Insurer panel among the highlights as NACE returned to ‘The Big Easy’ by John Yoswick New Orleans—Seventeen years after it was last in New Orleans, the International <strong>Auto</strong>body Congress and Exposition (NACE) strolled into The Big Easy this fall. Although the show was significantly smaller than it was back in 1995 — and even slightly down <strong>from</strong> what it was just last year in Orlando — NACE organizers said attendance at key events during the show was up, and some major exhibitors that had been absent were back among the approximately 220 companies on the show floor. The opportunity for education and networking remains one of the major draws for NACE attendees, and this year’s event offered more than 80 sessions. One of two “Collision Forums” included a 45-minute panel discussion featuring representatives of three major insurance companies. Among the key questions they addressed was how they view the growing prevalence of multishop operations (MSOs). George Avery of State Farm said his company worked with the California-based consolidator M2 before that 27-shop chain suddenly closed its doors back in 2005. “With M2 going out of business along with some other things, we recognized that All six editions, one great price! NORTHERN CALIFORNIA SOUTHERN CALIFORNIA Collision Supplement advertisers enjoy a targeted audience at a pro-rated price. For rates, contact Jay Sicht 800.530.8557 • jay.sicht@partsandpeople.com NORTHWEST • Washington • Oregon • Idaho • Montana • Alaska www.partsandpeople.com MOUNTAIN • Colorado • Wyoming • W. Kansas • W. Nebraska • New Mexico MIDWEST • Missouri • Kansas • Nebraska • Iowa RIVER VALLEY • Missouri • Illinois • S. Indiana • W. Kentucky our focus really needs to be on individual repair facilities,” Avery said. “We felt that anybody should be able to compete, so we really backed off. The big difference with MSOs in my mind is that they are getting a lot more successful at being able to replicate. And as a result, that makes them very attractive as a group. But State Farm maintains that whether you are an independent or an MSO, you should be able to compete. And so State Farm evaluates even MSOs as individual repairers.” Avery said that just as he sees variation in the attitudes and abilities of State Farm’s 3,000 staff estimators, he knows MSOs have a challenge getting every one of their shops operating in the way the corporate office wants them to. “There’s something to be said for having skin in the game, if your name is on the company sign,” Avery said. “I’m not discounting the MSOs’ ability, but I am saying that those with individual repair facilities have skin in the game, and that can have a lot of value on the customer service side, which we’re all after.” Still, Avery said, MSOs present an “interesting platform” for experimenting with change on a large but not national scale. “You hear people talk about how the model is broken,” Avery said. “There are components of change that could be perhaps introduced into an MSO that you couldn’t quite introduce companywide. So I feel compelled to tell you, not to make anyone nervous about MSOs taking over, but I do have to say that that is a place where you could possibly go and say, ‘Look, we’d like to try something different.’” Other insurers concur Rob Knott, who is responsible for Nationwide Insurance Company’s direct repair network, agreed that his company evaluates performance on a shop-by-shop basis. “We think the mom-and-pops still have a place,” Knott said. “Some of the challenges Rob Knott of Nationwide Insurance said his company evaluates the performance of even multiple shop operations on a store-by-store basis. Allstate’s Randy Hanson said he likes some of the approaches he sees larger shop operations taking, such as extended shop hours. that the MSOs have is over-saturation in certain marketplaces, so you’re not going to put all their shops in a market on the direct repair program. And then there’s the consistency issue, when they expand too fast and aren’t able to maintain the same service levels and quality.” Still, Knott said, MSOs do offer an insurer some appealing values, such as a single point of contact and call centers. Randy Hanson, director of auto claims for Allstate, said that like the others, his company believes each facility, even if part of an MSO, has to stand on its own performance. But he does see MSOs taking some new approaches. “If you go to some of the banking or venture capital people and say, ‘I want to spend $3 million on a collision repair facility. I want to buy a fancy building and put equipment in it. And guess what? I’m going to use it about 30 percent of the time,’” Hanson said, “I don’t think Continued on page C-4 Page C-2 December 2012 <strong>Parts</strong> & <strong>People</strong> www.partsandpeople.com
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