Dealership Parts Counter Prices

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Originally Posted By: rat
I don't believe you can accurately compare standard business/accounting practices to a dealership environment.


LULZ!!!!!!!!!!!! Why not?!?!? Ever heard of GAAP? Guess not. Revenues, expenses, EBITDA, gross sales, gross profit, net profit, etc are all clearly defined so it is possible to compare similar and dissimilar industries. Some industries are extremely complicated. A dealership owned by one dude is not.

"creative accounting" as you define it is outright fraud. I would not believe your dept manager that the $30K is NET PROFIT - he is probably being lied to too!!!!
 
Originally Posted By: rat
I thought you were done with this anyway....


Changed my mind after reading cardinal's post which had me ROTFL. Half mil in NET PROFIT PER MONTH? Yeeeaahhhh OK!!! What, do you have a half-billion dollar inventory? And Semi trucks lined up to ship it out all day? This dealership must be have the infrastructure of a 4-terminal airport.
 
Originally Posted By: 82DMC12
Gross or net? Huge difference. Please don't respond unless you are 100% positive.


net. I see the accounting paperwork as part of my paycheck. For a while a few years ago we were regularly bringing in over $100k a month NET in parts sales. We have a very strong wholesale business and deliver over a wide area.

And yes I know proper accounting terminology, my mom is an accountant for a major defense contractor and taught me them all from a young age.
 
82DMC makes out like you parts guys are idiots about your own business you work in because you're not accountants or general managers-the only people who count. You are also class envious union organizers for pointing out how much profit the business is making. That sounds like typical classist, white color attitude. If a dealership grossed even what he seem to think they do they would not be able to stay in business. I don't think it is that uncommon for a parts store to net $30,000/ month. I'm not saying that is necessarily wrong.
 
Let's put it this way, if a Ford parts dept in a decently busy area isn't making at least $65,000 a month in net profit there is something seriously wrong.
 
New car dealers make the most profits in parts, services and used cars; The least profit is from new cars.

For some parts, the profit can be as high as 60-70% of list price.
 
maybe I should open a Ford parts department without a dealership. hmm. probably Ford won't allow it.
 
Originally Posted By: The Critic
I have been finding lately, that for many maintenance parts, I can purchase the genuine part from the dealership for about the same price as the lesser aftermarket parts. Also, I have found that with a bit of effort, I have usually been able to convince the dealership parts counters to match the price of the online OEM parts sites.

Do any of you do this on a regular basis, or am I the only who is crazy enough to try and politely haggle with the dealership parts counter?


I Haven't tried to haggle prices down and haven't needed to so far.

Oil filters are cheaper than most parts stores (even discount stores). Air filters and cabin air filters are about the same price, and are a guaranteed perfect fit (and usually higher quality).

I have purchased wiper blades at the dealer for less than I paid at Wal-Mart or any auto part store. That really surprised me.

It all depends on the local dealer and the individual part. Sometimes, the OE part is very expensive, sometimes it is not.

There is a lot of hate directed at dealers over all, but it is not always deserved since not all dealers are bad.
 
Originally Posted By: HTSS_TR
New car dealers make the most profits in parts, services and used cars; The least profit is from new cars.

For some parts, the profit can be as high as 60-70% of list price.


Bingo, there is no money in selling new cars, you sell cars so you can operate a manufacturer supported service department which in turn buys a high % of the parts moved through the parts dept at list prices.

Its unfortunate there are people on this board who think they know everything about everything; while I don't disagree with their overall position, I have worked in a second gen car dealership and as an industry I don't think many treat their employees well but this is a free market economy and people are free to move on as I did.
 
Originally Posted By: HTSS_TR
New car dealers make the most profits in parts, services and used cars; The least profit is from new cars.

For some parts, the profit can be as high as 60-70% of list price.

Based on my recent parts purchase experience, I don't doubt that figure at all.

Recently, needed an air/fuel ratio sensor for an 01 Tacoma. Here's the price breakdown (rounded to nearest dollar). fyi OEM was Denso made, which would be my preferred choice if available.

Napa.....Bosch $200, Denso $180 +tax

AZ.....Bosch $180. Denso $174 +tax

Advance....Bosch $180 ($140) +tax. No Denso listed. Likely could get ~$40 off using an online code.

Rock Auto.....Denso $97. Includes 5% discount and ~$3 1st class mail. No tax.

Amazon.....Denso $88 Free shipping. (add $10 for 2day shipping) No tax.

