'What Would You Do?'

Posted 5/15/2012
By T.J. Reilly, AAM

Editor's note: Shop owners run into "situations" all the time - situations that leave them scratching their heads, trying to figure out how to resolve the issue fairly to everyone concerned. They want to make the right decision in solving a dilemma, but things are not always black and white. Sometimes there are gray areas. Following is a good example of just such a dilemma. What would you do?

This situation comes from Mike Buckridge of Sun Automotive in Springfield, Ore.

Buckridge said, “We do a lot of work for a local body shop. Last year, they spent more than $36,000 with us.   

“Three years ago, we did an alignment for them on a Subaru Outback. The customer’s tires wore out 19,000 miles after we did the alignment. The customer then went to a competitor and had all four tires replaced with better tires than the ones that wore out, along with another alignment. The total cost was $880. The body shop – without calling us – immediately wrote the customer a check for $880.

“The body shop owner is now asking us to reimburse him. We have no way of knowing whether the customer hit a curb since we did the alignment. If this customer had been coming to us for regular maintenance, we would have caught the problem before the tires wore out prematurely.

“What would you do?”

Terry Steenholdt, AAM, owner, T.D.S. Auto Repair Inc., Sioux Falls, S.D. – “It is not a good thing to lose a customer, and a fleet account of this size could hurt. I would first review this fleet account, not just looking at gross dollars, but also at the profit dollars per hour the fleet account generates. IF it is determined that the fleet customer should be saved, I would call and schedule a face-to-face meeting with the owner of the body shop. Not having any input to the customer already being paid, three years after the fact, I would have a hard time writing a check of any size. The conversation between the two owners should tell the story. Depending on the outcome of the business meeting, I might write a check for partial payment, NOT for the entire amount. A quality customer would not have made a decision about my money without my input.”

Tim Cummings, AAM, general manager, Rick’s Automotive, Springfield, Mo. – “This is a very interesting situation, a real dilemma. Do I stick to my principles, questioning whether the individual hit a curb to cause the problem, or do I keep a good customer? If I were in Mike’s situation, I would cheerfully refund the $880 (if you give a refund, always be cheerful about it) and take it from my advertising budget. If I only had to spend $880 in advertising to get $36,000 in business, I would consider this a good investment.”

How Mike Buckridge handled it – “We felt like the customer may have taken advantage of the body shop, but the body shop had a policy of taking care of its customers – whatever it takes.

“We were not happy having to fork out $880, but this was a business decision that was going to make everyone involved happy. We maintained our relationship with the body shop and even received a call from the insurance company representing the customer thanking us for being an organization that stands behind its work. They even offered to send us work in the future. Sometimes it’s just the cost of doing business.”

How T.J. Reilly would have handled it – “I think some negotiation would have been in order in this case. If it had been $100, that would have been one thing, but $880 is quite another.

The body shop had a responsibility to contact the repair shop before refunding the customer $880. The customer had a responsibility to the body shop to contact them before having any warranty work done. It would only have taken a phone call on the part of the customer and on the part of the body shop.

Since the body shop paid the customer without contacting the repair shop, I would have negotiated to pay 50 percent. This would have shown my good faith as well as taught the body shop to call me first before refunding money they expected me to pay.

I don’t know of any tire store that would have bought this customer four tires after three years, especially if they never came back to have the tires rotated or inspected. In addition, I highly doubt that the original tires were new when the shop did the alignment, or that they were worth $880. If the insurance company had been liable, it would have surely discounted the payment based on the amount of wear on the old tires and their original value.

T.J. Reilly, AAM, is the owner of Same Day Auto Service, an ASA-member business in Clackamas, Ore. His e-mail address is TJ@SameDayAutoService.com.

Would you like to participate in an upcoming “What Would You Do?” feature by saying how you would handle the problem? If so, just email your name and the name of your shop and its location to Levy Joffrion, assistant editor of AutoInc., at levyj@asashop.org.