Sorry Peter, if I knew how to underline it I would have 
I should have put this
https://intheflesh.fandom.com/wiki/PDS_(Partially_Deceased_Syndrome)
Anyway to topic, I had a good meeting with my current provider yesterday and we came to a very good and decent compromise on the way forward. He understands the dilemma faced by owners and operators. He also explained the old dilemma of finding ‘’stuff’ during the inspection and facing the decision of going ahead and fixing whilst it is in bits, or delaying and haggling with the customer about the merits. He referenced a wheel bearing for example…..
This is a subject close to my heart because pricing (bids and tenders in the pharmaceutical & clinical research industry) is what I do for a living.
Generally speaking, people are not great at analysing a quote and getting the company/person providing it to break it down into exactly what drives it. This is even more the case when they don’t really understand the subject matter. They also don’t want to appear confrontational, so they don’t challenge – especially if they’re not sure of the position. If you read Mike Busch on the subject, that is basically my attitude to it.
It isn’t rocket science, but for some reason people are shy of getting into it. What are you charging per hour (and do I find that reasonable) and how many hours do you think you need? What assumptions are behind you assessment of how many hours you need (no, I’m not paying you four hours labour to change the oil!) Where are you getting parts, how much is that costing you and what markup are you putting on them?
At work our customers rip us apart over this every day. They want to understand every hour and why it is required (understandable since charge-out rates for this work are a lot higher than aircraft maintenance) and because of this we really do our pricing in detail so that we can justify it. Everything is from algorithms based on our latest information as to how long certain work takes – there is no element of sticking in a load of hours and seeing if they’ll go for it. All the commercial negotiation is done on discounts and hourly rates – a customer giving us $100m a year might get 8% off all rates or something, rather than less-inflated estimates on time-to-task.
The ‘fixed price’ annual inspection is presented as being convenient for you, but really it is convenient for the shop because it eliminates all price negotiation and avoids them having to explain their quote to the few customers who might try to pick it apart.
Right now I am about to pick apart a quote I have received from a guy for some tree work at home. The quote is vague, just a number based on the discussion we had and him looking round my property, so obviously I will be going back to him to get him to spell out exactly what that includes, what his assumptions are, how long the work will take and things like waste disposal, etc. No doubt I will find that a fair portion of his quoting logic will have been looking me (and my property) up and down and forming an assessment of how much he thinks I might pay without complaining too much.
You see pricing ignorance also with car servicing. For the last two decades at least there has been almost no real work in a car service besides the oil change – and this is 15 mins work for someone competent who can put the car on a four-post lift. Back in the day there were ignition points, valve clearances and carburettors to check and adjust, plugs to clean and gap, there was brake fluid, coolant and gearbox and differential oil to change, you might have to flush the radiator, grease the trunnions and a load of other pivot points, adjust the brake drums, etc. So obviously a service took a couple of hours and one paid for the labour accordingly. The garages/dealers don’t want to lose that revenue, so a service still costs much the same (allowing for inflation) but there is almost nothing in it. Nothing to adjust, all those fluids (except the engine oil) are usually sealed for life, everything is ‘inspection’ of XYZ which really you have already paid to have inspected at the MOT.
Ultimately it comes down to customer ignorance. If a company finds that they aren’t being asked to justify their quotes then they will base those quotes on how much money they think you might have!
I suspect the fixed annual inspection quote for different types, depending on complexity, is somewhat akin to paying a small retainer to your shop.
I drive a 40 year old timer which requires the TLC described by Graham, but either the design or original parts, still means that the maintenance bill is a fraction, and I mean a small fraction, of the memsahib’s modern AUDI – hence the Audi is maintained by the Beetle mechanic.
But many customers would just pay the bill, in the interest of “relationship maintenance”.
But what choice do you have? There is a EASA part 66 engineer not to far from us. Yet he isn’t allowed on the airfield as the maintenance organisation is owned by the airfield operator.
The next closest maintaince organisation is a one hour forty minute drive away and they aren’t taking on any more work. It’s a one man band outfit.
After that’s about 2 hours drive and they don’t have LAMP approval only SDMP.
So what choice do you have? You simply can’t fall out with you maintainace company because there is no one else.
As you say what really needs to change is the approval lies with the individual not the organisation. But can you ever see EASA changing that?
