Saturday, 02 August 2008 03:51

Safe and Quality Repairs: Putting Profit Back Into Repair Process

Written by Dick Strom
Co-written with Mike Orso

A major conundrum shop owners face today is the fact that, contrary to what insurers espouse, all collision repairs are not created equal. The lack of true standards in the repair of collision damaged vehicles leaves the potential for improper or substandard repair up to the discretion of the shop or the insurance company paying for the repair.

    But is this the way we have been “conditioned” to accept this situation? Is quality in the eyes of the beholder, or is quality the result of some cost standard?
    Taking this concept to the next level, safety items like seat belts and structural repairs can greatly affect the cost of repair. Leave them off and the cost is certainly contained, but the shop’s exposure to liability is greater. The more intelligent, professional method is to thoroughly investigate each repair, and repair the vehicle accordingly.
    Explaining the true cost of the repair and the risk associated with not completing the repair fully and properly, the vehicle owner will normally make the right decision on which shop to choose.
    Regarding ‘safe and quality repairs’ here, we’re not talking about shops’ making the occasional mistake of too much sealer on a joint or forgetting to refinish a weld. Rather, we’re zeroing in on blatant negligence, such as not priming before caulking, or not using zinc-weld primer as a matter of practice.
    We’re talking about not repairing pinch weld clamp damage, using adhesives when the factory recommends welding, skinning a door which still has a bent intrusion beam, or splicing a panel in an un-approved, non factory-recommended manner. We’re speaking of not replacing a kinked unibody rail or hydro-formed damaged frame when it becomes obvious that this is necessary for a proper and safe repair.
    I did a post repair inspection recently in which the bottom of a new trunk floor was left unfinished, and welds missed the rail! Was this a mistake, or blatant negligence? Since someone in that shop had to assemble the attached components to that un-welded and unfinished floor, it was obviously a case of negligence, or incompetence, or both.
    From a financial aspect it would appear that the shop that performed that repair made a lot of money not repairing the car right. So, when asked how do such shops survive while giving their insurer-partners deep discounts, its easy  – they don’t do the work!


Industry standards missing in action

It is generally assumed in this industry that the standard for collision-damaged repairs is the vehicle manufacturer’s recommended repair procedures, or, in the absence of a written standard, the replicating of the original.
    Those of us who have been in the industry over 20 years have learned our trade by duplicating the appearance of the original. I’ve been involved in collision repair for 42 years, and as such am a product of having had to ‘wing it’ in many situations, due to a lack of available information and formal training on repair procedures.
    Sure, we veterans have the basics, the ability, and the tools necessary to perform collision repairs.  But in today’s litigious world of incredibly complicated repairs on vehicles made to exacting tolerances from expensive, temperamental metals, consulting authoritative written approved standards on a car-by-car basis is a must.  “Winging it” won’t make it today, nor will it in the future.
    Today we have access to manufacturer-recommended repair information through sources such as ALLDATA, Mitchell CRS, and the internet, where we can access repair data by the hour, day or week for a price. Other than ignorance, or shops’ allowing insurers to control the repair process (in which case liability for any transgressions, including improper repair, is then shifted back upon the repair shop), there really is no excuse for an improper repair.
    Ultimately, the responsibility for a proper repair lies solely with the repair shop. We are the repair professionals, which is a good thing. And we must limit the liabilities involved in repairing vehicles through performing a complete repair. Cosmetic issues aside, the structural integrity and safety systems manufactured into the vehicles we repair are nothing to be guessing at or re-engineering.
    When we set out to repair a vehicle, we must address the full extent of the repair. A dent or cosmetic repair is simple to diagnose, and generally the most complicated part of this might be whether to repair or replace the part, which might be determined in part by the cost of the item. While a fender or bumper cover may not drastically affect the safety or functionality of a vehicle, it is still our duty to return the vehicle to as close to pre-loss condition as possible. A simple examination of a cosmetic repair and agreement with the consumer on cost and expectation should offer the repair shop and vehicle owner the best anticipated result.
    When repairs involve more than a cosmetic issue, we enter the gray area where we need help. In the absence of factory training and the ability to implement standard operating procedures in the repair process, collision shops need to know specific repair data to determine what is the best repair process to follow.

