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COLONIAL VOLKSWAGEN COLONIAL SOUTH CHEVROLET 89 Turnpike Road (Rte. 9) 361 State Road (Rte. 6) Westborough, MA. 01581 Dartmouth, MA. 02747 Phone Number: 508-996-6266 Phone Number: 888-322-6570 FAX Number: 508-979-1219 FAX Number: 508-616-0445 COLONIAL VOLKSWAGEN OF MEDFORD 162 Mystic Avenue Medford, MA. 02155 Phone Number: 781-475-5200 FAX Number: 781-391-3506 WELLESLEY VOLKSWAGEN 231 Linden Street Wellesley, MA. 02482 Phone Number: 800-228-8344 FAX Number: 781-237-6024 Contact: Dan Bettencourt / Wholesale Parts Manager
COLONIAL CHEVROLET 171 Great Road Acton, MA. 01720 Phone Number: 800-787-2787 FAX Number: 978-263-8587 COLONIAL WEST CHEVROLET 314 John Fitch Highway Fitchburg, MA. 01420 Phone Number: 978-345-5532 FAX Number: 978-345-1152
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January 2024 3
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Quirk Auto Dealers 115 E. Howard St. Quincy, MA 02169 Toll Free: 877-707-8475
4 January 2024
New England Automotive Report
January 2024 • Volume 22, No. 1
DEPARTMENTS
CONTENTS COVER STORY
EXECUTIVE DIRECTOR’S MESSAGE 6 | Rewarding Poor Behavior by Evangelos “Lucky” Papageorg LOCAL NEWS 10 | Insurer Bias at the ADALB: A Foregone Conclusion NATIONAL NEWS 12 | CREF’s 2024 School Benchmark Grants and Student Scholarships Applications Open VENDOR AFFINITY PROGRAM SPOTLIGHT 16 | Designer Office Systems by Alana Quartuccio WHERE ARE THEY NOW? 20 | Retired Shop Owner/MABA Leader Jeff Loeser is Still Outspoken, Still Working with Tools by Alana Quartuccio
32 | The Recipe for Success: What Are the Ingredients of a ‘Good’ Body Shop? by Alana Quartuccio
LEGAL PERSPECTIVE
LOCAL FEATURE 26 | New Faces at the ADALB: A Q&A with Carl Garcia by Chasidy Rae Sisk NATIONAL FEATURE 30 | Lessen the Learning Curve with SOPs by Chasidy Rae Sisk
ALSO THIS ISSUE 7 | AASP/MA MEMBER APPLICATION 17 | AASP/MA VENDOR AFFINITY PROGRAM SPONSORS
36 | The Not-So-Fine Print on Referral and Program Repair Contracts, Part 1 by Sean Preston, Coverall Law
New England Automotive Report
January 2024 5
EXECUTIVE DIRECTOR’S MESSAGE
Rewarding Poor Behavior EVANGELOS “LUCKY” PAPAGEORG
As we all embark on a new year in 2024, many of us have made New Year’s resolutions. Some of those resolutions deal with taking better care of ourselves through better eating habits or possibly starting a new exercise routine in order to drop a few of those holiday pounds we tend to pack on. Some of us resolve to interact better and more frequently with family and friends. We set goals for ourselves in both our personal and business lives. As you are reading this, we are about two weeks into the new year, and some of those well-meaning resolutions may have already been broken. Under the heading of “it is never too late,” I propose a New Year’s resolution that would be most beneficial as we transition from “Breaking Free In ‘23” to “Getting More In ‘24.” Both of these slogans are more than catchy rhymes – they are a mindset that many took to heart in late 2022 and all the way through 2023, as they made changes in how they handled their business decisions and how they ran their businesses in general. They found success in ’23 and are geared up to “Get More In ‘24.” The resolution I am proposing will help to continue the momentum for those already on the road to independence and will assist those who are now ready to travel down the same road to take back control of their businesses. Simply put: Resolve to stop rewarding poor behavior! Rewarding poor behavior is largely at the core of why we are in the boat we are in as collision repairers. We all too frequently take on the duties and responsibilities of others in order to get the repair of a vehicle
STAFF
AASP/MA EXECUTIVE COMMITTEE
PUBLISHER
President Kevin Gallerani
Thomas Greco | thomas@grecopublishing.com
AASP/MA STATEWIDE DIRECTORS
EDITORIAL/CREATIVE COORDINATOR
Legislative Director At-Large Ray Belsito
Alana Quartuccio | alana@grecopublishing.com
OFFICE MANAGER
Donna Greco | donna@grecopublishing.com
PRODUCTION COORDINATOR Joe Greco | joe@grecopublishing.com
MANAGING EDITOR
Chasidy Rae Sisk | chasidy@grecopublishing.com
PUBLISHED BY: Thomas Greco Publishing, Inc. 244 Chestnut Street, Suite 202, Nutley, NJ 07110 Corporate: (973) 667-6922 / FAX: (973) 235-1963 www.grecopublishing.com @grecopublishing
AASP/MA DIRECTORS ZONE 1 Mike Penacho John Studer Dan Wenzel
continued on pg. 40
Vice President Matthew Ciaschini
VICE PRESIDENT/SALES DIRECTOR Alicia Figurelli | alicia@grecopublishing.com
completed, and we pay dearly for doing so. First and foremost, we need to hold all parties in the claims and collision repair process accountable to their obligations in the process and stop making excuses and jumping through hoops due to others’ shortcomings. This process should begin right from the “First Notice of Loss” (FNOL). The FNOL is like the starter’s pistol going off at the beginning of a race. The clock starts ticking for the insurer and their obligations in the process. These obligations and time frames are clearly defined in the Massachusetts General Laws (MGLs) and the Code of Massachusetts Regulations (CMRs). If you are not familiar with the specified timelines, you are doing yourself, your business and your customers a huge disservice. You must make a point to review MGL 26 8 G, 211 CMR 123.00, 211 CMR 133.00 and 212 CMR 2.0. Contained therein are the foundation by which ALL insurers and appraisers (staff, independent or body shop) must abide by in the claims and collision repair process. Once you are familiar, it is incumbent upon you to inform your customers – through signage, work authorization documents and conversations – what the insurer’s obligations are in the process. The adage of “knowledge being power” is absolutely the case in the instance of the timelines. I have been informed
Treasurer Dana Snowdale
Secretary Don Dowling
Collision Director At-Large Dan Wenzel ZONE 2 Ray Belsito Brenda Lacaire
Affiliate Director Al Correia Brent Dabrosca C.J. Ellis Jimmy Kelsey Russ Oagles Doug Begin
ZONE 3 Gary Cloutier Andrew Potter Brian Stone Affiliate Directors Mike Nawrocki McColl Rhodes
ZONE 4 Dean Luther Jeff White Affiliate Directors J.R. Force Simon Frietas Jayce Mitchell Gregg Tanguay Scott Varney
AASP/MA ADMINISTRATIVE OFFICE New England Automotive Report is published monthly by TGP, Inc., 244 Chestnut Street, Suite 202 Nutley, NJ 07110. Distributed free to qualified recipients; $48 to all others. Additional copies of New England Automotive Report are available at $5 per copy. Reproduction of any portions of this publication is specifically prohibited without written permission of the publisher. The opinions and ideas appearing in this magazine are not necessarily representations of TGP Inc. or of AASP/MA. Copyright © 2023 by Thomas Greco Publishing, Inc. Images courtesy of www.istockphoto.com
6 January 2024
AASP/MA Executive Director Evangelos “Lucky” Papageorg
New England Automotive Report
AASP/MA Administrative Assistant Alana Quartuccio
WWW.AASPMA.ORG
P. O. Box 850210 Braintree, MA 02185 617-574-0741
Membership Application 2024-2025
AASP-MA P.O. BOX 850210 Braintree, MA 02185 Phone: 617-574-0741 Fax: 973-235-1963 Email: admin@aaspma.org
Please complete this form and return to our office via mail, email or fax with your dues payment. Thank You! BUSINESS INFORMATION Massachusetts Shop Registration # __________________
Total number of Staff (Techs, office, Mgrs)________
Company’s Official Name: ________________________________________________________________________________________________ Business Physical Address: _______________________________________________________________________________________________ Business Mailing Address (If Different): ________________________________________________________________________________ Telephone Number: (______)-________-___________ Fax: (______)-________-___________ DUES STRUCTURE. Collision Shop Annual Dues: $650 / 12 Months* PRIMARY BUSINESS CONTACT Name: _______________________________________________________________________________________________________________ Email: _______________________________________________________________________________________________________________ As a member in good standing, your shop WILL BE listed on our website. Click here � if you do not want your shop listed on our website map for potential customers to find you. If you have any questions about this benefit, call (617) 574-0741, ext. 1.
