{"id":5010,"date":"2024-06-05T01:21:54","date_gmt":"2024-06-05T01:21:54","guid":{"rendered":"https:\/\/partstech.com\/?post_type=resource-hub&p=5010"},"modified":"2024-06-05T17:44:56","modified_gmt":"2024-06-05T17:44:56","slug":"navigating-pricing-objections-and-byo-parts-requests-in-your-auto-shop","status":"publish","type":"resource-hub","link":"https:\/\/partstech.com\/resource\/blog\/navigating-pricing-objections-and-byo-parts-requests-in-your-auto-shop\/","title":{"rendered":"Navigating Pricing Objections and BYO Parts Requests in Your Auto Shop"},"content":{"rendered":"\n

During our recent webinar series focused on parts markup strategies for auto repair shops<\/a>, we received many questions and comments from shops highlighting the challenges and concerns they face when considering price increases for their parts.\u00a0<\/p>\n\n\n\n

Our guest speaker, Cecil Bullard, Founder & CEO of The Institute for Automotive Business Excellence<\/a>, provided insightful guidance. With decades of experience coaching thousands of shops across the U.S. on optimizing their parts margins, Cecil shared his thoughts and insights for confidently handling customer pricing objections and addressing the growing trend of customers wanting to bring their parts. Below, we summarize the concerns we heard and Cecil\u2019s advice.<\/p>\n\n\n\n

\u201cMy customers tell me that my parts are very expensive.\u201d <\/h2>\n\n\n\n

Cecil acknowledges that all parts are expensive but emphasizes that interpreting statements like \u201cyour parts are expensive\u201d as a need to lower your prices (or not raise your prices) is a mistake. <\/p>\n\n\n\n

When a vehicle owner needs work on their car, it\u2019s often not a planned expense. \u201cNo one wakes up in the morning and says, \u2018I want to buy brakes,\u2019\u201d says Cecil. Customers saying, \u201cIt\u2019s expensive,\u201d is a natural reaction, but not one that you should take personally or that your shop should act on by lowering your prices or choosing not to raise them.<\/p>\n\n\n\n

He illustrates his point with a personal anecdote, “Even the shop that I go to today will call me and say, ‘Cecil, you need XY&Z done, and it\u2019s a couple of thousand dollars,’ and my first reaction is, ‘Dang it, that\u2019s so expensive!’ But that doesn’t mean they should lower their prices.”<\/p>\n\n\n\n

Cecil further emphasizes that many things have gotten expensive today. Whether it be milk, your favorite fast food order, or gas \u2014 it\u2019s natural to have a \u201cwow, that\u2019s expensive\u201d reaction, but it doesn\u2019t mean you\u2019ll never buy gas, get your favorite to-go meal, or purchase milk again. It\u2019s the same for auto repair services.<\/p>\n\n\n\n

\u201cYou have to get your emotions out of your pricing,\u201d encourages Cecil, \u201cNo one likes to pay for automotive repair. No one likes to pay for groceries. I don\u2019t like to pay for groceries \u2013 but I like to eat. I don\u2019t like the price of gas, but I\u2019m going to go fill up my truck.\u201d<\/p>\n\n\n\n

\u201cI\u2019m worried I will lose customers if I raise my prices.\u201d <\/h2>\n\n\n\n

“I\u2019ve worked with thousands of shops, and I\u2019ve never priced anyone out of business, ” Cecil says. The shops I\u2019ve worked with that have higher labor rates and parts margins actually have a steadier, more profitable business. Customers leave when they don\u2019t see the value, not because your costs are $5 more.”<\/p>\n\n\n\n

Ultimately, handling your parts pricing with the right mindset boils down to confidence in your pricing strategy, the quality of service you provide, and the relationships you build with your customers. These elements, combined with a clear understanding of the added value your shop offers, are vital to maintaining a profitable and reputable auto repair business.<\/p>\n\n\n\n

Value is key. The financial impact of slight increases will go unnoticed by 95% of your customers if they see the value you offer in your services. “If you raised your parts margin by 10% on a $500 order, where $250 is parts, the order only increases to $525,\u201d says Cecil,  \u201cMost customers won’t balk at this small increase. I\u2019ve had hundreds of customers raise their rates, and none of them chased away a bunch of clients. Most don\u2019t even know who left, and they probably lost a few clients, but those are the bottom 1% or 2%, who are the ones that don\u2019t let you make money and eat up your life.\u201d<\/p>\n\n\n\n

\u201cMy customers tell me they can get the parts for cheaper and bring them in.\u201d<\/h2>\n\n\n\n

Cecil also addresses the trend of customers wanting to bring their own parts. He acknowledges, “Yes, they can probably buy the part cheaper online or at a local store. But what does that part come with?\u201d<\/p>\n\n\n\n

In demonstrating how he would speak to a customer who wants to bring their own parts, he says, \u201cThe part that comes from me guarantees it’s going to fit. I guarantee that it\u2019s going to last. I guarantee that it\u2019s going to take care of your problem. You get great customer service from us. You don\u2019t have to spend your time going down and trying to get the right part. If a part from me goes on your car and it doesn\u2019t work, I will take care of it because I have a warranty.\u201d <\/p>\n\n\n\n

The consequences of allowing customers to bring their own parts are significant. Here are some Cecil called out:<\/p>\n\n\n\n