FenderBender - March 2019 by EndeavorBusinessMedia-VehicleRepairGroup

FENDERBENDER.COM / MARCH 2019

Top customer myths—debunked PAGE 60

Build better rapport with your staff PAG E 51

Providing 20 Years of Strategies & Inspiration for Collision Repair Success

Find your perfect WIP PAGE 56

THE NEW RULES OF ESTIMATING

The Next Frontier Randy Miller has dramatically adapted his Minnesota shop’s estimating processes to compensate for vehicle changes.

Evolving vehicle technology is poised to revolutionize your front-end processes PAGE 36

RAINS: THE BACKWARD WAY WE MOTIVATE OUR TEAMS

PAG March 2019 | fenderbender.com 1 E 33

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The clear choice for high-velocity collision centers.

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March 2019 | fenderbender.com 3

THERE ARE NO SUBSTITUTES.

Many imitation parts have fit problems, ranging from twisted metal and misaligned mounting holes to major gap variances. Donâ€™t settle for imitation, give your customers the real deal.

FOR MAXIMUM QUALITY AT COMPETITIVE PRICES, CONTACT AN AUTHORIZED MITSUBISHI DEALER TODAY.

march

0 3 .1 9 / V O L U M E 2 1 / N U M B E R 0 3

Implement Efficiently LaMettry’s regional manager Eric Johnson was instrumental in helping implement new processes to manage WIP at the shops.

F E AT U R E

PROFILE

C A SE STU DY

S H O P TA L K

With new technology being added to vehicles at a rapid rate, the estimating process in shops is also changing significantly, as a result.

Dennis Reittinger’s shop is wellknown in the community, both for its unique exterior and for the genuine way that he cares for and supports others.

At LaMettry’s Collision in Minnesota, a focus on work in process has been instrumental in increasing car count and decreasing cycle time.

Despite growing his shop to the $2.2 million mark, Marc LaFerriere is still just as dedicated and enthusiastic about being a hands-on owner.

BY KELLY BEATON

BY MELISSA STEINKEN

JESSIENA LAKE

BETTER ESTIMATING

MAKE A NAME

MASTERING WIP

GROW THE SHOP

Printed in the U.S.A. COPYRIGHT ©2019 BY 10 Missions Media LLC. All rights reserved. FenderBender (ISSN 1937-7150) is published monthly by 10 Missions Media, LLC, 571 Snelling Avenue North, St. Paul, MN 55104. FenderBender content may not be photocopied, reproduced or redistributed without the consent of the publisher. Periodicals postage paid at St. Paul, MN, and additional mailing offices. POSTMASTERS Send address changes to: FenderBender, 571 Snelling Avenue North, St. Paul, MN 55104. March 2019 | fenderbender.com 5

TAB LE OF CONTENTS

MARCH

QUICK FIX

Apprentice programs for estimators

Gaining an ROI on aluminum repair

Valley Auto Body

Pre- and postrepair scanning

Offering competitive health care benefits

PAST THE PAGE

ANALYSIS

NUMBERS

VIEWPOINT

6 fenderbender.com | March 2019

The secret to encouraging your team BY KEVIN RAINS

Catering to Clients The staff at Valley Auto Body in Wasilla, Alaska, keeps customers satisfied by offering an extensive shuttle service.

Consumersâ€™ confusion regarding ADAS

30 FRED MOSELE Y

Expect the unexpected

THE BIG IDEA

LIGHT HITS

Tips to inspire your team

DRIVER'S SEAT

AWARDS INSIGHT

SNAP SHOP

S T R AT E G Y

Build a respectful, personal rapport with staff

Three customer myths to debunk

David Roberts

IDEA SHOP

CUSTOMER SERVICE

20TH ANNIVERSARY SERIES

Tips to hiring a contract worker

Get a handle on non-included operations

Grow your team

LAW

IN THE TRENCHES

OUTSIDE THE LINES BY JASON BOGGS

BY STEVE MORRIS

PROCESS DRIVEN How to deal with facility repairs BY RYAN CROPPER

THINKSTOCK

March 2019 | fenderbender.com 7

TAB LE OF CONTENTS

ONLINE EXTRAS

CLICK ON THE LOGO BELOW FOR PRODUCT INFORMATION

AUTEL

BMW

LAUNCH Tech USA

Mitsubishi

PPG

TECH USA

Auto Job Central

Drew Technologies

LKQ Corporation

MobiTech

ProSpot

Automotive Art Paints

I-CAR

Matrix Electronic Measuring

O'Reilly Auto Parts

Sherwin-Williams Automotive Finishes

WIRED FOR

Axalta Coating Systems

Kia Motors America

SUCCESS Mercedes-Benz You’re wired differentlyPolyvance and we like that. America likes that.

Spanesi Americas

Visit futuretechsuccess.org and find out how your hands-on talent is the key to an amazing technical career. TechForce Foundation When Techs Rock, America Rolls ℠ futuretechsuccess.org

8 fenderbender.com | March 2019

FUTURETECH

SUCCESS

™

COLLISION C A S T

EDITORIAL Bryce Evans Vice President, Content and Events Anna Zeck Editorial Director Kelly Beaton Associate Editor Melissa Steinken Staff Writer Jordan Wiklund Special Projects Editor Jason Boggs Contributing Writer Ryan Cropper Contributing Writer Steve Morris Contributing Writer Kevin Rains Contributing Writer

EDITORIAL ADVISORY BOARD Jason Boggs Boggs Auto Collision Rebuilders Justin Fisher CARSTAR Yorkville Bob Pearson Pearson Auto Body

New FenderBender Podcasts.

Mark Probst Probst Auto Body Randy Sattler Rydell Collision Center Doug Voelzke Doug’s Custom Paint and Body

3 SERIES WITH NEW EPISODES EVERY MONTH.

ART AND PRODUCTION Zach Pate Art Director Lily Risken Graphic Designer Fue Vang Graphic Designer Lauren Coleman Production Assistant

SALES Chris Messer Vice President and Publisher 651.846.9462 / cmesser@10missions.com Andrew Johnson Associate Publisher 651.846.9459 / ajohnson@10missions.com Nathan Smock Sales Manager 651.846.9452 / nsmock@10missions.com

Adapt. Series featuring a rotating special guest each month. An insider’s look at how technology, trends and advanced vehicle design impact the way shops work today. New episode this month. A DA P T S E R I E S S P O N S O R E D BY:

Ross Kirgiss Regional Advertising Sales 651.846.9485 / rkirgiss@10missions.com Jen George Client Service Specialist 651.846.9465 / jgeorge@10missions.com

10 MISSIONS MEDIA Jay DeWitt President Mariah Straub General Manager and Production Manager Meghann Moore Bookkeeper and Client Service Specialist Katie Cornet Event Coordinator Josh Jaskulka Digital Media Strategist

Vision. Series featuring shop operator Kevin Rains. The go-to resource for leadership lessons, philosophies and success stories. New episode this month.

Kasey Lanenberg Marketing Communications Specialist HOW TO REACH US 571 Snelling Avenue North, St. Paul, MN 55104 tel 651.224.6207 fax 651.224.6212 web 10missions.com The annual subscription rate is $72 (U.S.A. only) for companies not qualified to receive complimentary copies of FenderBender. BACK ISSUES Past issue single copies are $8. Go to fenderbender.com/backissues LETTERS TO THE EDITOR editor@fenderbender.com

Disrupt. Series featuring a rotating special guest each month. An introspective look at collision repair’s most pressing topics and the innovators pushing the industry forward. New episode this month.

ARTICLE REPRINTS For high-quality reprints or e-prints of articles in this issue call 651.846.9488 or email reprints@fenderbender.com. Opinions expressed in FenderBender are not necessarily those of 10 Missions Media, and 10 Missions Media does not accept responsibility for advertising content.

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PAST THE PAGE COMMENTS, DISCUSSIONS, FEEDBACK AND MORE FROM AROUND THE WEB

PODCAST

COLLISION C A S T

Apprenticeship Programs for Estimators

HOW I WORK: ROBERT GRIEVE Each month, FenderBender examines a day in the life of an accomplished collision repairer. In February, the magazine took an in-depth look at how Colorado shop owner Robert Grieve brings a rather unique approach to running his business. Grieve never schedules sit-down meetings, he personally monitors every comment on his shop’s Facebook page, and has made it a point to partner with dealerships near his business, Nylund’s Collision Center, in Englewood, Colo. Grieve says that nearly two-thirds of his shop’s work comes from its partnership with a local Lexus dealership. “I have a good relationship with a Lexus dealer in the area, and now a Subaru dealer,” Grieve notes, “because a lot of technical issues have come from those types of vehicles. “I found the dealerships through my parts vendor. Whenever we buy from a specific dealership, we make an appointment with the dealership with whom we’re already doing business. Now, those dealers have started to recommend customers to my shop.” REPORTER'S BLOG

FenderBender produces four podcasts per month, with topics aimed at offering collision repairers tips to allow them to work as effectively as possible. Recently, Bill Vallely, an I-CAR instructor and president of BSR Inc., appeared on CollisionCast and broke down the key elements that shop operators should consider when implementing an apprenticeship program for estimators. Vallely said the most important thing, overall, is to make sure that a prospective apprentice is “totally invested” in learning about collision repair and seems eager to forge a career in the profession. As long as apprentices have desire in ample supply, they’ll almost always prove to be worth a shop’s time, Vallely says, even if they’re still in high school. “It’s the perfect time, when they’re in the student setting,” Vallely told FenderBender, “to mold them.” You can listen to the entire conversation by accessing the podcast page at fenderbender.com/ podcasts.

MICHAEL HOBBY

How to Find a Contract Worker For the website’s weekly blog post, FenderBender recently spoke with Jesse Jacobson, the vice president of Heppner’s Auto Body in the Twin Cities area of Minnesota, and gained insight on how to find a contract worker when looking to hire someone for a special project. Jacobson has occasionally hired independent contractors to help with tasks such as paint booth cleaning, and air compressor maintenance. The shop vice president also recently hired a contractor for a rather sizeable chore: adding a 6,500-square-foot paint department at his shop. He found the contract worker through a referral from friends of his staff. Another key step in Jacobson’s process in hiring a contract worker that time around: he created a 30-page work contract and had a lawyer look over the document; that helped alleviate Jacobson’s concerns about any possible liability for his shop. You can read the entire blog entry at fenderbender/com/contractworkers.

