When jobs roll out your shop door, does lost revenue go with them? - BodyShop Business

When jobs roll out your shop door, does lost revenue go with them?

A new generation of integrated management tools takes the work out of inventory and billing

Sponsored by 3M

As a body shop owner or operator, you don’t give away your time or expertise. But how much are you giving away in materials? Every job uses adhesives, paint, abrasives, clips, fasteners, seam sealers and other consumable products. You pay to have them on hand. If no one pays you for using them, however, that could be money out the door.

You could bear down and spend more time accounting for ordering, inventory, and billing specific costs to specific job orders. You could watch every tube and fastener, scrutinize every invoice. But that would make you an accountant. Did you get into auto body work to be an accountant?

Fortunately, a new generation of integrated performance solutions has emerged to take on that detail work—automatically, in real time, and in concert with many other systems most shops already use. This way, shop operators can focus on what they do best, while remaining confident they’re controlling inventory and invoicing for every valid input cost.

Being able to invoice in an accurate, comprehensive way is only one benefit to using an inventory management system. By automatically linking your inventory system with approved suppliers, you can also avoid ordering lags—and the work delays they can cause. You’ll know you’re ordering the right materials at the agreed upon price from the approved vendor. And your team will operate more efficiently while keeping tabs on materials used, and it is as easy as scanning a bar code.

Shop owners we’ve worked with at 3M have been shocked to find what they’re able to recover by invoicing insurers with the right documentation. That means documenting that they’re using the right product from an approved vendor, then recording how much material they use on each job, in accordance with accepted standards. It once took more time to chase all that documentation than the additional revenue it produced was worth. But when a system handles it all automatically, the calculus changes in your favor.

“We are now getting paid for what we use; we understand what we use and who’s using it,” one Miami shop owner said after implementing such a system. “So if we’re billing an insurance company, we know exactly the product by product number and how much we need to charge for that product. By allowing us to monitor what they’re using, not only control their usage, our cost of dry goods has gone down by 50%. The best part about it is, we can go and make sure that we’re billing appropriately for it.”

In the kind of system in question, the term “integrated” is important. Your inventory and work flow through a process from beginning to end – from outside suppliers to your internal operations and then back out to insurers and customers. A management system needs to be able to follow that flow, every step of the way.

What can a system like this offer?

  • Inventory management. Automatically replenish what you need in the right amounts at the right times—no more delayed jobs, overstocking, hunting for a material, using newer stock before more dated supplies, or having five tubes open at once.
  • Billable invoicing. Revenue “leakage” that used to roll out the door with finished repair orders now ends up itemized on the invoice—and reimbursed by the insurer.
  • Performance analytics. Which of your processes is running efficiently? Where are there improvements to make? What are your costs and profits by job type or product type? A modern system saves you time from burying your head in spreadsheets—or just not knowing.
  • Customer service. People turn to you for your expertise in getting cars back on the road. Whom do you turn to? A truly comprehensive system can include support with humans on the other end to answer your questions, as well as developers who keep working to refine and improve it.
  • Desktop billing. Many of the jobs you do are standard and repeatable. Why not use a system that can establish templates for common repair orders and regularize the use and billing of required materials? The parts and supplies you need for “replace a quarter-panel” don’t vary much from job to job; why calculate the requirements each time? A standard template is also a useful resource in presenting solid estimates to an insurance company before work begins.

Shops that have used 3M RepairStack Performance Solutions have access to a performance dashboard that charts key business metrics and puts them on one screen—including labor, parts, and consumables along with revenue and profit. Customers who used it for at least 60 days have reported saving nearly a thousand dollars a month* in repair materials alone.

“I don’t have to call a paint store anymore,” one Houston-area shop owner said recently. “[My system] automatically sends an alert to the paint company, and they come and replenish the cabinet. Now, you’re able to measure your business and measure each one of your technicians. It’s not just about inventory management. It’s about coaching. It’s about learning your business.”

*Based on review of body shops who used the 3M RepairStack Billables Invoicing software for at least 60 days between October 1, 2021-June 30, 2022.

Sponsored by 3M.

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