It amazes me how quickly some of us are ready to throw State Farm under the bus. Have we forgotten how much we loved doing business with State Farm up to this point? Perhaps the problem is not State Farm, but with the collision industry itself.
Our industry is afraid of the "N" word. We are so used to giving in to ridiculous concessions and demands that we say "yes" to almost everything. Who defined cycle time anyway? To me, it's the time elapsed from when a repair is completed to when I get paid. How's that for cycle time. Why hasn't anyone figured out that it takes more time for us to receive the payment than the time it took us to repair the vehicle? Why aren't we demanding twenty dollars a day interest according to our own version of cycle time?
I started my auto collision business in 1979, because I wanted to be my own boss, and I've been fortunate enough to survive for over twenty-seven years. I can even remember when I still knew how to repair cars. Now twenty-seven years later, you would think I knew little or nothing about repairing cars or running a business.
Twenty-seven years after opening my business in 1979, I'm trying to figure out how our industry went so wrong. Although I have learned many things in those years, I haven't learned how to produce a profit consistently.
"What we have here is a failure to communicate!"
- Paul Newman in Cool Hand Luke
I've been writing articles trying to give my perspective on what I think would be good changes for our industry. This collision industry is a major part of my life. It provides a living, I enjoy doing what I do, and I love to repair collisions. But there are many things in my life that I value more. I'm also "Lee" the person; I have a life apart from this industry. If we ask about the most meaningful things in our lives, the answer is never going to be the collision industry. While it consumes most of our time, it is far from the most important aspect of our lives.
The tactics used by the insurance companies to outsmart us never cease to amaze me. They have us processing their claims for free. They've figured out how to control our labor rates and dictate the way we repair vehicles. Now we are being asked to pay rental bills.
The subject of supplements was brought up at the Collision Industry Conference (CIC) in San Jose last July - and it is an issue that is clearly in need of attention. One participant pointed out that each supplement costs an average of $250. While this number struck me as high, it began to make sense when I focused on the fact that supplements are time consuming - and estimators don't work for free.
After a lifetime in the auto collision industry you might think I would know it all, yet I'm amazed at how much I still don't know. Attending this year's NACE demonstrated that I still have much to learn to repair some of today's vehicles properly. If we are going to stay up with these new technologically-advanced automobiles, a substantial investment in equipment and training will need to be made.
Recently I had the opportunity to give a presentation to a group of shop owners and managers. The presentation highlighted several areas of change in vehicle technology: advanced high-strength steels, laser welding, MIG brazing, hybrid disabling procedures, structural sectioning, and panel attachment methods, such as bonding and riveting. During the presentation, I spoke not only about the technology, but also how the technology was impacting the collision repair industry in areas such as: technician safety; required tools, equipment and materials; technician efficiency; estimate accuracy and other areas that affect the business.
Over the past several years we have seen changes in vehicle design and construction. Many of these changes provide increased protection for vehicle occupants, increase fuel economy, reduce emissions, or meet the market demands of potential new vehicle buyers.
How many times have you heard over the last several years? “I’ve been doing this for more than 20 years, and I know how to create a damage report, repair plan, and perform the repairs.”
The first thing I would like to start this month’s column with is an update on the shops that have started to implement the lean process.
In a recent article I discussed the lean process and how we can eliminate waste. I recently taught I-CAR’s Cycle time class in Downey and San Jose. Greg Gunter, owner of Greg’s Autobody in Whittier, CA, asked me for help in starting the lean process in his shop. I spent about 4 hours with his staff prior to the 4th of July holiday discussing the lean process and what we were going to accomplish, but before we got started, we did a walk-through of the shop as a group and identified all of the items of waste.