How to Manage Supplements and Reduce the Cycle TimePosted 3/11/2008
By Leona Dalavai Scott
Many collision repairers have accepted the fact that supplements are unavoidable and have treated them as a familiar part of the collision repair landscape. By definition, a supplement is created if a change or addition must be made to an estimate where a final blueprint has been produced.
The definition sounds innocent but what is happening in body shops all over the country is that as a result of a poor or mediocre estimating job, the occurrence of supplements is leading to all kinds of inefficiencies such as increased cycle time and loss of profits.
What is a collision repairer to do?
Mike Schoonover of Schoonover Bodyworks Inc., St. Paul, Minn., is chairman of the Insurance Subcommittee for the ASA Collision Division Operations Committee. He believes supplements is one of the top issues facing the industry. He is not alone.
The Collision Industry Conference (CIC) also sees supplements as an inherent part of a vicious cycle for collision shops. CIC uses a training graphic titled "Cycle of Insanity" to explain the cyclical pitfalls of the process.
For instance, a collision estimator may have the best intentions for carrying out an accurate estimate once a customer walks in the door. But what routinely happens is while the estimate is taking place, other fires arise, resulting in estimators hurriedly finishing up an estimate so they can deal with the pressing problem. As a result of the inaccurate or rushed estimate, unrealistic expectations may be shared with customers as to when they will get their vehicles returned to them. Unrealistic expectations for a delivery date - coupled with an inaccurate estimate - results in delays, thereby extending the cycle time. Then another customer comes in and the cycle is repeated.
How can a shop reduce its number of supplements to a repair job? Schoonover says that reducing the number of supplements starts with a desire on the part of the estimator to do a good estimate.
"There is no doubt that an estimator who knows his/her stuff is technically sound, has good work habits, is organized and knows the collision repair processes will surely reduce the supplements," said Schoonover. "The inexperienced estimator will have more supplements, errors, etc. And the cycle time will usually be longer as well. If the estimate is not written well from the beginning, there will be more problems, issues, delays, etc. If they have the desire, they will learn, and become better estimators. I would take lack of experience over lack of desire any day. The experience will come. It requires good training, and patience. However, lack of desire is a trait you cannot manage or 'train.'"
Craig Griffin, an adviser at Laney's Collision Center Inc. in El Dorado, Ark., agrees with Schoonover that problems for a shop increase when there are more supplements. He says a high number of supplements creates a production and administrative burden on his shop.
"When all damages are not included on an estimate, it's not a true blueprint," says Griffin.
"From a production standpoint, we may not have enough parts and would have to order more. Also, from an administrative perspective, additional supplements create more paperwork on our part. That is time for which we don't get paid. We get paid for fixing cars, not managing the paperwork that supplements create."
In addressing how to get as accurate an estimate as possible, some shops are evaluating the whole process of how they gather an estimate.
Mike Quinn, owner of 911 Collision Centers - with shops in Tucson, Ariz., and Las Vegas - is co-chair of CIC's Business Management Committee and has been involved in coming up with a new process called Complete Repair Plan (CRP) System whose end goal is reducing or doing away with supplements altogether.
Quinn believes that shops need to approach their estimating process with a "Zero supplement mentality." "Having zero supplements should be our end goal," he says. "If the estimator isn't efficient, a shop cannot survive. We have to change how we look at the entire process."
A collision repairer for 26 years, Quinn has adopted the CRP System in several of his shops and has reduced his supplement rate to around 2 percent to 4 percent, which is very low, he says. One of the big differences between a traditional repair plan system and the CRP system is that within one hour of a customer dropping off a car, the shop does a methodical disassembly of the vehicle. This important step allows for a thorough inspection of the vehicle, which in turn produces a more accurate estimate. The dismantled vehicle and initial appraisal are reviewed by a team of staff members looking for deficiencies.
In the traditional method of repairing a car, a shop may go through an initial estimate and pre-order parts only to find out that when the damaged vehicle comes in for the actual repair, there are many other items that are supplemented to the original estimate and more parts must be ordered. This obviously wastes time and money, and extends cycle time.
Quinn says reducing supplements is all about being as efficient as possible. Having multiple supplements is not acceptable and it's not efficient, he says.
Dan Olsen, an estimator with Lehmans Garage, Bloomington, Minn., says his shop tries to tear down a vehicle within two hours of when the customer drops off a vehicle. The teardown process allows them to visually inspect everything thoroughly, because, he says, "You can't write an estimate for something you can't see."
Olsen says the quickness of the teardown also helps them identify which parts to order at one time and not multiple times. "Sometimes for foreign parts, it may take a long time to get a part because we may have to get it from overseas," he says. By pinpointing the needed parts early, he explains, it keeps the job on track and it's more likely to be on time.
Adds Schoonover, "If you can tear the vehicle down while writing the estimate at the same time, you will be sure to get most, if not all, of the damage identified. Most technicians would prefer to have an accurate estimate written, order all parts, then be able to perform the repairs with no stoppage in work. Besides, four eyes are better than two."
Of course, a teardown is not always an option if the vehicle comes in and it's in driveable condition. In those cases, seasoned estimators advise that you need to be as thorough as you possibly can and take your time in conducting the estimate and not do a "rush job."
Olsen has been working in the industry for a long time and has found that as a result of new procedures and new ways of doing things - like a quick teardown - Lehmans Garage has reduced its supplements and just averages about two supplements per job.
"Taking the extra five minutes on the front end," says Schoonover, "could save days, if not weeks, of repair time." And reducing cycle time - for the collision repair industry - is the name of the game.
Tips on Writing a Proper Estimate
Here's what the pros interviewed for this article recommend to other estimators on how to write a proper estimate to reduce the number of supplements.
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