Yes � Please send me information regarding the following MONEY SAVING BENEFITS: � Dental plan � Healthcare plan � Credit card processing � FMLA savings program � Grant writing/training � Google presence optimization � All benefits PLEASE ENCLOSE PAYMENT WITH YOUR MEMBERSHIP APPLICATION Check# : _______________ (IF collision shop please note your RS# on the memo line of the check) CC #: ______________________________________________________________________
OR
EXP: ________/___________ CID: _________________
Billing Address: ______________________________________________________________________________________________________________ Name On Card: _____________________________________________ Signature: ____________________________________________________ Check here � to opt out of auto renewal using this credit card information for future renewal Note: A 4 percent convenience fee will be charged for membership renewal via credit card transaction
I hereby make this application for membership with the Alliance of Automotive Service Providers of MA (AASP/MA) for membership dues 2024-2025 as provided for in this contract. *Membership Dues are for a twelve-month period commencing on your anniversary month of membership.
REV 12/23 REV 12/23
RECOMMENDED BY:__________________ FROM BUSINESS NAME: ___________________ New England Automotive Report
January 2024 7
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New England Automotive Report
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Lia Honda of Northampton 293 King Street Northampton, MA 01060 Toll Free: 800-369-7889 Direct: 1-413-587-2900 FAX: 1-413-585-0502 www.liahondanorthampton.com
Honda of Enfield 20 Palomba Drive Enfield, CT 06082 Toll Free: 800-222-6632 FAX: 860-253-5419 www.liahondaofenfield.com
Honda North 382 Newbury Street Danvers, MA 01923 Toll Free: 800-882-9797 FAX: 978-774-9483 e-mail: eadams@iclautos.com www.hondanorth.com
Schaller Honda 1 Veterans Drive New Britain, CT 06051 Toll Free: 800-382-4525 Direct: 860-826-2080 FAX: 860-826-2083 e-mail: jkiniry@schallerauto.com www.schallerauto.com
Lundgren Honda of Auburn 525 Washington Street Auburn, MA 01501 Toll Free: 800-777-2044 FAX: 508-721-0872 e-mail:pmccarthy@lhonda.com www.lhonda.com
Balise Honda 400 Riverdale St. West Springfield, MA 01089 TOLL FREE: 800-992-6220 FAX: 800-254-3544 wparts@baliseauto.com www.BaliseWholesaleParts.com One Call, One Truck for 14 Brands!
Balise Honda of West Warwick 509 Quaker Lane West Warwick, RI 02893 TOLL FREE: 800-992-6220 FAX: 800-254-3544 wparts@baliseauto.com www.BaliseWholesaleParts.com One Call, One Truck for 14 Brands!
New England Automotive Report
January 2024 9
[LOCAL] NEWS
Insurer Bias at the ADALB: A Foregone Conclusion The recent meeting of the Auto Damage Appraiser Licensing Board (ADALB), held December 5, was nothing short of disillusioning for anyone who might have previously believed the Board’s purpose was to protect consumers and regulate appraisers (as per M.G.L. c. 26, § 8G which states its duty to govern licenses “in order to promote the public welfare and safety”)…or really to do anything other than defend the ability of insurance companies to continue abusing the system. The first hint of the Board’s ineffectiveness appeared when Attorney Michael Powers shared an update on the status of the proposed amendments to 212 CMR 2.00, the regulation that the ADALB spent a year’s worth of meetings reviewing ad nauseam before voting to submit the revised regulatory language to the Division of Insurance (DOI) in July 2022. “I contacted the General Counsel, and he advised that because we have a newly constituted Board, the newly constituted Board should review the process on its own,” Attorney Powers reported, asserting his certainty that new Board members Carl Garcia (Carl’s Collision Center; Fall River) and Vicky Wei Ye (Bos Insurance Agency) would like to participate and promising to send them the “really nice draft that’s ready to go [after being] reviewed repeatedly by two Boards.” During the call for “Other Business,” Board member Bill Johnson (Pleasant Street Auto; South Hadley/Belchertown) referred to the action taken against an appraiser at the previous meeting, noting that review of the court documents revealed another appraiser who violated the CMRs by writing an appraisal based on photos without ever doing a personal inspection. “It’s a clear violation, so if we’re going to be fair across the board, I don’t see how we could ignore this,” he pointed out.
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Yet, that’s exactly what the Board voted to do in response to Johnson’s motion to contact the appraiser in question asking why he wrote a total loss based on photos. Johnson and Garcia voted in favor, while Ye and Board member Peter Smith (MAPFRE) voted against the motion; Chairman Michael Donovan broke the tie by voting in line with the insurers. As the Board moved on to its final order of business, the review of complaints 2023-2 through 2023-85, Smith noted that all of the complaints in question were filed by one individual, involve the same respondent and “seem to be retaliatory in nature.” He claimed the complaints lacked appropriate supporting documentation and even some critical pieces of information. Ultimately, Smith’s motion to dismiss all of the complaints with the exception of 2023-9 led to a tied vote with the shop representatives voting against the dismissal and the insurers voting in favor of it. Chairman Donovan voted in line with the insurance representatives. Although the review of 2023-9 was postponed until the Board’s next meeting, Johnson observed that the complainant recommended a notice be sent out to all insurance companies and independent appraisal firms reminding them that they are allowed three days to inspect and complete the paperwork, else they’ll be subject to review by the Board. He made a motion to send an advisory ruling to appraisers to remind them of the timelines related to the CMR. Garcia seconded the motion, and both repairers voted in favor. Yet again, Smith rejected the motion, and Ye abstained; surprisingly, Chairman Donovan sided with Johnson and Garcia, agreeing to send out the advisory ruling. The obvious bias displayed during the meeting provided a clear demonstration of why the ADALB should be moved from the Division of Insurance (DOI) to its proper place under the Division of Occupational Licensure (DOL) to ensure that all appraisers are actually being regulated by the Board called upon to do that duty. The ADALB is scheduled to reconvene on January 23. Don’t miss detailed coverage of the meeting, only available in the December issue of Damage Report, AASP/MA’s members-only newsletter. AASP/MA members are strongly encouraged to listen to the recording of the December 5 meeting in the Members Only section of aaspma.org for a glimpse into the inner workings of the ADALB. View the meeting agenda at bit.ly/ADALB1223.
PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
10 January 2024
New England Automotive Report
New England Automotive Report
January 2024 11
[NATIONAL] NEWS
CREF’s 2024 School Benchmark Grants and Student Scholarship Applications Open Collision repair facilities around the country are in desperate need of new talent to address the ongoing workforce shortage, yet a lack of qualified young professionals are entering the industry for many reasons. Many schools’ collision programs are underfunded, and post-secondary students seeking to enhance their skills and knowledge often struggle to afford tuition and tools. The Collision Repair Education Foundation (CREF) addresses
Sheridan Technical College (Hollywood, FL) was one of over 100 schools awarded with a CREF Benchmark Grant in 2023.
