incentive to replace parts unnecessarily

[LTD]

Most businesses will supply a part at a cost to a customer and note the cost on invoice accordingly. This will usually include a margin of profit to cover invisible expenses such as phone call to order, time to collect/receive and examine.

The business will be billed for the same part by their supplier at a, usually, lesser value. This invoice is not required to be shown to ANY Customer.

The issuing of an invoice to business from supplier showing anything other than the charged price is fraudulent as it may be used by the client for VAT and auditing purposes.

 

[Dieselman]

Turning up with your own parts is a bit like showing up to a resturant with your own bottle of wine.

I know someone who has done it to attempt to save money. I don't think He's saved anything at all.

Bizarrely, this year I supplied some parts I intended to fit myself when I wasn't fit enough to do an emergency repair on my own car. They had no issue at all, but were doing another job as well anyway, so just lumped in more labour.

 

[markjay]

Turning up with your own parts is a bit like showing up to a resturant with your own bottle of wine.

Err... an Iranian restaurant I've been to in Notting Hill actually encourages this... they don't sell alcohol, but will supply the glasses if you bring your own bottle of wine, which is what everyone else was doing.

 

[LTD]

Err... an Iranian restaurant I've been to in Notting Hill actually encourages this... they don't sell alcohol, but will supply the glasses if you bring your own bottle of wine, which is what everyone else was doing.

That's because they cannot supply.

 

[markjay]

From the commercial point of view...

We provide equipment and install it for our customers.

In our quote we will list each item including the manufacturer's name and Part Number.

If the customer has its own purchasing department, they are more than welcome to buy the parts themselves, and we will install them. We would even point them in the direction of suppliers we recommend.

However, if the customer prefers that we supply the parts, we will buy them as trade and sell them with a small margin.

So we give the customer both options. Supply your own parts (as long as it agrees with our spec), or ask us to supply them.

But having said that, I can fully understand businesses that will not install parts supplied by the customer. The business owner has a choice as to how he runs his business, and so do the customers - they can choose to go elsewhere.

 

[markjay]

That's because they cannot supply.

And in my post above I suggested that it down to the individual business to decide, i.e. some restaurant might be happy with this, other won't. There is no one rule. As long as it's all above board, what's the problem?

 

[Dieselman]

And in my post above I suggested that it down to the individual business to decide, i.e. some restaurant might be happy with this, other won't. There is no one rule. As long as it's all above board, what's the problem?

The reason they don't supply is because they are not licensed to supply. Imagine how much business a restaurant would do if it didn't have any drinking.

 

[markjay]

Why?

Originally Posted by markjay
The two invoices is indeed fraud...

The end customer pays the person doing the work for the total cost of the job, which (if the place is VAT registered) will show the correct VAT. The place doing the work can claim back the input VAT based upon the invoice that they paid the parts supplier against. Where's the fraud?

Because it is misrepresentation. You are providing the customer with false information which may influence his decision whether to give you his custom or not.

There is no difference in my view between this and between writing 'was £99.99, now £45.99', when it was never £99.99 beforehand - and the latter is also illegal by the way.

 

[LTD]

And in my post above I suggested that it down to the individual business to decide, i.e. some restaurant might be happy with this, other won't. There is no one rule. As long as it's all above board, what's the problem?

The restaurant will not have the option. The local Licensing Board made that for them.

No restaurant in their right mind would only ever offer corkage if they have the option to supply. The profit on sale is too good to ignore.

 

[markjay]

Dieselman, I agree with you... what I am saying is that there is no right or wrong. Any business owner has the right to set-up the terms under which he is willing providing the service or goods (as long as it is legal of course) - and as long as they are saying it clearly and truthfully.

 

[markjay]

From the customer's point of view...

Some years ago we had a van in the business that was in urgent need of a new engine. The local garage offered to supply and fit a second hand-engine, or charge for labour only if we sourced the second-hand engine ourselves.

I chose the latter, and of course after the garage installed it the engine turned out to have a bottom-end knock... we had warranty for the second-hand engine, and warranty for the labour, but still ended-up paying twice for the labour - I am sure you can see why.

So in spite of the saving it is not always in the best interest of the customer to supply their own parts, as it clearly reduces the garage's liability.

 

[A-AvantGarde]

The restaurant will not have the option. The local Licensing Board made that for them.

No restaurant in their right mind would only ever offer corkage if they have the option to supply. The profit on sale is too good to ignore.

Not necessarily true. Without taking this off topic, some people (from a religous perspective) may not wish to sell alcohol.

