Virtually all states require OEMs to reimburse dealers for warranty parts and labor at retail rates. However, OEMs will do everything in their power to pay dealers rates lower than those you are entitled to. Based on our experience, warranty parts or labor submissions can increase gross profit by $5,000 to $10,000 a month and, in many cases, even more! Withum can assist in preparing the dealership’s submission to the manufacturer to ensure you receive the rates you are entitled to!
Frequently Asked Questions on Parts and Labor Warranty Reimbursement
The state franchise laws allow the dealer to submit for increases on their current warranty parts and/or labor rate annually. While each law is different, the laws all require a calculation of the retail rate the dealers charges to the customer for non-warranty repairs.
The vast majority of dealerships will receive an increase of at least $50,000-$100,000 annually, which pays for the cost of the analysis in about 30 days and serves as a perpetual revenue stream.
We charge a flat fee of $7,500 per submission (parts or labor). When a parts and labor submission is prepared simultaneous, we charge $10,500. No contingency fees!
Our extensive knowledge of the state statutes and manufacturer tactics has resulted in 100% approval rate.
We turnaround these submissions within 30 days!
MSRP and retail prices are equal. MSRP is controlled by the manufacturer, which is significantly less than the retail price in many cases.
Manufacturers will refuse approval. Because we are familiar with the laws and the manufacturing process, our clients experience a high approval percentage.
Withum’s Dealership Advisory Team has over 15 years of warranty experience getting thousands of dealers approved at retail rates for warranty repairs. We have extensive knowledge of the various state statute requirements, as well as the manufacturers’ tactics. Analytical software allows us to pinpoint the range that will yield the highest rate for each dealership.
I highly recommend using Withum for warranty parts and labor submissions. They handle the submission for all 50 dealerships in our group and make the process seamless. Frank and his team have been doing these for a long time and they know how to get it done. They are true professionals and experts in the field.
Larry Daugherty, Fixed Operations Director | Victory Automotive Group
Withum does a great job with all my warranty reimbursement needs. We use them for all our stores, and they get us big increases every time. The process is quick and efficient. We are super excited about the return on investment we have received from our relationship. Dealing with the manufacturer on warranty reimbursement submissions can be tricky and they have the experience to avoid any issues with the manufacturer.
Tully Williams, Parts & Service Director | The Niello Company
Several years ago, I was a little hesitant when it came to warranty parts reimbursement. I was under the assumption that the manufacturer would just reject my submission for a rate increase. But Frank assured me that they will take the necessary steps to get it approved. And he was right. The process was quick and easy and well worth the cost. I have not only used Withum for both my dealerships but also referred many of my fellow dealers to them.
Allen Turner, Owner | Allen Turner Hyundai
Withum was referred to us by a member of our 20 Group and they did not disappoint. The entire process was really a breeze from start to finish. From the word go, Frank and team really took care of everything and completed the package to submit to the factory within a few weeks. They got me increases in both my parts and labor rates, adding thousands to my bottom line each month.
RC Rogers, General Manager | Zimmerman Honda
For more information or to discuss your business needs, contact Withum’s Dealership Services Team.