The Independent Garage Association has published a study to examine labour rates, and to asses if garages in any given area are competitive with each other.
Perhaps unsurprisingly, the IGA has concluded that independent garages provide consumers with ‘outstanding’ value for money, and that their proposition is ‘unrivalled’ by any other sector in the automotive aftermarket. The report goes further and concludes that in many circumstances, garages may be selling labour too cheaply, as they have not increased prices as their costs increased.
Apart from the key findings of the UK Independent Garage Labour Rate Study ,the IGA has also developed a labour rate calculator to accompany the study, which will help members to review their costs and work out an approximate breakeven hourly rate.
Stuart James, IGA Chief Executive, said: “The study clearly shows that in many cases, independent garages have been absorbing the rising costs involved with running a garage business, rather than passing those increases on to their customers.
“While this is great news for their customers, it is impacting on garage profit margins year-on-year, which in the long-term is not sustainable. In these difficult times, it is more important than ever for garages to build all ongoing costs into charging structures to future-proof their businesses.
“A significant number of members have taken part in this study and feedback indicates that they will use this to review their charge out rates, so they can make a sustainable margin and continue to provide their vital services to local communities.”