I just learned that State Farm has raised their rates to $48 for Body and Paint, $50.00 for Frame and $28 for Paint & Material in the Phoenix Metro Market.  Go figure, Phoenix has finally crossed the line.  Flagstaff, Yuma, Tucson and all other surrounding areas have had split rates for years.  I guess Phoenix is WAKING UP.  HAVE YOU!  Now that you have the bone what are you going to do with it?  POST IT, ENFORCE IT AND GET WHAT YOU DESERVE!

    I had the opportunity today to hear different opinions on the problems that face our industry and I can tell you that I was amazed at the amount of fear that is shared from so many.  The collision industry has given too much power to the insurance companies, allowing them to dictate to these owners how to run their business and how to repair vehicles.  We feel fortunate to have the issues that we have and what I mean by that is, at least we are standing up for ourselves and the industry.  
    Way too many owners are willing to continue this fantasy that the insurance companies are their friends and that they are not expendable.  We hear time and time again that the "DRP" contract is held over heads as an extortion type of tool to allow the insurance companies to pressure the shop to do things that is against the beliefs of its owner.  Some are feeling it more than others and it is due to the "Business Model" that has been accepted by them and now when times are tough and that volume that they have taken for granted so long is no longer available they are unable to change direction for fear that one of their insurance friends will retaliate against them and cut off what they do have!  Wow!!
    What has the industry come to, what have some let it come to?  We believe that the time is now to "Pick a Side" and stand up for what we have worked so hard for all our lives, our business!  This is no different than setting your alarm before you leave the facility, you do that to avoid any theft or damage to the business so set the alarm, stop the theft, and stop the damage to your business.  Like I said for some this will be the equivalent of stepping into the unknown but it's not like you haven't been there before.  I am confident that we together can defeat this, that we can repair the damage to our industry.  Okay, so there will be some that are and will be willing to continue their fairytale but if the majority stands firm they will disappear eventually and it will be a more level, profitable playground for those of us who decided that it was "Time to Pick a Side"

OK, so this week I made a deal with myself that I would honestly try and look at things from the Insurance standpoint and try and consider that all the information that was coming from these well trained individuals was indeed fact and that I was just never properly instructed or taught how to repair a vehicle, I truly gave in for this one week!!!

What I noticed is that these well trained individuals were not really that well trained in vehicle repair, but were in the assessment of damages based upon a certain criteria passed on to them from their superiors, trainers, etc.  It would appear to me based upon the terminology that is used on a daily basis from these individuals that all collision losses are exactly the same and that all processes and procedures that some of us deem necessary are in fact not necessary.  I was trained in the repair and refinish procedures necessary to restore a vehicle to its "Pre-Loss" condition based upon an itemized estimate prepared by the deemed expert, regardless of our input or experience.

I stood in amazement at the way these losses were assessed and how the terminology or practices stayed the same no matter which Insurance Company we were dealing with, amazing!!  I am so glad that this was just an experiment, that I have not reached the point no matter what they throw at us to say I give!!!  I honestly believe that this can change, that you out there that are letting this happen can change.  The Insurance industry cares about one thing "The Bottom Line" as we do also, but we are willing to charge for what we do and nothing more, whereas the Insurance industry wants to get paid for things that they do not do!  and there are way too many of you out there that are willing to help them at others expense and it has to stop, stop today! 

The Difference Between Right and Wrong has become clouded in our industry and it is my hope that this will change.  I was told today by an insurance expert that I cannot change what is happening and that I should just get out of the Industry, Hmmm!!  I thought that doing the Right thing was the way things should be, but it appears that Right is Wrong if you are wearing the properly labeled polo!!!  Thanks for listening because it would appear that this is what some of you do best in Arizona, you listen and not act!!!

Attendees from Phoenix Metro, Tucson, Yuma, Page, and Lake Havasu were amongst the 69 that took the Dare offered by Bob Schubert in a previous comment on this blog.  Here are some of the comments that we received:

    Mike was incredible!  He kept it very fast paced and everyone in the room was engaged.  The information was very valuable and I came back to my shop to implement some of the concepts immediately.  It was positively worth my time and would like to see him come back so that I can bring another four people from my shop to hear him speak.

    The information was very helpful and we have already implemented some of it and will be doing more.  On a scale of 1 to 10, I would give this a 10!  I wish it was longer.

