The Request
“I have found the parts you have told me that I need. I found them on line. They are much cheaper than what you quoted. Will you install them for me for just the labor you quoted ? “
From the Shop Perspective
Consider that the shop to which you take your car (any car) must make “Gross Profit Dollars” (Sales minus Cost of Sales) to cover their expenses. I am not talking about percentages…. I am talking about the generation of raw, spendable dollars. All automotive shops make about an equal amount of “Gross Profit Dollars” by selling labor and parts at a profit. That “Gross-Profit-Dollar-Pool” is what the shop generates in an amount sufficient so as to pay the rent, insurance, uniforms, utilities, taxes, repairs, fuel, administrative salaries and, if lucky, a little is left over for a profit to the owner.
If 50% of the “Gross-Profit-Dollar-Pool” is derived from the sale of parts, and a customer offers or expects the shop owner to forgo the sale (and accompanying Gross Profit) of the needed parts, then it follows that the shop owner will necessarily forgo 50% of his needed “Gross Profit Dollars” with which to run the business.
By installing customer-supplied-parts, the shop is then deprived of the dollars needed with which to pay the shop’s accumulating operating expenses regardless of the goodwill generated with the customer.
Some shops may reason that they “will install the customer-supplied parts and at least sell the labor portion of the transaction”…. but towards the end of the month, the operating percentages may look good, but there is no actual spendable money !
Would this arrangement look as good to the requesting customer if the shop owner agreed to double his labor rate so as to generate the needed Gross Profit Dollars in order to stay in business ? Probably not… after all, “the guy down the street only charges half that amount !”
From the Customer Perspective
Let the finger pointing begin!!
The warranty on the customer-supplied-part will probably not cover installation error or a bad diagnosis… and… the parts supplier will also not pay for “warranty labor” which the installer will charge to install another part if the first customer-supplied part fails.
The installer will say it was a “parts problem” and the parts supplier will say it was an “installation problem”. Unfortunately, in either case, the customer will probably be asked to pay for another part or for additional labor, or both.
And, and this is the really big issue…. liability. If the part fails or if the labor was improperly performed, exactly who’s liability would the car owner address as a result of a failure of the completed operation ? The manufacturer of the part ? Or the installer of the part ? You can presume that both of the entities have products liability insurance, but most of the shops agreeing to install customer-supplied-parts, probably do not make enough money to afford either garage keepers or products liability insurance. I am not being mean; but if the shop is accustomed to giving up one half of its needed Gross Profit Dollar, it probably does not generate enough dollars to pay for products insurance, completed operations insurance or liability insurance..…
Conclusion
It is imprudent for a shop owner to install a customer-supplied parts because, over time, there will not be sufficient Gross Profit Dollars available in the shop to meet expenses.
It is equally imprudent for a car owner to buy parts on line and ask a shop to install them because: 1) there is a large potential that an inferior quality part may be supplied; 2) there is no labor warranty covering the supplied part; 3) there is no guarantee by the parts supplier or the installer as to the diagnosis or suitability of the part; and 4) there is a serious question as to who will be liable in the case of a parts failure or an installation failure in the event of a catastrophic tort claim.
In the long run, there is little upside to these arrangements for either the customer or the shop.
Motorcars Ltd. only installs parts we supply and we offer a 12 month / 12,000 mile warranty on both parts and labor. The issue of liability between parts and labor if one fails is not in question with our customer; the suitability of the parts and the diagnosis of the problem is not in question with our customer; and completed operations are covered by our liability coverage.
Motorcars Ltd. is the Jaguar, Land Rover and British Classics “go to” repair and maintenance destination in Houston. We have been through thick and thin for over 50 years by operating on sound business practices and offering quality workmanship at a price both fair to the customer and fair to our business.