JOIN US ONLINE fenderbender.com fenderbender.com/facebook twitter.com/fenderbendermag fenderbender.com/linkedin instagram.com/fenderbendermag

March 2019 | fenderbender.com 13

BY THE NUMBERS THE TOPIC S, TRENDS AND METRIC S DRIVING YOUR OPER ATION

THE VALUE OF PERFORMING PRE- AND POST-REPAIR SCANNING

NEVER PERFORM SCANNING

ALWAYS

ONLY WHEN REQUIRED BY OEM REPAIR PROCESSES

HAVE A YEARLY SALES VOLUME OF $1 MILLION+

26%

80%

62%

AVERAGE CSI SCORE OF 90%+

22%

68%

54%

AVERAGE SUPPLEMENT RATIO OF 25% OR HIGHER

19%

29%

21%

OVERALL GROSS PROFIT MARGIN OF 40% OR HIGHER

22%

51%

38%

HAVE AN OVERALL NET PROFIT MARGIN OF 11% OR BETTER

19%

47%

25%

LEARN MORE

Not long ago, FenderBender’s CollisionCast podcast featured insight regarding pre- and post-repair scanning from Matt McDonnell, the owner of Big Sky Collision and A&D Auto Body in Montana. McDonnell explains why his shops began routinely performing vehicle scans. Hear the discussion by visiting fenderbender.com/scanning

14 fenderbender.com | March 2019

THINKSTOCK, STAFF GRAPHIC

If the statistics yielded by the 2018 FenderBender Industry Survey are any indication, diagnostic scanning pays significant dividends. Feedback from those in the collision repair industry indicate that, by performing pre- and post-repair scanning, shops typically produce exemplary profits and CSI scores. Here’s a look at the numbers of note regarding scanning, and how it impacts collision repair facilities.

PRE-SCAN

MS906TS

& POST-SCAN

COLLISION-REPAIR READY SCAN

REPAIR

FROM TOOL - WIRELESSLY PRINT & EMAIL REPORTS TO SUBMIT FOR INSURANCE CARRIER APPROVAL

SCAN MORE VEHICLES - GET MORE PROFIT OUT OF EVERY ESTIMATE

Fast & Easy Reports

PRE-SCAN

Step 1: AutoSCAN the Vehicle • AutoVIN instantly identify all vehicle information • AutoSCAN all available modules in all systems • Single screen list all DTCs and code details

Step 2: Print Pre-SCAN Report • Take vehicle pictures and attach to SCAN report • Single button generates dated report file to submit • Report is customized with shop and vehicle info • Expedite insurer approved repair estimate • Avoid additional insurance authorizations

Step 3: Repair Vehicle

TEST ALL MODULES IN ALL VEHICLE SYSTEMS

CREATE EFFICIENT REPAIR PLAN FROM THE START

POST-SCAN

Step 4: AutoSCAN Repaired Vehicle • Ensure no new faults were created during repair • Confirm no DTCs are present at completion • Ensure vehicle is repaired and safe for customer

Step 5: Print Post-SCAN Report • Prove all DTCs on Pre-SCAN report are fixed • Dated SCAN report to confirm project complete

TEST ALL MODULES IN ALL VEHICLE SYSTEMS

1YR UPDATES 1YR WARANTY

AFFORDABLE & EASY-TO-USE

CALIBRATION

MaxiSYS MS906TS

MODULE IDENTIFICATION

WIRELESS BI-DIRECTIONAL ADVANCED DIAGNOSTICS

Icon shows during AutoSCAN to pinpoint modules requiring ADAS calibration procedures.

• All Systems Diagnostics - Access All Modules In All Systems • Advanced Service Features - Reset Diesel Emissions • Complete TPMS Features - Exclusive TPMS Status Screen

March 2019 | fenderbender.com 15

FINES HE

AWARDS INSIGHT

AWARDS NOMINEE:

LLI

—

SHOP MANAGER GOTHAM CITY COLLISION LONG ISLAND CITY, NY

AWARDS IN

DOMINICK PASSARELLA

P SION RE

Nominate Today

FenderBender Awards Insights feature past FenderBender Award nominees. To nominate an inspiring collision repair professional, or for more information, go to fenderbender.com/awards.

Motivating Your Team B Y K E L LY B E AT O N

Juan Oliveres, co-owner of Gotham City Collision, says his shop’s manager is a gifted motivator. The reasons why are many. But, mainly, manager Dominick Passarella simply knows how to walk the fine line of when to offer tough love and when to take an employee out for a steak dinner. “I’m stern; I have a presence,” admits Passarella, 37, who has worked in the auto industry for roughly two decades. “I try to motivate them by showing them how it should be done, and why it should be done, and what the necessary steps are to do it the right way. “So, my guys have faith in me.” That said, Passarella, an avid sports fan, knows he can’t lead his staff in Long Island City, N.Y., like a stressed-out baseball manager. Otherwise, his team will start pressing, stressing over each mistake. The shop manager, whose facility boasts a CSI score near 96, explains the steps he takes to motivate a collision repair center staff of 31.

Passarella has been in the industry since he was 16 years old. And, over the last 21 years, he has taken note of managerial styles that work and, most importantly, those that miss the mark. “The way I see it is, I treat my guys here as if we’re a team,” he explains. “And that’s how I try to keep them motivated; I oversee all their work. “I’m not just a guy that comes inside the shop and delegates. If I’m critiquing somebody’s work, that means I know how to do their job, because I’ve done their job a million times. “So, if a guy’s compounding a car, or sanding or prepping a panel, I know how it needs to get done the right way. … Are they installing air bags? Are they looking for an air bag module that needs to be replaced? I find it for them and I print it for them. And that motivates guys, because they’re not sitting there frustrated.” Passarella also buys lunch for his staff every Saturday, and even takes exemplary employees out to local steakhouses, or Mexican restaurants. Additionally, he attempts to keep employees motivated by paying for training courses 16 fenderbender.com | March 2019

for any technicians or painters that seek to expand their skillsets.

Give Tough Love Time.

Passarella tries not to stomp around the shop floor while screaming demands at employees. After all, earlier in his career, he worked in shops like that, and it never sat well with him. “I’ve been in a few other shops where that happens,” he says, and, eventually, “employees lose trust and motivation, because it becomes unpleasant.” That said, Passarella is willing to sound like a drill sergeant if the moment calls for it. He knows that it’s tough to be a boss if you’re viewed as a pushover by employees—especially in the world of collision repair. “That’s the way it’s got to be; we’re working on peoples’ cars, and it could be very dangerous out there [if there are] improper repairs,” Passarella says. “Every single car, every job, and every function of the job, gets quality checked. Even if the [employee] has been here for 15 years, it doesn’t matter; somebody else is going to check the work and make sure they did the right job.”

Recognize Stressed Staff Members.

The last thing Passarella wants on his shop floor is to see employees who are frazzled and “flying through work just to get it done, while making mistakes.” Because of that, when he sees employees who are stressed, he makes sure to sit them down to pinpoint any issues. And, often, he lightens those employees’ workloads, in an effort to balance out work throughout his staff. On occasion, he’ll even advocate for hiring a new employee, if his staff seems overwhelmed by its workload. Typically, Passarella has found that if he simply clarifies employees’ work deadlines, they usually make the necessary adjustments in short order. Because of that observation, he leaves employees like painters and frame specialists with detailed lists that illustrate their daily deadlines. Most of the time, he notes, when an employee’s work starts to suffer, it’s because “they don’t have direction. So, every morning, there’s a list: My paint guys get a paint list of what cars need to get painted and in what order, with what parts. And, my frame guys know what cars are going on the frame machines, and how much time they have for each car.”

FUE VANG

Motivate in Multiple Ways.

DRIVER ' S SE AT

Learn from Disaster The extraordinary makes consistent systems and processes all the more important

NICK SPAETH

As I write this letter, we’re a few days out from the polar vortex of January 2019. It’s

not the first polar vortex we’ve experienced up here in Minnesota, but it is the first time that the cold has caused 10 Missions’ office to shut down for the day. In fact, the weather was so frigid one of our employee’s cars is still sitting in our parking lot, refusing to start. It was fairly ridiculous, and it makes you question why you live in a place where the windchill can conceivably hit –50 degrees Fahrenheit and where 2 degrees above zero feels balmy in comparison. However, any chance I had of feeling sorry for myself and my hometown stopped when I read Ryan Cropper’s column this month, “Staying Open Amid Repairs” (p. 55). Over the past couple of months, Ryan has explained in his column the process of dealing with the aftermath of a 7.0 magnitude earthquake that struck Anchorage, Alaska, late November and that seriously damaged his facilities. It’s quite the story, and I encourage you to read it. And for those of you who finish the column thinking, “Oof, I’m glad I live in a land-locked state in the Midwest” like I did, there are some takeaways from the (admittedly extreme) situation that apply to any operation, regardless of circumstance, location or size. On a surface level, that takeaway is simple: Life is unpredictable. A natural disaster could strike. Someone in the shop could fall ill. Your best manager could quit. You might want to take a month-long sabbatical, like columnist Kevin Rains did. Heck, you might want to take one day off without wondering how the shop is doing without you. Those possibilities, however, only underscore the importance of a concept that we touch on in nearly every issue of FenderBender: the need for systematic processes. Without processes and procedures, dealing with those situations becomes exponentially more difficult. But even beyond their increased necessity during difficult times, consistent processes are also the key to smooth day-to-day operations. In this issue, you’ll find a variety of stories with the goal of helping you shore up your shop’s procedures—from the main feature on estimating (“The Ultimate Guide to Modern Estimating,” page 36) to the Case Study on managing WIP (“The Key to Better WIP,” page 56)—and ensure it doesn’t take a disaster to systemize how your shop runs.

ANNA ZECK EDITORIAL DIRECTOR a z e c k @10 m i s s i o n s .c o m

March 2019 | fenderbender.com 17

18 fenderbender.com | March 2019

QUICK FIX NEWS

IDEAS

PEOPLE

TRENDS

Increase Speed A new paint booth has helped increase efficiency significantly in the paint department at Valley Auto Body in Wasilla, Alaska.

ANALYSIS VIEWPOINT LIGHT HITS SNAP SHOP

FRED MOSELE Y

SN A P SHOP

March 2019 | fenderbender.com 19

20 fenderbender.com | March 2019

QUICK FIX

ANALYSIS

investment for aluminum repair certifications could cost anywhere from $80,000 to as much as $300,000, according to Mike Anderson, the founder of Collision Advice. So, a high ROI means that gains compare favorably to costs. Anderson says that it’s not only important for shops to invest in aluminum OEM certification repairs, but also in all OEM certification repairs.

