Consultant Says CA Auto Body Shops Need to Know the Laws that Affect Them by Ed Attanasio
It all began with a poorly-painted Camaro, which led to a career as an industry consultant whose services are coveted by auto body shops primarily in California. When things go sideways and a shop owner or manager has more questions than answers, they don’t call the Ghostbusters―they call Juan Martinez. He learned the industry by working for top shops on primarily luxury brands in southern California over two decades. But the way he entered the collision repair industry happened literally by chance when Martinez was 12. “My sister had a 1970 Camaro and she wanted to sell it,” Martinez said. “I told her don’t do it, I’ll figure out some way to pay for it eventually. I painted it in forest green and showed it to my father and he told me it was mine. I didn’t have to pay a dime. “There was a mom-and-pop paint store in our town, and they helped me through the process. It cost me $500 to paint that car, and I started driving it before I was 16. The cops would spot me and pull me over, but they never gave me a ticket. They would say, keep the vehicle parked right where it is, and then I would walk home. But they always gave it back.” The experience led to a job at an auto body shop in San Diego, CA, as a prepper, and for the next 20 years, he worked as a painter, estimator, shop manager and regional manager. When he realized collision repair was in his blood, Martinez dropped out of college and went all in. He landed a job as an estimator at a prestigious shop in Beverly Hills, learning from great mentors and accumulating knowledge he could call upon throughout his career. Some years ago, Martinez started JM Business Solutions, Inc., in West Covina, CA, which helps body shops with fixed operations, business tactics, insurance relationships and customer service. Martinez trains how to write cleaner sheets, navigate through DRPs and make more money on parts and repairs, for example. He’s all about first-person,
one-on-one training, visiting 20 to 30 shops almost every week.
Q:
cerns?
As a body shop industry consultant, what are your top con-
A:
First, I would say safety and then insurance abuse are two issues that immediately come to mind. I encounter them literally every day. Some body shops are doing things right now that are not safe. They just don’t know when to say “I shouldn’t take this car in.” These shops are more concerned about making money. But if you’re not a Porsche-certified shop, don’t try to work on one. Their attitude is that they’ll figure it out, but in the end it’s unsafe for the owner of the vehicle. Not to mention that it’s also a bad business decision for the shop. In many cases, they’re not going to make money on the repair. It’s likely that they will also make mistakes, which is a liability issue. I can safely say that 80% of all the shops out there right now have at least one vehicle they should not be repairing. It’s no sin to admit you don’t have the training or equipment to work on a certain vehicle, so find a shop that can do it and give them a referral. I get calls all the time from shops who say we don’t know how to write an estimate on a higher-end vehicle, can you help us? Ninety-nine percent of the time they shouldn’t have taken the car in at all. I tell them to refer it, get your teardown money and a couple days of storage, and then move on. The insurance companies abuse body shops by operating with impunity and violating legislation that was created to protect consumers. Most shops don’t know the law. So, they can’t usually catch things, like paint caps that are illegal. But no one addresses them, so guess who pays for it? If you don’t have well-trained estimators, they won’t catch things and the insurance companies love it. They prey on the fact that most shops don’t know the regulations, so it’s to their advantage. I see so many poorly written estimates, it’s crazy. To make money, they must be cutting corners, because otherwise they
48 OCTOBER 2021 AUTOBODY NEWS / autobodynews.com
would be out of business by now.
Q:
What’s your opinion about DRPs? Should shops pursue them or reject them?
A:
There’s a market for DRPs, but the problem is they’re not the same. The DRP game has changed so much in the last 10 to 15 years, and more and more shops are gravitating away from it. Unless you have other sources of revenue, DRPs aren’t profitable enough to keep the doors open. They used to be the main source of revenue for many shops, but now they’re looking for other venues, usually from dealerships or fleet work, for example. If you are a new shop and you don’t have a book of business, a DRP might be good for the short-term, but it won’t likely be sustainable. Every DRP contract I’ve seen within the last five years is so one-sided, I can’t understand why any shop would sign one. They take advantage of the less experienced
shops and thrive on their lack of knowledge. I’ve convinced some of my clients not to take certain DRPs on and they end up thanking me every time. One source of revenue for shops that’s fairly new in California involves working with attorneys, who want to represent their clients in personal injury cases. They find them on Yelp and are building business relationships with shops that are getting good reviews. It has become a viable source of business for shops because these lawyers are representing injury victims and want to make sure that their cars are being repaired properly. In southern California, everyone owns a Porsche, a Lexus, a BMW or an Audi. This means OE certifications are more important here than in many other parts of the country. Shops have to make certain their training is up-to-date and that they have the right equipment to do the job. Because if they can’t or won’t, there are 20 other qualified shops out there that can.
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