Service Dept Profit - Help

[Mat C 77]

Apologies if this sounds like i'm being a retard, but I'm confusing myself with what profit i'm making from my service side of things.

I understand the P&L side of sales and the Vat margin scheme etc, however this example below which one is correct?

Sell a service to a customer for £200 ( INC VAT ) Cost of said service was £50 INC VAT ( Materials and Labour ) and YES i'm VAT Registerd

Is my margin

A. £200 inc minus £50 inc = £150 

B. £200 inc minus £41.66 net = £158.34

C £166.67 net minus £41.66 net = £125.00

D  neither you stupid arse, you've got it wrong, go home via the pub.

Thanks

Mat

 

[justina3 518]

c £125 or 75%

Just now, justina3 said:

c £125 or 75%

The reason i use c is the vat is never your money your just collecting on behalf of HMRC is the way i look at it. 

 

[umesh 336]

5 minutes ago, justina3 said:

c £125 or 75%

The reason i use c is the vat is never your money your just collecting on behalf of HMRC is the way i look at it. 

 

As Justin A3 Says  

[Mark101 536]

C

[Stalker 180]

None of the above, 

 

A well prepared/equipped workshop costs a lot of money, 

unless your doing a service on a trolley jack with basic tools outside in the car park, I would imagine you would make less than any of your calculations. 

The profit from the simple services helps to pay for the head scratching jobs or the ones that go way wrong too in my experience. 

[justina3 518]

1 hour ago, Stalker said:

None of the above, 

 

A well prepared/equipped workshop costs a lot of money, 

unless your doing a service on a trolley jack with basic tools outside in the car park, I would imagine you would make less than any of your calculations. 

The profit from the simple services helps to pay for the head scratching jobs or the ones that go way wrong too in my experience. 

His calculations where based on as he said an example, not a complete brake down of costs so the answer to his question should still be option c 

[Screenman 47]

I am glad he wrote margin and not profit, plenty of guys going bust confusing those two.

C.

 

[Mat C 77]

Thanks chaps, 

I had it down as C, but then questioned myself and you know what its like!

[Rory RSC 596]

Mat do you run it as a separate company or is it in the same accounts as car sales out of interest? 

[Stalker 180]

11 hours ago, justina3 said:

His calculations where based on as he said an example, not a complete brake down of costs so the answer to his question should still be option c 

When the "award winning" supermini asked how much profit he was making, he only made allowances within the £50 inc vat for Labour and materials!

 

I have to note, we struggle to net £125 from a £200 service, without pulling a customers pants down. But then again... were not an  "award winning" dealer.

[Dave2302 387]

Asda Oil ?? Chinese Filter ??  At £50 it got bugger all else, hardly a "Service", Oil and Filter Change

[Mat C 77]

45 minutes ago, Rory RSC said:

Mat do you run it as a separate company or is it in the same accounts as car sales out of interest? 

We've been trialling it last year as the same company, we invested in a ramp, tyre machine, balancer, diag equipment etc. its just been run alongside the same company.

it all goes into autosales and sage and spits out our profit / loss at the end of the year. We wanted to be a little more precise, so were calculating daily our service income now hence my question initially.

5 minutes ago, Stalker said:

When the "award winning" supermini asked how much profit he was making, he only made allowances within the £50 inc vat for Labour and materials!

 

I have to note, we struggle to net £125 from a £200 service, without pulling a customers pants down. But then again... were not an  "award winning" dealer.

It was a hypothetical question.. i put it as a simple example.

 

and please use "multi award winning" in future

3 minutes ago, Dave2302 said:

Asda Oil ?? Chinese Filter ??  At £50 it got bugger all else, hardly a "Service", Oil and Filter Change

We use Comma 5w30 oil and bosch filters..

[Dave2302 387]

Fair Enough, I take it it the Minis don't hold much Oil then,  or are you just using the non Mfr Specific Comma 5W/30, which is cheaper.

Most of the MB Engines I see hold at least 7 Litres, some of the lumpy Vehicles I do take 11 + litres, I always use the Comma Mfr Specific Oils in customer Cars, like Syner-Z for a lot of MB's and, in fact, in my own Cars I buy the Oil and Filters from MB as I get a decent deal from them on a lot of parts.

Customers get offered genuine too, but most of them want to go cheaper with OEM quality  

Regarding other parts like Suspension Links Ball Joints etc I will not even sell or fit the likes of First Line / Meyle etc ................... Chinese Junk  

Either OE or OEM or they can go elsewhere. Decent Customers with decent Cars do appreciate this, and the scumbags who want to buy their own bit's off EBay can fuck off.

Thankfully we don't get many of them up here, and those few that there are know not to bother coming to me 

There is a few local kerbside cowboys who can accomodate them for booze money 

[Rory RSC 596]

2 hours ago, Dave2302 said:

Fair Enough, I take it it the Minis don't hold much Oil then,  or are you just using the non Mfr Specific Comma 5W/30, which is cheaper.

Most of the MB Engines I see hold at least 7 Litres, some of the lumpy Vehicles I do take 11 + litres, I always use the Comma Mfr Specific Oils in customer Cars, like Syner-Z for a lot of MB's and, in fact, in my own Cars I buy the Oil and Filters from MB as I get a decent deal from them on a lot of parts.

Customers get offered genuine too, but most of them want to go cheaper with OEM quality  

Regarding other parts like Suspension Links Ball Joints etc I will not even sell or fit the likes of First Line / Meyle etc ................... Chinese Junk  

Either OE or OEM or they can go elsewhere. Decent Customers with decent Cars do appreciate this, and the scumbags who want to buy their own bit's off EBay can fuck off.

Thankfully we don't get many of them up here, and those few that there are know not to bother coming to me 

There is a few local kerbside cowboys who can accomodate them for booze money 

Gen Merc parts are often quite good value, service bits are pretty reasonable. Same goes for TPS with VAG stuff particularly when buying bulk.