Synthetic Oil Changes at Quick Lubes.

[donnyj08]

Originally Posted By: bourne
Our prices :

Conventional Oil Change : $18.95 + Oil Filter Disposal + Tax
Syn Blend Oil Change ( Maxlife , 4 T rotation for free ) : $ 29.95 + Oil Filter Disposal + Tax
Synthetic Oil Change ( Synpower , 4 T rotation for free ) : $ 49.95
+ Oil Filter Disposal + Tax

All the above said services include 29 point inspection, fluid top offs , Chassis lube and free alignment checks ( customer request ). Upto 5 quarts of oil + Filter. Additional oil extra.


those are good prices, honestly. I'd pay that for a synpower change if it was the middle of winter or i was itching to get an oil change.

the parts dept at My local ford/dodge dealer here buys a ton of Mobil 1 at Walmart once a month to fill cars that come in requesting Mobil synthetic. they charge 54.95 for M1 a motorcraft/mopar filter. fluid top off's and inspections. The guys in parts say its the only way they can buy synthetic and do oil changes and turn a profit. They say to stock motorcraft syn cost them too much and people always want M1.

 

[chevrofreak]

Originally Posted By: Brenden
Originally Posted By: RamFan
$34.99 for conventional, $64.99 for Havoline synthetic at my shop. I will say this though, the profit margin on synthetic isn't nearly as large as you might think.


Indeed, they usually don't sell a lot of syn so they buy them in 6qt packs like m1 for example which is around $45 for the 6qt pack. when you consider the $500 for 55 gal of conventional and that profit margin, their price on syn becomes a little less criminal, food for thought though.

The question is how much are people with higher end cars that spec syn only willing to pay? apparently sub $100 is not a big deal to them.


$500 maybe for a private label. For a name brand you're looking at at least $550, and that is often with steep discounts. Many conventionals are selling for $700+ at full price. A drum of Mobil 1 5w30 is about $1400.

We offer private label synthetics to the quick lubes, which are around $20 for 6 quarts and are good quality. Most name brand synthetics are between $35 and $50 a case, averaging about $40. I do not know what they resell it at, since I will never let a quick lube near my car.

 

[HTSS_TR]

Originally Posted By: JHZR2
What did PT Barnum say?

Some stuff, like this, to me is just highway robbery. Because the "value added" of syn oil is worth the value that we see in retail price delta, and youre exactly right - everything else is EXACTLY the same.

Its grounds to haggle and then walk. Someone will be hungry enough for the business. The rest can starve.

Which retail price ? From pat chains such as O'Reilly, Pep Boys ... or Walmart ?

Mobil 1 is about $8-9/qt at part chains and $6.xx at Walmart.

If you multiply the syn oil price at $8.xx by 5 plus oil filter at $5, the shop's cost is $45, now add the overhead cost of $5 per vehicle the shop cost is $50. So the shop should charge $60 for a syn oil change for 5-qt, addition $10 per qt above that.

Now if you do it yourself then 5-qt jug at Walmart is the way to go, the total part cost is about $30 and your labor is free.

 

[TrevorS]

Walmart TLE charge $18 more to go from conventional to synthetic and just $4 to go to semi syn / HM including dexos oils.

Both for 5qts.

 

[bdcardinal]

FWIW when we have to buy Mobil 1 for a customer that requests it, we are charged 8.99 a quart from O'Reilly's.

 

[lubedude13]

Oil changes don't make any money considering payroll etc. our profit on Full Synthetic oil change after parts is about $20. (Pay the tech about $7.50 for 45 mins of work plus cleaners, floor mats, the salesman making the workorder= no profit)

 

[SwampSurvivor]

The 0w-20 I calculated to be 3.81 a quart.

So, if I brought my Focus in for a $60 synthetic change ...

$17 of oil (4.5 qts)
$3 filter
____
$21 Total

That's $40 of margin they made, not including other expenses.

Conventional would be around $2.20 or so (averaging some prices)

$10 in oil
$3 Filter
_____
$13 total

If I went to VIOC where they charge $40 for an oil change, there is $27 in margin.

They make a bit more with the synthetic, but not too much , when compared to their markup for conventional.

 

[JHZR2]

Originally Posted By: HTSS_TR
Originally Posted By: JHZR2
What did PT Barnum say?

Some stuff, like this, to me is just highway robbery. Because the "value added" of syn oil is worth the value that we see in retail price delta, and youre exactly right - everything else is EXACTLY the same.

Its grounds to haggle and then walk. Someone will be hungry enough for the business. The rest can starve.

Which retail price ? From pat chains such as O'Reilly, Pep Boys ... or Walmart ?

Mobil 1 is about $8-9/qt at part chains and $6.xx at Walmart.

If you multiply the syn oil price at $8.xx by 5 plus oil filter at $5, the shop's cost is $45, now add the overhead cost of $5 per vehicle the shop cost is $50. So the shop should charge $60 for a syn oil change for 5-qt, addition $10 per qt above that.

Now if you do it yourself then 5-qt jug at Walmart is the way to go, the total part cost is about $30 and your labor is free.


Well, it depends upon the sourcing of oil (direct, jobber, retail parts, Walmart) and the cost delta associated. From direct experience in the Caribbean, where population is lower, and there is less overall business, the shops and businesses that maintain vehicles all buy from a jobber, not a retail store.

