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Thursday, 27 May 2010 12:07

Beating a Dead Horse

Written by Lee Amaradio Jr.

I try to write articles to help others out; articles that try to motivate shop owners and managers to do a better job. I have come under attack many times from some in our industry for voicing my opinion and being the person that is willing to speak up and say the hard truth.

Our industry wants “Change” but no one can agree what that change should be or what direction we need to go to get there. I have shop owners that hate me because I have DRPs and stand up for those insurers that I think are doing a good job. Some shop owners think we need to hate all of the insurers and saying anything less than that makes me a hypocrite.

Some think DRPs are the problem while others think they are fine. Some think the insurance company is our customer while others think the vehicle owner is the customer. Some like aftermarket parts while others stand against them. Some think the insurers are responsible for the repair process while others think it’s the shops liability for the repair. We cannot even agree on some of the simplest things.

The truth is that nothing has changed and it never will because we can’t even decide what change we want. If I were a commanding officer heading to battle and I ordered the troops to go in one direction and they just chose to go their own way and started fighting each other we would certainly lose any battle we were to fight. To win any battle the troops need to all be on the same page and they all need to support one another and have each other’s back, not stab each other in the back. This is why things will never change; we are not in agreement on anything as an industry.

Here’s what I believe:

I believe that DRPs are nothing more than a way to process claims and DRPs are the most efficient way to expedite the repairs.

I believe the repair shop is the repair expert and is responsible for the repair process (not the insurer).

I believe the repairer carries the entire liability for the repair of the customer’s vehicle.

I believe the vehicle owner is my customer and the repair contract is between the shop and the customer.

I believe the insurance company is a third party payer and their contract is with the policyholder to perform to the terms of the policy.

I believe that due to the fact that we have a term called “industry standards” those standards need to be defined as “OEM collision repair requirements.”

I believe that cost should never be the primary driver dictating the repair process.

I believe aftermarket parts defraud the consumer and should never be considered in the cost of settling a claim.

I believe that the vehicle should be repaired exactly as the final bill states and there should be no cost shifting.

I believe that each shop should charge whatever they think is necessary to make a fair profit.

I believe that if a shop wants to give concessions it is their business and others are under no obligation to offer the same discounts.

I believe DRP’s can be good or bad depending on the insurer and or the concessions involved.

I believe it is up to each shop owner to negotiate the rates that they expect to get paid.

I believe that a lot of shops would be paid a higher rate if they only negotiated for the higher rate and proved why it is necessary.

I believe I am the only one responsible for making a profit. It’s my business.

Now that I have made some things clear about what I think you will find that a few will agree with me and many will disagree with me. This is exactly my point and this is the reason that nothing will change.

If you want to change the industry I suggest that you change the way you do business and let the industry take care of itself.

One would think that if enough shops united that they would be able to gather enough support for a major change to follow, not true!

We are in an industry that continues to pass the buck and pass the blame on to others whether it be some shops or the insurers. The sad thing is that because we have always been able to blame someone else we fail to take the necessary actions to make anything different.

It’s just easier to blame someone else and say “it’s not my fault”; this thinking dominates our entire industry. Everyone is very quick to complain and very slow to get involved.

Take care of your own backyard and watch your own bottom line if you do this you will see the change you have been looking for.

If you work with profit as your primary goal you will make a profit.

If you work to produce quality you will produce quality.

If you negotiate for a higher labor rate you will get a higher labor rate.

If you change things will change.

If you keep beating a dead horse you will get the status quo, a beaten horse that is no less dead.