Potential for Investment

GAINING AN ROI ON ALUMINUM REPAIRS

According to survey data, shops are seeing a significant return off aluminum work BY MELISSA STEINKEN

GETT Y IMAGES

The “Who Pays for What” survey conduct-

ed in the fourth quarter of 2018 by Collision Advice and the CRASH Network put aluminum repair under the spotlight. Back in 2015, the “Who Pays for What?” aluminum-related survey asked shops how much money they spent on tooling, training, fees and facility upgrades to become OEM certified in aluminum repair. Every year since, the survey has asked how satisfied shops are with that investment. Given that the median amount spent by shops in 2015 to become certified was more than $84,000, their views on what return they are seeing seems significant. Although the percentage of body shops that view their investment in OEM aluminum certification as a “great” business decision has fallen slightly over the past three years, the percentage of shops that say they are already seeing a return on their investment has risen, according to the survey. The percentage of shops that believe they will eventually see a return on their investment also has grown. After falling for a couple years, the percentage of shops charging a higher rate

for refinishing aluminum has remained steady since last year. The percentage of shops charging a higher rate for structural work has remained in the low 90 percent range, according to the survey. Tim Ronak, senior services consultant for AkzoNobel, says that investing in business requires a return greater than what is available in alternative secure investments. The increasing rate of technological innovation and implementation in the auto industry requires higher specialized environments, equipment and training than any time in the past. “I believe being certified by an OEM will be the key to remaining viable as a collision repairer in the future as the sophistication of vehicle structures and technology increases,” Ronak says. “Aluminum certification, along with highstrength steel and carbon fiber, will be areas that shops will need to decide whether they wish to be capable of safely performing repairs.” Ronak says that with the increasing number of vehicles using aluminum as part of lightweighting, he envisions more aluminum being used, not less. While it is difficult to define, a typical

“OEM certifications are really where the trends are at,” Anderson says. Many OEMs started out offering aluminum-specific certification programs but now, Anderson says, those same OEMS have morphed the programs to include more repairs than just aluminum repair. “I do believe there is an increase in shops receiving OEM certifications and a lot more shops today are seeing the value that the OEMs provide,” he says. With that being said, Anderson suggests that shops watch out for three things before making the plunge and investing: 1. Pursue the right type of OEM certification. Anderson stresses that shops should research the market they’re located in before deciding which OEM certification programs to invest in. For example, if a shop invests money in an Audi certification program, but there are only roughly 20 Audi vehicles in the town, it’s destined to be a lose-on investment, Anderson says. Anderson says that paint companies will often provide a shop with data needed to make such decisions. Axalta, he says, gives its customers a “G-map” to show the area’s demographics and type of vehicles in the market. “If you don’t have that data, then utilize your management system,” Anderson says. Or, third-party vendors that run the ORM certification programs will also typically provide such data. 2. Make sure there is a need before investing. OEMs often restrict the number of shops on a certification program, like an aluminum certification program, so a shop operator should inquire with the manufacturer as to whether there is space for the shop in the program. March 2019 | fenderbender.com 21

QUICK FIX

ANALYSIS

Expect more from your finish. Introducing Nason XL, a new product line from Axalta available in both Low VOC and National Rule formulations. NasonXL is fast and easy to apply and provides long-lasting collision-quality color at a cost that won’t slow you down. ®

VALUE THAT LASTS.

There might be 32 shops certified for aluminum repair in the program because there are not that many makes and models with aluminum available to the public, Anderson says. “If there are too many shops in the program, then you would never get a return on investment,” he says. 3. Be mindful that you could wait for an opportunity to open. If the aluminum certification program is full, the shop could potentially wait to be added to the list after another shop goes out of business or stops renewing its certification. So, Anderson says it’s possible to be next in line in that area if a shop drops out.

Guaranteeing an ROI

Simple ROI equals gains minus cost, divided by cost, Anderson says. When calculating ROI, he says to consider all costs of the investment and if there is some related additional expense. For instance, costs could include interest expense, finance charges, increased asset or property taxes and opportunity cost of an alternate investment. Ronak says a facility expense calculation is as follows: 1. Determine the total facility investment 2. Determine the required return on that investment 3. Calculate incremental sales targets that provide sufficient revenue to cover cost and return 4. If additional work volume is not forthcoming, consider adjusting to higher door unit rate for specialized work 5. Develop a plan to achieve target sales or rate increases Here’s how that looks in practice: If a shop owner borrows $75,000 in capital to invest in aluminum work and his or her gross profit percentage is 38 percent, he or she should consider the incremental gross profit dollars, Ronak says. If it’s a three-year loan with financing costs at 10 percent, that would add up to $15,000 at the end of the three years. That brings the total investment costs to $90,000. Dividing the total investment cost by the 38 percent gross profit results in $246,842 in additional sales needed over three years to break even on the investment, or $6,578 per month.

n i a G o Train t

E C N E L L E C EX PLETE, S

TO COM RIBUTES

PAIRS

RE QUALITY D N A E AF

THAT CO

March 2019 | fenderbender.com 23

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VIEWPOINT

OFFERING COMPETITIVE HEALTHCARE BENEFITS

With consolidators larger and stronger than ever, here’s how smaller collision repair businesses can provide competitive healthcare to employees BY MELISSA STEINKEN

You see it all the time: shop operators are consolidating their businesses, and gaining strength in numbers as a result. Caliber Collision and ABRA merged in December 2018, for example, and other shops are being bought out by the top consolidators, a list that includes Caliber Collision, Gerber Collision & Glass, and Service King. Now, CARSTAR has announced it is making significant growth plans in 2019 and other smaller regional MSOs are combining. While these shops are sweeping across the country and expanding, independent shops are still competing in the same markets. So, questions remain: What happens to the benefits that larger consolidators can offer employees compared to independent collision repair facilities? And how can small collision repair businesses offer benefits like health care that will allow them to compete with consolidators for talent? Sue Ritzman, human resources manager for Nagy’s Collision Centers, manages human resources for not just one shop, but 12 locations, and the individual personalities that go along with it. In her four years working at Nagy’s, she has seen employees choose Nagy’s because their other place of employment lacked certain employee benefits. Ritzman believes that, moving forward, employees will search for companies that offer more benefits than small operations typically do. She shares her thoughts on how consolidation affects the employee benefits—mainly healthcare—that a company offers.

COURTESY SUE RITZMAN, GET T Y IMAGES

What does your job role entail for a collision repair shop with multiple locations?

The job encompasses everything from hiring, onboarding, performance reviews, employee-coaching and relationship building, legal and compliance, and benefits. Daily tasks include scanning for any employees and applicants, answering employee questions, keeping up with the latest changes in the industry and employment law. I keep necessary records, continually scan for better benefits for our employees and build work relationships. Can larger companies offer more in terms of employee benefits?

More locations allows us to have more bargaining power with the number of employees that we have. It really comes down to weighing what is available and the benefit it gives your

Sue Ritzman Human resources manager Nagy's Collision Centers

employees. You have to take into account whether the employees will view the new benefits as a positive or negative change. What trends are you experiencing in healthcare?

Our healthcare provider has expanded its network to us by integrating more providers for an expanded network. Many individual owners cannot afford to offer and provide benefits to their employees. The larger the company, the more you are able to offer to your employees. For example, we offer benefits including healthcare insurance, dental insurance, vision insurance in which we pay the premium, a term life insurance we also pay for, a 401(K) plan that we match at different tiers, voluntary life and disability insurance, and we also provide employee discounts. We provide shirts and sweatshirts for

technicians, and coats, vests and shirts for the administration staff. We give our technicians a $200 pants allowance per year and a $100 safety gear allowance. What advice would you give independent shops when it comes to offering competitive benefits?

Well, shops can join some groups out there that would help them get better rates on healthcare insurance. For example, there are some business groups a shop can join that can then consolidate the businesses so the shops can offer more to their employees and have greater bargaining power. Also, one thing I do every year is negotiate with the broker and health insurance company on the rate we get. I keep going back to them until I get the rate I want. I ask questions like, “What are my options?” and sometimes I have to research some other health insurance options as a way to present the case that if they can’t offer me what I want, I’ll go with another provider. What has been the result of this approach to negotiation?

No one wants to have to go out to bid and change health insurance companies. I’ve been at Nagy’s Collision Center for four years and the broker and healthcare provider we have now was here before I was. We have had success and last year our provider came back with a 28 percent increase on the policy but I negotiated it down to 8 percent. Then, two years prior to that, we locked in at a two-year no increase agreement with a one-month payment holiday. Under 8 percent is under industry standards. Typically, industry standards for healthcare are at an 8 percent or 9 percent increase per year. Have you had a high employee turnover rate or has it been lower because of the benefits you offer?

We do have some turnover but not an extremely high turnover rate. For management and administration, we have a low turnover rate but for technicians it is not extremely low. In fact, a lot of employees we do get is because they did not receive good enough benefits at their old job. We do a run down of all our benefits in a second interview with the potential hire and we offer them information on the specific plans we can give them. March 2019 | fenderbender.com 25

QUICK FIX

LIGHT HITS

FIAT CHRYSLER RECALLS 182K RAM TRUCKS In late January, Fiat Chrysler announced it is recalling more than 182,000 Ram trucks around the world to inspect an electrical problem that could cause the power steering to fail. This is the second recall this year from the automaker. One-third of the affected 2019 Ram 1500 pickups are still on dealerships, and most are in the U.S. and Canada. The automaker said Friday fasteners for the batteries were not secured properly in manufacturing, meaning that should they come loose, drivers would not be able to steer properly. No crashes or injuries had been reported as of late January, according to FCA.

I-CAR TWEAKS TRAINING PROGRAMS Nearly one quarter (24 percent) of the collision repair industry is now engaged in I-CAR training for I-CAR Gold Class status.

Over the years that the I-CAR training program has been in place, students have shifted from taking a majority of the training through classroom training lessons to taking more online courses. In-shop training has increased too, according to John Van Alstyne, I-CAR CEO and president. To keep the training in line with industry feedback, there will be a total curriculum refresh as of the second quarter of 2019. Starting this year, there will be more I-CAR courses, but the number of hours that technicians will need to train will be reduced. In addition to more courses and a total of 246 courses, Spanish courses will be available in 2019. Courses are not the only element changing for I-CAR in 2019. The program will be ending its Road to Gold status as of February 2019. There is a transition period for Gold-Class shops to reach that status by the end of February and stay current with renewals in 2019. An additional new element for I-CAR in

2019: Van Alstyne said at a media briefing last week that I-CAR will be getting a data feed from the OEM partners and updating the knowledge assessments of technicians, so that technicians no longer need to say theyâ€™ve been trained through an OEM or have updated their training.

FORD FACING SEXUAL HARASSMENT LAWSUIT A lawyer who recently won a $16.8-million jury verdict against Ford on behalf of a former company engineer on Friday filed another employment discrimination claim against the OEM, this time for sexual harassment, according to the Detroit Free Press. Carol Laughbaum of Bloomfield Hills filed a lawsuit in U.S. District Court for the Eastern District of Michigan on behalf of DeAnna Johnson, 54, who started at the Ford Dearborn Truck Plant as a production C O N T I N U E D O N P. 2 9

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READ WHAT THE PROS READ. “I HAVE TO TAKE MY HAT OFF TO FENDERBENDER. IT’S DEFINITELY BETTER & ABOVE THE REST.” - Greg Lobsiger, Owner Loren’s Auto Body, Bluffton, IND.

