Distributor Labor Rates and PM Programs?

[ScottV]

My PDQ distributor has just notified us that they are raising their service rates effective 5/15. Standard rates will be $159 first hour, $89 per add'l hour per service call. These are up from $140 and $79 respectively. I have 3 washes within 5 miles of each other and I still get the 1st hour charged per visit, despite little to no drive time by the tech who happens to also live in town!

They have also rolled out a new and improved Preventative Maintenance program that they are offering. $295 per IBA per month. Since I have 5 IBA's that would be $1,475 per month or $17,700 per year. We currently do our own service (grease, clean, inspect, check tires, etc.) on our IBA equipment twice a month (or every 2000 cycles) and use the distributor for more technical things that we cant fix ourselves.

I know that they can probably find more "issues" if they were doing the PM's and may actually prevent a shut down bay, but I can't believe that it would save the incremental cost of their PM program. I figure my PM's cost me about $60 per bay per month to have one of my guys do it. What is your experience with PM programs? Are they worth the additional cost?

They are also offering discounts on their service call labor rates if you buy chemicals from them and also use their PM programs. My fear is that they will start prioritizing their service calls based on who has PM and chemical programs with them. If I don't then will my sites be the last ones on the list if we have a shut down problem? I sure hope not.

 

[Whale of a Wash]

All your concerns sure sound valid. If you have 5 washes you should be able to stock some of the most troubling parts at each location, and learn to fix a couple of the things that break down and save alot of money. $17.7K would buy alot of parts. I would also guess the pm's will cost alot more with all the problems they find. I try to fix most problems with my vector, and try not to pay our local guys $90hr, also tied with soap, which i won't use-- ecolab.

 

[aberaleigh]

gee now I don't feel so bad about charging $50 to $55 dollars an hour.

 

[Randy]

One of our local distributors cut his rate down to $69 an hour with no travel time or mileage, a flat $69 an hour. I think they are fighting to stay in business. We learned many years ago if you’re going to survive in the car wash business you’d better learn to do for yourself. If you have to call someone out every time something breaks it’s going to eat up your bottom line fast.