In 2005, I found myself with 9 DRPs. We were so inundated with DRP processes that we forgot about our customers. We were watching our reputation go in the toilet and there was little we could do. We were so concerned about cycle time that we were more worried about how we looked on some report than what our final product looked like. The pressure level was over the top and our profits were decreasing. Our shop repaired so many cars that we couldn’t imagine we weren’t making money. We believed the insurers were our partners and they were all good to have, the more the better.
    After running some numbers, we found that we were not making any money on two of them and the third one was barely turning a profit. I decided to rethink my relationship with these DRPs (the biggest losers, speaking of profit) and within two years I had three less DRPs. My sales dropped from 7 million to 6 million but my profits were up –  not substantially but up nonetheless. My company was easier run and things were instantly better. Our labor rates increased $7 per hour to those companies same companies. Cycle time wasn’t even an issue because we no longer showed up on their reports. Things were definitely better.
    We continued to move ahead with our business plan and started treating the customer as our customer, the insurance company as a valued client, and we began to rebuild our reputation. We still have some DRPs that are easy to work with, our sales are back up to over 7 million and our CSI is at 9.76%. Our reputation has been completely repaired.
    The squeeze is over for us. Even though I really value those remaining accounts, I’m not afraid to part company with any of them who might ask us to do something that is unreasonable, like compromising the integrity of a repair or failing to recognizing the Procedure Pages.
    Their old tactics will no longer work because there is nothing left to give. It may not be cost effective to argue over 3 tenths of an hour, but, as the old adage says “Give them an inch and they will take a mile.”  I’m certain that if I allow them to get away with anything, they will try to take advantage of me. I will never allow this to happen to me again. I offer an honest repair and great customer service. If they don’t see the value in this, then shame on them.
    If the insurers want to see their profits continue to go up, then they need to find another avenue. Maybe it is time that they start lobbying for a price increase, or start searching for new business. Maybe they should cut back on their TV advertising or try “Going Lean” themselves. But it is ridiculous for them to think that they will be able to cut more and more from shops  to reach their profit benchmarks. There is just nothing left to cut.
    We must start using common sense in regards to our dollars and cents. We forego our better judgment when it comes to estimating our vehicles. We’ve even tried  calling our estimates a series of different names like damage analysis, visual damage inspection, and so on. No matter what we call them, our estimates need to make us money. You cannot remove everything profitable from your estimate and stay in business. Why would you want to?

    In business for over 29 years, Lee Amaradio, Jr. is the president and owner of “Faith” Quality Auto Body Inc. in Murrieta, California. With 53 employees, he attributes his success to surrounding himself with good help, with some of the best office staff and techs in our industry. Amaradio has been in this industry long enough to see the handwriting on the wall. He feels that now is the time for us to unite as an industry before it’s too late. He can be reached by e-mail at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it