Praying for him and his family. Get well soon Gonzo!

4 hours ago, xrac said:

What a great thread this has become. Definitely conversation and ideas that all shop owners should read. 

Because this is exactly what business owners should be talking about the business side of the trade.

Also, this is the side that mechanics that become business owners need to know, yet they shy away from it because it's perceived as superfluous.

Case in point, and to illustrate, most don't understand numbers.   If you ask them how much is a million, they would look at you puzzled. Instead of saying 1,000 x 1,000 or 100 x 10,000, etc. Or if you ask them what's half of 3/8 they couldn't tell you it's 3/16.

So, what is so important about the numbers? Well, how would you know what is the maximum possible output of your shop if you have no baseline knowledge, how could you quantify your efficiency rate? What would be the point of investing another 2% of of gross revenue into marketing when you couldn't take care of the additional customers.

I agree with you, great thread indeed.

I think every serious shop owner knows that marketing the business is an essential thing to do and requires work in it self. What most would like to avoid is the learning curve and the waste money on things that do not work or produce a sustainable result.

I haven't found a single system that works. I have tried so many things, one of them was cheap oil changes that brought me more grief than a curse upon my head. The value I received from the bottom feeders that cheap oil changes brought me was developing a thick skin.

What are we doing now, that works? Social media, paper mail newsletters, billboards, email-newsletter articles, clinics, and participation on local events. Word of mouth comes through excellent customer service, and customized pricing. Without taking rents into account, our marketing budget runs between 6 to 8% of gross sales for the average six bay/lift shop.

Could I spend less on marketing? Yes, but then I would go back to the seesaw of feast or famine work flow.

15 minutes ago, Gonzo said:

I too pride myself on learning the science behind the technology.  Which in turn, makes repairs a lot easier to understand.  AND, like you said, I've had customers tell me that I'm the most expensive-best money they've spent-and wouldn't change a thing-repair shop.  Still, I do get the oil change coupon jerks on occasion, and it's sad to say, but I chase them out the door with my usual sarcastic attitude....which usually ends up with me looking like the bad guy....which at this point in my career...I couldn't give a sh'''''t less about.  It's quite simple, you want the best...pay for the best.  You want the best training...pay for the best training.  We can argue about cost all day, but it still comes down to who knows what they're doing and who doesn't.   

Exactly! People that nickle and dime you and have no clue about what it takes to deliver a great service will always waste your valuable time. I learn long ago not to waste my time with those people.

One of the first things I teach the service advisors is not to feel bad when someone declines a service, specially people that have no clue how a car works. There is a certain segment of foreign people that now live here and this is their first time owning a car, they have no clue as to what it cost to have a car service, but anything that cost anything is too much for them, heck, even with the free maintenance option they don't have their car service. This as told to me by the Ford dealer down the street.

Like one of the SAs told me, they want to get a free coupon for the free coupon inspection they are redeeming for next time. Next, they will want us to pay them to let us work on their cars, lol.

Excellent article, Gonzo! Great reading.

I spend a lot of money on testing equipment and training, I also train my guys all the time, I hold formal classes for them. I have dealers send me their people, and I am picky on whom I train.

What's the difference between my shops and the competition, 1. We strive to know the science better than anyone. This in turn delivers efficient service to our customers.

I had an old guy deliver a great compliment to me yesterday, he said "Harry, you are expensive as Hell, but I be damn if I will go somewhere else to get my car fixed. I like it fixed right the first time with no bullshit." This was his granddaughter's car that had bounced around a few shops after a collision, the culprit? A forgotten ground strap that was left off at the collision shop. Yes my friends, electronics need solid signals.

3 hours ago, AndersonAuto said:

Oil costs 2.58 a quart. 5 quarts is $12.90. Filters average a couple bucks. Lube dude costs $15 an hour. Figure .3 to do the oil change, that's $4.50.  12.90+2+4.50=19.40  

The lube dude's hourly production is good, but he's new so I don't have great tracking on him yet.

Again, I don't really care if I make a dime on oil changes. I'd do them for free if I had to. Making money on oil changes is not the point of the oil change.

Let's agree to disagree. The game is truly simple, if all you did were oil changes at your current practices, how long could you stay in business? I have no more to say.