    The information was valuable from the stand point of presenting the extreme opposite end of estimating from the insurer's point of view.  In this extreme estimating world it shows us how much room there is in the middle and how we may each choose to build a business model anywhere in between.  The biggest take away was that no matter what model you choose, becoming systems oriented and why, will provide the best stability.

    The meeting was positively worth my time and it was one of the best estimating seminars I have ever attended.  I applaud ASA for putting this together and making it happen.  We got a hell of a bang for our $40 bucks.

    Absolutely worth the 3 hour drive each way for myself and my assistant!

Mark your calendar for May 19th - Mike Anderson is coming to town with what is probably the best estimating seminar in the country!  I dare you to go to this and not increase your bottom line.  You would have to sleep through it and trust me, it just isn't possible to sleep through a Mike Anderson seminar.  (Ask anybody that has been to one.)  This isn't just about what is in the P Pages - Mike will also share with you proven systems and processes for accurate estimating that you can take to your shop and use right away.  Everybody that writes estimates in your shop should attend.  Don't wait for the next one - Mike is booked up months in advance.  And thank you Dupont and ASA AZ for making this possible at a fraction of the regular price!  See you all there!

To download the registration form click here

Bob Schubert
Impact Auto Body

I read this in Seth Godins blog I follow...

There's a story in the bible with very specific instructions for building an ark.  Included in the instructions is a call for using tanned dolphin leather.  Regardless of your feelings about the historical accuracy of the story, it's an interestin questions:  why create an impossible mission like that?  Why enourage people who might travel 100 miles over their entire lifetime to undertake a quest to find, capture, kill, skin and eventually tan a dolphin?

My friend Adam han an interesting take on this.  He told me that the acquisition of the leather is irrelevant.  It was the quest that mattered.  Having community-based quest means that ther's less room for whining, for infighting and for dissolution.  Having a mission not only points everyone in the same direction, it also creates motion.  An motion in any direction is often better than no motion at all.

All around you, people are telling you two things:
1.  Whatever you want, forget it, it's impossible and
2. Sit still, preserve resources, lay low.

And yet, the people who are succeeding, creating change and (not coincidentlally) are happier aren't listening to either of these pieces of advice.  Instead, they're on the searc for dolphin leather.

Frank Sinatra had it wrong.  Your dream shouldn't be impossible, but it sure helps if it's improbable.  Don't choose your dreams based on what is certain to happen,choose them based on what's likely to cause the change you want to occur around you.

Best regards,

Bill Park

Has anyone heard that Farmers is conducting a prevailing rate survey in Phoenix?  The reason I'm asking is that an appraiser from Farmers came in on a supplement on a claim, we tried to supplement on the labor rate increase, and the appraiser stated that he could not pay the increase. 

I am wondering if this is true.  I am also wondering if the appraiser made untrue statements to not pay the increase, anyone experiencing this?  Any suggestions?

When industry norms start to dies, people panic.  It's difficult to change when you think that you must change everything in order to succeed.  Changing everthing is too difficult.

Consider for a minute the pivot points available to you:

• Keep the machines in your factory, but change what they make.
• Keep your customers, but change what you sell to them.
• Keep your providers, but change the profit structure.
• Keep your industry, but change where the money comes from.
• Keep you staff, but change what you do.
• Keep your mission, but change your scale.
• Keep your products, but change the way you market them.
• Keep your customers, but change how much you sell each one.
• Keep your technology, but use it to do something else.
• Keep your reputation, but apply it to a different industry or problem.

Simple examples:

• Keep the musicians, but change how you make money (sell concerts, not CDs).
• Keep making guitars, but make bespoke expensive ones, not the mass market ones that overseas competiion has made obsolete.
• Keep the punch press and the lathe, but make large scale art installations, not car parts.
• Keep your wealthy travel clients, but sell them personal services instead of trips to Europe.
• Keep the factory that makes missiles, but figure out how to make high-efficiency turbines instead.

Technorati Links - Posted by Seth Godin on March 12, 2009

The Accuracy of the State Farm Prevailing Rate Survey Depends on You!

In an effort to dispell misconceptions and educate our industry, the ASA of Arizona is providing the following as part of our mission: "To advance professionalism and excellence in the automotive repair/collision industry through education, representation and member services."

