EXTENDED WARRANTY PRICING

[OLDPARTSGUY]

Looking for a way to ensure we are getting all we can. We are a R&R user and have three labor ops C W I. I have been told thats all we can get. Is this true? I am certain far too often we are leaving money on the table charging GM warranty prices when more can be collected at extended warranty prices

What are others doing to combat this?

[This message has been edited by OLDPARTSGUY (edited 03-06-2006).]

[Old Irish]

Most extended warranty companies...nearly all, really.....that we deal with will pay MSRP. There's the odd exception here and there, but that's pretty much it.

You are leaving lots of money on the table if you are only charging the GM warranty amount, cost+40%.

You can set up umpteen different pricing codes so that mark-up/sale amount can be altered on any repair order...or even individual lines of a single repair order.

Cheers
DD

[Badbjd]

Our Reynolds is set up so I charge the parts out at warranty prices however when closing the ticket the service advisor changes something in line 21 in 3651. That then changes prices to List and charges tax. This is what we do for GMPP.

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GM and ASE Certified
Parts Manager

[petepuma01]

When writing an RO in the service application, you are limited to the CWI options. However, in 3010, 3030 and 3651, the user can perform a journal prefix override at the job level.

(The J command on the command line in 3010/3030, as well as the job screen in 3651).

In 3636 RO Sales Journal, you can create user defined sale types, or, journal prefox overrides. With these overrides, you can assign an alternate PL code to be used.

So when someone in service overrides the journal prefix in 3010, 3030, or 3651, the parts prices will be recalculated according to the PL attached to the prefix. If this is done in 3010/3030 (or 3651 if the parts are not billed yet), when parts gets the RO, the pricing will be correct from the beginning.

If the override applied to the job after the parts are billed (via 3651), the prices will change at that point.

So bottom line-- you can set your system to use alternative pricing. You may already have the journal prefix overrides set up since extended warranties often use different GL's than customer pay or warranty. Setting up another prefix allows the accounts to be overridden.

[2wheels4me]

The journal prefix override is the way to go but I'd suggest another change to further protect yourself. Make all ext.warranty lines on ROs start as CP lines, then use override to correct prices. Upside, no one is going to forget to do the override because, if your on a matrix, your default prices are too high. Downside, your ext. warranty sales will be report as CP on your management reports.

[Old Irish]

"Downside, your ext. warranty sales will be report as CP on your management reports."

What's the down side of having extended warranty or service contract jobs reflect as a customer pay? Isn't that what they are?

I think of them as a customer pay with a third party billing......just like a body shop repair where an insurance company is paying.



Am I missing something?

Cheers
DD

[This message has been edited by Old Irish (edited 03-18-2006).]

[2wheels4me]

Old Irish...No, you're not missing a thing. Maybe "downside" wasn't the right word. In my store ext.warr. is C.P. My point was that some GMs or owners may want it reported as warranty.