September 10, 2016 at 10:00 pm #6134
Two part question:
When you bill out tires, do you sell the tires as “parts”, then list a separate labor line for the mount and balance ( I currently do).
And if you do split tires & mounting, when you track “tire sales”, do you add total tire sales (parts) or do you include the mount & balance (labor)?
For example, how I invoice:
Continental 255/40ZR17 $132.97
Mount & Balance: $24.00
Is my total tire sales $132.97 or $156.97
Or does anybody invoice like this:
Mount & Balance Continental 255/40ZR17: $156.97
September 11, 2016 at 8:05 am #14678
We would track that tire sale as $132.97 and the labor would go in with all other types of labor.
5355 Plainfield Ave. NE
Grand Rapids, MI 49525
September 14, 2016 at 1:00 pm #14682
Bernard,I agree with Tom. The reason shops break out tire sales from other part sales is because of the different profit margins associated with tires. By breaking out the tire sales and cost from your other part sales and cost, you’re able to see what your actual profit margin is on each and adjust accordingly against your profit targets.I also agree with you Bernard in breaking out the labor from the tire as it allows you to capture more revenue.Have an AWESOME day!
September 14, 2016 at 1:01 pm #14683
We track tire as parts. We also track mounting and balance as a seperate labor!
September 14, 2016 at 1:08 pm #14684
We agree seperate that way your able to track overall profit for both.
September 14, 2016 at 5:38 pm #14685
Same, with the exception of trailer tires, (in which case I figure the installation in the tire price) tires are billed seperately from installation and accounted for seperately
September 22, 2016 at 2:24 pm #14690
Tires under parts, mount and balance is labor.
September 22, 2016 at 2:52 pm #14691
Tire’s don’t get billed under parts, they are bill separately under Tires so they can be tracked separately since the GP is different than parts.
Labor is listed separately as well so that can be appropriately tracked.
Hope that helps.
September 22, 2016 at 3:18 pm #14692
I agree with Dick. Tires are tracked as a part in a different category to be able to monitor tire GP% and also parts GP% (if they were all together, tires would skew the parts GP), and then labor is billed out as labor, the same as any other job.
September 22, 2016 at 3:54 pm #14693
We operate w three separate profit centers — parts, tires and labor — separating parts and tires allows us a more accurate assessment of marginsMark Smith — OwnerMidas of Richmond
September 22, 2016 at 3:55 pm #14694
We are the same as Dick and Mark for the same reasons
September 22, 2016 at 3:59 pm #14695
At Car Clinic Service / PreRepair, we separate tire sales and mount & balance labor. We also break out tire sales on our ROWriter balance sheet due to the lower GM, with a targeted GM goal of 25% GM for tire sales. Tire sales is currently not a large part of our business.
Bobby Likis, Owner
Car Clinic Service / PreRepair
September 22, 2016 at 3:59 pm #14696
We break tires out as parts and labor also. Our reasons are for profit calculations and ALSO because Massachusetts only has sales tax on parts and not labor.
September 22, 2016 at 4:01 pm #14697
We bill tires as parts and track as tire category. Labor is billed as mount & balance.
September 22, 2016 at 4:02 pm #14698
We track Tires as separate revenue category with its own matrixed gp% (as we do with Sublet, Enviro/Supplies, Batteries, & Emission testing)- not Parts per se. Installation & balancing labour is included with total labour revenue. Ultimately you make what you make but separating categories helps keep our eye on Profit.Dave MackoArmstrong-Macko AutoproChatham, On Canada
September 22, 2016 at 4:04 pm #14699
We do it the same way you do Tom.
September 22, 2016 at 4:10 pm #14700
We bill tires just as we do any part, and labor similar to other labor. As was mentioned this skews the GP% on parts sales, but since it doesn’t change the money in the bank, that has never bothered me. We work to move the GP% up continuously and whether tires are in it or not makes no difference to our internal goals. If I am talking with other shop owners (which I am no longer) I am at a disadvantage for bragging rights. That doesn’t bother me. I do believe tire sales are tracked separately as I can do with any part in our Fastrack software.
September 22, 2016 at 4:12 pm #14701
We have a separate Chart of Account code for Tires, not only the part but the labor. It allows us to keep the general repair side of the business seperated for the low profit margin of tire sales
September 22, 2016 at 4:16 pm #14702
We track it as parts/tires and labor separately.
September 22, 2016 at 4:22 pm #14703
We brake out the tires and labor separately . Also track tires separate with parts.
September 22, 2016 at 4:33 pm #14704
We separate the charges, tires as parts and m&b as labor. As others have noted, because of lower GP on tires, it’s good to track them separately. While there is a lower gross profit on the tires themselves, there is good gross profit per hour on tire sales if they are priced right and a fast and accurate installer is doing the work.
September 22, 2016 at 4:51 pm #14705
We account for tires a part as well as the weights and stems required. These ” parts ” are accounted for separately because the GP% benchmarks we use as goals are different for tires, parts and labor.
September 22, 2016 at 5:01 pm #14706
We dont sell tires but use Discount Tire. We bill out normally with tires as parts and balance on labor. (and we dont track tire sales!!)More of a convenience for customer.
September 22, 2016 at 6:22 pm #14707
We bill out separately, tires are the parts, and M/B is the labor. I have raised the dollar amount on tire markup to cover us on the cost of wheel weights. All other pieces like TPMS rubber valve stems and regular valve stems still get added as needed. Tire disposal is a separate line item also.
September 26, 2016 at 2:14 pm #14710
We bill the tire out as a part and track sales info. on the part and separate from all other parts. and bill Labor on its own and tracked with all labor
September 28, 2016 at 4:17 pm #14712
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