Retail Warranty Reimbursement can be a profitable revenue stream for automotive dealerships. With the right legal counsel, these reimbursements can increase dealership bottom lines by tens of thousands of dollars per month and hundreds of thousands of dollars annually. In addition, dealers in the Northeast have benefited from this revenue opportunity without significantly increasing volume. But how can dealerships maximize their potential? Below are some tips that can help you improve your revenue with Warranty Parts Reimbursement.
First of all, don’t assume that the manufacturer will give you a full reimbursement unless you provide documentation. Most manufacturers will allow you to submit a reimbursement request only after verifying that you have performed the work correctly. Be sure to follow all manufacturer guidelines before submitting your request. For example, Ford will only reimburse your parts if you fill out a specific worksheet or work paper. The manufacturer’s policies may change without warning.
Third, don’t forget to take advantage of your auto warranty. Warranty Parts Reimbursement helps auto companies keep their repair costs low and retain customers. If you buy replacement parts at retail rates, you can offset the cost of parts and repairs with warranty reimbursement, which is generally higher than wholesale prices. Ultimately, you’ll save money with Warranty Reimbursement Rate, so it’s worth it to take advantage of it.
Fortunately, most states have already adopted legislation limiting manufacturers’ ability to change Warranty Parts Reimbursement rates. Others are working to amend their statutes. In South Carolina, SB 510 amends the dealer statute to require manufacturers to compensate dealers at retail rates for warranty services. Further, it specifies retail markups for “no cost” parts and requires manufacturers to follow a strict protest process.
Dealers should submit 100 customer pay repair orders within 90 days to receive a higher reimbursement rate. This rate applies to all repairs made by the dealer, except for routine maintenance repairs. Moreover, a dealer can only submit for a higher rate once a year. This process is complicated, and most manufacturers reject an initial submission due to its lack of legal expertise. A consultant can also help dealers build a better case for warranty reimbursement. Contact Warranty Parts Company for any query.
There are many pitfalls to watch out for when submitting a warranty claim. Dealers must submit 100 high yield repairs to the manufacturer before they can be approved. Manufacturers may either honor the rate submitted or negotiate for a lower rate. Dealers often regret self-submitting, as the revenue lost due to the delay is far greater than the legal fees they pay. It’s not always easy, but it’s worth it.
The formula for Dealer Warranty Reimbursement remains unchanged, but it will be extended to include recall repairs. Manufacturers do not want to penalize dealers who collect retail rates. The formula for determining the reimbursement rate is the dealer’s purchase price, plus shipping and other expenses. Then, multiply this rate by one