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supervisor in June 2018 after a career working for automotive suppliers, according to the report. “From the outset,” the lawsuit said, Johnson, who is black, was subjected to “unwanted comments and conduct of a sexual nature, and unwanted comments of both a sexual and racial nature.” Ford spokeswoman Kelli Felker responded to the lawsuit with this statement: “Ford does not tolerate sexual harassment or discrimination. We take those claims very seriously and investigate them thoroughly. While we have not received this lawsuit, we are aware of the allegations. The plaintiff filed a Human Resources complaint in November 2018. “We launched an investigation, immediately suspended the employee that was the subject of the complaint, then fired him in December. Ford also interviewed every supervisor who the plaintiff claims had knowledge of her allegations prior to her Human Resources complaint and found that the only supervisor to whom she complained

immediately referred her complaint to Human Resources.”

specific concerns with ADAS systems called PilotAssist, ProPILOT, and AutoPilot.

AAA REPORT: STANDARD NAMES, DEFINITIONS FOR ADAS NEED

TESLA FINED OVER $29K FOR MODEL 3 SAFETY HAZARDS

A recent AAA report recommends that the names and definitions of various driver assistance tech should be standardized. The AAA study found that the array of ADAS marketing names sometimes leaves consumers confused about the differences among systems and what the features are supposed to do. As evidence for the extent of consumer confusion, AAA cites its Sept. 2018 study that found drivers had too much faith in systems such as adaptive cruise control. Two months later, in November 2018, the consumer group reported the disturbing results of another study based on ADAS technology naming. In its November report, AAA found that 40 percent of consumers believed fully autonomous cars were already available and traveling on U.S. roads. The study mentioned

Tesla has been fined $29,365 for violating California labor laws in the parking lot tent where Model 3s are assembled, according to a report from The Verge. California's Division of Occupational Safety and Health (CAL-OSHA) recorded six violations between June 2018 (when the tent was erected) and Dec. 2018, according to the report. Tesla failed to obtain a permit before building the tent, and failed to inspect it for potential safety hazards, according to Cal-OSHA. The company also failed to cover a hole in the floor that measured 22 inches wide, 14 inches long, and eight inches deep. Tesla also did not properly train employees on evacuation procedures in the tent, or on how to prevent and respond to heat illness. Lastly, the tent featured exposed metal rods and rebar.

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QUICK FIX

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VALLEY AUTO BODY BY KELLY BEATON PHOTOGRAPHY BY FRED MOSELEY LOCATION:

Wasilla, Alaska OWNER:

Destry Harmon SIZE:

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30 fenderbender.com | March 2019

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1. BIG-TIME BRANDING

Destry Harmon wants potential customers to see his body shop for long stretches of Alaska’s Parks Highway, which runs near his facility. That’s why Harmon, Valley Auto Body’s owner since 1989, recently had his business’s red-and-white logo updated on everything from inclosed trailers to loanervehicles to company trucks. It also appears above the shop’s custom awning. According to Harmon, the consistent use of the business’s logo helps personalize its brand and keeps it top of mind of townsfolk in Wasilla for when they require Valley’s services.

2. GOING THE EXTRA MILE

Harmon is a prideful business owner who dreams of someday passing on his business to his son, Cameron, 28, who just entered his ninth year painting at the shop. And Harmon’s pride extends to every service offered by the body shop. For example, Valley employees utilize a fleet of four vehicles dedicated to providing pick-up and delivery for customers, driving as far as 80 miles roundtrip. Harmon’s shop also has a pair of dedicated parts catering vehicles, and the shop owner says his employees will drive as far away as Fairbanks—a 300-mile trip—to pick up parts. “I just bend over backward

for the customer,” Harmon notes. “We cater to any of their needs.”

3. SUPREMELY EFFICIENT PAINT BOOTH The facility boasts a 98 percent CSI score, due in part to the efficiency of its shop floor. And that efficiency is greatly aided by a climate-controlled, Global Finishing Solutions (GFS) drive-thru paint booth. “It’s state of the art,” Harmon says of the paint booth. “It helps dry the paint and makes production a lot faster, to where we can paint three to four cars a day. Cars are in the booth at least 45 minutes, then you’ve got your cycle time for baking and usually it’s about 45 minutes, [before] a cooldown cycle. So, you’re looking at roughly 3 hours per vehicle.”

4. THE HEAT IS ON Winter can create massive challenges in Wasilla, which is located about 45 miles north of Anchorage. “It’s tough, if you get a car all iced up,” Harmon notes. “The cars take a little longer to start working on; you’ve got to thaw them out—it can take up to half a day on some of them.” That’s why, a couple years ago, Harmon saw fit to equip Valley Auto Body with a heated floor that features a boiler system—a setup, he says, “heats the car up a little faster than the air."

March 2019 | fenderbender.com 31

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COLUMNS

THE BIG IDEA KEVIN RAINS

Throw the Ball Harder! How intensity develops people

MICHAEL HOEWELER, GETTY IMAGES

As I write this, we are approaching

Super Bowl Sunday. Of course, by the time you read this, the contest will already be decided. Will it be the Rams, the underdog story beating the legacy team with many, many Super Bowl wins already? Or will it be the Patriots yet again taking the title? While I don’t know the outcome just yet, one thing I know for sure: the best coaches rely on making their weaker players adapt to the stronger ones and not the other way around. I first read about adaptation from Edwin Friedman in his book, Failure of Nerve. Friedman was among the most influential therapists of our generation. Now his books are routinely used in universities across the country as standard texts to prepare the next generation of therapists. But Friedman liked to cut across the grain. Not because he was a contrarian by nature; it was his broad experience as a practitioner and his deep research as a scholar that revealed to him how most people in his profession got it wrong. He saw that many were first captivated— but then held captive—by the concept of empathy. And he started to emphasize a less popular concept called adaptation. It goes without saying that empathy is an important concept. Empathy is often the key to most healthy relationships, whether at home or at work. But it does have a shadow side when taken too far. This is especially true when we are trying to develop people. In short, if we treat people—whether they be our kids or our coworkers—as weak, they may start to believe they are weak. And soon they will act accordingly. But, if our desire is to develop people, help them learn and perform better, then we need to treat them as capable. We hold them to a high standard and coach them to achieve greater things. We help them adapt to the talent around them and the higher expectations we set as leaders. In Friedman’s book, he uses the example of a football coach who was frustrated with complaining teammates. But instead of coddling them, this was the coach's philosophy: “When I coach,

if the receivers complain that the quarterback throws the ball too hard, I don’t go to the quarterback and tell him to let up. I tell him to throw it as hard as he can, and then I tell the receivers they better hang on to his passes if they want to hang on to the team. “If those who cover punts complain that the punter kicks it too far, I don’t go to the punter and tell him not to kick it so far. I tell the punter to kick it as far as he can, and I’ll try to find players that can get down the field and cover his kicks. “And if blockers say they are having trouble keeping up with a running back because he is too fast or too slippery, I don’t get on the running back and tell him to go slower; I tell him to do his thing as best he is able, and I get on the blockers to keep up with his agility.” What does this look like? Recently, at one of our shops, we had a technician that started to come in later and later. We had an agreement with him that, due to a family commitment, he could come in later than our other technicians. Our shop is flat rate so it wasn’t like he was hurting us directly by coming in later, as long as his work gets done. But, over time, what we noticed is that he would come in later and later and then he would leave earlier and earlier. And if there wasn’t work put right in front of him once he was caught up, he would bounce out rather than check with a manager to see if any new work had come in or if there was one coming back to him from paint soon. Simultaneously to this, I have been

pushing this manager to get more hours weekly out of his team. I also said that if the current team isn’t able to step up on the hours, I would have to hire another technician. The manager went to work. He set up a lunch meeting with this tech and laid out the new goal I had given him and explained clearly how many hours we needed him to turn and how him coming in late was not only hurting his earning potential, it was also keeping the shop from hitting the larger goals we had set. And if we don’t hit those hours, the shop can’t afford new equipment and all the extras that comes with being a profitable shop, like lunches, bonuses, more time off when needed. Over lunch, he secured from this tech a fresh commitment to come in on time, stay later or work weekends once in a while to offset coming in later and checking with a manager before just bouncing. In short, he threw the ball harder and expected his receiver to step up. And he did. The tech committed to the new standard. There is total clarity on what stepping up means. We all want our team members to succeed and do well. We want them to grow and become the best they can be. We want them to perform well at our shops and, in turn, be able to provide for their families and reach goals they have set for themselves. And throwing the ball harder—holding them to a higher standard than they are currently comfortable with—may just be the key to unlock that next chapter of their growth and development.

KEVIN RAINS Kevin Rains is the owner of Rains CARSTAR Group with locations in Cincinnati, Ohio, West Chester, Ohio and Lexington, KY. He is also an industry consultant and founder of Body Shop 2.0.

E M A I L : kev i n r a i n s @ g m a i l .c o m A R C H I V E : f e n d e r b e n d e r.c o m /r a i n s

March 2019 | fenderbender.com 33

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2019

The Ultimate Guide to Modern Estimating Accomplished collision repairers break down the keys to doing estimates as efficiently as possible BY K E L LY B E ATO N PHOTOS BY THE SOUTHERN NORTH PHOTOGRAPHY

36 fenderbender.com | March 2019

The Next Step Randy Miller (center) has always run a progressive operation in Minnesota, which is why modernizing his estimating processes has become an area of focus in recent years.

andy Miller, a veteran of nearly four decades in the collision repair industry, has refined his shop’s estimating process for years now. And he’s had to. After all, the complexity of vehicles is so much greater than when Miller began his career in the 1970s. And, most shops—not unlike Miller’s in Austin, Minn.—only have a couple estimators at their disposal. “I’ve been doing this for almost 40 years now,” notes Miller, the president of Collision Specialists Inc., who has earned widespread acclaim in the industry for his shop’s estimating process. “In the beginning, it was just a quick write-out, handwritten type of estimate. … You guessed on how much labor, parts and materials would be, and put it on the estimate as a total cost.” Nowadays, ballpark figures won’t cut it. “You’ve got to be really serious, and every dollar counts these days,” Miller says. The biggest key, in his experience, is to schedule out estimates. That way, estimators won’t be rushed, and shops experience few costly oversights. Miller looks at it this way: If you had a sore tooth, you wouldn’t simply show up at the dentist and expect to have your issue fixed in one day; you would expect to be forced to schedule a dental exam. “The biggest thing is scheduling your estimates out,” Miller says. “The reason we do that? First off, a lot of times, the emotion goes away with the customer. If [the accident] just happened, the customer’s very emotional. “We realized that what’s going on in the shop work area is directly affected by the estimating and scheduling process.” In some respects, handling estimates effectively is easier than ever. Then again, with shops often saddled with budget constraints, estimators are expected to track more work than ever these days. “It’s all the procedures around the estimate itself that helps create a smooth process,” Miller says. “It has to be worked on continually, because of all the changes in the industry.” FenderBender spoke with multiple industry veterans, seeking the keys to estimating as effectively as possible in 2019. Here’s an in-depth look at their estimating processes.

