Auto Body Repair Industry in need of Unity

The auto body repair industry is in a major need of a communication overhaul. Seems everyday you hear one another bash each other. Wither it is a repair shop bashing an insurance company or an insurance company bashing a shop. We need to form a line of communications and avoid all this nonproductive yak. If you look at the whole picture, we are all in this together, and our job is to get the customers vehicle back to pre-accident condition.

My intentions of this article is to bond our industry, not hold hands and talk about our feelings, but get the pessimistic view cleared of each trading partner. Need to overhaul our communications to make the complete claims and repair process run more smoothly.

DRP (Direct Repair Programs); To start with, I think DRPS should be banned. Curbing and labor rate suppression are the two biggest issues at this time. DRPS can destroy a shop. This brings me to my first point of unity, unity within the auto body shop owners. If they where able to bond and refuse the direct repair programs than the marketplace would force the DRPS out, and go back to free markets, of which our great country was founded on. I know there are some good DRPS out there, but the majority are bad for business. I understand that the penetration with these programs have given some shops no choice, they need volume. By giving in, you make them stronger and you weaker. The old days where much better, better margins, etc.

Auto adjusters and the shop; Seems there is always some adomosity in this relationship. A shop’s objective is to repair the customers’ vehicle for a reasonable amount, via industry standards, and make some money. This is the same motive for any business. An insurance companies objective is to sell a customer a policy, if an accident occurs, put them in the position they where in prior to the accident. The conflict normally occurs in the adjuster and shop dealings. The adjuster writes an estimate according to the policy, industry, and state guidelines. The shop might do the same. The shop might review the adjuster’s estimate and just flat out say no way. This could be the result of many issues. An incompetent adjuster, there are numerous adjusters in the field with 0 days of shop experience. A shop has a hard to time trying to deal with someone that has never done the work they are expecting an experienced technician to perform. This is probably the most frustrating issue a shop deals with. Especially when it comes down to labor times on repairing panels. On the flip side, the adjuster feels that shops have lost most of their talents, and are pretty much just part changers. Adjuster’s might also feel, that the shop is trying to maximize there profits at their companies expense. What is wrong with that? That is what any good business does. This is assuming it is legitimate. What about alternative parts, sometimes the adjuster might find lower priced parts from vendors the shop does not use, this is hard to expect a shop to use an outside vendor. Especially if they have had problems with that vendor in the past.

Let’s get these issues resolved; there is such a mix of auto body shops out there. There are massive chains, mom & pop shops, and dealership shops. They are all ran differently, all have different objectives, and all compete with each other on some scale. DRPS, etc. First off, the body shop owners need to bond together and fight some of these ludicrous industry changes. If this does not start now, it is only going to get worse and worse, you margins will shrink and shrink. I was also reading about an insurance company in Texas that was buying shops, the law has since stopped them. But when will it end? The associations out there are helping, but seems like they need much more. Shops seem too independent, they need to get together.

Shops and adjusters; Shops need to be more descriptive with the adjusters. If problems arise, explain why you need the part or time. The shop needs to keep in mind; this adjuster is the one writing the check. Show the adjuster why this panel could not be repaired, or why this panel could be repaired. The first person that raises their voice losses. The adjuster needs to do the same, show the shop why they think this repair procedure is appropriate. There are numerous stories out there of shops throwing out adjusters, this will resolve nothing. Better to hash out the estimate and get working. The most important part of this whole transaction is the customer. If the shop decides they are not able to repair for the adjuster’s estimate, they should tell the adjuster to please move the vehicle off their property to another repair facility. If the adjuster is unable to resolve with the shop, it might be a good idea to see if the customer has any other repair facilities in mind. This obviously is for extreme situations. The bottom line is we need to all work together. We are all from different sides of the transaction, but need to realize we all need to make a living. Please share your stories and discussions on http://www.CrashChat.com

Auto body repair and the economy

Let’s face it, fuel prices are high, food costs are high, your neighbor is loosing their home. Times are not the best. What could be worse? Maybe an auto accident?

