Independent mechs.

As some of you know,some dealers give no discount on parts. What do you mark up those parts,if any?

45% profit margin is what most shops strive to hit on parts . There is a matrix some use, higher on cheaper and lower on big tickets items .

having been on both sides of the parts counter in my time i can answer you, when you get your car fixed any shop can mark the price of the parts for your car up 50 to 100% over what they paid for them, that being said you cant buy at their price at the parts house either, your not spending ten grand a month with them you pay somewhere in between shop price and full retail, depending on the parts house pricing schedule and how you act in the store if your easy to get along with you pay less, if your a problem customer, you pay dearly for the right to be one

If I do not get any discount then it depends on the customer. If it is one that pays me in a timely fashion then I just charge for the time/travel I have invested in getting the parts(This is at my shop rate which is $45/hour). If it is one that is a slower paying guy then I make him a list of what parts are needed with quantities and brands. They can pay or charge them somewhere else.

Years ago carrying shop accounts is partly what caused me to have to start working at dealerships. I would be one of the last ones paid. The Farm Plan and Credit Cards would get paid before me because those would cause them issues. When they stiffed me for a few months then all they where out was having to go else where in the future. When I started at the first dealership I had over $25K on the books.

There have been a few court cases here in Iowa the last few years where if you mark the prices up them you become the seller of the parts. Therefore you could be involved in any parts warranty issues monetarily. Meaning that you had to honor the warranty and then collect it from whomever you bought the parts from. If you got nothing from them then you could not charge the customer.

I only work on maybe five guys stuff any more. I have pretty much quit doing any customer work. There is just too many rules/laws that can hang you now.

I used to charge to anyone years and years ago . Seemed like the thing to due . Till you sit down and see ,,like you say JD, $25 grand or so out there . ended that fast ! I have 3 maybe 4 fleet accounts now that are the only ones to charge . They pay at the end of the week too. Everyone else is cash or check . I don't take credit cards,,used to ,but so many headaches. Merchant fees etc . I know I should ,,but really havn't had too many complain about not accepting them .

Back when I had my station we got 55% discount on parts at the local parts store nothing at the dealers but then the parts houses had new car parts from the company back then dealers went there rather than have their own arts department. There was free delivery. You could mark the parts up to what ever you wanted up to the retail price set by he parts house. It was a better system for the mechanic. Then the big companies stopped selling to the local parts house and we all got ripped off.
Walt

As you said most dealers don't give discounts to independent shops. Most of my customers have Farm Plan accounts at the dealers and the dealer knows me well enough that I can charge the parts on the customer's account. The few that don't it depends on the customer and how big of an order it is. Larger orders I will have the customer pick up and pay for. One or two parts I will pick up and mark up a little to cover expenses. My wife works 1/2 mile from the JD dealer (20 miles from home) so I don't have much time or travel tied up in picking up parts. If I have to make a special trip I charge shop rate for the trip.

I just checked on my HY-Capacity acct and it gave me a choice on profit margins. I quit selling parts do to all the hastle. I just order parts from where ever customer wants and charge them to him. If I pick up some small items for a small repair I just charge exactly what I paid but if I was charged sales tax I include that in the charge even though farm equip has no sales tax for parts or equip. If our Governor gets his way and I have to charge sales tax on service labor I may just hang it up completely. Enough trouble keeping records for self employment tax (social security) without adding some more hastle.

I have a Deere dealer that gives me 10% and a couple of independents that also gives me 10% on things that I cannot get through my own wholesale sources. I try to make 30% on aftermarket parts. Freight charges really hit you hard today. You also have to charge for that too. Some add it to the price or add it on the bill as freight. I don't think any of us little guys are getting rich on parts

I charge a mark up on parts at my shop because I spent time to look up/order them and I am on the hook for the warranty if it fails. The parts company does not always come through with warranty payment. Chaps my butt when shops order cheap parts and then direct bill the customer, so when it fails, the customer is on the hook for labor. If a shop recommends a certain part they should charge a mark up and man up when it fails.

I've seen markups around here anywhere from 10% to 100% plus. The 100% plus was actuallty a markup on labor for a job done for a dealership. Dad was standing there in the office talking to another guy and happened to notice the guy doing the paperwork as he filled out the invoice for the end customer.

That said, the way things are right now I let the customers buy anything major needed for a job and only buy incidentals, which I pay tax on and then charge them exactly what I pay for them.

I don't have a shop or work on other people's stuff, but when I was young I used to turn wrenches on friend's cars and I always had a project car or race car.
In the late 70's- early 80's NAPA gave me a small discount. The parts guy at the Ford dealer sold me parts at 75% off list! I bought allot of parts. If I recognized other customers as shop owners I'd step aside and let them go ahead of me in line. I scored major points with the guys at the counter for that. Sometimes they would give me small parts.
One time Ford didn't have what I needed so he called NAPA. He told them he was sending me over and would appreciate if they gave me his discount which turned out to be 55% off list. The thing with NAPA was I'd get a big discount one time and the next time hardly any discount. I doubt that anyone ever paid list price there.
I'm told that Ford dealers no longer offer those big discounts.

With the overhead involved I doubt any legitimate shop could survive without marking parts up.