Below you will find:

• Explanation of the importance of the survey
• Misconcepions about the survey
• How to Complete the Survey

Collision repair shops need to understand the importance of participating in the State Farm Repair Facility Survey, whether they do business with State Fram or not.

State Farm is one of the larger insurers of automobiles.  State Farm is also the only insurance claims department that surveys the current pricing of repair shops in order that it can formulate a fair market prevailing price.

Until a few years ago, a State Farm representative went from shop to shop and made sure the surveys were completed.  Typically this was done once per year.  Recently, State Farm has gone to an internet based survey that shops can update whenever they like.  While the internet is much more efficient, it only works if everybody understands and participates.

Unfortunately, many shops fail to recognize the importance of the survey, or to remember to 'go to the survey, and update their rates'.  Recognizing this, ASA has taken a pro-active position to remind shop owners and manager and to help build a clear understanding about the importance for shops to keep their rates updated in the State Farm Repair Facility Survey.

When shops do not keep their rates updated in the State Farm Survey, the current prevailing rate may not be accurately reflected.

Common Misconception Concerning the State Farm Survey

>Only Select Service Shop's should fill out the survey.
This is not true.  All collision repair shops are invitied to participate.

>Any shop that lists a rate higher than the current prevailing pricing can not perform State Farm repairs.
Also false.  Although the rates you list on the survey may not always match the current prevailing rate for your area, you can still repair State Farm vehicles at the current approved rates.

>The survey is time consuming and difficult.
It's not.  In fact, after you complete it the first time, you will find that it is faster than the old paper form.

>State Farm wants each shop to fill out the survey once per year.
False.  You hould fill out the survey whenever conditions change within your facility.  This could be th number of technicians and/or work stalls or if the cost of doing business has changed.  State Farm monitors these changes as they occur and then applies them to the formula used for determining prevailing rates.

>Subitting lower rates in the survey will result in performing more State Farm work.
Wrong.  State Farm's policy is that the vehicle owner chooses the repair shop, not State Farm.  The survey is not used as a bidding process but rather a way to establish market prevailing rates.

>All shops need to fill out the survey at approximately the same time.
Absolutely not!  Only shops that may need to update the survey to accurately reflect their cost of doing business or for shops that may have never filled out the online survey at all.

Filling out the State Farm Online Survey

You must first have 'your shop specific' State Farm ID number.  All shops have already been assigned a number, however, if you don't know what yours is contact State Farm claims at 888-759-9034 and you will be directed to the Estimatics team manager in your area.

It takes less than 5 minutes to complete the survey!

• Go to www.b2b.statefarm.com
• Click on drop down arrow next o Select a Business Type
• Select Auto Repair Facilities
• Select Auto Repair Facility Survey on the right side of the page
• After reading the two statements, click on the square box to the left of each disclaimer.
• Select Agree or Disagree
• Slect Repair Facility Survey Online
• Enter your Repairer ID and click on Continue
• Fill out survey.  The questions are easy and self explanatory.
• Click on submit
• Print a copy for your records.

Survey results are weighted by the number of technicians or work bays, whichever is less, so it's important to reflect these accrately.  Technicians are defined as anyone who works on the car (i.e.: all body, mechanical, and paint technicians and helpters - not detailers)

Although using the online questionnaire is the most poplar way to complete the survey, you can also do this by phone.  Call 888-759-9034 and ask to speak to an Estimatics team manager.

Anti Trust Guidelines
"You should not discuss your rates or prices or consult with any other repair facility when updating your information.  Any joint understanding or agreement among competing repair facilities concerning pricing constitutes illegal price-fixing in violation of antitrust lawas and carriers substantial civil and criminal penalties.  Pricing decisions must be made independently and not in concert or coordination with other rapair facilities."

Automotive Service Association of Arizona - 602-544-2600 - www.asaaz.org

For those of you that could not attend the February presentation by Tim Ronak, he will be coming back on April 7 in Phoenix and April 8 in Tucson.  This is extremely valuable information that all shop owners and managers need!!!!!!

If you have not reserved your space, please contact Luz at the ASA office at 602-544-2600.  For details on the presentations visit the ASA Az website.

• Become more profitable by focusing on specific costs of doing business!
• Learn why door rates are much higher in certain parts of the country.
• Learn why labor rates in bordering cities will vary.
• Learn how and why the industry is overly controlled by statistics.
• Know why the difference between RETAIL and WHOLESALE rate might just save your business.