Shop Supply Charges

[Tom]

No.

We itemize what we use, and sell as parts within the appropriate job on the invoice.

So, there are no “added charges” at the bottom of the invoice. (No hazmat, either.)

“Remove every negative you can think of and compensate for it some other way.”

[Unknown Member]

We charge shop supplies based on labor charges. 3% of labor with a max of  $20. 

[joecval]

We charge a percentage on just labor. 4.75% with a max of $39.21, we also have a minimum charge of .75

[Greg Minnick]

We charge a flat fee of $7.55. Does not get charged on oil service or diag/testing only. I’ve wanted to do what Tom does but haven’t had the staff in the past that would consistently bill it out. Current staff would likely be able to do it.

[Rob]

We do not add a fee for shop supplies. Depending on repair and supplies used we will add a ” service kit ” as a part which contains a description of lube, cleaner, connectors, door panel clips, bolts, nuts, etc…. Price will vary depending on what the technician has used. Range is between $4.50-$8.99 per task where kits are used.

[jprop]

I agree with Tom, I’m a local small shop and charge according to the job. I try to be as thorough on my invoice as possible so my customers understand the reasons for my charges. I realize there are overhead fees for things but some charges I see from other shops/dealers are unnecessary depending on the job. But then again most customers don’t know what’s really involved with certain repairs so they just accept the charges.

[Richard Zaagman]

We charge 3% of parts and 6% of labor to cover shop supplies and environmental. We cap it at $50.00. We seldom if ever hear any complaints on this.

[Unknown Member]

We also charge Shop Supplies as a line item on every ticket.  3% of labor up to a cap of $34.60.  I look at this from the other side…  I have an account number for “Shop Supply Purchase” (Includes rags, fender covers, acetylene, most chemicals, etc.) and I think if you actually faithfully keep track of these expenses you will be shocked at the amount of money it adds up to.  Best way I know to cover that expense is to show a separate income stream.  And for the same reason we also  charge an “environmental / hazardous materials fee”.

[Joseph Van syoc]

I use a flat fee of $7.50 which is included on the estimate.  One of my big gripes from previous jobs was having a percentage added to the ticket and the end, sometimes $20 or more, and having the customer get hit with that surprise.  Just not good business IMO

[pbrennan]

I believe the less you surprise the customers, the better. If there’s a way to simply add it into the cost of each task on the invoice without splitting out parts & labor & shop supplies visible to the customer, so you have ONE price for each task on the invoice, that’s best. 

That way it’s included in your price. Two big benefits there: you don’t have to explain it to customers, and customers won’t feel “nickel-and-dimed” by your shop. It could even be a selling point. No “nickel-and-dime” nonsense pricing. Also, quoting prices over the phone & drafting estimates would be a little quicker.

[wchambosse]

Just a thought, charge a labor rate and parts
margins that meet your profit goals and bill true “supplies like partial
cans of fluids and fasteners on invoices as they exist. This can be done by
kitting things such as brake jobs with a can of cleaner, and engine job with a
parts kit containing cleaners, sealers, and fasteners. Rags, the electric bill
and uniforms are not supplies, they are expenses. I know I am getting older,
and old fashion in ways, and my opinion takes a position that is a losing battle.
That does not make supply charges good business, just lazy business. Think
about dropping the supply charge and use that as a differentiator with your competition. 

[elonblock]

I agree there are other better ways to increase your profits and bottom-line. Today’s more educated, internet-driven customer is sensitive to these methods. If you copy and paste this link into your browser, you will see a number of online reviews where customers are very vocal about their dislike for these charges:
http://bit.ly/shopsuppliesfeedback

I was in a shop last year when a customer told the service advisor, “when I go to a restaurant, I’m not charged a supply charge for napkins and condiments. So, I don’t understand why I have to pay for your shop’s rags and chemicals.”

In an industry where pricing is already a mystery to the customer, it’s important not to give them any reason for mistrusting your business practices.

[Greg McConiga]

We do, and we collect hazmat for tires, oil filters and waste lubricants as well.  For shop fees it’s a percentage of labor, currently 7.25%, capped at $20.00.

We explain it this way… (and it’s both true and accurate…)… it’s a part of the normal labor charge that has been broken out and moved into a separate account to offset small use items that include nuts, bolts, wiring supplies, lubricants, windshield washer fluid and top off fluids and so on.  We do this so that you aren’t confused by dozen of lines for small amounts on your bill and it allows us to account for our costs of doing business.  We will cheerfully remove the line if you ask us to, but your total will be the same since shop fee amount will just move back up into the labor.

We wash out the account at year end and adjust the percentage and cap as needed.