Let's talk about customer-supplied parts. Should you accept parts a customer wants to buy themselves and hand to you for the install? My answer is no.
Here's the short version. Don't accept customer-supplied parts as your default policy. It makes you less money and it wrecks the efficiency of your shop, because you're no longer in control of your own bay, the customer is. There are exceptions for the odd special situation, and you can make those calls. But if a customer's whole way of doing business is that they supply the parts and you supply the labor, that's not a customer you want. And if you ever do make an exception, get it in writing that you're not covering the part's warranty or the labor if it fails.
Now here's why, and what to do when you make an exception.
Why customer-supplied parts break your shop
Say a truck comes in for an inspection. You do the inspection, it needs repairs, and now instead of pulling the part off your own shelf or calling your own supplier, you have to call the customer and wait on them to get you the part.
That one phone call changes everything about how your day runs. You're no longer in control of your own bay. You're reliant on the customer to get you the part before you can even start the repair, and you don't know when that's going to happen. Maybe it shows up today. Maybe it's a day or two longer than they said. Either way, your bay is down and there's nothing you can do about it but wait.
Customer-supplied parts affect your bay throughput because the customer, not you, controls how fast the part gets to you. Multiply that across a shop full of jobs and you can see how fast it grinds your whole operation down.
You make less money on every one of these jobs
There's also the simple math of it. When you supply the part, you make margin on the part and you make margin on the labor. When the customer supplies the part, you only make the labor. Now imagine every single customer you had did this. You'd be making less money on every job, and you wouldn't control your own parts flow on a single one of them.
These aren't the customers you want
There are instances where it makes sense to make an exception. A customer needs some special part for a specific reason, and it's a one-off. That's fine. But generally, you don't want to work with customers whose standing policy is that they supply their own parts and you just do the labor. You make less money, and your shop's efficiency takes a hit every time.
When you make an exception, put the terms in writing
If you do accept a customer-supplied part, it needs to be outlined to the customer up front, in writing, that you are not covering the warranty on that part. If the part fails, that's on the customer to sort out, not you.
You're also not covering the labor. If a part they supplied fails, the customer pays you to do the job again. That's different from a part you supplied failing. If your shop supplies the part and it fails, you cover the parts and the labor. It's full warranty coverage, on you.
Why shop-supplied parts are worth protecting
This is the trade-off worth spelling out for yourself and for your customers. When you supply the part, you make a little extra margin on the parts sale, and in exchange, your customer gets full warranty coverage if anything goes wrong. That's a good deal for them, and it's a good deal for you, because you control the timeline, the quality of the part, and the whole repair from start to finish.
Put it on the work order
Don't rely on a verbal agreement or a handshake for this. Write the policy into your estimate or work order: shop-supplied parts carry full warranty on parts and labor. Customer-supplied parts carry no warranty from your shop on the part, and no warranty on the labor to redo it if the part fails. Have the customer sign it. It protects you the one time a customer forgets what you told them and comes back expecting a free warranty repair.
The bottom line
Most shops that take customer-supplied parts do it because they're afraid to lose the job. Think about what that job actually is. You only bill the labor, you wait on somebody else's part, and you carry the argument when it fails. That is not work worth fighting for.
Supply the parts yourself and stand behind the whole repair. Let the odd exception be exactly that, an exception, with signed terms behind it. The customers worth keeping will respect the line. The ones who won't were never going to make you money anyway.