North Hollywood Auto Repair benefits from location ... - Parts & People

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Collision Repair Recycled parts can aid in DRP favor and profitability, NACE speakers say by Michael Anderson New Orleans—Multiple DRP requirements, coupled with the demands of operating in a lean environment, have created a slim margin of error for many collision repairers. However, using recycled parts can help owners meet their bottom line and at the same time gain favor with insurance partners. That was the key message of Dave Damon and Jeff Schroder, of Carpart.com, at a seminar, “Using Recycled Parts in a Lean Environment,” held during the International Autobody Congress & Exposition (NACE) at the New Orleans Convention Center on Oct. 11. “In a lean environment, things have to happen and you expect them to happen,” Damon told an audience of collision industry professionals. “Cycle time is a driving force in the business today.” DRP expectations Insurers are under great pressure to confirm part availability, said Damon, who has extensive experience with insurance companies. So owners need to show evidence of “shopping” for a mix of Original. Genuine Mazda Parts are made from the same blueprint as the original parts and guarantees the same fit, performance, and durability as the day the vehicle was built. Genuine Parts Jeff Schroder of Car-part.com points to a panel damage chart that aids recyclers in communicating with collision repair shop personnel on damage location. OEM, recycled, and aftermarket parts for each job, he said. “Insurers asks themselves: Is ‘my’ shop spending my money as wisely as possible?” Damon said, referring to parts procurement. Wishing you a joyful Holiday Season. Contact one of these local dealers for assistance and delivery of your Genuine Mazda Parts. Glendale, CA Star Mazda 818-247-2123 • Fax: 818-246-6901 Van Nuys, CA Galpin Mazda 866-665-2365 • 818-778-2005 Fax: 818-778-2090 Irvine, CA Tuttle-Click Mazda 866-940-4444 • 949-472-5230 Fax: 949-472-0327 “Meet the insurance companies’ expectations and you don’t fall under a watchful eye so often,” he said. Alternative parts usage is a measuring stick or key performance indicator (KPI) that can vary greatly by shop type, he said. BMW specialists, for example, may have only 15- percent alternative parts usage, he said, because there aren’t many choices in collision parts. Other KPIs that alternative parts usage may impact are repair vs. replace ratios and labor hours per estimate, he said. Another frequently scrutinized item is refinish times, he said, noting that insurers think they should be one-third of overall labor hours. “The trend with insurance companies is to direct more work through ‘their’ shops,” he said. “If you meet their KPIs, you’ll likely get more work.” How much damage? “If a part arrives and requires significant work, it could cause problems,” Damon said, adding that good communication with a recycler who adheres to grading systems helps limit such problems. “Some people look for parts with no damage,” Schroder said. “But you can make some money fixing (recycled) parts. The fit is as good as the OE part.” “Meet the insurance companies’ expectations and you don’t fall under a watchful eye so often.” When ordering parts, Schroder recommended using VIN decoding, which takes some of the guesswork out of the process. To determine extent of damage, many recyclers use the credit-card method of measurement, Schroder said, adding that this can be applied to the length of a scratch, for example. A credit-card length is referred to as a unit of damage, and some recyclers even break it down into one-fourth of a unit, he said. Two-thirds of recycled body parts sold use the Automotive Recyclers Association (ARA) grading system, he said, pointing out that “000” means no damage, and “A” indicates three units of damage or less, “B” six or less, and “C” more than six. The ARA damage codes indicate the amount and location of damage, he added. Damon said that damaged panels will often work in the repair process because only a portion of the sheet metal may be needed to fix the car. Greater profitability If a shop is being paid on markup, it has a chance to make additional money, he said, not to mention that the insurer can be charged for the additional labor. For example, if a front clip is purchased, the cost for the total unit can save time and money. In some cases, he said, using recycled parts can save a car from being totaled, and make sure the shop gets paid for the estimate it wrote. “If you’re buying a door, the question is: What comes with that door?” Schroder said. ARA standards dictate that the mirror isn’t included on the door. The technology found in mirrors has drastically increased their price, he said, so “if you’re getting it, it’s a bonus.” With damage, 80 percent of recyclers use actual pricing for parts, while the remaining 20 percent use “undamaged” pricing. If a recycler doesn’t pay for cleanup time, that has to be accounted for on an estimate, he said. For example, if a recycled $500 door is on the estimate, and $100 is required for cleanup, the insurance company must be billed $600. Other recyclers will negotiate price for damage at the time of purchase, he said. n Page 14 December 2012 Parts & People www.partsandpeople.com