But let's play the game...

OP said $34.99 vs $69.99 for conv. vs. syn oil change. Because pricing is easy to find by cursory search, let's say that Walmart is indicative of wholesale pricing.

Mobil super 5w30 is $14.17 for 5qt, and Mobil 1 5w30 is $24.97.

So we can calculate that filter, labor and profit is a bit over $20 (often a shop materials charge is also added, to offset shop cost/increase profit).

So as the OP stated, for the exact same amount of labor, same filter, etc., the consumer price doubles for $10 more in materials cost.

That is, it goes from roughly $20 for labor, filter and profit, to roughly $45 for labor, filter and profit. Labor and filter is the same, so it's all profit.

Let's say the shop truly makes nothing on a conventional change. That still implies that the shop charging $69.99 is making 36% profit on the syn change. Surely they will still try the same upsell or replacements, so subsequent profit is still the same.

So thus the "value added" of syn, which we know is about $10, is actually $25 or more to the consumer. Yes, certainly the numbers squeeze lower if the pricing on syn and conventional change, but my point was regarding the delta in materials costs vs cost to the consumer, given that all other aspects of the cost structure are consistent.

So it's a question of if that value proposition is indeed good value. As I said, an informed customer has that data as grounds to haggle if they so desire. Somewhere between the set price and the materials delta is the true fair price. And the shop could haggle or say no, as could the customer who holds the dollars.

I'm sure I'll get the "you don't understand how business works" comments, but at the end of the day, the customer can always work out their own deal, or walk. If they walk, the shop loses all chances of making a sale and turning a profit.

 

[Hootbro]

Originally Posted By: Donald


What all wives want to see in their garage, a fluid change trench.


My wife could care less if there was a fluid change trench in the garage so long as it is not on the side where she parks and does not trip her on going in and out of the house to her car.

 

[CHARLIEBRONSON21]

Originally Posted By: y_p_w
Originally Posted By: RamFan

In regards to how much the market will handle, I find that if the car requires syn not too many people say to use conventional. Except for GM owners and 0w20 owners who get sticker shock because they don't realize their cars call for syn.

I noted that a lot of Honda dealers in my area are only charging $40 - or maybe a $10 additional markup for 0W-20 "full synthetic" oil change. The ones I see will up that to around $60 for any other synthetic motor oil weight. I'm guessing that with the 0W-20 factory spec they are ordering bulk drums. Not sure if they're going with the OEM-label oil. I generally wouldn't because it seems overpriced.



Chevy dealer here charges 8.95 conventional oil change, 19.95 dexos oil change.

 

[CHARLIEBRONSON21]

Originally Posted By: Hootbro
Originally Posted By: Donald


What all wives want to see in their garage, a fluid change trench.


My wife could care less if there was a fluid change trench in the garage so long as it is not on the side where she parks and does not trip her on going in and out of the house to her car.



My parents have one at their house. Actually a tornado shelter, but I've made it work. Changed my trans in that pit.

 

[MrQuackers]

Originally Posted By: CHARLIEBRONSON21



Chevy dealer here charges 8.95 conventional oil change, 19.95 dexos oil change.


At those prices, I'd worry about shenanigans, like *rip* hey looks like you have a torn boot, need a new CV joint.

 

[Pop_Rivit]

Originally Posted By: stchman
Pure profit.


It's clear you never took any basic business classes in grade school. Businesses need to make a profit in order to continue to be a business.

Depending upon the business model that they use, some items may be priced at a point where very little profit is made. That profit is made up on other items with either real, or in the case of synthetic oil, perceived higher quality to the average consumer. They make a higher profit from the synthetic oil changes in order to offset low profit items.

Out of the profit that you're seeing also comes wages/benefits, electricity costs, gas to heat the building, outside costs such as accountants and attorneys, building maintenance, taxes, franchise fees, shop supplies, and a host of other expenses. Given the number of expenses that a business has just to open the doors, it's clear that profits get reduced significantly.

I don't have time to "peruse" quick lube sites, I don't use synthetic oil, nor do I have oil changes done for me. But for those who choose to use synthetic oils and have their oil changed at a quick lube business, they should expect to pay a premium; not only for the oil but for the service.

Originally Posted By: JHZR2
What did PT Barnum say?

Remember, a fool and their money are soon departed if they dont understand and accept the price structure that they are buying into.


The actual quote you're looking for is "A fool and his money are soon parted.

It was from an English proverb originally penned by Thomas Tusser in the late 1500's and most certainly did not originate with PT Barnum. The original proverb is:

Quote:
A foole and his money be soone at debate: which after with sorow repents him too late.

 

[dareo]

Years ago when i ran a walmart TLE, we frequently had small business shop owners come in and buy carts full of oil off our shelves. Clearly there are no good oil supply options for a lot of these quick lube places if they buy at retail from Walmart.

No money is expected to be made from the TLE operations, its the money people spend in the store while their car is serviced that makes it worth while. We had a few years where we actually contributed profit but it was unusual.

The oil change business is so broken that i don't know how it still exists. People want it done for nothing, cars go longer on an OCI these days, brand specific oil requirements, just a hard business. Scamming people on air filters and stuff they don't really need is probably the only life line keeping some shops afloat.

The fierce competition leaves low profits that only allows cheap unskilled labor doing the work on your car most of the time.