Indie V Main Dealer

[Frontstep]

The often posed question on here,
but I was talking to a local shop owner who was complaining she couldn't compete with the "Big Boys" and their prices.
Transfer that scenario to your local Indie.
Why isn't your main dealer cheaper, apart from the obvious, because they can get away with it.
They have huge economies of scale, access to time saving know how, factory direct prices, etc.

 

[Steve@Avantgarde]

Cost of operation is one stumbling block for them. Rising energy bills, cost of training, facitities, tooling and equipment, cost of being a dealer all costs massive amounts of money. When I ran a service department in the Bristol dealership we had to sell 2800 hours at a recovery rate of £78.00 just to break even. In this climate its a very hard task and a couple of months like Xmas and Feb we used to fall short. They cannot compete on price because of their constraints of being a dealer, pure and simple.

The trick is for the dealer is to offer top class service to go with that price, that is where most fall short. If you stay in a Premier Inn, your expectation of service is lowered, you stay in a Hilton, you want the best of everything, same applies to a dealer. Sadly, when dealers cut corners here it is when they fall down and a reason why I am an Indie now as opposed to working directly for MB and will do until the attitude towards this principal changes.

Dealers are starting to suffer really badly but I am afraid they have brought it upon themselves.

 

[television]

One thing is for sure, you cannot buy knowledge, and nothing better than a free hand to tackle a problem.

Lets take an SL 230 with the boot leaks, and water getting in. If you go to a Mercedes dealer, the guys there can only try and fix the problem by fitting new rubbers at a cost of some £4k, you pay the bill and the car will still leak.

Go to an indie, they could do the mod that I put up here, that cost £7 and takes 2 hours at the most, so say £150 all in and the boot will not leak again.

Mercedes Exeter know that I can fix them so easily, but they are not allowed to do what I do.

There are many cases where the above applies, and the thing that sticks out here and to do with your question is, sure the dealer gets the rubbers much cheaper than the indie can buy them, but they were not needed in the first place.

There are so many threads where Mercedes guys have to work by the book, and the indie can use his head, and here the indie will win on the price.

If you are just buying and selling, then yes the main Mercedes dealer can buy cheaper, but they are selling labour rates of £110 plus VAT per hour, and on this the indie can win again with a much lower labour cost or charge.

When I was trading it was the same for me where the likes of Comet had to charge £50 just for booking in a repair with the repair cost on top, and I could probably fix the the thing for under their booking in charge.

 

[Andy.M]

Don't know what sort of shop the op is relating to but take a company such as B&Q. They perceive that they are the cheapest when by a margin they are not. Sure they have a seasonal offering at competetive price points yet the bulk of their range is vastly overpriced compared to smaller shops yet the publics perception is that the local shop will always be dearer. Knowing that B&Q screw the suppliers down and probably buy at the lowest price possible, they usually sell at the highest price possible!

 

[television]

Don't know what sort of shop the op is relating to but take a company such as B&Q. They perceive that they are the cheapest when by a margin they are not. Sure they have a seasonal offering at competetive price points yet the bulk of their range is vastly overpriced compared to smaller shops yet the publics perception is that the local shop will always be dearer. Knowing that B&Q screw the suppliers down and probably buy at the lowest price possible, they usually sell at the highest price possible!

And the rotten söds only sell the fast moving lines, never the odd bits that are needed, I hate them

 

[d215yq]

Probably because the dealers (and any big shop) will be paying a fortune to marketeers, managers, health and safety people and the like...all will be on £50k per year + bonuses and it adds up.

In my previous career I had access to many big companies systems/processes and you would be absolutely shocked at how inefficient and wasteful half the people are. Big companies are good at screwing their suppliers and obtaining parts for low cost, but that is all. They are horrendously inefficient at getting a good deal on labour (their biggest costs) and even worse at targetting this labour to do something useful. Even the government (not exactly known for their efficiency) manage to pay staff less and have less stupid roles than big corporations.

Why do you think the likes of LIDL/ryanair/poundland are so much cheaper than their competitors (and yet more profitable)...they all sell the same (or better) quality stuff for under half what everyone else does, but when did you ever see an advert for them? when do you ever see some useless "customer service representative" when you use them? when have you ever seen a PR representative on the news (for Ryanair O'leary the chief executive speaks himself), do they mess around implementing uselsss (get 0.5% back) loyalty cards....it's no coincidence

A respected indie won't have to hunt for business and will have little or zero marketing budget, and no staff other than mechanics and maybe an admin person. The premises won't be as nice so they can charge half what a dealer would and be more flexible. Sure they might pay 10% more for parts but on almost all jobs the labour/overheads savings will far outweigh this by a considerable margin.

This is before we get on to greed and trying to take as much money as possible from those who will always go to a dealer no matter what as it's too much effort/risky to find an independent.