I paid for my ATPL training being a one man band maintenance supplier and under the old CAA rules it was a reasonable thing to do bit times have moved on.
While EASA has not made this totaly imposable it is a lot more difficult than it was. What has made me move into the EASA 145 environment is the modern trend to resort to leagal action at the drop of a hat, while I’m more than happy to shoulder my leagal responsibility under the law in terms of the technical decisions I make. I fear the very rich owner who can afford to go to law to avoid a bill he does not like with the intention of getting me to pay for the restoration of the old dog he has purchased . Far better to be protected from the unscrupulous by having an EASA 145 company between me and the customer, that way I have a reasonable chance of not loosing all I own to a leagal action I could win but still have to pay my leagal costs.A_and_C wrote:
to a leagal action I could win but still have to pay my leagal costs.
Litigation is the last resort. No one wins except lawyers who get a chance to play their game whilst the pursuers and the defender pay for it. I was on the end of a pair of scallywags who stole a business off me. The father of the daughter, who I was actually mentoring in the business for him, was very wealthy. His sport was to get lawyers to sue other lawyers, for sport 
Unfortunately for me, I got on the wrong end. I was IMO right, my lawyers said I was right, but what price is principal? In this one I withdraw at £45k in legal fees, to ‘win’ 43k. She had nothing when we credit checked her. My good friend heads up a large corporate global legal team. He has the Price of Principal etched on his desk on every case he looks at. Litigation is a total mugs game……
The problem, from what I have seen from nearly 20 years in this game, is that the general standard of what would anywhere else be called “project management” is universally atrocious. It ranges from comical (I could write reams on this) to nonexistent (the job is commenced only when the customer starts to scream down the phone – words of a former employee of what used to be UK’s arguably top avionics shop).
The end result is that a lot of customers are unhappy with the process. And only some of these are crooks, shysters, wide boys, and general t0ssers (both rich and poor and everything in between) which the human race inevitably has a certain % of and thus inevitably some will end up as aircraft owners.
I think one could devise a pre-assessment process whereby the customer agrees that €x will be an initial assessment charge, then €y will be for Work Z, etc.
I can see that a lot of people will be driven away by that, but they will be the ones who you don’t want as customers, anyway. Other trades have introduced such a system. Try sending a pricey watch in for a service, for example…
Litigation is usually pointless, because the issues are way too complex for the judicial system to understand them. The system is set up to bust somebody for killing somebody, and various levels of “simple to understand crimes” below that, or, for civil cases, fairly crude forms of fraud and breach of contract. Litigating technical disputes is just pouring money down a black hole, and a good lawyer will absorb a few k a day. And that is true even if geographically the parties are close (i.e. the dispute could have been avoided to start with, by man-to-man discussion). If the parties are distant (and this is often the case with aircraft work) then you can forget litigation. One past poster here discovered to his cost (5 digits and a plane abandoned) that giving work to a shop at the end of an 11hr car journey means that you can do absolutely nothing whatsoever if things go wrong. Why he went to a shop at such a vast distance is a story one can only guess at, although one can guess it pretty well. And this level of loss is not uncommon; I have heard numerous such stories.
So take today. I had a hydraulic fluid leak and no right brake. We reviewed it, probably an O ring. So off it comes, yes it was an O ring, but pads are worn. I am not there. Positive note I was called. What will the parts cost? Do not know is the answer. Can we go ahead and change the pads? Yes is the answer. I have not a clue what this will cost me? Does it actually matter? No in reality, but……..I may get a bill for 5k. so a simple O ring job, escalates to pads, O rings, fluid etc..
Where would the blame lie if I do get a 5k bill?
They should contact you for your consent before doing the work. But even brake pads, for the usual Cleveland brakes, are really cheap. It is mostly labour.
Graham wrote:
This is a subject close to my heart because pricing (bids and tenders in the pharmaceutical & clinical research industry) is what I do for a living.
Unfortunately pricing schemes are very different in a real-world competitive market like that compared to our aviation-world where options are few and far appart, and that guy who cannot substantiate his inflated prices barely makes a living out of them…whereas pharmaceutical and clinical have historically been high-margin industries.
Agreement on pricing cannot work the same in both worlds.
