Markup to the service dept

[mightytitan9]

I was told I could no longer mark up parts to the service department. Is this normal? I am talking about items that we provide to the service dept that are not itemized on ROs. Things like washer fluid, brake fluid, DEF etc.

We've always charged internal pricing on this and now are no longer allowed. I told them that now we are doing a lot of work for absolutely no money. Is this normal to not mark up items sold to the service dept?

[PartScott]

If it comes from my inventory (242) then it absolutely gets marked up!

[Zep33]

no, that's not normal

[Bearster18]

I had a prior service/parts director tell me we couldn't mark up any parts sold to the shop on the shop counter ticket. Because he was tired of seeing the sales manager get his bonus and my old boss wasn't . So he was cutting all costs to the shop as possible. Pretty much BS. Glad he is gone.

[tmundal]

If they want to play that game, just make your markup on the cost when the stuff comes in the door.

[camaroman]

The only thing that we do not mark up are shop supplies. It all comes out of the service and parts department gross before I get paid so I want it to be the least expensive as possible.

[LOKI1]

If we have to order it, store it and hand it out then we assume we are untitled to a markup. So does our owner.

[mightytitan9]

If we have to order it, store it and hand it out then we assume we are untitled to a markup. So does our owner.

This is my opinion. ANYTHING that requires us to order, store, hand out and inventory should be marked up in my opinion. Unfortunately, others disagree.

I think it's largely to cover for a service dept that is hemorrhaging money.

Now we are "in charge" of special tools, retaining warranty parts, keeping track/handing out LPO Parts, and providing them with supplies, all for no profit! Sounds like my department is getting the shaft.

[mightytitan9]

If they want to play that game, just make your markup on the cost when the stuff comes in the door.

I think the service dept is going to be "buying" a lot of Optikleen instead of regular washer fluid from now on

[MSInventory]

It's definitely not the norm. The service dept. should be able to re-coup a majority of their shop supply expense through customer pay and internal ROs. By not marking it up at all is backward thinking. It doesn't work.
We sell the service dept. supplies at a cost + 67% mark-up. Basically, list price. Internal gross profit is a healthy thing for any dealership.