March 2019 | fenderbender.com 37

FE ATURE

THE ULTIMATE GUIDE TO MODERN ESTIMATING

Communication With Techs

Many body shops foster quick, non-verbal communication between their estimators and technicians by marking up vehicles— with green notes on a vehicle windshield representing areas requiring a repair, with another color, such as pink, noting vehicle damage that’s unrelated to a scheduled repair. At Miller’s shop, he has established checkpoints throughout his shop floor that aid communication among staff members. “We have steps all throughout the process,” says Miller, whose business produces $2 million in annual revenue. “There are sheets [and] these sheets follow the car throughout the whole shop, for the vehicle check-in, blue printer, estimator, parts, body refinish tech, detailer and so on. That sheet is signed by each employee and moved on with the vehicle until it’s completed.” To inspire conversations among the entire staff, Miller has much of his staff get involved in the estimation process. Every vehicle—even if it’s a simple fender job— receives the attention of multiple Collision Specialists staffers. “When the vehicle is disassembled, parts received and ready to go into process, we walk around it as a team,” Miller says. “We usually do that in the morning and our noon meeting. “We’ll walk around every vehicle that comes in the shop. … And, at that point in time is where the estimate is completely locked up and done. “All eyes are on every vehicle: the estimators’, painters’, body techs’, and the detailers’. The estimator reads through the entire estimate and final changes are made and agreed to by the technicians, which includes labor repair times, missed R/Is, and what panels are to be refinished and replaced.” That estimating procedure ensures that the crew at Collision Specialists works together, as a unit, Miller says. Several shop floor employees are involved, and, as he says, they all feel like they have “skin in the game.” Overall, here’s how Miller incorporates his estimating philosophies and puts his preferred processes in action:

them, it helps ensure that his estimators rarely write a rushed estimate. “What we do is schedule [estimates] for a one-hour period of time,” says Miller, whose shop has a 97.2 CSI score, so, “they know that we’re doing a good, thorough job for them, using a prequalification form on the customer. Then we also have time to wash their vehicle, which lets us see all the damage. “If we have 10 people walk in and they all want an estimate right now, we’re going to be hurried, because we’re going to take 20 minutes with them, and we’re not going to have a complete and accurate estimate.”

Schedule estimates. Miller feels scheduling out estimates is paramount nowadays. By scheduling

Do group walk-arounds. As mentioned earlier, Miller also swears by having your staff perform vehicle

38 fenderbender.com | March 2019

Get Together Scheduling estimates has become even more important at Randy Miller’s Minnesota shop. The team frequently gathers to evaluate that day’s schedule.

walkarounds as a team. That way, very few repair issues will escape your shop’s attention early in the repair process. “We’ll walk around every vehicle that comes in the shop—it doesn’t matter if it’s a simple fender job or something small,” Miller says. Utilize Modern Technology. Considering all the innovative technology that’s at collision repairers’ fingertips these days, the shop operators that FenderBender spoke to say it’s misguided to not use them all. Miller recommends utilizing 3D measuring systems, since they can rule out any bent vehicle frames early in the estimating process. He has also made pre- and post-repair scanning a key element of his shop’s

SMALL, YET SIGNIFICANT, TIPS

— Industry veterans offer seemingly small tips that can nevertheless significantly improve the estimating process. Know your estimating system inside and out. To ensure that estimators put all necessary information on their estimating sheet, they must know procedure pages for every system, since they all work a little differently. “Every insurance company wants it to look a different way,” says Randy Miller, president of Collision Specialists Inc. in Austin, Minn., “so, to know that information [thoroughly] is crucial to making a sheet everyone is happy with.” Go over checklists line by line. It’s a tried-and-true method: By methodically poring over an estimate, shop staffers lessen the chance for required supplements down the line. If an estimator checks each part against what their computer system notes, supplement ratios are likely to improve.

estimating process. Diagnosing, or prescanning, can educate a body shop’s staff on the full condition of a vehicle and the ideal order of procedures that need to be performed on it, Miller says. “It starts with us educating [the customer] that we will be pre-scanning and post-scanning their vehicle,” Miller explains, “and informing them that there could be prior codes that had occured before their accident and that the insurance company could deny paying for. Diagnosing the vehicle … helps us get up front parts we need for many of the electronic devices on today’s vehicle.” Document everything. Considering that insurance companies typically seek to keep repair bills reined in

as much as possible, it’s in the best interest of body shops to take as many photos of vehicle damage as possible. Plus, by making photos part of the estimating process, customers can quickly be informed when, and if, repair supplements are needed. Essentially, by providing clients and insurers with prompt photos or screenshots, it can present your shop as a business that prides itself on working transparently.

Insurance Negotiations

Like Miller, Dan Sjolseth has, for years, pondered how to streamline the estimating process as much as possible. “Years ago,” says Sjolseth, the owner of Superior Service Centers in greater Minneapolis, “the way we’d process the work

Mark up cars to aid non-verbal communication. Many shops mark up the windshields of vehicles in an effort to aid shop floor communication. In some facilities, for example, green writing is related to repair work that must be addressed immediately, while red writing refers to vehicle damage unrelated to ongoing repair work. Keep your own file for repairs. Since many modern estimating systems utilize cloud-based technology, it’s helpful to keep your own, separate file of each repair. That way, even if your estimating system crashes, you’ll still have access to key repair information, Miller says. “You have to do something to protect yourself and your information—and your customers,” he says.

March 2019 | fenderbender.com 39

FE ATURE

THE ULTIMATE GUIDE TO MODERN ESTIMATING

IMPROVING YOUR SALES

Make a Choice Randy Miller (left) places a strict emphasis on OEM procedures.

— A look at how a pair of successful Minnesota shops have improved estimators’ sales in recent years. At the Superior Service Centers in the Twin Cities, their estimators’ sales are aided by the support staff. Tony Hoffman, the small MSO’s GM, says employees like customer service reps can greatly assist an estimator. “Every shop does it a little different, whether it’s by way of CSRs, or a blueprinter, and then having strictly front-end estimators,” says Hoffman, whose MSO employs a pair of CSRs at each location. “But, to increase sales, you’ve got to have a supporting staff around them. Obviously, there’s a shortage of people in the trade, and estimators aren’t necessarily easy to find. “So it’s about putting a good staff around” estimators. Meanwhile, in Austin, Minn., Randy Miller, the owner of Collision Specialists Inc., instructs his estimators to use the vehicle walk-around as a time to gauge whether or not customers might be open to additional expenditures like small repairs to bumper covers or panels. “We take them by hand and show them the damage, and walk them around the vehicle,” the Minnesota shop owner says. “And that's a good time for an upsell, if there’s anything else that they want taken care of that they’d pay for. If it’s going to cost $200 or $300 to do something, they usually go for that—and that’s a very good upsell.”

40 fenderbender.com | March 2019

was, we’d grab the keys and write what we could see. Because we were trained by insurance companies to only write what you can see; don’t write anything else. “We would disassemble it, we’d discover more damage, we’d order necessary parts. “We were always on the run. … There were times we’d have five, six supplements on vehicles.” Those frustrations are now largely a thing of the past for Sjolseth, whose shops—which handle both collision repair and mechanical work—currently produce $7.5 million in combined annual revenue ($4.6 million of which is from collision repair work). Sjolseth has learned how important it is to document all vehicle damage, utilizing modern photo estimating, for example. With such technological advances, estimating is not only more accurate, but also, an insurance negotiation process that used to take days has now been whittled down to mere minutes. “Some of the innovations on that end have come from insurance companies themselves,” notes Tony Hoffman, the general manager at Superior Service Center. “They essentially use an app like Skype on your phone. And, your supplements are essentially instantaneous with them now. “You get all your parts lined up, you get your supplement done, you fire up the app, and somebody jumps on and you Skype with them and they take screenshots while you’re doing that. And the supplement’s done in minutes.” If body shops want to quickly silence arguments from insurers regarding repair

bills, modern 3D measuring systems can also offer assistance. After all, if your shop’s staff were to find out, midway through a repair, that a vehicle’s frame was bent, that could cause unwanted delays in the repair process, and with insurers. That’s why, at Miller’s shop in Austin, Minn., the staff measures vehicles early on in the repair process. “The insurance company, we’ve negotiated with them to pa us for what we call ‘diagnosing the vehicle,’” Miller says. “And they’ll pay us 30 minutes to an hour to do that. “There are arguments [from some in the industry] that you’re not going to get paid for that. Well, you know what? What you’re doing, when you measure a vehicle up front, is [assessing] all the problems with that vehicle and not identifying them halfway through the repair process.” Miller also feels that diagnostic scanning can help a shop justify the repairs it does, as well as labor times and parts replacement. Collision Specialists Inc. has its own scan tools and currently uses a remote vendor. And, Miller envisions a time in the near future in which the Minnesota shop possesses all manufacturers’ scan tools. “We have a set minimum rate for prescan and for post-scanning on vehicles,” Miller notes. “We did this by doing our own survey on mechanical shops and dealers in our local area. It’s understood that there could be additional costs due to programming, dealer-only services, and transportation costs.”

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Make a Name

Everyone in Dennis Reittinger’s community is familiar with his shop—and it’s not just because of the unique exterior. It’s due to his charitable nature.

42 fenderbender.com | March 2019

A CARING HEART FOR DENNIS REITTINGER, CARING ABOUT HIS C O M M U N I T Y, H I S F A M I LY A N D H I S S T A F F H A S BEEN THE FOUNDATION FOR HIS SUCCESS

BY MELISSA STEINKEN PHOTOGRAPHY BY JEFF ALLEN STUDIOS

March 2019 | fenderbender.com 43

PROFILE

A CARING HEART

A PINK SIGN, A PINK WEBSITE & A PINK-PAINTED PARKING LOT. Pink is not a color often seen at body shops but, for Dennis Reittinger, the color holds a special place in his heart. In 2003, his wife developed breast cancer and battled it for 11 years, before eventually passing away four years ago. Her journey became an important part of MidTown Body Repair’s history, Reittinger says. One time, Reittinger was bringing his wife back from the hospital, when his son and his shop manager revealed a surprise: a newly painted pink sign in front of the shop and a new logo that was pink to support breast cancer research. “I was going to be painting the shop brighter colors anyway and she ended up being tickled pink by it,” Reittinger says. The new logo change made the shop more prominent in the local community as a shop that was interested in participating in fundraisers and donations. Since the change, Reittinger says that he often has local charities and nonprofits coming to ask him if he can donate to a cause. While he tries to stick to donating to breast cancer awareness events like cycle events and runs, he says he does offer to help other charities. Reittinger has a big heart for his community and staff, going to lengths such as hosting an annual Christmas party at his house and giving out Christmas bonuses. A focus on giving back to causes he is passionate about has helped his family-owned shop’s reputation in the community and grown the 20,000-square-foot stop to more than $3 million in annual revenue.

