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Mike Anderson

mike anderson autobody newsMike Anderson is the president and owner of Collision Advice, a consulting company for the auto body/collision repair industry. For nearly 25 years, he was the owner of Wagonwork Collision Center, an OEM-certified, full-service auto body repair facility in Alexandria, VA.

 
Thursday, 04 June 2020 19:31

From the Desk of Mike Anderson: Determining Whether---and How---to Charge for OEM Research

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I get a lot of questions from shops regarding billing for the process of researching OEM repair procedures.

Obviously, I can’t tell anyone whether to charge for this, nor how much to charge, but I can point to some things you may want to consider as you make that decision for your business.

 

First, I can tell you what our “Who Pays for What?” surveys indicate about what’s happening in the industry related to billing for OEM procedure research. The surveys definitely show a growing number of shops are charging an administrative fee for this work.

 

Back in 2015, three in four shops said they’d never sought to be paid such a fee. Last year, just shy of half (49 %) said they had. Among those seeking to be paid, about half said the largest eight insurance companies weren’t paying the fee, but 16% said otherwise, saying they were being paid “always” or “most of the time” for OEM research. That was up from just 6% five years ago.

 

FREQUENCY OF BILLING PAYMENT web

Next, I can tell you the two aspects to keep in mind as you determine whether and what to charge for OEM research.

 

First, consider what you’re spending to access the OEM procedures. A few automakers make access to the information available at no charge, but most charge a subscription fee. If you’re working on a type of vehicle you rarely repair, you might just pay for a day or two of access to that automaker’s procedures, and your receipt for that can serve as part of the justification for your charge.

 

But maybe you buy annual subscriptions to some automakers’ procedures because you use them regularly. A “Who Pays for What?” survey last year, for example, found more than 25% of shops have an annual subscription to the Honda/Acura repair information website, and even more have one to the Nissan/Infiniti website.

 

In that situation, you might consider calculating a per-vehicle cost for that access. Say you pay $400 a year to access one automaker’s information, and you repaired 100 of that automaker’s vehicles last year. Then that access averaged $4 a vehicle. Whether you bill for it---marked-up or not---is another business decision for you to make.

 

subscription fee web

 

Our surveys last year asked whether shops charge a separate line item specifically to cover the access fees they pay for OEM information. Almost one in four (23 %) say they always or almost always do, and another 20% said they do when using an OEM site for which they don’t have an annual subscription.


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