Blue printing the repair
“Blue printing” is the best way to incorporate all the repair data to correctly repair a damaged vehicle. While “blue printing” is a new phrase to the collision repair industry, my shop has always “blue printed” each repair through our repair process. My file handlers write their own sheet, apart from that of the insurers, and as the vehicle is disassembled the sheet is updated to include any hidden damage. In the process, we research manufacturer recommended repair procedures, plus investigate many other items as the repair evolves.
    Regardless of what the insurance company allows, it is the responsibility of the repair shop to recommend/propose a proper repair. We use a “Notice of Deficiency” (NOD) to inform the parties of the repair needs and our recommendations. The question of who is going to pay for it is left to the contract we have with our customer, and the contract they have with the insurer. But once we assume the repair liability we own the repair, and we expect to be compensated fully for the services we provide and what the consumer approves.

Not all repairs are equal

The perception that all repairs are the same is the “big lie” that insurers would have consumers believe. The promise of a guaranty or warranty to subsidize a repair that has been “limited”, or in some other way “managed” to contain cost, is a big risk to consumers and collision shops.
    Number-crunchers would have us believe that the risk in performing “limited” repairs is minimal. But shops need to know they are playing with fire anytime they agree with insurers or vehicle owners to look the other way. Whether you over look damage, cost shift or leave damage unrepaired, you are putting your license and livelihood on the line in almost any state.
    If you discount labor or paint materials or parts, believing you can make up for your losses in some other creative manner, remember that you are then exposing yourself to potential liability, beside losing money. Losing money on a dozen repair jobs cannot be made up in volume by doing more losing repairs.
    Recently I read where M2 was losing $200 on every vehicle they repaired, yet they continued to conduct business at the same fee schedule for fear of losing their preferred contracts with insurers. All this accomplishes is that your shop loses more and more money. Last time I looked we are not in business to lose money. This is not a hobby.  
    Giving work away is one industry-wide disease. But not completing the entire repair is just plain wrong. A huge amount of money can be saved by not color sanding and buffing. Think about the work time and mess, and the clean up involved with that one required function. But don’t forget about the huge amount of risk also incurred by you in that one operation, if you have to do it all over, this time entirely at your own personal expense. In the process your customer is inconvenienced, and there might be a rental involved (at your expense, of course). You may need to repaint the affected area, and in the re-do process very well may lose that customer and his friends and acquaintances.
    As a wise former shop employee reminded me back in the day, “Every re-do costs the shop owner three times: First, he loses everything he may have gained from the original repair.  Then, he loses when he is forced to re-repair the vehicle at the shop’s expense for labor, materials and parts. And finally, he loses a third time by re-repairing a vehicle at a loss when he should be repairing another vehicle at a profit.”
    Shops should look at safe and quality repairs as a huge opportunity to do the required work and be compensated for the necessary process of repair, preserving the vehicle owner’s confidence. That concept can be applied to any of the functions required to properly repair a damaged vehicle.
    There is a lot of talk about shops’ need for improved efficiency. Efficiency is a factor of processes, with its benefits and loss. I once considered making my techs return the empty tape core before giving them a new roll of tape. The time spent to control that one function in efficiency cost me ten fold in lost labor time and production. A better course is to sensibly manage the problem rather than to compound the issue
    Take a hard look at the process of repair in your shop and how best to improve not only day-to-day efficiency, but to charge for and perform all the necessary services you provide and those for which you will be assuming liability. You deserve to be compensated for every function you perform on every repair, and insurers owe their claimants full compensation for the true cost of proper repair.
    The cheapest repair is, with extremely few exceptions, not the most efficient and best repair. There is a big difference in quality when all the factors of quality repairs are considered, and a safe, quality repair deserves full compensation. It’s time to put the profit back in the repair process.

    Mike Orso is the president of the New York State Auto Collision Technicians Association and Nick Orso’s Body Shop in Syracuse N.Y. and can be reached at nickorso@prodigy.net.