Local Toyota Dealer..... OEM Denso $223
lol.gif
Something tells me the dealer wasn't going to negotiate down to $88.
whistle.gif
No need to waste my time. But, the parts guy did give me a free diagram copy of the sensor location.
48.gif


Went with Amazon and free shipping as there was no hurry. Got the Denso sensor (with gasket included) in a week, one of those days was Labor day. And consider, Amazon must still be making some profit.
 
That could still be 'only' a 60-70% markup by the dealer though. Amazon could ship from a distributors warehouse maybe for about the price the dealer gets it. Big retailers like Advance Auto and Walmart is its own distributor that, and a few other reasons negotiating price, volume etc, is why they can sell for less and still make more money. The big chains like Pet Boys, AA and AZ in some ways are a bigger jip than the dealers when you consider they're not always cheaper and are usually selling inferior parts.
 
Originally Posted By: sayjac
Recently, needed an air/fuel ratio sensor for an 01 Tacoma. Here's the price breakdown (rounded to nearest dollar). fyi OEM was Denso made, which would be my preferred choice if available.


In fairness to the various shops and parts stores, some of the blame, at least, has to be placed upon their suppliers. One of my local shops has switched to Worldpac after the owner saw that I was getting parts at about 50% cheaper from them than he was able to from his supplier, Alltrom, for basically all the same (mostly OEM) brands.
 
Originally Posted By: bdcardinal
Let's put it this way, if a Ford parts dept in a decently busy area isn't making at least $65,000 a month in net profit there is something seriously wrong.


Correct.
While some of our business is retail/walk in customers, wholesale and fleet is our main business. Plus we have the body shop, internet and the shop.
Haven't seen exact figures lately, but we normally stock over $1M in inventory. And net, well let's just say $100,000 would be a very bad month.
 
Quote:
That could still be 'only' a 60-70% markup by the dealer though. Amazon could ship from a distributors warehouse maybe for about the price the dealer gets it. Big retailers like Advance Auto and Walmart is its own distributor that, and a few other reasons negotiating price, volume etc, is why they can sell for less and still make more money. The big chains like Pet Boys, AA and AZ in some ways are a bigger jip than the dealers when you consider they're not always cheaper and are usually selling inferior parts.

Could be I suppose. The Toyota dealer may have to put the same Denso sensor in an "official" Toyota box with an official Toyota part number. So more middle men in the dealer price? That said, when dealers are charging more than list (what I suspect happened with the sensor) for parts, that's not right imo. That is especially easy to see with Honda OEM parts. One can go online to several Honda parts sites (eg., Majestic) see the list price, and then see a discount price for that OEM Honda part. But most of the dealers around here mark up the price from list price.
whistle.gif


As for the part stores selling inferior parts, again could be, but in my specific a/f sensor example I believe it to be the same parts with the same numbers. If not for the RockAuto price, I almost would have thought the Amazon price too good to be true. Needless to say I was thrilled to get the part for that price. Then I wondered what the dealer would have charged to replace the sensor with the $223 sensor price. Yikes!

In the end though, the Amazon $88 to Toyota dealer $223 +tax price does show the huge mark up available in OEM parts. As said, even at $88, Amazon was making a profit too.
 
When I go to a dealer for a part, I usually already know the p/n and the list price. I don't need any advice or extra help form the parts counter guy. All he needs to do is enter the order and I'll be back to pick it up if it's not in stock. I even pay in cash most of the time.

I don't think it's too much to ask for a discount considering I am probably the easiest customer they will deal with all day.

I rarely need the part right now and could easily wait for Rock Auto or Amazon and save money. As has already been said, often these online retailers offer the exact same brand and p/n the dealer does for a substantial discount. I like to support local business, but I expect some give from the dealer's end too.

I went through this with motorcycle dealers years ago (these guys are like the worst car dealer you ever dealt with X10.) I finally stopped buying anything local because of the ridiculous pricing, poor stock and overall surly attitude. If I walk up to the counter and 3 guys sit on their fat rears BSing while ignoring me, I'm walking right back out the door an will never return. Same if the guy behind the counter keeps answering the phone instead of taking care of my order.

If you want to charge a premium, you have to offer something extra to justify it. Customer service is the one place a dealer can really shine. Sad that so few do.
 
Originally Posted By: rat
Where is our doubting friend 82DMC12 now?


I already made my points and stand by what I said. No dealer is taking a half million NET profit per month on the parts department alone. Get real.
 
Originally Posted By: 82DMC12
Originally Posted By: rat
Where is our doubting friend 82DMC12 now?


I already made my points and stand by what I said. No dealer is taking a half million NET profit per month on the parts department alone. Get real.



For your average dealer no, for some yes.
And yes, NET profit. Gross can be 1.5M plus in ONE month.
 
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