Originally Posted by Woodrow

I have not read the post in it's entirety yet. Here is my input as I have worked for a few independent shops and some Dealerships. For what it is worth and i will use Subaru as an example as i am a Subaru advisor.

There are a lot of things involved in running a service dept.
For Starters, we are required to purchase special tools from Subaru to service cars we sell. These tools actually cost us more than if the average person wanted to buy them(shocking huh?). If we do not have them we can be penalized by the manufacturer and can not perform services and/or warranty repairs on the vehicles. Right now my tool room is around $30,000 worth of tools that we are required to have and purchase and with each year and updated model, we have to buy new tools.

We must send out Technicians out for training. We pay to enroll our technicians so they can be trained by Subaru which typically can cost us $1500-2,000 per technician per class, now times that by 8 or so classes for 3 of our techs. It adds up really fast. If they are not certified, again we can not perform any warranty work on (this is not the case with a performance shop). The dealership incurs all these costs. Also if a technician misses 1 class, he has to retake them all again.

We have a $12,000 laptop that we pay to have updates for so we can perform re-flashes, etc. In addition we pay for tech/software support for our SM3 laptop in case it goes down or brakes. That adds up. I haven't even gone into the other things that we get billed for and is a cost of running a service department. One for example are equipment and lifts. Infact, in 2008 we had to replace 10 of our lifts being they were old and dangerous. At the price of $8-12,000 a piece. Again, all of that adds up and that is why you pay us $75-120 per hour depending on the dealership.

Now you have operating expenses. You have to pay the technician, the writer, the porter, etc. So after you get done paying the staff, you have to pay the bills, plus you have other expenses like insurance and things like that. When it is said and done you have make a profit to stay in business. After all we have a right to make a profit.

Now there is a difference in making a profit and gouging someone. That comes down to the person and their integrity. I am known for sending customers away for certain work because I feel our prices are too high for some things like tires. I also try and keep my prices competitive among other dealerships and i try to be as close to some independent shops as i can. However, they are not using OE parts and fluids and we generally go back over their misdiagnosis and screw-ups. This is not the case all the time though.

Same with goodwill warranty. If the customer is a good service customer, I do what I can for them and cover the repairs. If they haven't seen me in 5 years except for their "free" state inspections, they pay. I am not going to penalize a customer that has paid their dues so to speak because i have no funding to cover the goodwill because i used it all up on customers that have not paid hardly anything. it is a tough balance.



Most of your smaller independent shops typically have less overhead, and do not have certain restrictions from manufacturers applied to them verse a dealership. They may have less people working for them, etc. They tend to charge less.

Then again, we have plenty of customers that come in for a good service experience and the job done right. I am also very personal with my customers and have a great report with them. I guess that is why I am not dead or slow but steady and in some months slammed.

Keep in mind, the fixed operations(service, parts and body shop) pays the bills and keeps the doors open. Sales just attract the customers and helps pay for advertising.

Originally Posted by JROW

URite. I can't speak for any others except for the fundamental business principles. As far as the way they treat their customers personally, I have no experience, I can only say how it should be done, and how we do it.

I know many dealerships treat their customers like shit, that's why many drive an hour or more here for all their service instead of going to their local dealer.

Another point I thought of a while ago, is that customer pay is def. big when it comes to any type of cel, abl, or electronics. Many indys don't have the experience, knowledge, or computers to properly and efficiently diagnose and repair that stuff so people often have no choice but to go to a dealer.