by Angie Wilson
ASA's Vice President of Marketing and Communication
"We, as an industry, repair a lot of cars for practice," said Steven Feltovich, Sherwin-Williams Automotive Finishes Corp., in a Saturday morning Congress session at NACE. If your volume is up and your profits are not, you're giving away a lot of work, he explained to attendees.
Profit is based on writing accurate estimates, said Feltovich. "It begins and ends with the estimate," he said. "When it comes to low profits, there are always lots of excuses and no good reason ... it always points to the estimating area."
Feltovich stressed the goals of insurers versus collision repair facilities, saying: "In a lot of cases, they will control their costs at your expense if you're not paying attention. That doesn't make them bad guys," he stressed, "But, be informed. The most informed always wins in negotiation."
Key to estimating for profit is "blueprinting," says Feltovich. "Get ahead of that wave, not behind it." Damage analysis on the front end is vital to profitability.
"The winning edge is a daily commitment to individual improvement," he added. "The way our industry is going, if you don't want to change, you won't survive." Insurers are statisticians and mathematicians," he said. "Their idea is to write for the least amount possible to control costs. Your idea is to write for profit."
The benefits of writing accurate estimates include reduced cycle time, decreased administrative time and costs, increased CSI ratings and improved relationships between shops and insurance partners.
Feltovich drove home to attendees the value of understanding the true effect the estimate has on your business. He also pointed out that, as professionals, the repair shop must be the ones determining the repair plan. The repair facility is liable for that repair - it must be in control.
Estimates basically influence everything in the repair process, from revenue and profits to quality to employee morale.
"You have to do the diagnosis work ... The winners are paying attention to damage diagnosis," Feltovich said, "They know that damage analysis is critical."