Hundreds of collision repairers turned out for a meeting Dec. 3 in Baton Rouge, La., to determine if there was enough interest in starting a trade association in Louisiana.
“It seems the insurance companies have pushed us around enough and I feel they have now awakened a sleeping giant in this industry,” said Alysia Hanks, office manager of Lakeway Collision Center in Mandeville, La., and organizer of the event.
According to Hanks, repairers from associations in Texas and Tennessee told her it was the largest crowd they had ever seen for such an event.
Hanks felt there was a misconception among some individuals that she and other repairers in Louisiana were forming the Louisiana Collision Repair Association to team up for a class-action lawsuit against State Farm. But she reiterated that this was not the case.
“Any shop that pursues that is doing it as an individual,” she said. “We will, however, work on changing Louisiana’s collision industry for the best through support and education together. With this association, when I show up at the commissioner’s office alone, I know I won’t truly be alone because I’ll have the backing of 200 shops across the state I’ll be representing.”
Steve Plier, Alabama Automotive Repair Industry Society of Excellence founder and president of Consumer Auto Repair Excellence, kicked off the meeting by introducing himself and outlining his background and credentials. Plier resigned his position at State Farm after almost 23 years, saying he could “no longer look at himself in the mirror every morning” and continue in his capacity as a supervisor. He made the observation that the collision repair industry has become one that’s controlled by fear.
“The person sitting next to you is not your enemy," said Plier. "The person sitting next to you shares your goals and aspirations. Your very presence here tonight is a signal that you understand that the time for taking back control of your business is now.”
John Mosley, president of the Mississippi Collision Repair Association, pointed out the many advantages of association membership. Entertaining the crowd with a few colorful stories about his own personal struggles in taking back his business, he drove home the current state of the collision repair industry and what must be done if it is to survive as an industry comprised of independent small businesses. Insurer intrusion with programs such as PartsTrader, labor rate suppression, refusal to recognize and compensate for procedures necessary to properly repair vehicles, and one-sided DRP agreements were just some of the issues he identified as being in urgent need of correction. He also reiterated that the time to take a stand is now.
Attorney John Eaves Jr. followed Mosley, continuing to advance the notion that curing what ails the collision repair industry is bigger than anything any individual by themselves can accomplish. He also spoke of his amazement that any business could operate successfully under the current circumstances faced by collision repairers and questioned why no lawyer has ever successfully taken on the job of righting the wrongs.
Eaves restated an analogy he has frequently made during the many gatherings he has attended over the past year, comparing PartsTrader to a virus that has the potential to infect the collision repair industry and something that must ultimately be recognized as a consumer issue. Eaves advanced the opinion that the majority of the problems faced by the collision repair industry can be traced back to a failure to recognize and enforce the 1963 Consent Decree, a failure he is endeavoring to correct.
Economist Dr. Fred Jennings opened his segment by saying, “By coming together, you can accomplish things not possible otherwise,” a conclusion that emerged as a common theme for the evening. Jennings, who has extensively studied the collision repair industry, focused on labor rate suppression as compared to other trades with similar levels of training, skill and investment. He held to the opinion that the financial requirements necessary to succeed in the collision repair industry exceed those of the auto mechanical repair industry, yet the rate of compensation is less than half of what would be appropriate if it were not for influence from the insurance industry. He presented methods for establishing the cost of providing goods and services and establishing what a true rate of compensation should be when taking variables into consideration, concluding that only when all businesses determine for themselves what an acceptable level of profitability should be would a true free market business environment be possible.
Ron Peretta, shop owner and industry consultant, wrapped up the evening by encouraging shop owners to learn how to manage their businesses. He spoke of “creating a brand” by marketing, not simply advertising, and explaining the difference. He made the point that the path to successful marketing and customer loyalty can only be accomplished by establishing and maintaining four things: level of service, repair expedience, value, and foremost, consistency. These things, Peretta said, make it possible to overcome the adversities presented by insurer steering, short pays and rate suppression. He also stressed the importance of never giving up and never compromising the standards set by the business owner.
Hanks said she will be arranging a meeting with the group’s attorney the week of Dec. 9 to make the new association official. The next step will be to establish a core board and elect a president. She is hoping that the association will be in place in time for the multi-association meeting on April 11-12, 2014, in Biloxi, Miss., where Texas, Alabama, Mississippi, Tennessee, Florida and Georgia will be represented.