What Goes Into A Labour Rate?Dec 11th, 2015
Sometimes people look at a labour rate and think something north of $120 is high. Before we get into everything that is involved in a service experience, we should have a little context. When someone comes to fix your computer or photocopier, they come armed with a screwdriver, show up between 9 and 5 with no actual time commitment. I defy you to pay less than $200 even if it’s a 10 minute job. Similarly, if you have a washing machine or plumbing issue, you’ll be lucky to escape a large bill to replace something as simple as a fuse or a screw.
Understanding The Labour Rate
Our business is complex. From the time we we answer the phone, transfer you to a service advisor, and schedule an appointment, our commitment has already started. Most of our technicians will have at the very least 1 week per year in offsite training. In addition, they have a multitude of online training throughout the year. The same goes for our advisors, and service managers. Every dealership has valets to shuttle customers and cars throughout the day. Of course we also have wash attendants cleaning your car after services. In addition, we heavily subsidize a fleet of courtesy cars. This service ensures you are mobile as quickly as possible, with little interference in your busy schedule.
Hard Costs Involved
During the day, our advisors are extremely busy. They prepare quotes for potential needs, answer calls for new bookings. They are always proactively communicating with our customers with finish times or additional questions to narrow down a diagnosis. Factor in the sheer square footage of our shop, clean up area, hundreds of thousands of dollars of special tools for the brand, in addition to the technicians own tools, you’ll get a feel for the commitment we have to servicing and repairing your car to your satisfaction. Heat, light, power, taxes, and insurance are just some of the extra costs that every business bears, and these things tend to go up every year as do benefits and wages. Manufacturers often set the warranty rate, that they pay us to repair your car, at a number lower than our required rate, but that just becomes part of the franchise.
These are some of the reasons behind how we set our labour rate in a competitive industry. Hopefully this gives you a better understanding of the inherent cost of every hour of labour charged.
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