16 minutes ago, AndersonAuto said:

Straight costs (parts and direct labor only) are $19.40 assuming my lube dude is doing the oil change. GP is then 35% if they're using the coupon with the cheapest price. But GP on the LOF isn't the point. The point is getting the car in to do the inspection and talk about what the car needs besides the oil change.

IDK, that seem very low to me. How much are you paying your lube tech, and what is his average hourly production. Not being an ass, but your number seems too low for my area and the ongoing costs to do business here.

And no surprise, here are some news articles about the trend:

http://www.ctvnews.ca/canada/sketchy-6-000-bill-leads-to-call-for-more-tow-truck-regulations-1.3340610

Quote

An industry insider is calling for stricter tow truck regulations in Ontario after seeing a pattern of rising bills, including one invoice for $6,000.

Shawn Jamieson, a collision repair expert in Ottawa, says he is tired of the rising cost of tow truck bills and frequently sees invoices for more than $1,000.

“Right now, I would like to see something that is standardized across the board: a specific sort of price they need to adhere to so there is no price gouging,” Jamieson told CTV Ottawa.

According to the Provincial Towing Association, the cost for a tow is up to the individual company and could range from a few hundred dollars to $1,000, depending on the circumstances.

However, Joey Gagne, president of the Provincial Towing Association, says the $6,000 invoice seems “sketchy.”

“It included storage and other fees but didn’t explain what they were for,” said Gagne. “It wasn’t clear and it’s a bill I wouldn’t pay.”

Gagne also doesn’t believe that there needs to be price regulation for tow truck operators, but that people need to be more aware of new rules put in place to protect the consumer.

As of January, tow truck operators are now required to obtain the driver’s permission and disclose their rates before hooking up the car and taking it to a collision centre or tow truck yard.

“If I do a service, I have to provide you with an invoice,” said Gagne. “I have to tell you what I’m going to charge you and I have to get you to sign off on those charges.”

Drivers are not required to take the first tow truck that shows up to a collision, and Gagne suggests that they should call their insurance company, if possible, to see if they can find a reputable source for a tow.

According to Jamieson, there are some honest tow truck operators in Ottawa, but are being given a bad name by those who take advantage of drivers.

“There are good people who do this kind of stuff for a living,” said Jamieson. “We’d just like to see more.”

http://www.landlinemag.com/Magazine/2016/Feb/story/inflated-towing-bills.aspx

Quote

February 2016

 

 

 

OOIDA steps up fight against inflated towing bills

 

By Mark Schremmer, staff writer

It seemed to be a fairly routine jackknife. Only one wrecker was required at the crash scene.

But the bill for tow and recovery tells a much different story.

The truck driver, an Owner-Operator Independent Drivers Association member, was charged $29,250 by Rocky Mountain Towing after the evening accident, May 9, 2015, on Interstate 80 in Wyoming.

The bill didn't take into account the amount of labor or number of hours worked. Instead, Rocky Mountain Towing's charge was at a rate of 48 cents a pound with a minimum of 60,000 pounds. (The actual weight was roughly 45,000 pounds). That alone created a $28,800 bill. Storage at a rate of $75 per unit per day added another $450.

Often, this is the reality of nonconsensual tows.

After a wreck, truck drivers have little to no opportunity to shop for a towing company or to negotiate rates. Instead, the towing company is determined by a rotation list that is usually administered by a law enforcement agency. So the cost of service is out of the truck driver's hands.

Towing bills in the tens of thousands of dollars are frequent occurrences. OOIDA Director of State Legislative Affairs Mike Matousek said that while most towing companies are honest and provide fair rates, egregiously overcharged towing bills are way too prevalent.

"I come across a bad towing bill about every week," Matousek said. "It may be even more frequent than that."

The problem is that even with insurance, inflated bills will affect the truck driver. Some bills can be outrageous enough to bankrupt small trucking businesses.

"During a nonconsensual tow, there is usually no opportunity for motorists to negotiate services or compare prices among multiple towing operators," Matousek said. "Unfortunately, as it relates to trucking, truck drivers are routinely held responsible for towing bills that are blatantly inflated by tens of thousands of dollars, and there is often no effective or efficient recourse. The impact on small-business truckers can be financially devastating."

