OP
accordfire
Nearly - I almost replies to your initial ballpark statement of a global 10% mark up. Either way, making a comment like "a 35% mark up is a rip off" is pretty naive, being honest.
Perhaps you haven't seen the cost of diesel lately? I don't know how much it is in Liverpool, but at the moment, I'm paying an average £1.45 a litre on around 360l a month of the stuff. Somewhere I have to recover that cost - both for the travel to the job and for my guys collecting stuff from suppliers.
Of course, as I said earlier, I could, conceivably, take that mark up off my materials, and add it back to my labour element - which would penalise customers NOT using my materials. That's closer ripping someone off, IMO.
What about guys that buy in stock ahead of time - should they not cover the cost of storing that?
We're talking about a difference here, by the way of around £2.50 in every ten quid. Or put another way, we're talking about charging a 35% mark up on parts, with a say, £30 an hour labour charge - OR, we're talking about a 10% mark up on materials and a £35 labour charge.
The point is, neither is a rip off, per se. What is is, though, is a business model. It's about applying mark up in the fairest way, or in simple terms making a profit in a way which reflects what your customers use from you.
Nobody HAS to apply a 35% mark up, any more than they have to apply a 10% mark up - the fact that you apply 10% is what works for YOUR business - not necessarily anyone elses. And that doesn't mean they're ripping anyone else off either.
What you're saying, certainly the way you've written it, is that anyone charging more than 10% mark up on parts is, defacto, ripping their customers off. That's a damn silly thing to say without knowing how their business works. IMO.
As for your comments about selling goods on for a bigger fee than the customer could in all honesty get for themselves......well, yeah.....what do you think your wholesaler is doing to you? You think they're only putting a few percent on what they pay from the manufacturer?
Here's a thought - what about underwriting the warranty on the manufacturer's goods - who pays for that? The manufacturer? Wholesaler? Not likely. When was the last time (apart from major recalls) that you got back your petrol and time for replacing a "widget" that failed under warranty?
That mark up doesn't just cover what the customer COULD have paid for it, but your time in getting it, selecting it as best for the job, transporting it, storing it safely, tracking warranty on it, and so on and on.
I'm not trying to suggest that you;re wrong, by the way, in what you mark your products up by - that works for you. But what I am saying is that suggesting blanket fashion that a 35% markup is a rip off, is wrong when you don't know why it's been marked up by that amount.