44 fenderbender.com | March 2019

A Message for Customers

From the outside, Dennis Reittinger’s shop immediately makes a personal cause known. Inside, the shop has continued to modernize.

MID-TOWN BODY REPAIR OWNER:

DENNIS REITTINGER LOCATION:

GREENSBORO, N.C. SIZE:

20,000 SQUARE FEET STAFF:

16 (6 BODY TECHNICIANS, 2 PAINTERS, 1 PARTS PERSON, 2 OFFICE WORKERS, 3 ESTIMATORS, 2 IN DETAIL, 1 OWNER) AVERAGE MONTHLY CAR COUNT:

100

ANNUAL REVENUE:

$3.2 MILLION

Sharing the Wealth

Every year for the past 20 years, during the holidays, Rettinger says he does his best to give out bonuses to the team of 18 people, based on job performance. The bonus might be $500 one year or $750 the next year, but the overarching point is that he tries to show his appreciation in some way if he can. He’s found that success is not about being a superstar in the industry but, instead, about making a true commitment and finishing what you started. Reittinger follows three principles for his business philosophy—treat others the way you want to be treated, focus on honesty, and always be dependable—and carries those over to his community as a way to show that he cares. Reittinger started volunteering in his community way before his wife was diagnosed with breast cancer. Not only was the community service a way to gain word-ofmouth referral business, Reittinger also says it was a way to look for talented, younger technicians by helping out in the industry events. He was on the auto body advisory board for the Guilford Technical Community College, a committee member for I-CAR and participated as a judge

in the North Carolina SkillsUSA 2004 State Conference. Today, Reittinger’s strategy for giving back typically involves donating money. He often donates a courtesy detail ranging from $50–$250 to any organizations hosting charity auctions. The Mid-Town Body Repair sign can be witnessed in the community but it’s a more subtle approach. In addition, Reittinger bought advertising on city buses to get his name out in a highly visible way that has a greater chance of being seen by many drivers. When it comes to donating to breast cancer charities and other cancer charities, he decided to donate money to the causes instead of hosting events at the shop. The reason? While his wife was still with him, she did not like to call attention to her diagnosis. Since then, Reittinger has been committed to helping the cause in honor of his wife but prefers to keep his charity endeavors off the radar. Not every effort needs to be advertised, communicated or promoted, he believes; you can still make a difference by supporting a cause in any way that’s feasible for you and your shop. March 2019 | fenderbender.com 45

PROFILE

A CARING HEART

Dedicated Staff

The 18 employees at Mid-Town Body Repair in Greensboro, N.C., are passionate about their jobs, due in part to the shop's family atmosphere.

Sharing the Culture

Dennis Reittinger built his business with $10,000 in his pocket in the 1970s. He’s grown the business steadily over the years, from a 3,000-square-foot facility to nearly 20,000 square feet and 18 employees today. Along the way, he’s even involved his entire family in the enterprise. His two sons work in the business, one as a painter and the other as a writer. Instead of focusing on finding the most highly skilled employees, he focused on hiring people who were new to the industry and that he met through his volunteering. Reittinger believes in second chances, he says. He’ll rehire someone once and in most cases in which he’s done this, the employee has stayed on for years at the shop. That culture is evident in his shop; he says it has a distinct family feel, but that 46 fenderbender.com | March 2019

family feel needs to extend among the whole staff, though, for it to properly work. That’s become especially important in recent years, as Reittinger has stepped back from an all hands-on role in the shop. He now comes in roughly three to four days per week, stopping in at 10 a.m. and staying for a few hours per day. However, stopping in less frequently means that he needs to make those visits count. They need to emphasize the culture and continue to build it. When he stops by, Reittinger comes into the shop and walks around the office and the shop floor. He shakes hands with everyone and checks in on the schedule and production. Despite taking a step back as a boss, he keeps his home open to his staff, as well. Every summer, Reittinger invites the entire staff to his lake home for a day of fun

on the lake. They grill food, hang out in his game room, ride jet skis and head out on the boats. During the holidays, he opens his home up again for a huge Christmas party for all the employees. Reittinger says he prefers to open his home for team building because it allows the team to meet for a longer period of time compared to the one or two hours they would have in a restaurant. “If you want to do it, you can’t fake it,” Reittinger says. “Treat them the way you would want to be treated.” It’s those employees that keep him involved in the business; 40 years later and at 64 years old, he still has no plans for an exit plan completely from the business, he says. “I’ll probably not think about that until I’m 70 years old,” he says. “I’m having too much fun right now.”

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Millions of vehicles with Takata airbags are being recalled for potentially life-threatening defects. After years of exposure to high humidity and fluctuating temperatures, the airbag inflator in a recalled vehicle can blow apart when deployed. This could send jagged shards of metal into the passenger compartment. Vehicles with these defective airbags pose a dangerous threat, and older vehicles show the greatest risk of failure.

Visit BMWUltimateRewards.com to enroll in the BMW Takata Recall Incentive Program. The steps are simple: • When your BMW customers come in for service, determine if their vehicle is part of the BMW Takata Recall • Inform affected customers of the safety recall and explain the importance of the recall repair • Work with your local BMW Dealer to complete the repair, ideally via BMW Mobile Service • Once the claim is verified as repaired, $50 in Ultimate Rewards (5,000 points) will be deposited into your account • Redeem your points!

BMW FenderBender has built a superb reputation as a publication that brings the most innovative content to automotive service centers across the country. At BMW, we appreciate the relationship FenderBender has built with its readers and within our community. With that being said, we now ask for your help on a very urgent matter. As you may be aware, approximately, 50 million Takata airbag inflators involving 37 million vehicles have been recalled by 19 vehicle manufacturers. NHTSA (the National Highway Traffic Safety Administration) estimated that a total of 65 to 70 million Takata air bags will be recalled by the end of 2019. In the United States, there have been 15 deaths and approximately 270 injuries attributed to these airbags. The state of Florida alone has 3 deaths and at least 80 injuries. Vehicles that have long term exposure to high heat and humidity are most at risk of a rupture if the airbag deploys in an accident. Further, NHTSA has directed the vehicle manufacturers involved in the Takata Airbag Recalls to repair 100% of the affected vehicles. While the affected manufacturers are working diligently towards that goal and have made good progress, some vehicles are difficult to locate, some owners do not act with the urgency that this important matter deserves and some do not respond to recall outreach efforts. For BMW, our older models (2000-2006) in high humidity areas make up the highest risk population of BMW vehicles. And those vehicles are also the most difficult to find and to effectuate the repair. Some of you may know of these vehicles and may have relatives, friends, and employees who have not yet received their FREE replacement airbag. Many of those customers are no longer in active servicing relationships with BMW dealers so we are utilizing other outreach channels to find them. This is where YOU come in. We are excited to announce that BMW of North America, LLC has launched a program working with independent repair centers, body shops, used car dealers and others to help get the message out about the URGENCY of the Takata Airbag Recall and completing the repair. As of January 2019, Independent Repair Facilities enrolled in the BMW Ultimate Rewards program will have access to a new “Recall Support” page. On this page, you will be able to check your customer’s vehicle for an open Takata recall, and earn $50 for assisting with getting the FREE repair completed. All you need to do is: 1) inform your customer of their Takata airbag recall and; 2) facilitate the completion of repair with the customer and your local BMW dealer within 30 days of VIN submission. For your convenience, many BMW dealers offer a Mobile Service option and will send a technician directly to you to complete the recall while the vehicle is still at your facility. This is an innovative program and will be a positive service experience for your customers. Not enrolled in BMW Ultimate Rewards? We have added the ability to INSTANTLY enroll and begin claiming your $50 reward TODAY. Simply visit www.BMWUltimateRewards.com and select “Enroll”. Please utilize this program and assist us with finding and repairing these vehicles. If you have any questions regarding the program or enrollment process please call (800) 858-6356 for more information. Company BMW of North America NA, LLC

Postal address P.O. Box 1227 Westwood, NJ 07675-1227

Russ Lucas Vice President, Recall Implementation

Ofﬁce address 300 Chestnut Ridge Road Woodcliff Lake, NJ 07677-7731 Telephone 201-307-4000 Internet bmwusa.com

50 fenderbender.com | March 2019

STRATEGY LEARN

GROW

WORK SMARTER

Complete Progress One Minnesota MSO learned that, by honing a complete teardown process, it could significantly improve efficiency.

IDEA SHOP L AW CASE STUDY CUSTOMER SERVICE

JESSIENA LAKE

CASE S T UDY

March 2019 | fenderbender.com 51

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STR ATEGY

IDEA SHOP

I’ve seen my team become closer, not only with me, but also with each other. There is a boundary between discussing the personal issue from home but it usually always finds its way to the workplace and vice versa. Showing your team that you have the capacity to listen, when they need it, will go a long way to build trust. And, don’t be rushed. If you are busy, offer them a chance to talk another time. Don’t brush the problems off.

How to Build Relationships with Staff Navigate the fine line of learning about employees’ personal lives and keeping it professional

Henry Yach III was in the middle of renewing his yearly contract for his shop’s uniforms when he asked his uniform vendor an innocuous question: “How’s it going?” To Yach’s surprise, the vendor shared that one of his employees was undergoing surgery for his bone marrow cancer that day. Yach was taken aback and asked if the vendor might want to pray with him. The two did and, later that day, Yach, the owner of Yach’s Body and Custom in Marathon County, Wis., received a phone call. “The vendor called me back and said, ‘In all the years I’ve known someone, I’ve never known someone who cared immediately for someone he did not know,’” Yach says. It’s why he’s a firm believer in taking the time to care—really care—about his employees. The simple act of inquiring if someone wants to talk or pray, he says, can have a huge effect on building trust and interpersonal relationships with the shop team. But, there’s a fine line between caring and having a relationship that’s too close with employees. You still need to be able to act as the employee’s boss—not his or her friend— and blurring the two lines can make this more difficult. Yach outlines how his practices help build relationships between him and staff members without crossing a boundary of any kind. AS TOLD TO MELISSA STEINKEN

THINKSTOCK

First, each day, it’s important to come in and make sure to spend time walking around the office and shop floor. This is a way to gauge

if someone seems not like their usual self. If you see an employee hunched over and scowling, stop and ask how they are doing that day. The interactions don’t usually last long but it’s a warning sign that something could be problematic with the employee if they have their shoulders hunched forward. Usually, if nothing is wrong, this takes about 30 seconds or 1 minute of interaction. Most of the time, everyone is cheerful and everything is good. But, for those times when an employee is not having a good day,

it’s vital to make sure to actively listen to that person. If the employee responds and says everything is fine, then move on to talking about work and discussing what lies ahead in production for the day. Next, if the person says he or she is having a bad day, then ask if he or she wants to go meet in your office to discuss the issue.