OOIDA, in turn, has made a point to get in the fight against inflated towing bills and to work with states to create better regulations and to remove corrupt towing companies from the rotation list.

The Association has recently filed complaints against the most blatant cases.

Last year an OOIDA member received a $53,000 towing bill in West Virginia.

The complaint questioned many of the charges billed by Hutch's Wrecker Service. Hutch's charged more than maximum permissible tariffs in several categories.

For instance, OOIDA's complaint claimed "the maximum rate for a service truck is $25 per hour. The defendant charged $200 per hour for a service truck for an overcharge of approximately $2,100."

According to the complaint, the maximum rate was exceeded numerous times. Some of the offenses include charging $90 per hour for two service trucks when the maximum rate is $25 per hour and $350 per hour for a light tower when the maximum rate is $300.

Hutch's has been involved in multiple OOIDA complaints.

"The invoice was largely permissible according to their approved rate tariffs in West Virginia," Matousek said. "They approved rates for reusable equipment. They charged $350 an hour for a portable light tower. That bill highlights why reform is needed in West Virginia. Some of the charges may have been allowed, but that doesn't mean they are reasonable charges."

A towing case last year in Deposit, N.Y., resulted in a $154,124 bill for an OOIDA member. The bill included a $92,650 charge for the "reefer trailer fee." The rate was $100 per hour for 926.5 hours, or approximately 38 days.

"Keep in mind that reefer trailer rental rates in the Deposit, N.Y., area are roughly $692 per week, $.06 per mile and $1.50 per refrigerated hour for the reefer unit," OOIDA wrote in a complaint to the New York Attorney General. "Assuming a seven-week rental with 100 miles driven and 926 refrigerated hours, the total rental cost is $5,550. Further, new high-end reefer trailers can be outright purchased for around $30,000."

Despite the arguments raised, the complaint was largely ignored.

However, some progress has been made.

A recent complaint in West Virginia against Anthony's Truck Repair led to a ruling for a $10,067 refund by the public service commission. Wyoming is in the process of implementing a law that could potentially allow fraudulent towing companies to be removed from the rotation list. Section 5514 of the FAST Act gives states the necessary authority to regulate all nonconsensual tows to protect motorists. In January, OOIDA filed comments with the Louisiana Public Service Commission in hopes of changing some of the state's nonconsensual towing regulations.

OOIDA plans to continue to make the fight against overcharged nonconsensual tows a priority throughout 2016.

"To be clear, OOIDA is not against towing operators making a living," Matousek said. "In fact, there are towing operators that are members of OOIDA. But we are against towing operators that inflate their invoices simply because they can due to inadequate state regulations or a lack of enforcement.

"I think there are some positive steps being made. You look at Wyoming, the FAST Act and the West Virginia case. We are bringing a lot of attention to this. We filed a couple of complaints in Florida. Progress is being made in Arkansas. There certainly are some states taking a good look at this issue. Overall, it's a drop in the bucket, but it is progress nonetheless." LL

Etc...

http://bigwheeltowingandrecovery.com/recovery-billing-unlimited/

Recovery Billing Unlimited

And I guess this is the company they are talking about:

http://towprofessional.com/article/recovery-billing-unlimited/

Quote

RECOVERY BILLING UNLIMITED

By Tow Professional on November 3, 2014 in

Since 2009, Recovery Billing Unlimited, Inc. (RBU) has been hosting their Advanced Business
Management Seminars with a flawless feedback record. While other training institutions teach
you how to tow and perform recoveries the proper way, RBU teaches you how to be more
profitable using the techniques you’ve acquired by having the ability to bill for your services
rendered and ultimately obtain payment. No matter if your company is a one-truck operation, or
if your company has multiple locations and five rotators, this seminar will benefit you!

With nearly 500 towing and recovery outfits throughout the United States and Canada attending
since 2009, their name, image, and what they stand for is growing within the industry at a
tremendous pace. They are an organization dedicated to teaching fellow towers how to become
more profitable at what they do in the course of their daily business operations. In addition to
profitability, safety, training, and proper certification are key components discussed within the
seminar. RBU teaches:

• Building the proper tow and recovery business from the ground up;
• Training employees so they project a more professional image;
• Remediation of the accident scene to free you from future liability;
• Proper way of writing an acceptable recovery invoice;
• Billing on liability insurance coverage only;
• State and Federal Laws; and
• Obtaining payment for proper billing procedures.

