State Farm sent out an e-mail this week to its Select Service shops in Indiana and California stating that, effective July 13, 2009, it would no longer require those shops to use its electronic parts ordering system, which it had been testing since 2007.

State Farm Consultant George Avery said that this decision shouldn’t be interpreted that the system didn’t work but that the test had simply run its course.

“When you test something and find out it works and you learn what you need to know, you can’t test it forever. You find it works good, you get it and you know it," Avery said. “We’re going to use the knowledge we gained and move forward and look at more opportunities to benefit our customers.”

“We think it has tremendous value and anticipate that a lot of repairers will continue to use it,” Avery added. “We think that perhaps the experience of what these repairers went through might have won over some repairers who may not have wanted to try it because they found out there are some advantages to it.”

In the e-mail, State Farm stated that it believes in the benefits of the system but is aware of significant amounts of change that have occurred in the industry since the test was first started.

The stress that the OEMs have been going through, Avery said, prompted State Farm some time ago to discontinue the 3-percent reduction on the manufacturer’s suggested retail price, the savings of which State Farm said would be passed along through the parts departments and Select Service shops. Shops had initially been concerned that their profit margins on parts would be reduced.

When the pilot program expanded from select markets to statewide in 2008, Avery said that State Farm had seen improvements in efficiency and the lowering of parts return rates thanks to the VIN-scrubbing capabilities offered by the computerized service providers participating in the program.