How much should I charge for parts?
Target Matrix
| Cost of Part | Gross Profit % | Markup % |
|---|---|---|
| $0.01 – $1 | 50% | 100% |
| $1.01 – $10 | 43% | 75% |
| $10.01 – $25 | 33% | 50% |
| $25.01 – $150 | 31% | 45% |
How do you calculate labor parts?
The parts-to-labor ratio can be calculated in two ways: by work order or in total. By work order, simply take the dollars of parts billed vs. the dollars of labor billed. In total, sum the parts billed though the shop and divide by the total labor billed.
Do dealerships overcharge for parts?
Some people believe that dealerships overcharge, while others say the same of independent garages. But the numbers don’t lie. A 2010 study by AutoMD.com revealed that repairs not covered under warranty cost an average of $300 dollars more at a dealership compared to the average corner repair shop.
How are shop supplies calculated?
The most common method for calculating shop supplies is to charge it as a percentage of total labor on a service order. For example, 8% of labor. If the total labor charge is $500, shop supplies would be $40.
What should my labor rate be at my shop?
Very close by our shops, the rates are lower and higher. I just want to be less than the dealer. Our cost of labor Techs and service advisers never exceeds 41% of the effective labor rate. I look for my gross profit to never go below 60%. parts and labor.
How much should you charge for labor at auto repair shop?
But over a long period of time, such as a month, strive to average at least $1 for labor for every $1 of parts sold. If your labor sales are significantly higher than your parts sales over time, it usually means that you aren’t marking your parts up enough.
Why are my parts sales higher than my labor sales?
If your labor sales are significantly higher than your parts sales over time, it usually means that you aren’t marking your parts up enough. If your parts sales are significantly higher than your labor sales over time, it usually means that your shop labor rate is too low.
What’s the average wage for a parts salesperson?
The median hourly wage for parts salespersons was $14.63 in May 2018. The median wage is the wage at which half the workers in an occupation earned more than that amount and half earned less. The lowest 10 percent earned less than $9.56, and the highest 10 percent earned more than $26.27.