Mis-Guided: The Estimating Systems Are Guides, Nothing More, Nothing Less - BodyShop Business

Mis-Guided: The Estimating Systems Are Guides, Nothing More, Nothing Less

The estimating systems are guides, nothing more, nothing less – even the providers say so. Yet somewhere along the line, repairers started treating these guides as law and handing over control to the insurance industry.

“That’s all I can pay – that’s what [insert name of data provider] shows.”

Sound familiar?

On one of the industry’s Internet bulletin boards, I recently read a post titled, “Focus Write save us!” While Focus Write (from the people formerly at CompEst) may indeed prove to be the best estimating system yet conceived, it is not the answer.

The problem is that too many people give too much weight to the estimating systems. The funny thing about this is, it’s not even the data providers who are claiming them to have authority.

The “Big 3” database providers – ADP, CCC and Mitchell – all have a disclaimer in their P-page sections that essentially says something to the effect of, “This is only a GUIDE.”

The very creators of these programs tell everyone they should only be used for guidance, so who’s pushing them as “factual” and/or authoritative”?

The insurance industry.

New, Undamaged Vehicles?
Another interesting aspect (it’d be humorous if it weren’t so serious) is that the times listed in these guides are based on installing parts on vehicles that haven’t been in an accident:

“Operation times listed are based on new, undamaged parts installed on new, undamaged vehicles.” (CCC/Pathways);

“Labor allotments suggested by ADP estimates are for replacement of new and undamaged parts.” (ADP);

“The labor times shown in the guide are in hours and tenths of an hour (6 minutes) and are for replacement with new, undamaged parts from the vehicle manufacturer on a new, undamaged vehicle.” (Mitchell/Ultramate).

Say what?! I don’t know about you, but I have never, in my entire career, repaired an undamaged automobile. This means additional time – above and beyond what’s shown in the guide – should be considered when repairing damaged automobiles. You know, when the fender is folded over the mounting bolts on the upper rail or when the reinforcement is mashed tightly against the rear body panel.

Actually, what this means is that any time the vehicle is damaged, additional time should be considered. It says so right in the P-pages.

For a while, I used to add something like, “Access damage – 1.0” to the estimate. But then I started thinking that more lines equals more money. (A general rule of thumb: It’s harder to cut times when it’s only a little added here and there than it is when the time is all in one lump sum). So I began to write things like, “Access fender mounting bolts (damage area) – .5,” “Pre-pull upper rail to access engine compartment components (i.e.: washer reservoir, radiator overflow, battery tray, etc.) – .6,” “Access front bumper cover mounting hardware (right side) – .3,” “Access right front door hinge bolts – .3.”

Rather than settling for a lump sum of 1.0 – which the insurance appraiser often reduced – I assessed each operation in the impact area and assigned a time to access it individually. So instead of 1.0, I wrote 1.7. Even if the appraiser cut .1 from each procedure, I was .3 ahead of the 1.0 lump-sum figure.

Other often overlooked things (due to lack of familiarity with the P-pages) are those that don’t appear on the “included operations” list. I’ve always maintained that if something isn’t on the “included” list, it’s not included – whether or not it shows on the “not included” list is irrelevant. If the battery burst, it only makes sense to add to “neutralize acid and clean residue.”

How We Got Here
So how in the world did these bits and bytes become Bibles? Because the repair industry allowed insurers to take control.

I remember hearing stories about when an estimate was nothing more than, “I’ll fix your dented fender for $100, $125 if you want me to fix the scratch in the door from your kid’s bike.” Back then, repairers had control. Of course, cars were actually made of metal then, so things could be repaired.

Then came the books. The times were still somewhat negotiable, and a shop could get additional time – above and beyond what was listed in the book – for a badly damaged door or fender. But at about that same time, a change occurred in the insurance industry. The appraisers sent out started to “negotiate” on the company’s behalf (all in the interest of not getting cheated and keeping rates down supposedly).

Next, computers began making their way onto the scene, and along with them came some very basic programs. The earliest were nothing more than spreadsheets with “quick codes”; the user still had to enter the times and parts prices – usually based on the books. This wasn’t entirely a bad thing. At least the estimates were legible. (I think the only people with worse handwriting than bodymen are doctors.)

Then came newer, faster “real” computers and “better” estimating systems/data sources. Instead of flipping though a book and typing the labor times and parts prices, the estimator only had to click here and there and everything was automatically added to the sheet. Speed and convenience – who could ask for anything more?

Little by little, shops gave control over to the insurers and believed the data systems were accurate. Of course, during that same transition, “funny times” also made their way into the industry full time.

Convenient?
When the data providers came out with the latest generation of estimating systems, they were touted as being better, more accurate and up-to-date. Parts pricing would be current. Procedures would be automated. More detail would be built in. Yeah, right.

Annual manufacturer part price increases seem to make for months of chaos – often rewriting several estimates to reflect actual pricing that the data providers haven’t updated. The only automated procedures are deductions. Not often have I seen an interior trim panel included automatically when working on a door. The “more detail” that’s been built in only makes it harder to decipher what is (and what is not) included in a certain operation.

Better, but for whom? Definitely not for the people using the software to earn a living.

Then there’s what’s been termed, “Jump On Parts” (JOPs). JOPs are magical, self-installing parts. They’re easy to spot – they’re the ones without any labor times in the databases.

For this article, I used a fairly common vehicle: a 2002 Dodge Intrepid ES. Looking at one of the systems, I found four JOPs (not counting fasteners) on the front bumper alone. Is there no labor required to install the front bumper reinforcement caps, the air duct, the absorber and the license plate mount kit?

These parts are the ultimate parts. You just order them, and when the time is right, they jump from the parts bin onto the vehicle. At least according to one of the data providers.

I see this all the time with car cover plastic, too – it jumps off the roll, cuts itself to length and then places itself on the vehicle, complete with tape. Either that, or a lot of estimators are giving money away (again).

How convenient is it to have to go back through an estimate and correct these “oversights”? Those who know me know that I take a strong stand against profiting from free labor performed by techs. If the estimator/manager/owner is too lazy to enter a labor time on the lines for the JOPs, the money to compensate the laborer should come from the estimator’s/manager’s/owner’s pockets – not borne on the backs of those who do the work.

Face it, there are no self-installing parts. And if the part isn’t listed in the “included operations” column, it’s not included and you should manually enter a time allowance.

Accurate?

Just like a coach relying on his quarterback throwing to a tight end in the final seconds of the Super Bowl, accuracy counts in estimating systems. Those who rely on these programs also depend on accuracy. It’s vitally important to hit the mark.

Well guess what? The “bullseye” is a moving target.

Like I said earlier, I used a 2002 Dodge Intrepid ES as the example for this article. I acquired estimates – written in each of the Big 3’s systems – to replace the front bumper cover and to replace the right front fender.

To keep it as simple as possible, I asked collision repair professionals to prepare a very basic estimate: replace the front bumper cover and the right front fender. No “add-ons” – just a simple two-panel replacement.

So how “accurate” are these systems? Alphabetically (to avoid any implication of improprieties): ADP showed 4.5 units for sheet metal and 6.4 units for refinish, for a total of 10.9 units; CCC/Pathways showed 2.7 sheet metal units (after an automated deduction of .4 for overlap) plus 5.5 units for refinish for a total of 8.2 units; and Mitchell/Ultramate showed 4.0 units for sheet metal and 6.0 units for refinish, for a total of 10.0 units.

10.9 vs. 8.2 vs. 10.0.

Is CCC underestimating by almost 25% (10.9 minus 8.2 = 2.7; 2.7

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