Your car has sustained $1500.00 in damage; your insurance company pays you less a deductible. You schedule your vehicle to be repaired at your neighborhood auto body shop. Two days before you take in your vehicle, you get a nasty credit card bill. You start to ponder, what if I took the money from my auto claim and paid off my credit card? I could live with a distorted fender and hood, there does not seem to be any sort of safety issues. When I get back ahead financially, I will get my car repaired. The problem is, most people from this point will never repair that vehicle.

The auto owner has certain obligations to their secured interest with a settlement check. An auto owner is obliged to repair their vehicle if that vehicle is leased, if they neglect to repair, they will be charged when the vehicle is turned in. If the auto has a loan, the vehicle repairs can be neglected, but if the vehicle was repossessed, the auto owner would be charged for the damages. That is the secured interest would try to collect, if the vehicle is repossessed seems like it is a lost cause. If the auto is 100% owned, than it does not matter what the owner does with the insurance payout.

There is a significant industry impact due to customers declining repairs. The local auto body shop now looses that work. That repair employs numerous people in the shop, numerous parts and supplies vendors, and keeps the industry on its toes with new technology and innovations. The only way for a shop to keep absorbing blows like this from cash strapped consumers, is to take drastic cuts in what is owed to them, cut their estimate, or even eat the customer’s deductible, which is not even legal in some states. Why would a shop need to work to just keep the lights on, might be better to just close the doors. The insurance company pays the retail estimate, they by no means encourage the customer to cut deals with the shop, there objective is to put the customer back in there prior position. The repair decision ultimately lies on the finicky auto owner.

Auto body repair at your service. Auto body shops need to reinvent their desire. Some auto owners still think of a shop as a dusty, backyard garage. When in fact, a lot of these shops are million dollar state of the art facilities, utilizing highly trained technicians. I have seen numerous shops with very nice front offices and waiting rooms. These are not dealerships, but independent shops. I think the best way to handle this every changing economy effect on the auto body repair industry is to bond with the customer. The customer is always right, I know sometimes this is hard to stomach, but unfortunately one happy customer might tell one our two potential or current customers, and an unhappy customer will tell twenty people.

A shop might want to utilize some reasonable concessions. Back to our example, the auto owner’s vehicle is inspected by the insurance company and is paid less the deductible. The auto owner takes vehicle to shop and schedules repairs. The shop at that time could work out some concessions with the owner, such as usage of alternative parts, does this 2 year old vehicle really need a $400.00 oem (original equipment manufacturer) headlamp assembly, or would I be ok, with a $180.00 used (like kind quality) assembly. (Disclaimer: all states have slightly different insurance laws, pertaining to insured’s and claimants, this is just an example) Would I be ok with the usage of a remanufactured bumper cover, used bumper cover, or aftermarket? It would save some money and my vehicle would be repaired and accepted by my leasee. These are all acceptable practices. You as a shop owner or technician, need to make the auto owner understand how important it is to get there car repaired. There could also be numerous safety concerns. The shop needs to explain to the auto owner about hidden damage, and the decline in value of their vehicle.

In this every changing industry, it seems that there are hurdles that constantly need to be jumped. A vehicle is the average American’s second highest valued asset; it always amazes me that people do not want to keep their vehicle in top condition. I think that a few tweaks with customer service and salesmanship, you should be able to get repairs lined up in this tough time.

www.CrashChat.com

CrashChat networking and discussion for the auto body repair industry. Body shops, technicians, appraisers, adjusters, estimators, and anyone in this industry is welcome.

CrashChat Auto Body Repair Forum

Hello everyone, my name is Adam Kreeger. I created CrahChat.com so there would be a centralized location for the discussion and networking for all involved in the auto body repair industry, It would be great if all new members could introduce themselves. I have been in the auto body repair industry for over 16 years, I started in a shop sweeping floors and washing cars, moved up and learned pretty much all repair techniques. I am now an insurance auto appraiser, I have been in this position for the last 6 years, I would like to share and combine my advice and knowledge and discuss this industry with anyone else in this business. Knowledge is power. Look forward to talking to all of you.

If you are a technicians, appraiser, estimator, adjuster, or are involved in the industry in anyway, you are welcome to the community.

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