12 January 2024
New England Automotive Report
these needs through its Collision School Career Readiness Benchmark Grants and Student Scholarship awards, thanks to support from many generous industry donors and sponsors. In 2023, CREF awarded $678,500 in grants to over 100 schools. The Benchmark Grants recognize those programs that excel at educating students but which require additional financial assistance due to constrained school budgets, providing funds to purchase the tools, equipment and supplies necessary to enhance their students’ learning experience and elevate the caliber of their graduates. The 2023 Student Scholarships benefitted nearly 90 students with over $130,000 awarded in financial assistance to ensure those students were able to continue their education, preparing them to pursue a successful career in body shops around the country. Applications for CREF’s 2024 Student Scholarships are now open, with a deadline of March 8, 2024. Applications for CREF’s 2024 School Benchmark Grants are open through June 28, 2024. To apply for a Benchmark Grant or Student Scholarship, visit bit.ly/CREFapply. Learn more about supporting CREF’s efforts to promote the industry to future generations at CollisionEducationFoundation.org.
PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
New England Automotive Report
January 2024 13
14 January 2024
New England Automotive Report
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January 2024 15
[VENDOR AFFINITY PROGAM] SPOTLIGHT
To say that computers are everywhere would be an understatement…it’s 2024 after all! Just about every step involved in auto body shop operations is linked to some type of computerized system, but that’s nothing new. In fact, repairers have been referring to vehicles themselves as “computers on wheels” for a number of years now. The good news for the Massachusetts body shop world is that they have a team of experts at Designer Office Systems who will serve as their partner and a gateway to this ever-changing technological world of repair. Designer Office Systems is an IT provider that specializes in catering to the collision repair world. According to owner and founder, Ed Rachwal, 90 percent of their clientele is collisionfocused as they support the needs of shops and insurance appraisers, which makes them the obvious choice for these businesses when seeking a computer/IT provider. Not only does Rachwal’s team have the right experience, but they have been growing with the collision repair industry for the past three decades and know all the ins and outs of their day-to-day needs. Rachwal got in on the ground floor with selling management software to body shops at the time when things weren’t computerized at all, back when estimates were written by hand. After graduating college in 1989, Rachwal worked for his older brother Mark, who had a company that sold what was known as Digitree, one of the first management systems that would later be bought by Mitchell. After three years, Rachwal bought his brother’s business and began to shape it into what it is known for today – providing technology and business solutions to body shops. “Very few body shops had any computers around back then,” recalls Rachwal. “Maybe you’d see a fax machine, but it was rare to see computers in the shops. Because shops were hand-writing estimates, a lot of operations were being missed. Our focus was to show them how they could make sure they were getting paid for everything they were supposed to get paid for. Back then, one had to buy a management system in order to get the estimating system. That was the way it was sold, so I focused on trying to get customers to use as much of the software that made sense to them, getting them to use software that was important to helping them run their business.” That methodology continues today as Designer Office Systems’ mission is to lead their customers to the right solutions to help them thrive. Although they can provide solutions for any estimating software out there, Designer Office Systems is the exclusive provider for Mitchell in the New England area. At one time, Mitchell had 40 dealers around the country, but the company has since gone into direct sales, except here in New England as Rachwal’s company is the only private dealer left, thanks to having the highest customer retention rate in the country. “A lot of people think of Mitchell as an estimating system, but there is a lot more offered, including a paint calculator, access 16 January 2024
New England Automotive Report
by Alana Quartuccio
to OEM procedures, management software and – more recently – ADAS diagnostics and calibrations,” explains Rachwal. Over the years, most computer/IT companies who served small businesses began to go after larger clientele, but Designer Office Systems stayed in their space, serving small businesses like collision repair shops. “We decided to focus on this industry, and we do it well,” says Rachwal of the family-owned business. Whereas his older brother Mark is no longer affiliated with the company Ed built, their younger brother Scott has been working on the sales side for more than 20 years. As technology advances, the Rachwals are there to help educate shops and provide them with what they need, whether it’s setting up remote access for business so employees can work at home, setting up estimating via a tablet or helping shops see if they can bring ADAS calibrations in house. “We help them find the best way to manage everything they need to run their business efficiently,” says Rachwal. A longtime supporter of AASP/MA, currently as a Vendor Affinity Program Bronze sponsor, Designer Office Systems stands behind the work of the Alliance and their fight for proper repairs and fairer labor rate reimbursement. “AASP/MA does fantastic things for Massachusetts auto body shops,” believes Rachwal. “I can never understand why a Ed Rachwal shop would not choose to be a member. There is just a ton of information they provide.” He referenced the Alliance’s recent “Breaking Free in ‘23” meeting where he and his brother Scott addressed shops on ADAS. Rachwal said he learned a lot as well listening to all the discussions involving how shops can utilize the copay and balance billing method. He also commends the association for Scott Rachwal their work at the legislative level trying to get the insufficient labor rate elevated substantially. Rachwal is grateful to serve the body shop world in Massachusetts and is proud of what makes his company unique in this market. “Body shops can just pick up the phone and call us when they have a problem. We service from an IT point of view for a fraction of what any IT firm would charge because we serve this one market and we know it so well. Not only can we do it for a fraction of the cost, but we offer service geared specifically to the needs of these shops. If someone has an OE Connection problem, we know what the problem is as we’ve dealt with the same one for countless other shops. Most IT companies would not be familiar with the OE Connection software like we do. We deal with hundreds of body shop customers day after day, and we have a unique sense of what they need.” PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
"Your Massachusetts Auto Body Association" PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
VENDOR AFFINITY PROGRAM
SPONSORS
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BUY FROM YOUR AASP/MA SPONSORS For more information or to become a sponsor of AASP/MA please call (617) 574-0741 or email admin@aaspma.org. New England Automotive Report
January 2024 17
18 January 2024
New England Automotive Report
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January 2024 19
[WHERE] ARE THEY NOW
Retired Shop Owner/MABA Leader Jeff Loeser is Still Outspoken, Still Working with Tools Auto body associations in Massachusetts have taken on different shapes and forms since it all began decades ago. And there are many men and women who have dedicated their time over the years to help fight the good fight for their fellow collision repairers. New England Automotive Report has been periodically catching up with some of AASP/MA’s earlier leaders to reminisce and see what life is like on the other side of the body shop world. This month, we caught up with Jeff Loeser, former Melrose Auto Body (Saugus) shop owner and former Massachusetts Auto Body Association (MABA) president. New England Automotive Report: When did you first get into the industry? Jeff Loeser: As a little kid. My dad bought a body shop the year after I was born, and I probably started working there when I was about 10 years old. When I got into middle school, I would take a bus to school, but I would take a different bus that would bring me to the town line and then grab another bus from a school I didn't go to, which would give me a ride to my dad’s shop. It was one of those things. I talked to the driver, and he understood. I just said, ‘Listen, I just want to go see my dad.’ And he said, ‘Get on the bus and shut your mouth.’ So they drove me to Saugus. I’d finish my homework on the bus or at my dad’s desk. I did that for years and then worked there all through high school. The day I graduated high school, I went to graduation, threw my hat up in the air, tucked it under my arm, jumped in my car and went to work. I didn't have a graduation party. I worked. That's all I did. I worked all my young life. I always had a decent amount of money. I always had a bunch of cars, like five or six at a time. And I didn't really care about much aside from work and cars. Fast forward to 1988, my dad got cancer and died within eight weeks. So, I was 25 and now I was the boss with a business to run, a mortgage to pay on the building and a mortgage to pay at my mother's house where I still lived with her, along with my brother and sister who were both still in school, plus I had a whole bunch of bills and responsibility. It all happened in one day. So, I said to myself, ‘You know what? I am not going to do this forever. I'll do this until I'm 50.’ I was 25 years old and did not want to get carried out the door like my father. I wound up retiring after 27 years. I missed it by two and a half years due to things beyond my control. But my goal was pretty clear. I almost made the 25 year mark, and I've been retired since. I sold my business in 2016. I kept my building and sold all my shop equipment. And now I play with old cars for fun and I fix old body shop tools, like air tools and spray guns. I’ll either buy stuff on 20 January 2024
