Remakes and Warranty Replacements in a Glass Business: How to Track the Cost

What glass business books need to track

A glass business is two kinds of work in one shop. One side is the first run. You measure, cut, temper, seal and install the glass the customer ordered. That is where the sale lands. The other side is the redo. A piece comes out wrong. A seal fails inside the warranty window. A pane breaks on the truck. Each one is real work, and each one costs real glass, real labor and real fuel.

When both sides land in one income line, the story gets muddy. You can not tell what the first runs earned. You can not tell what the remakes cost. You can not tell whether a busy month of installs was eaten up by the redo work that followed it. You can read more about how we keep these streams apart on our bookkeeping service page.

Here is what a clean month looks like.

What a remake looks like in your books

A remake is a piece of glass you have to cut, temper or install a second time. The first one came out wrong. The size was off. The edge chipped. The temper did not take. The customer sent it back. Now you do it again.

The glass for the remake is a real cost. The labor to cut it again is a real cost. The fuel to run the tempering furnace a second time is a real cost. When you book all of that to one overhead pile, the first run looks like it earned more than it did, and the shop looks like it costs more to run than it should.

The clean way is to book the remake glass and labor to a remake cost line, away from first run sales. When you do, your profit and loss shows what the first runs earned on their own, and it shows what the redo work cost you. You can see whether the remake rate is holding steady or climbing.

Here is what to keep straight.

• **Book the first run sale to a first run income line: ** not to one mixed sales line.
• - **Book the remake glass to a remake cost line: ** so the redo work shows on its own.
• - **Book the remake labor to the same remake cost line: ** so the full cost of the redo is in one place.
• - **Tag each job: ** so you can see which jobs needed a remake and which did not.

What a warranty replacement looks like in your books

A warranty replacement is a piece of glass you install again because the first one failed inside the warranty window. The seal went. The pane cracked on its own. The customer called and you made it right. That is good service, and it is also a real cost.

The glass for the warranty replacement is a cost. The labor to swap it out is a cost. The fuel for the truck to drive back is a cost. When you book it to the same line as the first run sale, the first run looks like it earned less than it did, and you can not see what the warranty work really costs you in a year.

The clean way is to book the warranty glass and labor to a warranty cost line. When you do, you can see what the warranty work costs you each month and each year. You can see whether one product line is failing more than the others. You can price your warranty the next time you write the terms.

Here is what to track.

• **Book warranty glass to a warranty cost line: ** not to the first run sale line.
• - **Book the swap out labor to the same warranty cost line: ** so the full cost sits in one place.
• - **Note the product line: ** so you can see which glass fails most.
• - **Watch the warranty cost trend: ** so you know when a product line needs a talk with the supplier.

How to keep remake costs apart from first run sales

The whole reason to keep the two lines apart is to see what the first run really earned. First run sales are the income. Remake costs are the cost of the redo. When they sit apart, you can see both stories at once.

A month with a lot of first runs and a few remakes looks busy on the income line and small on the remake line. A month with the same first runs but a pile of remakes looks busy on the income line and big on the remake line. Both months sold the same glass. Only the split books show you why one kept the cash and the other spent it.

When the streams sit together, the story is lost. You can not price the first run. You can not tell which crew or which product line drives the remakes. You can not tell whether to push the schedule harder or to slow down and fix the process. The split books answer that.

Here is what a clean split looks like.

How to hold the warranty glass as a cost

A warranty replacement is not a new sale. You already booked the first run. The second piece of glass is a cost of standing behind the work. When you book it as a cost, the first run sale keeps its true shape, and the warranty work shows up where it belongs.

Some shops book the warranty glass as a reduction of the first run sale. That works too, but it hides the size of the warranty work. The clean way is to book the glass and the labor to a warranty cost line, so the number is easy to see and easy to watch over time.

Here is the rule.