Obviously, there’s a very fine line between inquiring too much and while some business principles may counsel against this, I think there’s a cost to not getting close to your team and not having them feel like their boss cares about them.

Finally, to do this on a consistent basis, you need to create meaningful moments with staff that connect leaders and staff, as well as provide insight. To do that, you need to

take a critical look at your culture, your mission statement, and your values and make sure that is understood by every employee. Part of the caring culture of my shop is created during the hiring process. During the onboarding process, get to know the new employee and vice versa. After each new hire, sit down with the person and teach him or her about the shop culture and values. Discuss the company mission statement and explain what it means, then inform the hire that your door is always open and that the person can come in to talk at any time. Your staff needs to know that you are not going to gossip if they come to you with a personal issue. They need to know you will be there for them. For example, my culture centers on a goal to get issues resolved within 24 hours. If someone is upset, I want either my manager or I to talk with the person before those hours are over. If you need help being able to do that and having those meaningful conversations, don’t be afraid to get some help. A business group I joined recommended hiring someone to help with deeper issues. We hired a corporate chaplain to meditate any other issues between staff or with staff if there are medical emergencies or a family member becomes ill or dies. Finally, it’s vital, as you’re building those relationships, to still be honest with employees as their boss. You can’t be so close with

them that you become scared of offering feedback or delivering tough critiques. If performance standards are not being met, you have to just say it. Don’t hide that it’s an issue and this will also help create healthy, constructive dialogue within the team. March 2019 | fenderbender.com 53

STR ATEGY

LAW

Four Essential Documents for Hiring a Contract Worker Before you sign on the dotted line, learn what you need to hire a contract worker

Now is the time to spend money and

take time to get the paperwork sorted out when hiring a contract worker, to avoid years of legal fees. “It’s a cliche, but an ounce of prevention is worth a pound of cure,” Randi Cohen says. Cohen, who has been a lawyer for over 12 years and specializes in employment law, says while the specifications for hiring a contract worker vary in different states, there are proper measures an owner needs to take to legally protect him or herself long term. If the right documents are not signed and the person is paid improperly, for example, then the shop could lose thousands of dollars in legal fees in the eventuality of a lawsuit. If completed improperly, a contract worker could sue with claims of unpaid overtime, unemployment insurance and more. While it’s enticing for a business owner to lower overhead by hiring a contract 54 fenderbender.com | March 2019

worker, it can be a huge business risk if the worker is misclassified and documentation is not on record. However, there are situations where hiring a contract worker makes sense. In fact, according to an NPR/Marist poll, one in five jobs in America is held by a worker under contract, and within a decade, contractors could make up half of the American workforce. Within your shop, contract hires can be go-to options for maintenance workers, construction and renovation projects, and many other positions. Cohen, principal for the Law Office of Randi M. Cohen, shares what a small business owner needs in order to properly hire a contract worker.

Defining a Contract Worker

The main differences between a contract worker and an employee arise from the control that the employer can exert

over his or her staff. Employees are under certain requirements when they are hired, including dress code, work hours, work assignments, meetings to attend and firing offenses. A contract worker, also known as an independent contractor, on the other hand, is an individual retained by a company for a predetermined time and price, meaning a company is not responsible for providing traditional employer benefits, such as taxes, social security, health benefits, vacation or sick leave, retirement, unemployment benefits or workers’ comp. Hiring contract employees has numerous benefits, including the ability to hire for short-term projects, lower overhead operating costs, and the opportunity to hire on an as-needed basis, but those employees typically don’t have the same allegiances to a company that a permanent employee does and may even work more than one job simultaneously.

THINKSTOCK

BY MELISSA STEINKEN

right tax forms filed and recorded. Traditionally, that means both the 1040 and I-90 forms are a must. The worker should come equipped with the proper authorization to work in the state, she says. An I-90 form will be needed in this case. Cohen says that the IRS is “cracking down” on employers for this document because the state law entities do not want businesses to take advantage of undocumented immigrants in order to save money. While the employer does not deduct any taxes for a contract worker and the worker does not pay into any assistance programs like social security or Medicare, the owner could pay more in the future for the programs, plus interest, if taxes and any type of compensation documents are not on record.

3. The State Law

Document requirements vary by state and Cohen encourages every shop owner to look into the employment laws where they operate. One law that has become more prominent in New York, she says, entails limitations on what an employer can ask in terms of criminal history. These laws are in place so people with criminal convictions cannot be denied work.

Creating a Contract

While Cohen recommends hiring a lawyer to put together a contract, he says shop owners can certainly put together contracts on their own. In that contract, you should include an in-depth statement about how the shop is not the employer and the contract worker is a not an employee. The worker should have it outlined in the document that he or she can work at a time and place chosen and agreed upon by both parties. Outline the due date for the project and the amount that you will pay to the hire. Specify how much you will pay the hire and when that will happen. If there is an agreement for the employer to be able to fire the contract worker with or without notice, then the contract is voided, Cohen says. While she recommends an owner do his or her due diligence, laws vary by

state. Cohen says you should request references from the contract worker, and a portfolio of work, if it is applicable. “Make sure there are records of the agreement,” Cohen says. “No cash allowed because anyone can say they’ve never been paid before.”

The Necessary Documentation 1. The Contract

The first document that should be finalized, Cohen says, is the contract between the contract worker and the employee. As outlined previously, the contract should clearly outline the length of the project, the payment, how the hire will be paid and whether or not there is a non-compete agreement for the duration of the contract.

2. The Tax Documents

In case problems evolve down the line, Cohen says the owner needs to have the

4. The Miscellaneous Provisions

The contract is a negotiation, Cohen says. A contract worker might want to be paid $50 for every hour he or she works on a project. However, the owner might want to pay a flat rate per week or per month. In this scenario, the shop owner and worker need to sit down and negotiate terms. “An employer shouldn’t require them to punch in or out because that is a hallmark of a full-time employee,” Cohen says. To terminate the contract, Cohen also recommends including a section in the contract on when the employer can check in with the worker. Some examples are for the employer and worker to check in every two weeks or for the owner to give a five-day notice of an issue. “You do not want a contractor and the business fighting over a broken contract,” she says. March 2019 | fenderbender.com 55

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56 fenderbender.com | March 2019

MANAGER

COLUMNS

PROCESS DRIVEN R YA N C R O P P E R

Staying Open Amid Repairs How to keep your business operational while parts of your facility aren’t functional

FUE VANG

The other day, I was sitting in my office,

and I could count 1, 2, 3, 4, 5, 6 major sheetrock cracks. We had some in our front office that opened up two inches. It’s just crazy to look at. Mostly, we had foundation damage at our main shop. Yes, our recovery continued in the weeks following Anchorage, Alaska’s 7.0 earthquake on Nov. 30. Looking back, our initial plan of attack on Nov. 30 was to make sure that everyone at all three of our locations was OK, first and foremost. Luckily, no roofs caved in; if the roof had come down, we would’ve been in a world of hurt. Right after the earthquake, my general manager type, our maintenance guy and I went around to each facility and did a good inspection, looking at what was damaged and what needed attention, and trying to figure out what was unsafe. Two of our buildings had pretty big issues. So, we met again the next morning, to come up with a game plan of what we were going to do with the two damaged buildings and to try and decide if we could work in them or not. I was able to get a team of engineers to those two buildings, and that group of engineers condemned both buildings. One of the buildings wasn’t one of our production facilities, so it wasn’t a big deal. But the other one was our main location, which is 15,000 square feet and usually has 40 employees there. When they said, “This building is condemned; you need to shut down business,” I asked them if it could eventually be fixed. They said they didn’t know, and that I might have to tear the whole building down. Yikes. We had almost 100 cars on site, and it was right before Christmas. We’re fortunate that we have other fa-

cilities to move employees to, but I couldn’t move everyone. The engineers left and my head’s spinning, like, “What the heck am I going to do?” I ended up getting more contractors to come in and give me more feedback. Seven days after the earthquake, another engineer comes in, and I told him, “Please realize that I’ll do any repairs and anything I need to do; but if you say we have to shut down, you’re talking about a major impact to 40 families.” We have every kind of insurance that we could other than earthquake insurance; something like 1 percent of all Alaska residents have earthquake insurance, because, if you’re a business owner, you would spend $100,000 per year just for the premium. Finally, I got in touch with one engineer that, as it randomly turned out, had been the engineer for the building in 1977. So, fortunately, he came up with a repair plan that let us keep our doors open. He wanted some cracks tended to right away, but then he also came up with a longterm plan … and he’s going to give it to us in order of priority, noting that some stuff needs to be done immediately, and some stuff needs to be done in the next 6 months. That’s how we handled the whole situation.

We luckily were able to keep the whole area open the entire time. But it was pretty touch and go for 7 days. That earthquake ordeal woke us up to the way that the facilities are laid out, and what equipment is stored up high and what’s not, and to consider if things could fall and threaten someone’s life. When you start stacking stuff on toolboxes, and stacking stuff up on top of things, someone could eventually get hurt. That process taught me to get much more detailed in my insurance coverage. Ten days after the earthquake, we sat down and did a full insurance review. We went through every policy and every option, just to make sure that we’re doing everything we can to have our policies in place as necessary. What that earthquake experience taught me, more than anything, was that it’s very important to stay very attuned with your insurance policies; if you’re not set up right, that can be the end of your business. Shop owners need to consider: if some bad, unexpected disaster happens like a tornado, hurricane, or flood, do you want it to be the end of your business, or just a bump in the road?

RYA N C R O P P E R is the owner of Able Body Shop, with three locations in Anchorage, Alaska, and Total Truck Accessory Center.

E M A I L : r c r o p p e r @ ab l e b o d y s h o p .c o m

March 2019 | fenderbender.com 57

STR ATEGY

CASE STUDY

THE KEY TO BETTER WIP M A S T E R I N G W O R K I N P R O C E S S I S V I TA L TO MOR E STR E AMLINED R EPAIRS

BY MELISSA STEINKEN PHOTOGRAPHY BY JESSIENA LAKE

58 fenderbender.com | March 2019

WORK IN PROGRESS...

SCHEDULING...

REPAIR ORDER...