New England Automotive Report
eBay or from a friend, or I’ll just see something and say ‘I remember those; those were good!’ I play with and repair some hydraulics. There was a famous hydraulics company called Porter Ferguson that used to make their stuff right in Somerville, Massachusetts. Porter Ferguson discontinued that line, so I’ll fix those tools and spray guns. I also fix air powered sanders from a company called National Detroit that are very difficult to find these days. I always have tools lying around in various stages of repair waiting for parts. I put them together and turn around and resell them. It keeps me busy, and it’s something I like to do. It’s like playing with Legos for big kids. That’s the best way to describe it. It’s different from working in a spray booth. I don’t really paint anymore, but I will If I have to. I still work on experimental aircraft and boats. Since I retired, I’ve restored a ‘66 Corvette Roadster, a ‘58 Jaguar XK150 and a ‘67 Jaguar E Type. Now, I’m working on a 1952 XK120. NEAR: How long did you own your shop? JL: In total, I owned the shop for almost 28 years, although I did run it six years before my father died. When he was still alive, I did everything except the estimating. I just dealt with the people and the cars. I took over the office work after he passed away. NEAR: How did you get involved with the association (MABA at the time)? JL: I was approached by MABA’s Executive Director Chris Muise. He came to visit me at my shop. Chris was probably the best salesman I ever met in my life, and that’s not to say that he fed me a bill of goods. He certainly did not! He asked me to consider joining the association and my reaction was ‘You know what, dude, I’m just here fixing cars, and I don’t have time for this.’ I was still pretty new in my career, and I gave it some thought, talked to some people and decided, what the hell did I have to lose, so I wrote him a check, and the rest is history. The association grew rather quickly, to the point where we established chapters so we could hold local meetings for those who knew each other on the local level rather than have everyone drive out to the middle of the state to meet. Each chapter needed its own Board of Directors. My feeling about needing to get involved with that goes the same as my yacht club: If there’s going to be a bunch of people in a room making decisions that are going to affect the way I do things, including how I spend my money, then I am going to be one of those people sitting in that room. That’s how it’s always been with me. So, I got involved with the local chapter, moved up the ranks. I went from chapter director to recording secretary right into the presidency. Unless something has changed since, I believe I am still the youngest person to have held that position. I was about 30 years old when I became president. I got married and had my first kid when I was serving as president. That was another first as no one had gotten married while serving as president before. They were interesting times. We used to have Board meetings in my kitchen.
by Alana Quartuccio
NEAR: Any memorable things from those years you’d like to reflect on?
JL: At 25 years old, I had a plan to retire at 50, and I wound up retiring at age 52 and change.
JL: I really enjoyed myself. I made a lot of really good, long-lasting friendships. It was nice to see a business transform before my eyes. During my father's time, body shop owners didn't talk to each other because it was basically ingrained by their elders to view anybody who did what they did not just as a competitor, but effectively as the enemy. You didn't want your competitors to know what you were doing. You didn't want them to know what kind of paint you were spraying. You definitely didn't want them to know any of your customers’ names. And you absolutely would not think about picking up the phone to ask them to borrow a tool. That all did a 180 degree change. We very quickly figured out that not only are we not enemies – we're like blood brothers. We were in the same boat, and to a large extent, carrying the same paddle. We're going in the same direction. We all want the same things. I don't want to pilfer your customers, and I don't want you to pilfer mine, but if you need anything, you call me and you can have it. Here’s a good story: Back in late 1999 into 2000, I closed down my shop to remodel. No matter what we did, there was one car that we could not get done in time before we shut down. My friend and colleague Ernie Nickole very graciously told me I could send my guys and all the materials to his shop with whatever tools they might need, and he’d set them up at his shop. He told me he could have my guys paint in his booth or he’d have his guys spray it, whatever I wanted. And he told me, ‘Don’t even consider offering me a dime because I don’t want to hear it.’ Can you imagine that? We went from the way my dad grew in this business to this in a very short time. It’s quite a testament to the formation of MABA. And this type of camaraderie frightened the insurance companies quite badly to the point that they infiltrated the association through a few people and destroyed it, and then we became partners in AASP National.
NEAR: Do you think the industry has changed since you stepped away?
NEAR: You broke from MABA to help organize AASP/MA. What led to that? JL: After the president of MABA at the time had me and Rick Starbard escorted out of the Board room by the police – a move that came out of nowhere – Rick and I talked about AASP. A small group of us got together and contacted AASP to let them know what we had to offer, who we were, where we came from and how we got to where we were, and they were very interested in opening up a chapter in Massachusetts. So, they basically adopted us, like an orphan child searching for a place to sleep. They graciously took us in and listened to what we had to say, and then we were off and running. I stayed in the background as my day at the big table was kind of over. My goals at that point had shifted toward preparing to retire and sell my business. NEAR: Now all these years later, AASP/MA is the one left standing. How do you feel about that? JL: It doesn’t surprise me one bit. MABA was losing members by the fistful mostly because of the people who were in charge. NEAR: When did you decide to retire and why?
JL: Based on some of the things I'm hearing, it's changed quite dramatically. The insurance industry seems to have used COVID-19 as a foothold to go wild and do the things that they always wanted to do and could never get away with in Massachusetts. For instance, taking photos of cars to send to the insurance company used to be forbidden, and then all of a sudden, that just went away. All you had to say was ‘due to COVID,’ and you could do whatever you want. It’s amazing, stunning actually. I hear things and get little tidbits here and there, but largely, I stay out of the body shop business and the entire industry. I’m not a rear view mirror guy. I don’t live in the rear view mirror; I don’t look in it. NEAR: Do you have any hobbies you’d like to share? JL: When I went to vocational school for high school, believe it or not, I went four years for carpentry. So, in high school we built four houses, and I've remodeled two of my own. I helped a whole bunch of my friends do very expensive renovations including some additions. NEAR: Looking back now, some years removed, what comes to mind when you think about your time in the body shop industry? JL: It actually saddens me to see this industry be captured and enslaved by the insurance industry, much like the medical industry. My doctor just retired, and I'm having a hell of a time finding a new doctor. He just gave up and retired. He decided he had enough money, and he didn’t need to do it and work for nothing. And in my opinion, the body shop industry has been captured and for all intents and purposes destroyed. It’s very difficult to make any money in that business unless you absolutely run a factory, and to me, that's not repairing cars. I got into that business because I liked working on cars, and I liked doing a really nice job. I treated everybody's car as if it belonged to me. NEAR: What do you miss most? Least? JL: What I miss the least is fighting over two-tenths of an hour or fighting over nickels and dimes for a tube of seam sealer. What I do miss is my friends. I miss the camaraderie. When I was a member of MABA and later when we went to AASP, I made some of the best friends I ever had. I’ll put it to you this way: When I got married, most of my friends, aside from lifelong friends, were from my business. I could point to any particular table and see Lucky Papageorg, Ernie Nickole the guys from Atlas Auto Body, Donald Smoot from Boston’s Advanced Automotive or the guys from Today’s Collision…this one and that one and right down the list. I’m still friends with all of them. We may not talk all the time, but we’re still friends. I just bumped into Kevin Kyes at a Zac Brown concert. continued on pg. 22 New England Automotive Report
January 2024 21
[WHERE] ARE THEY NOW continued from pg. 21 NEAR: What is the one thing you think you got out of this industry you would not have gotten if you didn’t pick this career? JL: Most body shop guys will tell you this: When you can take a car that hits something at 40 miles an hour and make it drivable again in a quality way, you can fix anything. Anything from toasters to washing machines to the roof of your own house. Every body man I know can fix anything. It doesn’t matter what it is or how complicated it is. Because we have had to fix electrical, plumbing, even glass and very complicated mechanical issues like the inside doors on BMWs. I loved my job. I love fixing the impossible. Give me the most ridiculous, impossible thing to fix.
