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99-Cent Burgers and the ‘Prevailing Rate’ in Collision Repair

If McDonald’s and Burger King charge 99 cents for their burgers, then all restaurants should charge 99 cents for their burgers.

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FLAWED LOGIC: If McDonald’s and Burger King charge 99 cents for their burgers, then all restaurants should charge 99 cents for their burgers.

What happens when a body shop owner tries to apply the insurance industry’s logic of prevailing labor rates while ordering a burger at a restaurant?

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Well, you get a hilarious – and awkward – exchange between the shop owner and the server (and her trainee).

“The prevailing rate for a hamburger is $1 – basically 99 cents,” the shop owner says to the server and her trainee. “McDonald’s and Burger King charge $1 for their hamburgers. So the prevailing rate in this area is $1. I’m not paying $9.98. I’m gonna pay $1 – that is the prevailing rate.”

Before things get too awkward, the shop owner tries to explain the concept of prevailing labor rates in the auto body industry.

“I own a body shop, and the prevailing rate for body work is $42 an hour,” he says. “The mechanics get $95 an hour, and a lot of times they do the same procedures that we do, and they get $95 an hour but we only get $42 an hour, because the insurance companies say that’s all they’re gonna pay because it’s the prevailing rate.”

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By that logic, he continues, the prevailing rate for a hamburger is $1.

“I know this hamburger is a lot better than McDonald’s or Burger King,” the shop owner says. “My body shop is a lot better than any other body shop in town. But I can only charge $42 an hour.”

To view the video, which StopDRP.com posted to YouTube in 2014, click here or watch below.

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