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Old 18th Feb 2014, 10:18
  #39 (permalink)  
D B Cooper
 
Join Date: May 2008
Location: Australia
Posts: 16
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Just a bit more on "mark-ups" here.....

Suppose you've just fitted a battery that you sold to your favourite customer. You paid $300 for it, and sold it to your favourite customer for $300 - because he's such a good bloke! And because your such a champion engineer, and such a good bloke too, you charge 19 minutes of your time, for the work.

Next week he's back. There's something wrong with the battery you just sold him. The aircraft wont start! Quick - you must drop whatever you're doing and save the situation.

So you dump your second favourite customer, (whose aircraft you were working on right then) and run off to do what you can to help your mate, who's by then threatening legal action.

You find that the new battery is faulty. You did a great job, but the battery you just sold was a dud when it left the factory. The bloke who sold it to you says "No worries, just bring it back and we'll sell you another one. When we send the one we sold last week back to the bloke we bought it from, and he checks it out and confirms it's a dud, we'll give you a credit for it. That should only take three months or so. You'll have to pick up the tab for the freight, though, and there's some forms to fill out."

So you pull the dud out, get another new one, and fit it. It all took a couple of hours, and cost you another $300. At least your customers aircraft is going again, but he's not happy, and reminds you that he'll expect a fair discount on his next 100 hourly, because he's been jerked around. Well, at least that's better than getting sued, like his lawyer wanted, because he missed that charter. Yeah, he's a real good bloke.

Then you go back to your hangar, and your second favourite customer is waiting around to pick up the aircraft you'd promised an hour ago, and he's not happy......

You did nothing wrong, but didn't make wages for the day, because last week you were a good bloke!

This scenario might not happen all the time, but it does happen. A reasonable mark-up, allows the MRO to smooth out a few bumps so it can provide a better service.
D B Cooper is offline