $10.00 max.

If you eliminate the charge and increase your labor rate to cover it I'd have the office make a journal entry every month so you can actually SEE the offset to your supply account. Name your figure...$1.50 per very flat rate hour or whatever....but be consistant.

Cheers
DD

Old Irish is right. Look at what "supplies" are flowing in and out of that account. We are at 5% of parts with a $12.00 Max with no charge for repair orders under $50.00. I don't feel it is important to make profit on shop supplies, break even is good. Maybe some of those "supplies" can be inventoried and sold for profit.

I hear you. Its a little peer pressure from our 20 group I got into. The owner seems to think if AutoNation can get $49.95 we can get $49.95. It was a struggle to get down to earth at $29.95. I just want to raise my labor rate to make up for it and not charge it on the ro as a seperate charge. If the customer pays for it in the labor rate they wont realize it and wont question it.

We're gradually moving more and more "supply" items into our parts inventory and selling them at a profit.

It works.

Cheers
DD

I have heard that it is illegal to add shop supplies in Oregon. Is this true? Can any one verify this? Thanks

It is illegal in California. We just charge what we use-4 bolts at .25 c each, brake cleaner -needs to itemized

It is illegal here in Ontario to bill a fee for Shop Supplies. We have diverted most shop supplies to the RO as parts. Everything from Lock Lube to wheel weights and it means more money for parts!

[This message has been edited by Parts Guru (edited 05-01-2008).]