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Let’s talk about prices in our industry. I will refer to the industry
as “we." Most shops have an hourly rate and use one of the published
labor guides. This is a book or compact disc we use to help establish
a labor time to perform a service. This does not take into
consideration age/mileage or the affects it has, modifications or
damage that could create problems adding to the labor cost.
Conversely it may not account for a new tool that helps to perform
a service more quickly, therefore; saving us time and you money.
You still think it is easy to come up with a price, it’s not that
simple. Most shops use several different parts suppliers that carry
new and reconditioned parts. This can be confusing when you start
to call around looking for prices. Take a water pump service. Just
the difference in the cost of a new water pump vs. a reconditioned
(often called “remaned” for remanufactured) pump can be huge. Then
the book time may be over-inflated or under-inflated which could
cause a fluctuation in pricing from shop to shop.
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Let us take a real world scenario. You call a shop for a price on
a water pump for a 1998 Honda Accord. There are 3 different engine
possibilities depending on the trim level. Some of us don’t know if
we have the four or six cylinder let alone if the four cylinder is the
Vtec design (this could make a difference in some repairs). Assuming
it’s the four cylinder and there is no difference in parts or labor
between the Vtec/non-Vtec, the shop goes to work on pricing. They
call their suppliers for pricing and have a choice of aftermarket,
new or remaned or dealer supplied new, original equipment (oe).
Aftermarket in this situation means a company other than the original
supplier. The aftermarket remaned pump is about $35.00 and the
aftermarket new pump is about $80.00, if going to a local quality
parts supplier (like Car Quest, Napa, etc.). The dealer part is
about $65.00 before any additional mark up. Most shops (like any
business) have systems that calculate mark up from cost. Dealers
typically do not give shops much of a break on parts, therefore the
mark-up on a part acquired from the dealer can be much more than
they charge, depending on the shop’s system and mark up. So, the
shop looks up labor and finds that it has a time of 4.6 hours
(assuming it has a/c). So, you call a Honda dealer and a tire store
located not too far from us. The dealer tells you the price is
$581.80, the local tire store tells you the price for the remaned
pump is $446.00, then you call us. If you have had that vehicle in
our shop previously and we confirmed the leak we will price it. If
you have never been in to see us, or we have not inspected to verify
the pump is faulty we will normally ask you several questions and
urge you to have it inspected, then we can price it. Now, the final
part of this scenario is; the belts, timing covers and timing belt(s)
have to be removed in order to replace the water pump. If the belts
are old, or you find other problems, it is in your best interest
(saves lots of money on labor) to take care of these at the same time
the water pump is installed. So we tell you a range of $600.00-800.00
depending on what is found. If the other shops did not ask the right
questions or warn you about belts, timing belts, seals, etc., you
think we are crazy and overpriced. You have to compare apples to
apples. Again, not as easy as it sounds or would appear.
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Our recommendation is to interview a shop the same you would when
using any service industry. Find a shop that is qualified to handle
your needs and backs up their work with a good warranty. Once you
find a shop you trust, then stick with them; like doctors, plumbers,
etc. Price is dependant on what is found during the actual service,
not what is quoted over the phone. We have all felt like we were
sucker-punched when lured into a retailer, or using a service, with
the promises of the lowest prices in town, then found out differently
after it was all said and done.
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