Mike Smith
En-Route
- Joined
- May 15, 2011
- Messages
- 2,627
- Location
- Prattville, Alabama
- Display Name
Display name:
Fresh Prince of PrattVegas
This issue, like so many other in aviation comes down to, " it depends". An independent working out of his truck has very little overhead, while a shop on the field has lots of overhead. assuming both charge $85 per hour, the independant will keep almost all of it in profit while the shop will keep much less than that after paying overhead costs.
There is nothing immoral about marking up consumer goods, we pay a markup on pretty much all consumer goods. There is also a cost involved in the A&P using his money to buy the parts, if sells them for the same price he pays, it actually cost him a small percentage. As Tom said earlier, dealing with sales tax collection adds costs to the transaction as well. When we order something ourselves, in many cases don't even pay sales tax saving 8-10%, the shop must collect that sales tax. If the shop wants to model their business around labor profit, that suits me fine. however, if the shop provides parts to the customer it is more that fair for them to make a profit.
The point I was making with R&W earlier is that there is a shift in the way business is being done in all types of repair businesses, with the proliferation of source of parts it is easier for people to provide their own and many are demanding to do so. Naturally, repair shops are having to adjust. Most places offer labor warranty equal to the length of time the part is warranted, you should expect no such labor warranty on owner supplied parts.
There is nothing immoral about marking up consumer goods, we pay a markup on pretty much all consumer goods. There is also a cost involved in the A&P using his money to buy the parts, if sells them for the same price he pays, it actually cost him a small percentage. As Tom said earlier, dealing with sales tax collection adds costs to the transaction as well. When we order something ourselves, in many cases don't even pay sales tax saving 8-10%, the shop must collect that sales tax. If the shop wants to model their business around labor profit, that suits me fine. however, if the shop provides parts to the customer it is more that fair for them to make a profit.
The point I was making with R&W earlier is that there is a shift in the way business is being done in all types of repair businesses, with the proliferation of source of parts it is easier for people to provide their own and many are demanding to do so. Naturally, repair shops are having to adjust. Most places offer labor warranty equal to the length of time the part is warranted, you should expect no such labor warranty on owner supplied parts.