 

[Sue new MB owner!!]

well

I think a lot of people who go to the Main Dealerships are scared of losing their Warranties with them.

From what I can see the inflated costs for servicing and parts with the main dealerships mean that its actually costing them more to keep in practice.

I got my MB from a Non MB dealership and have bought a Warranty seperately to cover it for 3 years.

I plan to have all my servicing done at Independents!!

 

[Frontstep]

Your main dealer can spread his workshop costs over say 6 techs, should have parts, materials and equipment cheaper.
His expensive location could be changed to a cheaper and seperate building his methods of diagnosis/repair honed by factory training to be quicker and more efficient but realistically it isn't going to happen;
The gin palace will be shinier bigger etc at the behest of the suits from head office.

 

[Naraic]

B&Q sell a 50Amp pull switch for isolating an electric shower, it costs £14.28...the same MK switch from a small local supplier cost me £5 today...go figure.

 

[Steve@Avantgarde]

The problem at the dealerships these days is the skill level both at customer facing and technical level. Pure and simply because the PLC's have failed to pay for good staff.

Take my last dealer, all 5 team managers came from the workshop and were earning 30k + per year. We all kept technically conversant with the product, we all spent days on the shop floor keeping our hand in so to speak, but because we did that we all knew our stuff. Within a year, Bristol replaced all of its front line staff with ex hotel receptionists and young girls with a beauty degree fresh from a travelling trip to Asia as they could pay them 18k per year.

There was 7 Diagnostic Technicians earning a measly 21800k per year. 6 of those left to either work somewhere else for better money or to start up as an indie. They wanted more money but the dealer refused to pay.

Technicians and good front line staff have always been underpaid in relation to a sales exec when in reality a good quality tech is worth far more, for far too long they have been underestimated and underpaid and now the cars are so technical and the good staff are now doing it for themselves or at a backstreet garage the dealers are now suffering. Do I have any sympathy? Not at all. I hope they continue to suffer and fail.

 

[st4]

Probably because the dealers (and any big shop) will be paying a fortune to marketeers, managers, health and safety people and the like...all will be on £50k per year + bonuses and it adds up.

In my previous career I had access to many big companies systems/processes and you would be absolutely shocked at how inefficient and wasteful half the people are. Big companies are good at screwing their suppliers and obtaining parts for low cost, but that is all. They are horrendously inefficient at getting a good deal on labour (their biggest costs) and even worse at targetting this labour to do something useful. Even the government (not exactly known for their efficiency) manage to pay staff less and have less stupid roles than big corporations.

Why do you think the likes of LIDL/ryanair/poundland are so much cheaper than their competitors (and yet more profitable)...they all sell the same (or better) quality stuff for under half what everyone else does, but when did you ever see an advert for them? when do you ever see some useless "customer service representative" when you use them? when have you ever seen a PR representative on the news (for Ryanair O'leary the chief executive speaks himself), do they mess around implementing uselsss (get 0.5% back) loyalty cards....it's no coincidence

A respected indie won't have to hunt for business and will have little or zero marketing budget, and no staff other than mechanics and maybe an admin person. The premises won't be as nice so they can charge half what a dealer would and be more flexible. Sure they might pay 10% more for parts but on almost all jobs the labour/overheads savings will far outweigh this by a considerable margin.

This is before we get on to greed and trying to take as much money as possible from those who will always go to a dealer no matter what as it's too much effort/risky to find an independent.

I'll tell you a story about a major UK PLC where one of the team managers who manages my mate at a big pension company had been on a training course for management. I won't name the PLC but the story goes as thus "I've been on this management developement course and I am keen to let you know about it....part of my job is to develop staff and the emphasis is in your working day your job, basically the main focus point should be developing yourselves and the job be the least part of the day and the most part should be upskilling yourselves and pursuing your own development"

Surely the biggest part of a staff members day should be doing their job, actually that should be their entire day pretty much, doing the tasks needed to carry out that job to serve the customers that business has, not having hot air meetings about development.

Why this country is the way it is.

 

[Frontstep]

People that do, are not respected in many Industries they are suffered as necessary evils.
The snobbishness of the Universities (I went) turns out graduates to fill the management positions and suffers the doers like Andrew Mitchell the police.
Customer satisfaction in their world can only be gleaned from A4 sheets, bought in consultants reports and tomorrows bottom line.
The boffins turn out ever more complex vehicles and the suits expect dumbed down staff to fix them with the customer paying for their ineptitude.
The charges rise inexorably as layers of suits command large salaries for their musings.
The overheads, ludicrously high rest on the tech shoulders who understandably see the barmy prices charged and think, I'm the one earning this, might as well do it for me.
I can charge half this, still earn more and be my own boss,
lucky for us.