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January 2024 25
[LOCAL] FEATURE
New Faces at the ADALB: A Q&A with
Carl Garcia
During the October meeting of the Auto Damage Appraiser Licensing Board (ADALB), two new members sat at the table: Carl Garcia (Carl’s Collision Center; Fall River) and Vicky Wei Ye (Bos Insurance Agency). The meeting ran without interruption, and the recent additions briefly introduced themselves at the end of the meeting after weighing in on Board business – and even voting on the revocation of an appraiser’s license! But who are these new Board members, and what are their qualifications? New England Automotive Report reached out to Garcia and Ye to request an interview. Although Ye did not respond to our request, Garcia graciously scheduled a call to assure readers of his automotive and appraisal experience as well as to share his goals as he joins the ADALB for the second time. New England Automotive Report: What are your goals going into your new role with the ADALB? Carl Garcia: Owning multiple repair shops in Massachusetts is a blessing, but it can also drive you a bit crazy, especially because we have a lot of regulations in place that insurance companies simply are not following. These abuses have become my biggest frustration over the last few years. My biggest pet peeve is when insurers write for used suspension parts, so I’m hoping we can get some clarity around this mispractice. Also, I hope to address the failure of certain insurers to inspect vehicles and write estimates within mandated timelines. I understand that COVID-19 created some challenges, but the abuse of the system has been incredibly blatant over the past few years…how long is it going to take for us to get back to enforcing the regulations we have in place? I believe the Commonwealth has some of the best and most effective regulations in place, so now it’s time to 26 January 2024
make sure everyone understands what they say and start enforcing them. NEAR: You were a member of the Board several years ago, and now you’re back. How did you find yourself back on the ADALB in 2023? Was there an application process, or were you invited to return? CG: Basically, the same process that happened to me seven or eight years ago happened in reverse. Then, I was on the Board, but when a new administration was elected, I got replaced as part of the process of governmental change. Since those days, I’ve remained very active in local politics, serving as chairman of my local credit union and staying involved with various organizations and entities across the state. Since my removal from the Board, I have spoken to Governor Healey (who was attorney general at the time) to express my frustration about insurance companies abusing the system. I have had a couple conversations about the possibility of me rejoining the Board, and several other people also reached out to see if I’d be interested. Entering into my second run on the ADALB, I plan to combat these systemic abuses by insurance carriers. And now I know that I need to focus on getting it down as quickly as possible because I don’t doubt that the Board will shift again the next time we have a new administration. NEAR: How will your background/ industry experience allow you to best serve the interests of consumers across the Commonwealth? For your own industry? CG: Carl’s Collision Center is a leader in electric vehicles, OEM procedures and so much more. The training we’ve been through to get there gives me a great understanding of what consumers need and
New England Automotive Report
deserve when their vehicle is being repaired, and it has helped me understand how important it is to get the industry educated about the repair process. Meanwhile, the insurance appraisers constantly tell us that no one else is asking for certain required processes and procedures, and if that’s true, it’s a huge problem that we need to fix. We need to make sure shops are educated about what OEMs require and help get their employees up to speed on the right way to perform in today’s industry. And then we need to make sure insurers are paying shops to meet these requirements that help protect consumers’ safety. NEAR: How familiar are you with the laws governing appraisers’ licenses in Massachusetts? CG: I’d like to say I’m extremely knowledgeable about those laws. This is my second stint on the Board, and I’m a firm believer in our regulations. I think this is a great state to do business in if we all play by the rules. I’m also very knowledgeable about the expedited supplement process, and the way it is abused these days completely blows my mind. NEAR: How familiar are you with the appraisal process itself? CG: Between all three of our shops, we repair 120-125 cars every week, so I’m extremely knowledgeable about the appraisal process. NEAR: Do you feel that the ADALB is as effective as it could and should be? If not, what actions could be taken to make it more effective? CG: No, it is not, but I want to preface those thoughts by explaining that a lot of people don’t understand the ADALB and
by Chasidy Rae Sisk
what it’s supposed to do. I want to see complaints filed as often as necessary, but shops need to realize that a complaint is not a fight between their facility and the insurance company; once the Board decides to move forward, it’s the ADALB moving forward against the appraiser. The shop alerts us to the issue, but that’s typically the only role they play. It is important for the shop owner to understand that they are responsible for providing all relevant and necessary information to present to the Board at the time of the complaint being filed. One of the biggest inefficiencies is improperly filed complaints, so I’m hoping that – through this magazine and other industry sources – we can spread information to help shops better understand what it takes to file a proper complaint that the Board will move forward on. It’s really about educating people, and that takes a team effort. When insurance companies file complaints against shop appraisers, they do a much better job than the shops do. The first time I was on the Board, I spoke about the process and the details that need to be included at regional meetings around the state, so perhaps I can do something like that again to help shops learn to write more effective complaints. We also need to educate consumers. When they first encounter a problem, it’s the end of the world, so they’re passionate about it. But once it is solved, they don’t want to continue the fight. We need to educate them about why it’s so important to keep fighting and make certain regulatory changes. NEAR: Are you still involved with any insurers as a referral or program shop?
CG: My father started our first shop in 1961, and referrals started as a much different relationship. As a second generation shop owner, I used to believe strongly in the benefits of referral programs because they were very helpful to my father at one point. But since I took the shop over, it became very clear that we were being taken advantage of in those relationships…so much so that my wife has compared one particular relationship to domestic abuse! And the abuses over the past few years have run rampant, so as we move into our third generation of ownership and I start stepping away from the shop more often, we’ve decided to disengage from those relationships with insurers, which is probably the smartest thing we’ve done for the business. But when shops sign up for them, we don’t always thoroughly read the contracts, and we’ve found it’s not always easy to extricate yourself because those contracts are designed to keep you in them. To any shop owner reading this who might be considering signing up for one of those programs, make sure to read the contract thoroughly and understand the ramifications of breaking the contract! I recently learned that I’m still a referral shop for an insurer after I withdrew from their program. I didn’t realize the same company could run a referral and an accelerated program, and I don’t think they should be able to run dual programs. 2019 Highlander I’m really looking forward to the Board cleaning up some of the low-hanging fruit and hopefully updating some of our regulations to make them more effective and easier to enforce. PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
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New England Automotive Report
New England Automotive Report
January 2024 29
[NATIONAL] FEATURE
Lessen the Learning Curve with SOPs
Training new employees can be stressful – even if you hire an experienced estimator, painter or technician, it’s unlikely they’ve ever done things the way YOU want them done at YOUR facility…after all, they’ve never worked for YOU before, and everyone does things differently. There’s always a learning curve when a new employee joins your team! Someone who is competent (or even highly skilled) could struggle to assimilate into your shop culture simply because your processes are different than what they’re used to. But what if there was a way to help them get accustomed to your way of doing things and lessen that learning curve? Having a tenured employee train them one-on-one is an option of course, and while there’s no substitute for that personal attention, it’s not the most efficient use of everyone’s time. Creating and implementing standard operating procedures (SOPs) allows you to hand step-bystep instructions to a new employee to help them understand how you want a process completed – and enables them to be successful, a factor that often contributes to employee retention. So, what exactly is a SOP? Mike Anderson (Collision Advice) describes SOPs as “the way we want things done.” They allow shop owners to train staff to perform a task the same way the owner would do it. A SOP is “a step-by-step process that explains exactly what we want an employee to do,” according to Maylan Newton (Educational Seminars Institute), who also points out, “We all have
