What is the margin on OEM parts?

[anom3]

I was just wondering roughly what the margin a bmw dealership / part distributor makes on an OEM bmw part?

Not expecting an exact number, but are we talking 5-15% or 30-50%?

[debom3]

I'm not entirely sure, but my local dealers mark things up from what I can find them online by anywhere from 115% - 150%

It depends on the part too. I have no idea what wild formula they have in their system. Sometimes I think the parts guy just makes up numbers.

Also depends on the dealership, some are more expensive than others.

:

[Flying Ace]

Just curious, why do you care? It's not negotiable anyways

[1MOREMOD]

Originally Posted by Flying Ace

Just curious, why do you care? It's not negotiable anyways

Sure it is your doing it wrong.

[Minator]

He speaks the truth.....I do it all the time either at the counter our on the phone. usually get 10/20% off.

[anom3]

The place I frequent gives me 10% off what I would call "the system sticker price".

So for example if their BMW ordering application says 1000USD, I pay 900.

Depends though... Some items they can only do 5% on.

Its just curiosity really... I'm just wondering if they have a healthy markup to work with or if its pretty tight.

Maybe one of the vendors can chime in? We are not looking for exact numbers, and everyone here understands we all gotta make a buck.

Oh, and when I say OEM parts... I mean something like a drive shaft or wheel hub. I am not talking about "performance" parts or additional extras... I mean repair related items.

[M3Bimmer77]

If you can find a part cheaper and OEM then buy it from them. Why care for the dealer with higher prices, unless you want to pay for it. The most I will do is call the guy and tell him that the dealer 20 miles away is x$ less and ask if they can match it. A friend of mine ordered a gasket online because the dealer 10 miles away was $60 more expensive. Online prices are very competitive and sometimes shipping is free and no tax. Once you start buying things you will start knowing the market. Bottom line dealers have different pricing and profit on one part could be 20% while on others could be 100%. There is no exact number. Also they all have different ways of doing their inventory and how they move it.

[Flying Ace]

Originally Posted by anom3

The place I frequent gives me 10% off what I would call "the system sticker price".

So for example if their BMW ordering application says 1000USD, I pay 900.

Depends though... Some items they can only do 5% on.

Its just curiosity really... I'm just wondering if they have a healthy markup to work with or if its pretty tight.

Maybe one of the vendors can chime in? We are not looking for exact numbers, and everyone here understands we all gotta make a buck.

Oh, and when I say OEM parts... I mean something like a drive shaft or wheel hub. I am not talking about "performance" parts or additional extras... I mean repair related items.

Are you in the USA? Your car signature indicates you order in Europe..which is likely a different dealership parts process

[Flying Ace]

Originally Posted by Minator

He speaks the truth.....I do it all the time either at the counter our on the phone. usually get 10/20% off.

give me an example of a part you purchased and its price

[1MOREMOD]

Bmwcca membership gives you 10 percent I think on parts. I usually get little more because I'm 1moremod.

[Beemdog]

Local dealers usually add 15-25% over the MSRP for the part (the MSRP as stated at many online OEM parts houses). Meanwhile, the good online parts places are offering 10-25% off the MSRP. So the net price span between local dealer and online discount can be significant, may be 35% or more, but then there are some shipping fees to deal with. On anything over $50, I would go online... and on smaller maintenance items, get 'em in bulk or with a larger order to save on shipping.

My BMW dealer charges $19 +tax for a liter of 10-60 Castrol TWS. That's 35% more than online ($13.95)...

[Flying Ace]

Originally Posted by Beemdog

Local dealers usually add 15-25% over the MSRP for the part (the MSRP as stated at many online OEM parts houses). Meanwhile, the good online parts places are offering 10-25% off the MSRP. So the net price span between local dealer and online discount can be significant, may be 35% or more, but then there are some shipping fees to deal with. On anything over $50, I would go online... and on smaller maintenance items, get 'em in bulk or with a larger order to save on shipping.

My BMW dealer charges $19 +tax for a liter of 10-60 Castrol TWS. That's 35% more than online ($13.95)...

There's even huge variability of the online prices, I was able to find TWS for $11.06 in this example. ($12 flat rate shipping under $200).

I agree order in bulk, my recent order, I bought 4 oil filter kits and lowered my average price per filter including shipping to $18. But I also change my oil twice a year., so I'm able to use them all in 2-years.

I've also used the free $200 shipping promo and ordered 9 bottles of oil with the parts I actually needed, which was a $25 part. Then I turned around locally and sold all the oil (at cost, I'm ethical) to local car club members and passed on the savings.

[anom3]

There we go. A constructive answer.

Now the question is, and I apologize for my ignorance of some basic understanding of retail markets... Does MSRP already include some sort of margin for the distributors? If so, any idea how much?