March 2019 | fenderbender.com 59

STR ATEGY

CASE STUDY

here’s a reason why the company-wide vision statement of LaMettry’s Collision is, “Leading the automotive repair industry with commitment to the finest workmanship and treating all people and vehicles with the utmost respect.” Even before the creation of that vision statement, the sentiment was already a guiding principle of the family-owned, nine-location operation in Minnesota. It’s evident in the way CEO JoAnne LaMettry, the entire LaMettry family, and president of operations Darrell Amberson have helped grow the business and diversify along the way. It’s evident when you consider the OEM certifications, the involvement in the industry, the early adoption of advanced paint-drying equipment, the emphasis on training and the standardized processes that LaMettry’s has championed. Continuous improvement is simply ingrained in the very fiber of the company, and it’s helped the operation remain one of the most progressive in the industry. That pursuit of improvement is exactly why work in process, or WIP, has become so important to the shops in recent years. Defined as any vehicle that’s in the shop or on the lot, knowing the shops’ WIP is instrumental in controlling inventory, increasing touch time, raising efficiency, and decreasing cycle time. Building out the target WIP for the shops—by looking at the total number of book hours the team could produce per vehicle per day and using that as the foundation to determine capacity—illuminated to LaMettry’s the importance of properly scheduling vehicles, and the balance between under and overscheduling. By making changes to their processes, KPIs were improved across all facilities. And at the Eden Prairie location, roughly 20 minutes from downtown Minneapolis, Eric Johnson serves as the recently promoted regional manager of a facility that now fixes 80–100 cars per week.

The Backstory

Johnson started at the Eden Prairie location of LaMettry’s Collision 26 years ago. As general manager for that location over the last decade, he has helped tweaked repair processes and maintained the shop’s services before eventually becoming regional manager for five of LaMettry’s nine location in the southwest region of the Twin Cities. Johnson says the high-volume location, which has a 17,000-square-foot building with 40 employees, has always worked to improve upon making the overall collision repair experience a convenient one for the customer.

The Problem

As outlined, the shop has always succeeded in high customer satisfaction and high volume. But to ensure those remained consistent, Johnson says there was one 60 fenderbender.com | March 2019

area of the process that the LaMettry’s noticed was holding repairs back from being finished quickly and preventing an even larger goal—minimal supplements. The management team wanted to reach a point where the team only submitted one parts order throughout the repair. To do that required a smooth disassembly and complete teardown process. As LaMettry’s tweaked the repair process to achieve the goal of one parts order, they realized that WIP could be better managed at the Eden Prairie location, particularly as a means to reduce cycle time. That would help address a common issue in the industry, which is cars sitting on the lot waiting for repairs. “The amount of work you have on the lot can really make a difference in productivity,” Johnson says. In turn, poor productivity can affect

Refined Processes At LaMettry’s Collision locations in Minnesota, manager Eric Johnson (right) always looks to streamline repair procedures.

overall sales. The shop noticed that excessive WIP, as well as when the light and hard-hit repairs were not balanced correctly, rental costs increased. The LaMettry’s team realized that if it started a more thorough disassembly process in the shop and made sure every car was being taken apart “down to the nuts and bolts,” then not only would it shave time off the cycle time by avoiding delays or stops in the repair, it would also, by default, guarantee only one parts order.

The Solution

LaMettry’s first introduced a new process focused on blueprinting and disassembly to the team at the 15-technician Eden Prairie location. Changes to the old process included a blueprint for the final bill; taking more photographs of parts that needed to be

LAMETTRY’S COLLISION OWNER:

THE LAMETTRY FAMILY LOCATION:

MULTIPLE LOCATIONS IN MINNESOTA SHOP SIZE:

17,000 SQUARE FEET (EDEN PRAIRIE) STAFF SIZE:

40 (EDEN PRAIRIE) AVERAGE WEEKLY CAR COUNT:

80-100 (EDEN PRAIRIE)

not been blueprinted, do not have approval or parts ordered.

The Aftermath

LaMettry’s implemented the addition of a designated scheduling manager first at the Eden Prairie location because it was a high-producing shop. The rest of the LaMettry’s locations could also implement a similar process. With one person scheduling all the jobs coming in, the team learned that change can be difficult and that they definitely need a faster response time when giving customers the scheduling options. Today, the shop has an average weekly car count of 80–100 vehicles. The shop’s cycle time is typical of the industry. replaced; bringing in parts carts for parts to be sorted by damage or replace and stacked; and focusing on spending more time in disassembling the car when it first comes into the shop. The teardown process now includes the following steps: • Get permission from insurance company or customer. • During teardown process, add a parts carts and a table with the parts laid out and all labeled. • Designate a repair plan manager who is responsible for the blueprint. This person photographs everything and works with the technician for the blueprinting process. • The repair plan manager also will update the insurance company. To improve WIP, LaMettry’s also decided to designate one manager for scheduling. One year ago, Johnson as-

signed the former production manager to act as schedule manager in order to better nail the balance of scheduling work in the shop, he says. The manager now follows a day-byday process and adjusts the amount of small bumper jobs compared to bigger hits each day, depending on how many cars are in the lot. Johnson and his manager have learned over the past year that if scheduling is not looked at on a continuous basis, it can cause problems and cause cars to sit in the lot for a longer period of time. The scheduling manager looks at the number of vehicles scheduled, hours on each job, and the number of potential hours a job will have after the blueprint. Those areas are weighed against what is currently in production. Vehicles are prioritized if they are not production ready and if the vehicles have

The Takeaway

In order to handle the difficulties, Johnson says all team members need to be diligent and use good communication. An important part of the process, he says, is communicating how the scheduling works with the customer and within the team. Johnson and his team explain to customers what a blueprint is, what it means if the car is in disassembly, paint or body. For communicating as a team, it’s important that everyone knows what cars are in production. For better communication, the team focuses now on auditing and scheduling two meetings each day with the staff. In the daily meetings at LaMettry’s, managers make sure customers have been contacted, the team knows which vehicles are scheduled to be delivered that day and the next, and which files need more attention than others. March 2019 | fenderbender.com 61

STR ATEGY

CUSTOMER SERVICE

Overcoming Consumer Misconceptions Easy ways to put an end to confusion and get on the same page with your customers B Y K E L LY B E AT O N

At Bedford Autobody, a collision repair

“facts” bulletin hangs in the owner’s office. While the facts listed on the sheet are well known throughout the industry, Greg Bedford is surprised at how often he needs to explain its bullet points to confused customers. “You get customers that come in for the first time that have never dealt with a body shop,” says Bedford, the longtime owner of the Mountain View, Calif., shop. “Sometimes they can get intimidated, because they don’t know anything about the auto body business.” While we live in the midst of the Internet age, with ample information at our fingertips, that inundation of information can leave customers with misconceptions about industries, like collision repair. In Bedford’s experience, the only answer for collision repair shop staff is to be as forthcoming as possible. “I just explain the whole process,” says Bedford, a veteran of 38 years in the industry. “I tend to talk to everyone like they’re my friend. I’m honest with them.” And, Bedford often refers to the collision repair “facts” list on his office wall to start the conversation. He recently explained to FenderBender the full extent of how he addresses the common misconceptions that customers have about collision repair. MYTH: Customers are required to get

multiple estimates. REALITY: It’s the first item listed on Bedford’s trusty facts sheet in his California shop: “No law requires you to get more than one estimate.” Bedford is stunned at how many customers are completely unaware that they’re not obligated to use any particular shop for repair work that their insurer suggests. He tells customers they’re perfectly free to take their business to their father’s 62 fenderbender.com | March 2019

favorite body shop 30 minutes away, if they prefer. “You choose the shop and authorize that repair,” he tells clients. “The main thing is, you’re the legal owner of the car, no matter what state you live in. The insurer doesn’t own your car; they can refer you to a shop, or they can recommend one of their own shops. But you don’t really have to choose any of their recommendations.” MYTH: ‘Like Kind and Quality’ parts are

new parts. REALITY: “LKQ,” clearly, is an acronym with which most consumers simply aren’t familiar. So, if they hastily Google search “like kind and quality parts,” they may misguidedly think they’re getting OEcaliber parts. “Some people are confused by the written statements in their [insurance] policy,” Bedford notes, “when they read, ‘Do you agree on accepting ‘like kind quality’ parts?’ That’s a major misconception.” And, because of that misconception, all too often, Bedford sees owners of high-end vehicles like BMWs irate that their cars ended up being repaired with aftermarket parts. “The term ‘like kind [and] quality parts’—who would know what that means?” Bedford says. Customers, “just think, ‘Oh, that must mean new parts.’ Well, it doesn’t. It means, if you get into an accident, you agree that, by signing here, that we use aftermarket parts on your car." And, when they get in an accident, and their adjuster comes to my shop to write it out, they’ll have in that estimate [demands for] aftermarket hood, aftermarket fender.” MYTH: Insurance companies cover any

and all repairs. REALITY: One issue that often creates confusion among customers, in Bedford’s experience, are situations like

the following: A customer’s vehicle endures a sideswipe collision, leaving the left front corner of the bumper scratched, with a scratch that extends from the fender across both driver’s side doors to the quarter panel. Occasionally, Bedford says, insurance adjusters will argue that part of the scratch is unrelated to the bumper’s scratch, and will refuse to cover each segment of the vehicle’s damage. That creates a big issue for shop owners.

“It’s like buying something from Best Buy, and Sony has their own warranty. You really don’t need the insurance company’s warranty.” To assure customers, Bedford explains his shop’s typical process—that it’ll take photos of vehicle damage, write an estimate, put the claim number on an estimate, and forward that documentation to any insurance company. And, from there, he adds, insurance companies typically approve the necessary repair. MYTH: Only a dealership can restore a

“There’s the problem that we face a lot,” Bedford says. “We have to call the owner and have them get involved with the insurance adjuster and let them know that the rear scratch was, indeed, part of the [collision]. … So there’s some tricky stuff there.”

THINKSTOCK

MYTH: Insurers won’t honor all lifetime

warranties. REALITY: At Bedford Autobody, estimators often find it necessary to sit customers down and thoroughly explain

the ins and outs of lifetime warranties. Because, according to Bedford, customers are sometimes told by insurers that their company can’t necessarily cover repair work at every body shop. “The insurance company [sometimes] says, ‘Because you’re not going to one of our shops, we can’t give you that guarantee and that lifetime warranty,’” he says. “But you really don’t need their lifetime warranty; you need the lifetime warranty from the body shop that you’re bringing your car to.

vehicle to pre-accident condition. REALITY: There’s a perception among many collision repair customers that dealership repair centers will perform unparalleled work. Because of that fact, Bedford feels that independent shop owners like himself need to sell the experience of their staff, and be as transparent as possible with customers. “I tell them I’ve been in business for 38 years—I’ve got guys working for me up to 30 years—and that you can get really, really good work here,” he says. “I’ve got five-star reviews on Yelp, I’m highly recognized within my area, and we have repeat customers all the time.” And, he further illustrates how honest his staff is by showing customers exactly why repairs cost what they do. He also clearly explains why supplements may eventually be required during the repair process. “I’ll bring a customer over to my estimating software and show them the diagram of the bumper, to show them what I’m replacing,” Bedford explains, “so then they’re sitting right next to me, looking at my screen, they’re seeing the same thing I’m seeing, and they know exactly what parts I’m choosing. That way, they have trust in my business. “It’s better to just have the customer sitting next to you, so that they can look at your computer screen, so that they can [see] that you’re being honest with every estimate that you write up.” March 2019 | fenderbender.com 63

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