Santana’s excels with higher standards for customers with higher expectations by Dick DeLoach Ontario, Calif.—Santana’s Auto Body is a full service collision repair shop, Owner Mike Santana said, specializing in high-end vehicle repair, with the latest equipment, I- CAR-trained and BASF-certified technicians, and a loyal clientele of high-end vehicle owners with high expectations. “It’s taken 28 years to get to this point,” Santana said. “It was just a one-man operation in one small building when I opened it.” With the help of his wife and CFO, Patricia, the shop now has nine employees and has expanded into a 27,000- square-foot facility in two lots with three buildings, he said. Its body technicians are certified on the shop’s three Chief EZ-Liner frame machines and Chief Velocity computerized framemeasuring system, which Santana said he bought through paint supplier contacts from shops that were closing. “Our body technicians are also certified on our Electron computerized resistance spot welding machine purchased from Equip Automotive Systems,” he added. “Joe Becerra from Equip trained our technicians on the welder and provides service and maintenance.” The shop sprays BASF Glasurit 90 waterborne products exclusively, purchased from D’Angelos Group, in its cross draft paint booth, Santana said, and refinish technicians are Glasurit 90 certified and trained by BASF. “Our shop is a BASF/Glasurit Lifetime Refinish Warranty Center, which means we can do warranty refinishing work for Mercedes-Benz, BMW, GM, Cadillac, Toyota/Lexus, Ford, and other high-end vehicles,” he said. Santana said the office staff and estimators are all trained in the CCC estimating system and certified in Summit Software Solutions management system. “We use OEM parts when possible, purchased from dealerships including Mark Christopher Auto Center and Crown Toyota, and Metro Nissan,” Santana said. “We also buy from Keystone-LKQ for certain recycled parts.” The shop does work for several local dealerships and has several fleet accounts, including CLS Landscape Management, Tropical Foods, Ontario Refrigeration, as well as for independent mechanical repair shops that Santana said represents 10 percent of total sales. “We also have a detail department, do paintless dent removal, custom pinstriping and graphics, and we do a lot of insurance work, but we have no DRPs,” he said. “Most of our business comes from repeat customers and referrals.” Co-owners of Santana’s Auto Body, Mike Santana and wife/CFO, Patricia, take pride in their shop and the high-quality work and personalized services they have provided customers for 28 years. Embracing the smart-phone app phenomenon, Santana said he is a participating “Help I Crashed My Car” shop, which has brought in additional business. “A customer just downloads a free app that gives them a one-click automated emergency communication system that contacts up to three family members, their insurance agent, and their preferred body shop.” Santana said because it’s GPS based, it also sends a map of the accident location to the shop so they can respond immediately. “It even provides the user with an accident report and the ability to take photos of the accident scene and send them to their insurance company and/or their preferred body shop. “We are currently in the process of putting together an e-mail and text messaging marketing process that will interface with our management system to capture all customer data,” Santana said. “This program will allow us to customize and track promotions and coupons.” The challenge in the industry today is that the pie is shrinking, Santana said. “Fewer cars are being repaired because of total losses, consumers are cashing out and not repairing their vehicles, and consolidators and MSOs are growing and taking more market share.” However, he also sees opportunities. “Now, more than ever before, independent shop owners have the opportunity to own their customers without any major investments, by marketing directly to Continued on page 16 LKQ’s Winning Season Promotion is Back! Now thru December 16th, 2012 participate in LKQ’s Winning Season promotion to WIN great PRIZES including licensed NFL® apparel & LKQ Footballs. PLUS, One GRAND PRIZE winner will receive an allexpense paid Super Destination Trip to New Orleans for the game on Sunday, February 3rd, 2013. MERCEDES-BENZ SUPERDOME NEW ORLEANS, LA Look for game pieces on products at your participating LKQ & Keystone locations and you could win some great prizes! Parts & People December 2012 Page 15
Page 1 and 2: FOCUS ISSUE New Technology, Product
Page 3 and 4: New Technology, Products & Practice
Page 5 and 6: Growing trend of extended terms pos
Page 7 and 8: AASA Executive Breakfast and AAIA T
Page 9 and 10: Parts & People December 2012 Page 9
Page 11 and 12: TIA TPMS Town Hall says consumer ed
Page 13: Seasons Greetings 2012 INSTALLER AN
Page 17 and 18: NOW THE BEST IS EVEN BETTER DPLV 2.
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Page 21 and 22: More Opportunity. With the strength
Page 23 and 24: WHAT DO DEPO LAMPS MEAN TO YOU? GET
Page 25 and 26: Miramar collision center uses custo
Page 27 and 28: Record-breaking vehicle sales in 20
Page 29 and 30: APRA/ATRA joint show offers busines
Page 31 and 32: Former Carstar CEO reveals common l
Page 33 and 34: Kia and DC Comics unveil five super
Page 35 and 36: The Mirage, Las Vegas January 21-24
Page 37 and 38: Continued from page 28 Interlink Me
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