Should a body shop charge markup on parts they buy for repairs

[uofom3]

some independant shops make a lot of their money off of parts sales...

[Funkmasta]

Dude. They are fixing YOUR CAR. do you have the ability to do it yourself? I'm guessing not.

So, pay them the parts markup, or pay an inflated labor rate, your choice. Thats what it takes to keep the lights on.

... because they have to fix your bodywork because you don't know how.

[Midnight Sun]

and i think its wrong for a shop to charge so much markup on parts. I learned a new trick from a guy at a shop this week. They get two receipts from their supplier one (a lot less, that they put in their file), and another (a lot more they give to the insurance company).

That is a new one. All of our vendors print both our cost and the list price on the invoice.

As a shop, we never mark up shit. Tonkin and the likes do it for us.

[Jscotty]

While we are on the topic, one thing that I hate about insurance is that my rates go up every year simply because other people who share some of my criteria cause accidents. And being that I have not had an accident or moving violation in the last 20 years I believe that I should get some of my money back. Granted I am not the most perfect driver but doggone it, I drive defenseively enough to not have accidents. I even manage to avoid the ones that would not have been my fault.

Even when I go rent a car, they always try to hard-sell me that damage waiver coverage. The insurance company that furnishes the damage waiver must be making a FORTUNE which makes me think that the agent earns a huge commission for selling it. At $20 a day (and lets be conservative and assume that 40,000 people rent a car every day) per car per person, that has to add up into the billions annually.

I always tell the guy that I don't need it simply because I do not have accidents. And of course they always have some sort of lame "what-if" rebuttal. And I respond by saying, "Well look, Mr. Rental Car Agent, if I can get away with wrecking 5 different rental cars in a one-week period, no questions asked, I will take the coverage. If its easy as just getting another rental, no strings attached I will wreck a car every single day knowing that my $20 damage waiver will cover it."

Dead silence.

I don't run stop signs, I don't drive like a maniac and I do not rush to get to where I am going. I don't drink, do drugs, or engage in any other activities that would distract my ability to pay attention. Heck, I don't even talk on the cell phone while driving unless I am expecting an important call. Even at that I will make the call as brief as possible, pull over, or offer to call them back later. But some dick on the other side of the rental counter wants to persuade me to buy their insurance because I might be a crappy driver. Heck, I will make sure I wreck this car before I return it.

And then the other bad thing about this damage waiver insurance is that the rental companies never get the car fixed unless the car is badly damaged to the point of being undriveable. I mean they warn me with "If there is one scratch on the paint or one stain on the seat when you bring the car back or if you smoke in the car, we will have to charge you a $1000 deductable. Being that I am a betting man, I am willing to take my chances. So finally I get the car and it has stains all over the interior, it reeks with cigarette smoke, and there are some pretty deep "love-tap" scratches on all 4 corners of the car. This tells me that a few irresponsible drivers took the damage waiver or got hit with the $1000 but the rental company didn't bother to restore the car back to its original condition. So I say screw it. If I get a scratch or ding on the car while I am renting it, I will just tell them that it was there when I got the car. No way that they could tell me that it wasn't being that the rest of the car was all messed up yet they rented it to me anyhow.

[1991 318is]

Our consumer economy is built on credit with the collateral insured against loss. Buying a car is a typical example. Your finance company requires physical damage coverage.
Insurance companies are regulated by the government in setting rates and the actual policy language and forms. Insurance companies pay the body shops. Then there are a lot of behind the scenes vendors supplying parts, paint, etc. All aspects of this are an opportunity for fraud. 90% of the consumer protection statutes are directed at auto sales, financing, and repair. There are crooked adjusters, shops, car dealers, finance companies, politicians, and people who are just walking down the street past the building!

[Fanzotti]

P town, that castle of a body shop is a poor example. 95% of body shops are in shit buildings. Have you ever seen the castle or even sky scrapers that insurance companys build? They make that deluxe shop look like a storage shed. Alot of my friends are in the insurance game and they make bank. I even have at least two friends whose parents started major insurance companys, I see how they live and to tell you the truth, even though their friends of mine I'm not to worried about them having to pay a mark up on a fender, they'll be way more than just fine. I guaruntee Body shops are getting the raw end of the insurance deal and their passing their loss ontom you.

I'm sure you're a good guy but insurance companys blow monkey nuts.

[thectrlguy]

They most likely had enough margin to cover it, but that's not the point. They made a repair, and should have been compensated accordingly.

You are correct, there attitude towards customer service has "won" my business.

And I am sure that they built in enough wiggle room to be able to fix that other scratch. It cuts back on some of their profits but they win you as a lifelong customer.

[Jscotty]

I am completely against blatent insurance fraud, however, sometimes you have to finagle the settlement a bit to get things done. Many years ago my place of employment was burned in a fire. The adjuster determined that everything inside of the office space including the walls was damaged by the fire and then he cut the owner a check to completely gut the place out and rebuild it from scratch.

Then when the fire restoration people came, they determined that the walls and the floors could be cleaned up and restored without tearing them down.

So when I asked the guy why go through all of that trouble if the insurance is going to pay for everything? He stated that its because if the construction crew finds other problems, that can free up some of the money that might be needed for other things that the adjuster did see. So I think that sometimes a body shop has to build in some degree of safety in the estimate so that if the car appears to just have a smashed fender and door but then the body shop realizes that it also has a bent strut, a cracked floor pan and other minor things that the adjuster didn't see, then they can still satisfactorily repair the car without a financial burden.

And I am sure that they built in enough wiggle room to be able to fix that other scratch. It cuts back on some of their profits but they win you as a lifelong customer.

[thectrlguy]

Have you ever ran your own business? I am guessing not, based on your stance.