• **The first run sale stays as income: ** the warranty swap does not reduce it.
• - **The warranty glass goes to a warranty cost line: ** so the cost is visible.
• - **The swap out labor goes to the same line: ** so the full warranty cost sits together.
• - **The truck fuel for the swap goes to the same line: ** so the trip back is counted.

How deposits and progress billing work for glass

Most big glass jobs start with a deposit. The customer pays a part of the price up front. You order the glass. You schedule the crew. You install the pane. Then the rest of the price comes in.

A deposit is not income the day it lands. It is money you owe until the work is done. When the deposit clears the bank, hold it as a liability, not sales. When the install is complete, move it to first run sales. That way the sale lands on the day the glass went out the door.

Some jobs bill in stages. A deposit, a payment when the glass lands from the tempering plant, and a final payment at sign off. Each one needs to land on the job. When they do, the job shows what it earned from start to finish, and the deposit never sits as income before it is earned.

Here is what to keep straight.

• **Hold the deposit as a liability: ** do not book it as sales the day it clears.
• - **Move it to sales when the install is done: ** the sale lands on the day the glass goes out.
• - **Tag each payment to the job: ** deposit, glass landing and final all sit on one install.
• - **Match the bank to the job: ** so no payment floats in general income.

How the month end close works for remakes

At month end, the remake and warranty lines need the same care as the first run sales. Each remake needs its glass and labor in the right account. Each warranty swap needs its glass and labor in the right account. The deposits need to move to sales when the work is done.

We start with the bank. We match each deposit to the job it belongs to. We move the deposits that are earned to first run sales. We book the remake glass and labor to the remake cost line. We book the warranty glass and labor to the warranty cost line. We tie the fuel and the materials to the bank. Then we send you the reports.

Here is a simple month end check.

• **Match each deposit to the job: ** and move earned deposits to first run sales.
• - **Book remake glass and labor to the remake line: ** so the redo cost is real.
• - **Book warranty glass and labor to the warranty line: ** so the warranty cost is real.
• - **Tie fuel and materials to the bank: ** so the shop costs match what you spent.

A situation we clean up

The remakes buried in one overhead pile

A glass shop runs a busy month of installs. A few pieces come out wrong and get cut again. A couple of seals fail inside the warranty window and get swapped out. No one tags the redo work, so the remake glass, the remake labor and the warranty glass all land in one overhead pile. At month end, the first run sales look strong but the bank did not grow the way they should. The owner can not tell what the first runs earned, what the remakes cost, or which product line drove the warranty swaps.

Here is how we handle it. We pull the job list and the bank for the month. We find the jobs that needed a second piece of glass. We move the remake glass and labor to a remake cost line. We find the warranty swaps and move that glass and labor to a warranty cost line. We tag each redo to the job it came from. When we are done, the first run sales show what the first time installs earned, the remake line shows what the redo cost, and the warranty line shows what the swaps cost. The owner can see which product line fails most. We set up a rule so the next remake lands in the remake line from the start.

Mistakes we fix

• First run sales and remake costs in one income line
• Warranty glass booked as a reduction of the first run sale
• Remake labor buried in one overhead pile with no job tag
• Deposits booked as sales the day they clear, before the install is done
• Warranty swaps not tagged to the product line that failed
• No remake cost line to watch the redo rate over time

Common questions

Is a warranty replacement a new sale? No. You already booked the first run. The second piece of glass is a cost of standing behind the work. Book it to a warranty cost line so the first run sale keeps its true shape.

Where do I book the glass for a remake? Book the remake glass to a remake cost line, away from first run sales. When you do, your profit and loss shows what the first runs earned and what the remakes cost.

Should a deposit go to sales the day it clears? No. Hold it as a liability until the install is done. Move it to first run sales when the glass goes out the door. The sale lands on the day the work is complete.

How do I tell which product line fails most? Tag each warranty swap to the product line. Over a few months, the warranty cost line shows which glass drives the most swaps, and you can take that to the supplier.