 

[DSM10000]

All this shows us is that there are many business models and we are free to chosse the one that suits us so three cheers for being able to choose!

 

[oldcro]

Garages are expected to make money on the parts that they fit.

You're missing my point, of course everyone expects them to make profit but lying about how much the part cost them by showing a false invoice is immoral and dishonest.

 

[NOMONEYBUTAMERC]

Not really come across double invoicing to garages , but in general , motor factors have two opportunities to make profit on parts. Firstly they buy at preferential prices from their trade suppliers , often 50 - 60% cheaper than joe public would buy at. Then at the end of the year they get a retrospective rebate from their suppliers, based on how much they have spent . It is still quite possible for a garages customer to pay around the same price as he would from a factor. I.E. list price of product from supplier is £100 . The factor buys in at -60% , so pays £40. sells it on to a garage for £55. The garage in turn sells it to you at cost + 10 % , so you pay £60.50.
You may feel that too much profit has been made , so try to bypass the garage and the factor by going direct to the supplier. As an individual your potentential spend is very limited , so you only qualify for 20% discount.Thus , on our item with the £100 list price you pay £80 plus vat. Thats business , and effectively, one way or another is how a large percentage of this forum make a living.

 

[jaymanek]

ps ive never heard of any garage getting two invoices, thats a new one, must be that branch only...

 

[MD5]

Not really come across double invoicing to garages , but in general , motor factors have two opportunities to make profit on parts. Firstly they buy at preferential prices from their trade suppliers , often 50 - 60% cheaper than joe public would buy at. Then at the end of the year they get a retrospective rebate from their suppliers, based on how much they have spent . It is still quite possible for a garages customer to pay around the same price as he would from a factor. I.E. list price of product from supplier is £100 . The factor buys in at -60% , so pays £40. sells it on to a garage for £55. The garage in turn sells it to you at cost + 10 % , so you pay £60.50.
You may feel that too much profit has been made , so try to bypass the garage and the factor by going direct to the supplier. As an individual your potentential spend is very limited , so you only qualify for 20% discount.Thus , on our item with the £100 list price you pay £80 plus vat. Thats business , and effectively, one way or another is how a large percentage of this forum make a living.

That's business indeed, and an interesting insight, but how many garages would want to charge the full retail for a bigger mark up? Anyone who is in business, not just in the motor trade, will try and negotiate preferential terms for themselves in most fields, car repairs included. How many posts appear on here about the best purchasing deals etc? In fact, how many companies offer parts discount to forum members? One naturally tends to think why should I pay x amount from one place when I can buy it for x -20% elsewhere? We can't help ourselves!

 

[nick mercedes]

ps ive never heard of any garage getting two invoices, thats a new one, must be that branch only...

People might be confusing delivery notes with actual invoices.

 

[ecossebev]

I work for ECP and have never supplied two seperate invoices to a trade customer, and they have never asked for one They sometimes, when they phone up for a part, will ask the retail price so they can work out the price they want to charge their customer.
With regards to taking your own parts to the garage, l have seen a garage charge more in labour rates than they normally would because the customer bought his own parts. Might be worth asking what their rates are and if they will charge more if the customer brings his own parts in.
Lastly, the incentives ECP offers to its trade customers is not intended for the trade to do unneccesary work on their clients cars, its to try and steal business away from our rivals. There is a lot of competition out there and if you (as a trader), promise to stay loyal to ECP, we will reward you with incentives to keep you on board.
If you think a garage is doing unnecessary work on your car just to make their target for an iphone, change garage, or complain to the SMMT or something.

 

[nick mercedes]

You're missing my point, of course everyone expects them to make profit but lying about how much the part cost them by showing a false invoice is immoral and dishonest.

This is how it works.

Most garages will fit parts from ECP or GSF etc, and despite using cheepo parts, invoice the customer at full OE retail.

In the case of Mercedes owners, they go away happy knowing that they've saved big money on the labour rates, and either don't realise that the parts aren't the real thing or by and large don't care, as all they can see is the saving they've made on the final bill.

Obviously there's levels of copy parts, ranging from real dross Chinese parts, often in a box with a reasuringly German sounding brand name from a certian large national supplier, or OEM parts, that really are the same as genuine MB parts as they are made in the same factory.

If you want peace of mind use Tony Purslow, that way you get discounted labour and discounted genuine parts, and a free MOT, but it will still be more expensive than using an indi, but you will be getting proper parts fitted.