As a business owner myself, it's fair practice to mark up materials PERIOD! Businesses cost money, your simplified view of the matter is really quite ridiculous. Are you telling me a business owner can function in todays market on labor rates alone?

What about......
- Rent / Mortgage
- Utilities
- Permits
- Liability Insurance
- Wages
- Advertising
- Equipment
- Maintenance
- Taxes
- Office Consumables
- Equipment Depreciation
- etc, etc....

It's pretty easy to sit at your desk and judge everyone. I'll admit, some operations are scam artists, but every business sector will encounter those.

So get off your soapbox, seriously.

---- EDIT ------------------------------------------------

One more thing, I recently got into an accident with my truck. Nothing serious, went to the local insurance office to have my vehicle "adjusted". I then proceed to the body shop to arrange to have said work completed. As we are reviewing the vehicle, we noticed a scratch on the top of my hood, and the body guy said it wasn't covered by the insurance company.

I proceed to call them, and ask why this wasn't covered under the accident. They proceed to tell me "we feel it was existing damage", I said "existing damage?" and he said "thats our judgment, case closed". My truck is fucking immaculate, this prick has the nerve to tell me it's existing, like I was trying to pull the heist of the fucking century. FUCKING SPARE ME!

This little asshole was probably having a bad day, and figured I should pay for his misery. After telling this guy he's a waste of skin, and really lives up to the global reputation of insurance companies, I headed back to the body shop. I told the body shop guy what happened, and they fixed it FOR FREE!!

As far as I am concerned, insurance companies are trash... PERIOD, I would love to review the financial statements of any large insurance company. These assholes make a ton of money, yet our insurance rates aren't getting any cheaper... would you care to explain that?

[ptownTSI]

I would like to post up a real estimate I got from a shop (all info about the company's and parties involved, blocked out) and someone can tell me where our (independent) appraiser may have been screwing someone, where they are making extra money, and where the shop is barely breaking even. On the internal side yes I am the adjuster but I don't write the appraisals.

If it turns out that maybe I or the appraiser was being unfair in some situation I'd like to know.

[ptownTSI]

from a personal standpoint I can get much better work for less elsewhere.

and i think its wrong for a shop to charge so much markup on parts. I learned a new trick from a guy at a shop this week. They get two receipts from their supplier one (a lot less, that they put in their file), and another (a lot more they give to the insurance company).

a lot of you don't see the shit shops pull on a day to day basis you all think every shop is this glory child ( AND FOR THE MOST PART WE DON'T HAVE PROBLEMS).

those of you that are honest, and hard working you fix our customer cars well, and in turn we send more business to your shop. if it wasn't for adjusters and field adjusters who would be there to protect the consumer from shops putting on cheap aftermarket parts when an insurance company is paying for premium parts?

We had a shop last week caught putting on cheap cheap foreign stuff on a brand new Chevy Impala we were paying for brand new GM parts.

I know the guys that DO the work, work their ASSES off. but for example, go look at this bodyshops page. http://gandcautobody.com/ they spend all their extra money they rip ins companies and individuals off with on basically building a castle, marble floors, hdtv flat screens, etc. They probably don't pay the bodymen anymore than normal.

I believe when I was there and got a tailgate on my jeep painted they wanted 2.5 hours of paint labor @ 95/hr, and $150 for paint. I had removed every single part from that panel so it was bare and all they needed to do was paint it. when i showed up to pick it up they were not honoring the $400 quoted price, they wanted an extra $50 too.

Who gives a fuck if they have a pimp shop or not? This even more so shows that you don't know how businesses work. A nice looking business can get more business. People don't goto dumps (for the most part). They obviously care about their customers and want the shop to look nice. Obviously from a business standpoint, if you think their prices are so high and outragous, the shop would not be in business. They must be doing something right.

[thectrlguy]

It's a business... you don't stay in business, by not charging people.

its a business. there are administrative costs, bookwork, filing taxes etc etc. yes, they are in business to make money and they should mark shit up.

[Midnight Sun]

i don't sell insurance i'm an adjuster. I have never "screwed" anyone and the only time we can really adjust prices down is when they are putting brand new parts on a 10 year old car, when very good used LKQ parts can be had for 20% of the price. then I will make the shop get the LKQ parts

That is laughable in some aspects.

Like the time the guy in the white ford escape with blue lettering on the side made me buy a LKQ trunklid for a 2003 Nissan Sentra... Yep, all $536 of it.

Brand new they are only $360...

Or how about that used quarter panel he wanted us to buy for a Grand Am... Great deal there. 400 dollars for a quarter panel that required 5 hours clean up.

Brand new, 514.


Sorry.. I just get aggravated with some adjusters, they see LKQ and automatically think it is a great deal without ever calling to check the condition of it.

[ptownTSI]

Ptown, Are you serious? Or are you just asking this question to stir things up. If your really an insurance adjuster your a brave man for admitting it. First off body guys work there asses off. I think every adjuster should be required to do bodywork for a year before they can sell insurance. I have a ton of friends that get rich off of selling insurance. I say we say no, not gonna do it, when you charge us to pay for insurance, but we can't do that cause you have the law that requires us to come to you. Yeah let's pay the body shop less so they can cut corners on our cars just so they can keep the lights on so you guys can get even bigger profits.

I know the guys that DO the work, work their ASSES off. but for example, go look at this bodyshops page. http://gandcautobody.com/ they spend all their extra money they rip ins companies and individuals off with on basically building a castle, marble floors, hdtv flat screens, etc. They probably don't pay the bodymen anymore than normal.

I believe when I was there and got a tailgate on my jeep painted they wanted 2.5 hours of paint labor @ 95/hr, and $150 for paint. I had removed every single part from that panel so it was bare and all they needed to do was paint it. when i showed up to pick it up they were not honoring the $400 quoted price, they wanted an extra $50 too.