In addition to Bob and Eric Fouquette from Big Wheel Towing & Recovery as the main instructors of the seminar, they have numerous guest speakers on hand, including Attorneys, Insurance Executives, OSHA Instructors, and even the occasional past seminar attendee that shares their experiences since they’ve taken the course.

Rumors about the course being designed to “scam” insurance companies could not be any further from the truth. In fact, the seminars teach towing and recovery companies to work with insurance companies to get them to better understand the process that went into creating the invoice set in front of them. By having an invoice complete with a detailed narrative, itemized pricing, breakdown of all equipment, and a full set of pictures, there are no unanswered questions. RBU’s main objective with hosting these seminars is to strengthen the towing and recovery industry.

The initial cost of attendance may seem a bit daunting to some companies; however, the benefits outweigh the cost tremendously. Included along with the tuition fee comes two free refresher classes for the same people from each company that attended the first paid seminar. Also, RBU stands behind each and every attendee by being on call 24/7 to answer any and all questions that may arise at a later date. As mentioned earlier, hundreds of companies have attended the seminar, and the overall consensus is 100% positive feedback.

With that being said, visit them at Booth #405 at the American Towman Exposition being hosted this year in Baltimore, Maryland. They are also hosting one of their seminars right at the American Towman Exposition on November 22 and 23, 2014, from 8 a.m. – 12 p.m. on both days. If you wish to sign up for that seminar, please contact American Towman directly. Otherwise, their next seminar will be hosted at their Massachusetts facility on January 17, 2015. Please feel free to contact Linda for more details and how to sign up at 508-763-5474.

You know, I just came to know that my views on towing are obsolete. Talking to another shop owner, he disclose that he owns a part of a very large towing outfit. I didn't press, but he seemed very happy with his investment. Then I found this out.

There is this company that back in 2009 started teaching how to properly bill for towing services, insurance companies aren't too happy with them. Check this out:

http://www.claimsjournal.com/news/national/2012/05/14/206743.htm?print

Quote

How to Combat Questionable Towing Bills

By Denise Johnson | May 14, 2012

• Article
• 7 Comments

Approximately 15 years ago, Adam J. Brand’s trucking clients began noticing larger recovery bills from towing companies.

Brand, founder of Brand & Associates, a firm specializing in insurance litigation, said that the practice soon found its way to personal auto.

“[It] migrated to personal auto insurers,” he said, during a session on the subject at the Insurance Fraud Management Conference in Phoenix, Ariz. “The exposure might be smaller, but at a much higher frequency.”

In a three year questionable claim (QC) referral analysis completed by the National Insurance Crime Bureau (NICB), there was a 116 percent increase in inflated billings reported in 2010 as compared to 2009 and a 39 percent decrease in inflated billings reported in 2010 as compared to 2011.

While these are not definitive cases of fraud, the reduction in QC reporting in 2011 may represent the industry’s proactive battle against such fraud.

According to Brand, the main cause for the rise relates to how towing companies get called to a scene. Usually, state and local police investigating a crash will contact a towing company on a rotational list, Brandt said.

The insurance litigator provided an example:

A semi is driven off a rural road and ends up wrapped around trees in a wooded area. A towing company called to the scene billed the semi’s insurer a whopping $21,588 claiming five days of work. The company claimed it used an entire fleet of heavy equipment and wreckers to remove the semi from the heavily wooded area. Day one’s bill included extra charges for a front end loader, chain saws and extra labor – billed at $350 per hour. Day two’s invoice included billing for chipping and hauling away trees and continued extra laborers and day three and four included charges for 24 hours’ worth of environmental cleanup. Day five’s billing had the tractor storage charge, accruing at $50 per day for a total of 45 days before the towing company released the semi after being paid in full.

According to Brand, the “old school” way in which towing companies tried to submit inflated invoices involved questionable invoices submitted by the same individuals. As a result, fraudulent billing practices and rates were easier to spot against standard invoices because the fraudsters had their own signature or thumbprint, he said.