So by the sounds of it, at least judging by your post:

10-35% + % included in MSRP = Total.

Originally Posted by Beemdog

Local dealers usually add 15-25% over the MSRP for the part (the MSRP as stated at many online OEM parts houses). Meanwhile, the good online parts places are offering 10-25% off the MSRP. So the net price span between local dealer and online discount can be significant, may be 35% or more, but then there are some shipping fees to deal with. On anything over $50, I would go online... and on smaller maintenance items, get 'em in bulk or with a larger order to save on shipping.

My BMW dealer charges $19 +tax for a liter of 10-60 Castrol TWS. That's 35% more than online ($13.95)...

[Flying Ace]

Originally Posted by anom3

There we go. A constructive answer.

Now the question is, and I apologize for my ignorance of some basic understanding of retail markets... Does MSRP already include some sort of margin for the distributors? If so, any idea how much?

So by the sounds of it, at least judging by your post:

10-35% + % included in MSRP = Total.

beemdog is counting MSRP as the original list prices on online websites. I think MSRP should be dealer walk up pricing which is already 15%-20% higher than MSRP. I don't even know why they bother to list MSRP, when you can't even get MSRP these days. You'll either get below MSRP, or above MSRP for some walk-up pricing.

My only point is, who cares what the dealer margin is, when you can get the cheapest price (including factoring in shipping) from online retailers. I don't care how much they're making in profit, so long as I'm getting the best possible price. Unless you're asking b/c you're trying to get into the business yourself?

These online retailers are BMW dealers themselves along with a few independents like ECS. Long story short is, it appears, BMW corporate doesn't allow dealers to market parts via BMWNA website interface, so each dealer must build their own proprietary parts sites, and they can't directly link their sites to their BMWNA sites. My guess is, it has something to do with competition and not watering down parts pricing, who knows.

Finally, I had hypothesized that it appears you aren't even based in the US, given you drive a 2007 MY M3. If you're in Europe or Asia, all this is irrelevant, b/c we're all US based owners here, and I guess US part sales are going to be very different in method of retail and distribution.

[Craigy]

Most retail products are marked up approximately 100% from manufacturer to distributor, and 100% from distributor to retail outlet. Thus if a product's retail price is $100, the retailer probably made something like $50 and the distributor may have made $25, all before overhead, interest, tax, other fixed costs etc.

Of course this varies... and in a dealer-manufacturer situation this pretty much goes out the window since the dealer is tied to the OEM, and the OEM is often also the distributor.

[anom3]

Yea I am in the EU.

Actually I am asking because I am just curious as to how big of an incentive there is for a dealer / shop to prescribe repairs that include high part costs with low labor costs.

I went in to have one of the wheel bearings on my E92 swapped today. Quite a pronounced whine at 60KM+. We were not 100% sure it was shot but sure enough, it had failed... What I was not expecting was the bearing housing to be "cracked".

Nothing TOO major, but a $XXX part.

I had no time to return to have a look myself so I just told them to make the order and fix it ASAP.

The additional labor to swap the housing isn't that much considering they will have quite a bit of it apart to do the bearing. But the part it self pretty much tripled the cost of the repair.

I have never had any reason to think these guys would fuck me over, but being a bit paranoid doesn't hurt.

They'll have it all sorted out tomorrow, so I will have a look at the old one then.

That's why I was asking

Thanks for the input regardless.

Originally Posted by Flying Ace

beemdog was a little confusing on MSRP, he counts average online pricing as MSRP. I think MSRP should be dealer walk up pricing which is already 15%-20% higher than those average online prices.

My only point is, who cares what the dealer margin is, when you can get the cheapest price (including factoring in shipping) from online retailers. I don't care how much they're making in profit, so long as I'm getting the best possible price. Unless you're asking b/c you're trying to get into the business yourself?

These online retailers are BMW dealers themselves along with a few independents like ECS. Long story short is, it appears, BMW corporate doesn't allow dealers to market parts via BMWNA website interface, so each dealer must build their own proprietary parts sites, and they can't directly link their sites to their BMWNA sites. My guess is, it has something to do with competition and not watering down parts pricing, who knows.

Finally, I had hypothesized that it appears you aren't even based in the US, given you drive a 2007 MY M3. If you're in Europe or Asia, all this is irrelevant, b/c we're all US based owners here, and I guess US part sales are going to be very different in method of retail and distribution.

[Beemdog]

MSRP is the manufacturer's stated retail price (which includes typically a 38% markup from wholesale). I used to own an auto parts store (speed shop). IMO, MSRP is the highest you should pay. However, at some point in time dealership parts counters started routinely marking up over the MSRP, and that's when I stopped buying from them.

Some online OEM parts houses do state the MSRP as sourced from factory price lists. These lists change frequently so they may not always be up to date.

[thekurgan]

[you're]