allow anyone to complete the task without needing help or asking any questions.” Once you’re confident in the SOP you’ve written, it’s time to implement it. Anderson identifies four steps to implementing a SOP: develop, train, test and audit. You’ve already determined how you want things done and developed the SOP. Next, train your staff to ensure they understand how you want things done. Testing them to confirm that they’ve retained that information will take different forms depending on what process the SOP defines. Lastly, audit your team to ensure the process becomes a sustainable habit. So, which processes in the shop actually warrant a SOP? All of them! “Develop SOPs for absolutely everything you do,” Anderson recommends. “Operating by process, not by luck, means documenting each task – from cleaning toilets to answering phones, from administrative work to damage analysis, disassembly/ reassembly, parts ordering and even storing tools and equipment – and then delivering it to employees, so they know what to do and exactly how to do it.” Newton agrees. “It’s hard to anticipate every potential problem that might arise in a business, but I suggest starting with areas in the business that are often done differently than you would like to see them. It could be anything from opening and closing the shop
certain expectations about how we want our businesses to perform, but the absence of clearly documented SOPs can create areas of failure because how can we expect a new employee to meet our expectations if we neglect to tell them exactly how we want things done?” The idea of writing a SOP may seem overwhelming, but it’s easy enough if you follow a few simple steps. “First, determine the results you hope to accomplish with your SOP, and then create an outline that identifies which steps must be taken to reach those desired results,” Newton instructs. “After creating the outline, develop a checklist to ensure each step is followed in the proper order.” He recommends a two-part process to test the checklist. First, observe your employee performing the task and fill in any gaps. Then, print it out and ask that same person to follow it and identify any missing or unclear steps in the written process. Revise the SOP based on that feedback, and then repeat the testing process. It may be necessary to test and revise the document several times until defining “a process that we feel can be handed to anyone and followed, without intervention, to achieve our desired results,” Newton warns; however, “the amount of energy and money you’ll save over time makes it a wise investment. A well-written SOP will
to vehicle drop-off and delivery. The idea is to create a SOP for any task that you’d like to hand off to an employee so that you, as the owner, don’t have to do it. And ultimately, you want that to include every task that needs to be performed in your business so that you’re not required to be present in the shop constantly!” Before beginning the daunting task of documenting every process in your shop, Anderson suggests checking with industry partners, such as paint manufacturers, software companies and other vendors that may already have created SOPs which they’ll make available so you don’t have to start from scratch. Of course, given the complexity of today’s cars, it’s not possible to document every aspect of the actual repair process. “It isn’t too difficult to create SOPs for the front office end of our business, but on the technical side, it’s a completely different story,” Anderson acknowledges. “Every car is different, so when it comes to actual repair processes, collision repair professionals should always defer to the OEM recommended procedures to ensure the vehicle is being restored properly to its pre-accident condition. But tasks like disassembly of a vehicle, the way we want to store parts and how we paint a car will typically be the same, and creating SOPs allows us to build confidence in our employees by developing uniform processes that improve efficiency.”
30 January 2024
New England Automotive Report
by Chasidy Rae Sisk
Improving shop efficiency is a major benefit of creating and implementing SOPs within your facility, but it’s certainly not the only one. Because operating procedures clearly identify each step in the process, there is a solid justification for holding an employee accountable when they miss one of those steps. It also creates consistency. “We need to establish a consistent way of approaching and performing various tasks to ensure that we are turning out a very consistent product,” Newton stresses. “Consistency creates confidence – each employee gains confidence that they are doing the right thing. When we build consistency, it’s far easier to train a new employee. “You know that running a successful business means establishing a set of rules, and that’s exactly why procedures and processes are so important for successful shops – these are rules for how you operate day-by-day, task-by-task,” he continues. “When you have clearly defined procedures and processes that each shop employee follows, everyone knows what is expected of them and their peers, and because they’ve consistently repeated these processes so many times, they develop waste-reducing efficiencies that can easily be duplicated by new hires who are trained on your procedures and processes.” Taking some time away from the shop could be another benefit of developing effective SOPs.
“Processes and procedures take the guesswork out of what you do and allow you to hand someone your handbook and have them follow your policy, enabling them to run your shop exactly how you’d run it – even when you’re not physically present!” Newton expresses. “Creating these documents also empowers you to plan your next vacation with the confidence that your shop won’t fall apart while you’re gone.” Unfortunately, sometimes, shop owners feel that they’ve followed all the steps outlined above, yet they struggle to see the results they hoped for. Often, that failure results from neglecting to engage employees and obtain their buy-in. “I think when you’re building your systems, you have to build in what I call the ‘why factor,’” Anderson says. “People need to understand why you’re asking them to do what you’re asking them to do. And once they understand the ‘why,’ they’re willing to follow the ‘how’ because they understand there’s a good reason for it.” Realize that the best SOPs are dynamic; they’ll need to be revisited and updated periodically. “In this industry, we frequently learn something new, and that means the road to improving our processes never ends,” Anderson observes. “This is a constantly evolving process, and you need to have the right shop culture to approach this journey one step at a time and stay the course.” PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
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Wagner KIA of Shrewsbury 730 Boston Turnpike Shrewsbury, MA 01545 (866) 438-3997 Option #2 Kiawholesale@wagnermotors.com
New England Automotive Report
January 2024 31
[COVER] STORY
The Recipe for Success: What Are the Ingredients of a ‘Good’ Shop?
What makes for a “good” or “great” body shop? If an auto body business wants to attract and retain customers and turn a profit, one would think that every shop would hope to be considered nothing less than “good” in the eyes of their customers or even their employees. Online reviews tell us what customers say, but do (or should) these reviews really hold much weight? A reviewer may give a collision repair shop five stars for being courteous and quick with the repair, but is that business doing all it can to repair cars safely by following OEM procedures? Are their employees happy, or are they leaving to work in better environments? Does a shop qualify as “good” or “great” because they only follow OEM procedures? Is a shop a “good” one because they communicate well with customers? So many factors can come into play. Is it all subjective? Or are the best shops around earning accolades because they’ve actually discovered the recipe for success? Mike Anderson (Collision Advice) believes there are three factors to be considered before labeling a shop “good.” The celebrated consultant, dynamic speaker and former successful shop owner says it comes down to putting the customer first, performing 32 January 2024
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safe and proper repairs and treating their employees well. “In my mind, it’s that they put the consumer first,” shared Anderson. “The consumer is number one – that is who they serve. Secondly, in order to put the consumer first and serve them properly, they prioritize safety over profit. Their moral compass should be on safe and proper repairs. Another factor is how well they invest in their employees, treating their team with respect and treating them well. Happy employees make for happier customers.” Making a good first impression with the customers is one key factor, according to AASP/MA Executive Director Lucky Papageorg. Having a pleasant atmosphere in the shop’s receiving area sets a nice first impression along with having their certifications on display. It’s also a good opportunity to start educating customers. “Place a TV in the waiting room that displays industry-related clips, like the ones the Alliance regularly shares with members. You don’t leave them waiting long, but it’s a way to start educating them before you have the opportunity to converse with them.” Another is having a solid message that conveys the business brand.