In 2009 a heavy equipment recovery company decided to set the standard for routine recovery practices. The company set reasonable rates for services and sold it to towing companies, Brand said. But, increasingly, the reasonable rates set for services became artificially inflated, like tacking on a four hour minimum or adding on administrative fees.

According to Brand, the company passed on these creative billing ideas to other towers and recovery companies through nationwide training, via websites and even during towing conventions.

Companies became sophisticated, adding experts and full-time attorneys to review coverage issues when insurers denied payment. Brand said that the program was created as an illusion of best practices; companies portrayed themselves as public safety icons.

Brand said the companies built this façade by:

• Exaggerating the danger of the recovery.
• Using carefully selected photos of the scene to support inflated billing.
• Staging or strategically positioning vehicles and equipment to appear as a much more complicated job.
• Loading an accident scene with lights, people and equipment.

Whereas the majority of inflated charges were billed as hazardous materials recovery, they are now being billing as remediation and cleanup, Brand said.

Rob Bodoni, an SIU regional manager for MetLife Auto & Home, shared his company’s success story involving inflated tow bills.

Once the issue was identified by SIU, the company provided training to the auto property field claims unit in order to identify tow bill red flags, Bodoni said. There were subsequent strategy meetings with the auto property field claims management and total loss unit. The issue was added to a watch list and a SIU liaison was designated, he said. There was also coordination with legal counsel and a call out to adjusters to keep an eye out for inflated tow bills.

According to Bodoni, the first invoice appeared a few weeks after the plan was implemented. A field appraiser received a tow bill with a four hour minimum charge that totaled $1,200. The circumstances involved a vehicle slamming into a utility pole, causing an alleged fluid spill that required a disposal drum and charges for cleanup cost and disposal.

“It was very heavily itemized,” Bodoni said of the bill.

The field adjuster decided to revisit the scene and found the spill still there, along the curb. The adjuster took a photo and used it in negotiations with the towing contractor. The bill was reduced to $503.

The second invoice received involved an insured who was also a MetLife agent, Bodoni said. He denied his vehicle ever leaked though the $1,300 tow bill reflected a charge for a bag of absorbent, drum and included the four hour minimum charge.

The third invoice involved an insured who was a firefighter, someone experienced in handling cleanups. He didn’t see the battery acid leak described on the tow bill. According to Bodoni, because of the alleged leak the towing company refused to tow the vehicle, stating that it was a public hazard. A field adjuster sent out to the scene found no evidence of a leak or cleanup. Photos were taken and the bill was negotiated from $1,732 down to $252.

The first three invoices came out of the same company, Bodoni said.

A result of MetLife’s tow bill scrutiny program, the company began requiring that tow companies take before and after photos documenting spills.

One way to combat inflated charges on tow bills is by reviewing the Department of Environmental Protection website for the applicable state. The department provides information on what constitutes a hazardous or toxic material, Bodoni said. Antifreeze is not considered toxic or hazardous. An adjuster may even find typical charges for cleanup. Local fire departments are also good sources, Bodoni said.

Overall, the actual towing charges seemed reasonable, Bodoni said. Of the more than 20 cases reviewed, $25,000 was billed as hazardous material cleanup and just under $10,000 was paid due to bills being negotiated or denied. According to Bodoni, there may be a deterrence effect as bills from local towers now reflect a $45 charge for environmental cleanup.

Bodoni offered some tips on investigating inflated tow bill charges:

1. Determine the circumstances of recovery, including the terrain, locale and hazardous material.
2. Confirm the date of loss.
3. Find out who called the tow company.
4. Find out when the tow company responded to the scene.
5. Determine if the insured signed anything.
6. Determine the type of equipment/vehicles used and whether each was necessary to the recovery effort.
7. Verify the number of employees used in the recovery and how long each was on site.
8. Clarify the work performed.
9. Verify whether cleanup was performed.
10. Obtain any photos taken of the scene.
11. Verify mileage claimed.

We did record numbers! My people are a bit stressed but hanging in there strong. I keep telling them, let's shoot fish in a barrel while we can. We haven't seen the A/C work load I have been expecting due to the rainy weather, but I am sure it is coming soon. Congratulations y'all!

