Paying a hefty price to be lazy...
I recently took my 1983 Ford Van back to a dealership for a "minor tune-up." I was presented with a bill of $32 for labor and $18 for eight spark plugs. Two blocks away from the dealership, an auto parts store sells identical plugs for 89 cents each. The dealer's service department charged me $2.25 per plug. Is this a rip off?
RAY: It depends on your point of view, George. Our theory is that the amount that you are willing to pay for something is a function of the extent to which you either CAN'T do it or DON'T FEEL LIKE doing it yourself.
TOM: Let's take something high of the "CAN'T DO" scale, like brain surgery. Most of us CAN'T do that, so doctors can charge an exorbitant amount ($10,500 plus parts), and we don't consider it a rip off.
RAY: We're also willing to pay a hefty price for something high on the "DON'T FEEL LIKE" scale. When it's time to have your septic tank cleaned, is any amount too much to pay?
TOM: Most jobs fall in between the two. Take dining out, for example. When you go to a fancy restaurant, you might order a pasta dish for $11.95 even though you know it's made from only $1.15 worth of ingredients, right?
RAY: Here, there's a combination of "CAN'T" and "DON'T FEEL LIKE" at work. You're paying someone to buy those ingredients (which you don't feel like doing), put them together in a way that tastes great (which you probably can't do), serve them to you in THEIR dining room (which you definitely can't do), and clean up when it's all over (which, according to this note we got here from your wife, you NEVER do). That's why you pay $11.95 for $1.15 worth of pasta and spices.
RAY: And that's also why you pay $2.25 for an 89c spark plug. A tune-up is a job most people can't do themselves, and even if they could, many would rather spend their day-off doing something else.
TOM: I know what you're going to say, George. You're still wondering why there's a markup on the parts. You thought you covered the mechanic's cost when you paid $32 for labor, right?. But you didn't cover all of it. And for some reason, we aren't willing to pay mechanics what mechanics think they're worth. So instead of charging a higher labor rate, repair shops hide some of their profit in the re-sale of parts.
RAY: If they thought we would pay it, mechanics would simply charge $60 an hour for labor. People don't hesitate to pay a plumber $60 an hour to track mud on the carpet and stop a leaky faucet, but a car mechanic who charges $60 an hour is called a crook (in fact, mechanics are called crooks no matter how much they charge!). And to be fair, we should point out that the plumber is also adding a healthy markup to the faucet he replaces for you. We don't condone this, but it has become standard practice in almost all repair businesses.
TOM: So the decision is up to you, George. Weigh the cost of the minor tune-up on your own "CAN'T DO/DON'T FEEL LIKE DOING" scale. If you'd rather do it yourself, go to the auto parts store and buy the spark plugs for 89 cents each. With all the money you save, you can go to a nice restaurant and have a pasta dinner for $11.95. Heck! You'll save so much money, you could even order one of their $3.99 bottles of wine (that's the one on the wine list that sells for $30)!