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If a bike supplier/manufacturer was supplying a crash replacement bike part to a UK shop (where I bought the original bike) for £50, how much would you expect to mark up/sell that product to me? It's coming from Germany and I've been quoted £90...seems a big % increase for a few phone calls...just checking this is normal.
Take the VAT off and the shop is taking £75.00 - so 50% mark-up which is reasonable to me and probably on the low side when you take overheads into consideration as well.
Mark-up doesn't equal actual profit!
is that fitted?
Not fitted.
How do you know what the shop is paying? What’s the non crash replacement rrp? I imagine the shop will be paying for shipping too, which will eat into profits.
It's a tough one, because it can depend heavily on how long the shop has had to work on it.
"A few phone calls" doesn't sound like much, but if the mechanic / staff member has spent, say, 10 minutes researching the damaged part code and the manufacturer's crash replacement policy, 5 minutes looking up your original purchase details and date, 10-15 minutes on the phone to the manufacturer discussing the return and replacement*, another 10-15 minutes putting together an email with all the details, taking photos of the part and maybe then 15 minutes packaging something up to send back to the manufacturer and arranging a courier, that's up to an hour of workshop time. Not to mention the cost of the courier.
As the-muffin-man says, the shop will pay VAT on your payment, so will take £75. The part's coming from oustide the UK, so there'll be no VAT to reclaim, so that £25 for an hour's work and possibly £10-15 of courier costs.
I don't mean to sound defensive about all this, just hoping it helps explain why the jobs that customers think "only take a few minutes" or "a couple of phone calls" are often the ones that bike shops don't welcome, because they can take up a lot of time and be a lot of hassle with the inevitable back-and-forth that can accompany warranty / crash-replacement cases - time that could be spent much more profitably servicing bikes. I'd say that _some_ of that cost should be paid for in the cost of selling the bike in the first place, but if the shop has had to do an Internet-matching discount just to get the sale, they may have only made a few tens of pounds on it in the first place, which has to cover the outlay of buying in the bike, building it, storing it, paying the rent for the shop floor space, talking to customers about it, processing the sale, etc...!
* This is a conservative estimate - this can often take several phone calls, some emails, some persuasive discussion where I've had to tell manufacturers that this is a trusted customer who really did have the part fail while s/he was just riding along, not an opportunistic punter who's taken an aero disc wheel down Innerleithen. Sometimes this is spread out over days or weeks. I've spent literally hours of phone / email time over customers' crash replacement / warranty frame cases. Many manufacturers don't make it easy, because they don't want it to be easy!
VAT isn’t always charged on goods supplied from Germany to the UK.
Crash replacement is usually say 50% of rrp. As long as the £90 is that it's not really any of your buisness how much the shop pays for the item. They could get it for free, all your concern is that the terms of the crash replacement warranty are met.
Warranty replacement is free, the only charge should be fitting the old parts to the new frame. That's how warranty works unless it's a crash replacement where you get a discounted part. Then you pay for the part & the shop charges for rebuild if needed.
VAT isn’t always charged on goods supplied from Germany to the UK.
Yes it is.