44 minutes ago, 5 Star Auto Spa said:

Thanks for the reply Harry.  In that scenario you just mentioned, what do you charge the customer to "check it out"?  Is that service complimentary?  Do you charge for "checking it out" if the customer declines the service once you have told him what he/she needs to fix the issue?

Hmm, I don't follow the question. Are you setting me up?

Well, I have to know what's it I am selling, so yeah complementary to check it out. But if I have to diagnose an electrical issue, I give the customer a preliminary estimate before we teardown. Again, know your customer. Keep in mind, there are opportunistic people that will not buy from you, but get anything you give them for free. ( I am sure you know this, but I am being verbose for the young guys that are learning the ropes.)

1 hour ago, 5 Star Auto Spa said:

To Harry:  How do you typically sell/price a light that has gone out on a vehicle from an oil change/state inspection?  Typically customers want a price before committing to a service and the price could vary based off of all of the different reasons why a light could be out.  We typically sell with the assumption that the bulb itself has gone out unless we can see obvious damage.

5 Star, I don't have to tell you, everything is about communication. Know your customer is not only good policy for the banking industry, it is the same with us. For example, the cashier girl is more price sensitive than the IT engineer guy. So, when you offer a service, leave it open to additional work that may be needed. We do this all the time, " Joe, you have a light out, could be the bulb, but sometimes the connector melts or corrodes, we will check it out, ok." My point is to always manage expectations to provide the best customer experience.

For those with bodyshops, here is some interesting reading:

http://www.bodyshopsolutions.com/WordPress/?p=111

bodyshopsolutions.com/WordPress/

John Shortell

I’ve taken a part time job working at an independent body shop close to my home writing estimates and supplements and harassing insurance companies. I’ve been at it for a few months now and up until recently I haven’t seen or heard from a Progressive appraiser. Finally, several weeks ago, I had a customer who was hit by one of Progressive’s insureds. Because I’m in a different area of the state now, I’m unfamiliar with the local appraisers. More importantly, they are unfamiliar with me. What fun!

 

First let me admit that I was spoiled working at a high line dealership body shop. Those evil rich drove nice new cars that demanded nice new OEM parts. Now all I see are Honda’s and Hyundai’s. Old ones at that. I’ve never seen so many junk cars in my life. But I guess the poor have to drive too.

Anyway, I had a customer who was hit by a Progressive insured. I wrote an estimate and asked the customer to make arrangements to meet the Progressive appraiser here at my shop. Progressive people hate that. They’d rather look at the vehicle somewhere else. Any where I am not. When the Progressive appraiser showed up I knew there would be trouble. He looked to be about 12 years old. He fit Progressive’s archetype for their ideal appraiser: young, naive and no experience in the collision repair industry.

His estimate was several hundred dollars less than mine. No surprise there. But it was a small repair, and that several hundred dollars amounted to about 30% of my estimate. Of course, the labor rate was an issue, but what really got me wound up with this moronic “blend within the panel” crap. I basically told the kid he could take his “blend within the panel” and have his first sexual experience with it. I wasn’t going to accept it. There were some other issues too, and it all added up to the 30% deficiency. I was beginning to lose my cool because this prepubescent putz couldn’t figure out how to meet my bottom line, so I told him to do what a lot of other appraisers do: make something up and put it on the estimate. Of course, I was being sarcastic, but being so young, this kid didn’t understand the sarcasm and took offense to my suggesting he commit fraud. Well at least the kid is honest.

I asked the kid for his appraiser’s license number and the name of his supervisor and explained that I would be filing a complaint with the insurance department, which I did immediately after he left (And don’t we all know how effective that was). I told the customer not to worry about the difference–I would take care of it. I had her sign a repair authorization, a direction to pay and a power of attorney in case I had to sue the bastards. Working at a dealership I never had the opportunity to sue an insurance company because the owner didn’t want the trouble, but now that I’m working at a small independent shop, the owner is willing to go after insurers who don’t play nice.