by Alana Quartuccio
“I think a good shop has a prepared dialogue in support of how they will sell the services they provide,” explained Papageorg. “A standard dialogue where everyone on staff shares the same message. Having everyone say the same thing is critical so a customer always knows the full scope, and nothing comes out of the blue.” The back end of the shop has to support what the front end tells the customer. McColl Rhodes of Nesco Sales Inc. Auto Body (Bondsville) shared the same sentiment about keeping everyone on the same page. Communication was the first thing she listed when asked what she thinks makes a good body shop. “I think the best shops are the ones where everyone knows what is going on,” she observed. “The technicians know when the parts are coming in, and the customer knows when their car will be done. “It’s also about organization,” she expanded on her point of view. “It’s communication and organization together. If everyone has their ducks in a row, then things run smoothly, and we can predict problems before they happen.” “To me, it’s about putting the idea of safety as a priority… PERIOD,” stressed Tim Ronak, senior services consultant for AkzoNobel. “Safety for consumers. Safety for staff. Safety for the community. Safety for the environment. Imbedding safety into the fabric of every decision a repair center makes as part of its interactions with consumers, staff and its community.” Jack Lamborghini spent 47 years in the auto body industry. Like Anderson, the recently retired shop owner believes a good body shop comes down to quality work, customer care and extraordinary employees. “There’s basically three pieces to it, and all are equally important,” the former co-owner of Total Care Accident Repair (Raynham) stated. “You have to do really consistent quality work. Quality work is defined by returning that vehicle back to its pre-loss condition based on the OE specifications. The second piece is that you have to provide a customer care experience that absolutely wows the vehicle owner. You want to give them an experience where the customer thinks of you, not only as the best body shop they’ve been to, but as the place where they received the best experience they ever had. The third piece is that you have to have extraordinary employees – people working for you who believe in their heart that you want to do everything to help them succeed. Make them understand how important they are to the process. “It’s all subjective to a certain degree,” Lamborghini continued. “You need to make sure you step outside of your comfort zone and verify that you have all those things. A lot of people say they do ‘great quality work,’ but there are levels to ‘great quality work.’ It’s the same with customer satisfaction. You may think you do a great job, but how ‘great’ is it?” Another line of thinking in all this is: what are the benefits to being at the top? In a competitive world that continues to be infiltrated with consolidation, it’s actually quite crucial. BASF’s John Shoemaker explored this concept at SEMA 2023 as part of the Society of Collision Repair Specialists’ Repairer Driven Education series with his talk “Being ‘Elite’ in a Consolidating Market.” Shoemaker demonstrated why it’s so important for shops to have a clear message in all the work they do. “A cultural shift within one’s business is another step toward being elite,” Shoemaker stated. “Make sure customers know they are at the right place to fix their car, and have every single member
of the staff know the shop’s brand and expectations. If your people aren’t able to identify and promote your brand, you’ve lost. They are the ones on the front line – at the check-in point, at the follow up – to get those Google reviews. If your employees don’t understand your brand, you won’t get the gains.” Speaking of reviews, just how heavy do they come into play in the makings of a “good” shop? In the words of Anderson, “There’s a term called ‘social proof.’ That is consumers looking for social proof that you can be trusted. Forms of social proof could be online reviews, like Google reviews and also your shop being listed on a OEM shop locator. It’s validation to the consumer that you can be trusted and that you have manufacturer equipment and are certified. The big thing I tell people is that there is customer service, and there is customer experience. Customer service is how you treat the customer; customer experience is how they feel they were treated. It’s really important that we distinguish the difference between the two.” Lamborghini also recognizes the benefits of customers having the opportunity to share their experience. “You really need to have some type of vehicle to give you customer feedback that will substantiate great customer care. In many cases, you may want to have more than one vehicle to obtain feedback.” As Lamborghini indicated, all of it is somewhat subjective as there are multiple qualities a body shop could display that could deem them worthy of a “great” rating. “A good shop stays current with technology and is willing to assist a customer in the ‘fight’ to get what they deserve while knowing full well it’s the customer’s responsibility,” Papageorg offered another perspective. Anderson finds businesses looking for ways to give back to their communities is quite a commendable thing. “I see people make a lot of money and buy boats, etc. but they don’t invest back into their communities, and I do think we have an obligation to give back.” A great shop is also one that offers a career path, Anderson suggested. “Great shops are open to giving women opportunities, invest in training and equipment and provide a nice place to work and a clean break room. That all goes back to having a great culture.” “A great shop will really be focused on owning their customers and not relying on an insurer to provide customers to them,” Lamborghini believes. “I think any truly great shop owns their customer and then has the ability to choose to not participate in insurance referral programs. I think it should be the goal for shops to be completely independent and operate their business so the customer is not only the first and foremost concern, but the only concern. That doesn’t mean you have to be adversarial with insurance carriers, but you should be striving toward complete independence so there is never a conflict between who your customer is and who you are truly obligated to. It just comes down to the fact that you can’t serve two masters.” Clearly, there are many elements that come into play and not one standard recipe for success. Although some common ingredients seem to be providing a good customer experience by way of good communication, treating employees right and turning out quality work that ultimately results in greatness. PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
New England Automotive Report
January 2024 33
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January 2024 35
[LEGAL] PERSPECTIVE by Sean Preston, Coverall Law
The Not-So-Fine Print on Referral and Program Repair Contracts, Part 1 Coverall Law’s Massachusetts-based team reviewed 14 unique insurer program contracts in preparation for a follow-up to our “Rip the Band-Aid Off: Divorcing your Referrals” article. (See grecopublishing.com/near1123legalperspective). The contracts reviewed were as old as 2010 and as recent as 2022. They covered repair programs and referral agreements, but they were largely hybrids, combining elements of the two. Perhaps most perplexing in our research was the Massachusetts Division of Insurance’s lack of any knowledge about these contracts at the outset of our investigation, whereas each contract is supposed to be approved by the Division of Insurance by law. While insurance referral and repair programs undeniably offer certain advantages to collision repair shops, it's essential to shed light on the potential pitfalls that can significantly impact the traditional contractual relationships that repair shops enter into with vehicle owners. Let's explore some of the challenges repair shops may face as they navigate these programs. This is the first of two installments on the topic. This month covers insurers’ influence in the repair process and communication issues. Next month, we’ll talk about the ensuing financial issues and preserving repair shop independence. Increased Influence of Insurers The automotive repair industry's landscape has undergone a significant transformation with the proliferation of insurance referral programs. While these programs promise streamlined processes and faster approvals, they bring along a complex web of challenges, notably the increased influence of insurers on repair shops. There are a few nuances of this influence and its potential ramifications for repair shops.Joining insurance referral programs often means repair shops work more closely with insurance appraisers. This collaboration can indeed facilitate quicker approvals and smoother interactions; however, a noteworthy shift occurs when appraisers, particularly those representing the insurer or their managers within the program, wield substantial authority over repair decisions. Insurers routinely promise a guarantee surrounding repairs made at a shop aligned with the insurer, but the contracts make clear that the repair shop is entirely responsible for holding the insurer harmless; when it comes to this empty promise, all repair shops are responsible for the work they perform. Unlike standard repair scenarios where the repair shop and customer have significant input into the decision-making process, the insurer adjuster, appraiser or their manager often have the final say in program contracts. This dynamic alters the traditional balance of decision-making power in favor of the insurer, potentially compromising the repair shop's autonomy. In fact, several contracts reviewed allowed insurers to dictate repairs and decide any need for re-repairs, at the repair shop’s cost of course. Repair shops engaged in insurance referral programs must 36 January 2024