I spoke with the kid’s supervisor over the phone about the situation. For the record, she was very pleasant, just like talking to sweet high school girl. I didn’t meet her in person, but by the sound of her voice she was another Progressive clone–too young and inexperienced in anything to be dealing with these issues. But she promised to look into it. I knew I was wasting my time, and I was. After three days of haggling, the young girl managed to come up with another hundred dollars. She was still a couple of hundred short. I explained to her that I was going to sue her insured for the balance. She responded with a perky “OK” like I had just asked her if she wanted to go hang out at the mall. She was trained to perfection. Great job Progressive behavior modification department!

With little effort I was able to locate the guy who hit my customer and promptly mailed him the following letter:

Dear Mr. XXXXX,

On November 29, 2007 you were involved in an accident with XXXXXX, damaging her Honda Civic. Mrs. XXXX brought her vehicle to us for repairs. Your insurance company, Progressive, refused to pay the amount needed to properly repair Mrs. XXXXX vehicle. Mrs. XXXXX has given us her Power of Attorney and we are collecting the remaining balance directly.

The total repair cost was $xxxxx, but Progressive has only agreed to pay $xxxx. Your insurance company has left you owing us $xxx. Your liability insurance is supposed to cover all damages up to your coverage limit, but ultimately you are responsible for any damages not covered by your insurer.

We have filed a complaint with the Connecticut Department of Insurance, and we suggest you do the same. If you need help filing the complaint we will be happy to assist you.

Progressive has already refused to pay the balance. If you do not pay the difference we will be forced to bring the matter to small claims court. Please contact us to discuss this matter, and for payment options. Our phone number is xxxxxxxxx.

Enclosed is a copy of our invoice, paperwork showing what Progressive is willing to pay, and a copy of the Power of Attorney signed by Mrs. XXXXX.

Sincerely,

John Shortell

A few days later I received a phone call from Mr. XXXX. He wanted to discuss the matter. I explained the situation to him in more detail, and he agreed to pay the balance owed and then deal with his insurance company. I again offered to help him in any way I could with filing a complaint with the insurance department or recovering the money from Progressive. He didn’t take me up on the offer, but he did send a check the next day. I’ve yet to hear from him or Progressive so I have no idea if he was reimbursed or not. I do know the gentleman was not too happy about having pay for repairs to someone else’s car after he had been paying premiums for liability insurance. Something tells me Mr. XXXX will be finding someone else to send his hard earned money to for insurance in the near future.

I fully expected to have to go to small claims court. I knew Progressive would not give in, and I never expected the insured to cough up the money so easily. I feel sorry for the poor bastard. But I’ll be damned if I will become a cheap whore just because Progressive is too profit driven to treat my customers fairly. It’s ironic. Progressive was started by a left wing socialist. The name Progressive is not a coincidence. This nut job and his dope smoking kid, who recently stepped down from running the company, preached the progressive movements dogma, and heavily funded many of its whacked out causes. Progressives are supposed to be more fair than the evil rich. They are supposed to care about the little guy and scorn the evil corporations, yet here they are now acting as bad as any corporation ever did. They only care about their profit and share holders. Kind of makes them big time hypocrites. Just my humble opinion.

Lesson learned? Never sell yourself short. If you’re going to be a whore, at least be a high priced whore. Stand up for yourself. Had I gone to court, I most certainly would have won. It is astonishingly easy to demonstrate to a judge how labor rates are artificially suppressed by insurers, how they manipulate the system for their corporate financial gain, and that they will do just about anything to save a buck. To be fair, I would probably do the same if I worked for Progressive or another insurance company. It is all part of their survival. When your cat eats a cute little bird, you may think it horrific, but it is only natural. And it is only natural for collision repairers to fight to survive. What is not natural is when collision repairers give up and play nice at the risk of losing everything. That’s agonizing suicide.

If you’re thinking that I spend a lot of time talking about Progressive, there’s good reason. First, they deserve it. Second, I know my audience–and it’s Progressive. For this past year, Progressive Insurance has been my number one visitor to this website. State Farm has been catching up lately. They are the top visitor this month. Way ahead of everyone else. The only other entities that generate more traffic to this site are the large ISP’s like Road Runner and AOL. I’m flattered. Hopefully some of what I talk about is subliminally sinking in.

Oh yeah, remember my prediction about CCC’s announcement that it would get rid of the prompts for bumper covers? I said it would be slow in coming. Well here we are a couple of months and updates later and it’s still there. Your complaints forced them to make a public acquiescence, but now that the hell raising has died down, no need to rush things. We’re still waiting CCC. Wassup?

One more thing. Apparently there is a lawsuit going on in Arizona against Progressive. The plaintiffs have deposed a former Progressive employee. The deposition is interesting reading. For an inside look on the pressure and incentives to steer vehicles to network shops give it a read. It is only a partial transcript. If anyone has the entire document or a link, please send it to me or link to it in the comments section.

 

http://www.bodyshopsolutions.com/WordPress/wp-content/uploads/2008/01/nobile-iacano-docs.pdf

 

This is one of those things you will come to learn through experience.

I charge it, but before you make any decisions let me tell you how is it that I have arrived at my position. -How well do you know this customer? I have learned through experience that a light bulb out, is not always just a burn light bulb. Teach this to your Service Advisors, and techs, although techs should already know this. I learned early on that Mercedes and BMWs would suffer from defective sockets, VW, Fords, whatever. So before you offer and service, make sure you have an idea of what the worse case scenario can be.

So, in this particular case, I would have had the tech check to make sure it was only a bulb that was needed before calling the customer or would have told the customer that a light was out and we didn't if it was a burn bulb, fuse, or socket. That way you would have not surprised the customer if he declined the repair.

So depending how good this customer is, and how well I know them, I would charge them for the install and tell them I would give them a credit when they want return for the complete repair. The point is, you want to keep the customer if he is worth it.

Our marketing strategy is working extremely well, all our shops are having record numbers. We have had to implement a technique from the medical field and have had to triage the incoming vehicles to provide the best service. I have had the competition stop in and ask why are we so busy, but we just tell them we don't know. What they wouldn't understand is the massive amount of research and planning we did before launching our strategy.

In another note, have you seen the new Toyota commercials touting their free maintenance plan? We are in for some interesting times with the incoming used vehicle glut and the manufacturer's pressure to keep their new car sales numbers.

Stay the course, keep reaching out to your profiled customers, keep delivering great value and make yourself indispensable in their car care needs.

June is coming, we should get some hot weather then that will bring in the air conditioner work, you should be prepared already, have your gauges cleaned, your a/c machines clean and ready to go, your supply stocked and your A/C tech up to date in their training. Your special should already be out the door, even though people will not pay attention until they are suffering in the heat.

I am trying not to neglect this thread as the shops have me really busy. I wanted to share with you this: body-shop owners should be seeing recent model cars with the HFO-1234yf refrigerant, more so than independent repair, have your guys ready trained and knowledgeable. Make sure they are pricing the jobs right, and taking into account a premium for the new equipment you have to get. Also, don't let the insurance companies push you around, charge your jobs right. You should not subsidize their profits at your expense. 

xrac,

In my view is all a matter of education. People that work at shops where they like to denigrate other shops have not being taugh that it damages our industry and reputation collectively.

Thank you for writing this article, wish more of us were involved in writing a labor guide that would benefit us shop owners.

If it is such a great location, why are they moving?

We are doing extremely well this season, we are breaking all time records. I am conscious we are in the middle of tax return season and that is helping us keep the revenue rolling in, like shooting fish in a barrel. This is the time to save and cushion your reserves for the slow season. Try as much to avoid the feast or famine cash flow, stay marketing so you can keep your guys well employed.

47 minutes ago, Bockauto said:

Harry is your shop in NJ?


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Yes, North and Central Jersey. From Paramus to Piscataway.

2 hours ago, OTPAuto said:

Price matching isn't the problem, they're more than willing to. I shouldn't have to call constantly for every item though - if so, whats the point of SpeedDial?  I think a lot of people responding are missing the point of the OP as well.  I've started tracking (with screenshots) the pricing of some items that I suspect will fluctuate in this manner. I know some items that have done this to me, but of course I have no proof. When I have better evidence, I'll post it as fact. 

I have suspected as much, but that's why I have my SA shop the best price/quality.

There are these guys https://www.partstech.com/

They were supposed to help get the best pricing/availability.