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delicately balance the competing interests of insurers and vehicle owners. The pressure to align with insurer preferences, driven by the desire for smoother processes and continued collaboration, creates a difficult balancing act. Conflicts of interest may arise when repair decisions deviate from what is genuinely in the best interest of the vehicle owner. The pursuit of efficiency and adherence to insurer priorities might lead to compromises in the repair quality or choices that prioritize cost savings over optimal outcomes for the customer. For example, any delay beyond the time allowed by insurers can result in the shop paying customer rental charges, potentially at no fault of the repair shop. Recall that per Massachusetts CMRs (211 CMR 133.04), nonOEM parts may be preferred for cost-savings, and repair shops must get reimbursed when they follow the insurer directive but end up with a non-conforming part. But in several of the contracts Coverall Law reviewed, repair shops are not reimbursed for following the insurer’s directive. Please beware: You can give up many of your legal rights with a valid contract. Navigating the complex web of increased insurer influence demands a strategic approach from repair shops. Here are some considerations: 1. Open and transparent communication with both insurers and vehicle owners is paramount. Repair shops should proactively communicate any deviations from standard and OE repair procedures, highlighting their commitment to prioritizing the vehicle owner's best interests. 2. Rigorous documentation of repair decisions and adherence to industry standards can serve as a shield for repair shops. Having a clear record of decisions based on safety and quality standards can be crucial when conflicts arise. 3. Repair shops should take on the role of educators, ensuring that vehicle owners are aware of the dynamics within insurance referral programs. Informing them about the potential impact on repair decisions, the importance of advocating for their own interests can empower customers and the potential that their advocacy puts more money in their pocket. 4. Repair shops, individually or collectively, can advocate for maintaining a fair balance of decision-making power within insurance referral programs. This may involve negotiating terms that respect the expertise of repair professionals and prioritize the best outcomes for both insurers and vehicle owners. Massachusetts does have historical examples of shops flexing and receiving considerable concessions. While insurance referral programs offer benefits, the increased influence of insurers introduces complexities that demand careful continued on pg. 38
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January 2024 37
[LEGAL] PERSPECTIVE continued from pg. 36 navigation. Repair shops must actively manage these challenges to uphold their commitment to quality repairs and prioritize the best interests of the vehicle owners they serve. Your shop’s forms can assert more control in your relationship with your customer. Coverall Law recently released their Massachusetts forms which can help. Communication Challenges In the intricate dance between repair shops, insurers and vehicle owners within insurance referral programs, effective communication stands as a critical pillar; however, the increased involvement of insurers in the repair process brings forth a host of challenges, particularly in maintaining transparent communication with vehicle owners. Consider the multifaceted nature of these challenges and their potential impact on customer satisfaction. The repair process often involves unforeseen circumstances, adjustments to the initial repair plan and/or unexpected costs. In insurance referral programs, where insurers exert significant influence, repair shops may find it challenging to maintain transparency regarding these deviations. Please note that the contracts reviewed grant broad rights for the insurers to audit many elements of your repair shop. Insurers can impose specific protocols and guidelines, making it difficult for repair shops to communicate openly about why a deviation from the original repair plan is necessary. This lack of transparency can lead to confusion and frustration for vehicle owners, who may feel disconnected from an already overwhelming
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decision-making process. Clear and open communication is the bedrock of trust between repair shops and their customers. When repair shops face obstacles in communicating deviations or unexpected costs due to insurer influence, it can easily result in a decline in customer satisfaction. Vehicle owners entrust their prized possessions to repair shops with the expectation of being kept informed throughout the repair journey. A lack of transparency can leave customers feeling uninformed and isolated, eroding the trust that is crucial for a positive customer-shop relationship. One significant challenge to communication is that insurance companies often act as intermediaries, controlling the relationship and narrative between repair shops and their customers. In Massachusetts, specific regulations stipulate that conflicts involving repair shops on an insurer's program must be handled directly with the insurer rather than with the vehicle owner. This dynamic further limits the repair shop's ability to communicate openly with customers when conflicts arise, but it doesn’t mean shops can’t talk with their customers. Effectively navigating communication challenges within insurance referral programs requires a strategic approach: 1. Repair shops should proactively communicate with vehicle owners, providing regular updates on the repair process, any deviations and unexpected costs. 2. Repair shops can take on the role of educators, informing customers about the dynamics within insurance referral
programs and setting clear expectations about the repair process. 3. While regulatory constraints exist, repair shops can advocate for clearer communication channels with customers, emphasizing the importance of transparency for building and maintaining trust. The communication challenges within insurance referral programs demand careful attention. Repair shops must navigate these challenges while upholding their commitment to transparent communication, customer satisfaction and compliance with regulatory dynamics. Balancing these elements is crucial for fostering positive relationships with both insurers and vehicle owners. The ability to communicate with and advocate alongside the customer can further serve to ensure the customer’s best interest is served. This analysis continues next month with the financial constraints and best practices for preserving independence where it matters most. PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
Coverall Law Managing Attorney Sean Preston finished in the top of his law school class at the historic Howard University School of Law in Washington, DC after serving in the United States Army. He went on to excel in business and legal strategy, serving some of the world's most recognizable brands in neighboring industries. Sean recently returned from Berlin, Germany with his family (where he served in Rolls-Royce's General Counsel function) and today resides in Wareham, MA, where he helps to oversee and meaningfully lead efforts in the region for Coverall Law. He can be reached at (508) 635-5329 or spreston@coveralllaw.com.
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New England Automotive Report
January 2024 39
EXECUTIVE DIRECTOR'S MESSAGE continued from pg. 6 by many shops who have been very successful in recouping the additional costs associated with storing vehicles (even those which are repairable) when insurers and their assigned appraisers are delayed in either seeing a vehicle for the first time or taking more than the allowed time to submit estimates. (212 CMR 2.04 (a): Assignment of an appraiser shall be made within two business days of the receipt of such claim.) The assigned appraiser has five business days to view the vehicle AND complete the initial estimate. Additionally, the appraiser should not further delay the repair process by taking longer than the three business days allowed to see the vehicle for a supplement. The appraiser MUST then finalize the paperwork within one day of the viewing. (212 CMR 2.04 (h): The insurer shall assign an appraiser who shall personally inspect the damaged vehicle within three business days of the receipt of such request. The appraiser shall have the option to leave a completed copy of the supplemental appraisal at the registered repair shop authorized by the insured or leave a signed copy of his or her field notes with the completed supplement to be mailed, faxed, electronically transmitted or hand delivered to the registered repair shop within one business day.) If you do not hold the insurer and their assigned appraiser to these time frames, you are wreaking havoc on your ability to properly schedule and move vehicles through the repair process in an orderly and timely fashion, which is ultimately costing you money! And it is costing you money in more ways than just one.
If you make the sound business decision to charge storage for delays caused by the insurer or their appraiser, it is important to notify your customer, making them aware and ensuring they agree to the charges. This is important because it may fall on them to pay for the additional charges if the insurer fails to do so. It is equally important that you explain that you are doing so in an attempt to keep the repair process moving and NOT just to make more money. If you elect to charge for storage and associated administrative costs you have incurred, you are well on your way to stopping the practice of rewarding poor behavior. Another way we tend to reward poor behavior is when an appraiser fails to make an appointment to see a vehicle at your shop. The Auto Damage Appraisers Licensing Board (ADALB) has stated that it is well within the rights of a shop to require that an appointment be made. Further, the ADALB has also ruled that you may require appraisers to sign in upon arrival and to leave signed field notes upon request. It would seem fair that any person who fails to abide by the regulations and edicts of the ADALB, which issued them the privilege of MVDA license, is NOT there as an appraiser. Why would you reward such a person with the ability to view a vehicle if they have already displayed the inability to follow and adhere to simple requirements which are not even technical in nature? What do you think that person will continued on pg. 42
One Call, One Truck for 14 Brands!
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New England Automotive Report
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January 2024 41
EXECUTIVE DIRECTOR'S MESSAGE continued from pg. 40 do when you start to discuss proper repair procedures and requirements? Rewarding poor behavior is NOT the solution! Speaking of appraisers and rewarding poor behavior, if any appraiser already owes you paperwork from previous claims, why would you reward them by allowing them to see another vehicle at your shop and add to what appears to be the inability to keep up with their workload? Further, if you are in receipt of an original or supplement which does not accurately reflect the agreed upon repairs as negotiated (for which you have signed field notes – shame on you if you do not), why are you rewarding the poor behavior by doing an audit yourself and writing another supplement? Remember that in both examples above, the appraiser (especially a staff appraiser) is well paid, receives benefits and possibly even profit sharing while YOU are doing ALL the extra work and further rewarding their poor behavior. Unfortunately, there are dozens more examples of how we as collision repairers reward poor behavior even though we have the power to withhold that reward. If you have made or plan to make the independent business decision to continue to “break free” and to “Get More In ‘24,” the “ALLIANCE” is here to help and provide you with whatever tools you may need. There are so many tools available to you to make your life easier, more productive and more profitable in ’24. Join those who are already reaping the rewards. Join the ALLIANCE and make the resolution to BE REWARDED FOR GREAT PERFORMANCE! See the application on page 7. PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
AASP/MA EXECUTIVE DIRECTOR EVANGELOS “LUCKY” PAPAGEORG can be reached at (617) 574-0741 or lucky@aaspma.org.
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January 2024 43
44 January 2024
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