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Let's start a conversation...

2011-01-26T23:25:00Z

In the last few months most body shops have been very busy repairing hail damaged vehicles, thanks to Mother Nature. I would like to begin a conversation on what the industry would like to see the ASA work on this year. In a most recent questionnaire the response to training was overwhelming. I need to know what type of training you would attend. Please email me or respond to this message on what you are looking for.

Shop Training
Front End Training
Management Training

Look forward to hearing from you

Luz Rubio (luzrubio@asaaz.org)

Training at NACE 2010

2010-09-06T17:59:00Z

ASRW – Bringing the Best to You!
By Ron Pyle on August 23, 2010

    Over the past several years, our Automotive Service and Repair Week (ASRW) planning teams noted that professional independent service providers desired more direct interaction with automakers and tool and equipment manufacturers.
As we developed the Congress of Automotive Repair and Service (CARS) into a full-fledged exhibition to complement its established reputation as a premier education and networking event, we purposefully invited the leading vehicle manufacturers to expand their presence at ASRW. Ford, General Motors (GM), Toyota, Chrysler and several others had traditionally been anchors at the International Autobody Congress and Exposition (NACE) where they promoted their wholesale crash parts programs and contributed a great deal to the technical education offerings.
    In spite of the effects of the recession and the federal programs instituted to stimulate GM and Chrysler, several automakers participated at ASRW in 2009 and are planning to return this October. This is encouraging and will be warmly welcomed by mechanical and collision repairers.
    Furthermore, this year’s events will feature the addition of a tool and equipment pavilion, populated by members of the Equipment and Tool Institute (ETI). We truly appreciate ETI’s decision to participate in this year’s ASRW events, and the premier repair shops recognize the importance of being properly equipped in order to service and repair the modern vehicles that are showing up in their bays.
    ASRW is designed for the serious automotive service professional. The audience has spoken, and it demands access to information, education, training, networking and products that are relevant in the complex and demanding business of automotive service and repair. Every week we are hearing more and more about the challenges of keeping current with technology, management best practices and the increasingly confusing and complex regulatory environment.
    In the movie “Field of Dreams,” the lead character was determined to create a baseball field special enough to attract the best players. “Build it, and they will come” became a part of our vernacular due to the popularity of the movie, but we know it isn’t that simple.
    “Building it,” has to begin with a clear understanding of what the professionals want. Our teams heard you, and we have responded. Take advantage of the opportunities that will be presented at ASRW this October, and become a part of shaping the future of these events. And rest assured, ASRW will be a part of the future because this industry deserves its own week.

Ford tests slam aftermarket structural parts at CIC

2010-07-29T18:01:00Z

You may have read the article below or a similar one in an industry publication. What are your thoughts? Made any changes to they way you do business?

Ford tests slam aftermarket structural parts at CIC

Publish date: Jul 26, 2010
By: Bruce Adams

Ford Motor Company engineers picked up where Toby Chess left off at the Collision Industry Conference (CIC) meeting July 21 resulting in a stinging indictment of aftermarket structural parts.

Chess, an industry activist and trainer, conducted demonstrations at the November 2009 and January 2010 CIC meetings showing how structural aftermarket parts did not match the same quality characteristics of original equipment (OE) parts. He was set to embark on a third demonstration at the April CIC meeting in Atlanta when LKQ Corp. threatened to sue him if he proceeded. His demonstration was canceled at the last minute and many repairers were angry over what they said was a stifling of free speech.

LKQ said its tests indicated the aftermarket parts met quality standards and Chess’ demonstrations were spreading misinformation. See Threatened LKQ lawsuit stifles CIC meeting.

While Chess sat on the sideline during the most recent meeting, Ford engineers Paul Massie and Roger Chen provided extensive details about five aftermarket structural parts that the company tested against Ford OE parts. All five parts fell short of OE quality standards.

"We will show you that these aftermarket parts are poorly constructed, are inferior quality and could compromise occupant safety in a crash," said Massie, of Ford's customer service division.

Ford engineers measured a variety of characteristics including metal gauge thickness, weight, raw materials and structural integrity. They also subjected the aftermarket parts to simulated crash performance tests using computer aided engineering (CAE) analysis.

Ford ordered the following aftermarket parts to compare to its OEM parts:

• 2005-09 Mustang front and rear bumper beams
• 2008-09 Focus front and rear bumper beams
• 2005-09 Mustang bumper isolators
• 2006-08 F-150 bumper brackets
• 2004-07 F-150 radiator core support

CAE modeling was done on the two Mustang parts and the F-150 radiator core support.

Aftermarket parts' metal gauge thickness and weight were less then the OEM parts with only one exception, Massie said. They also found that aftermarket parts' material usage varied significantly from OEM parts. "There were significant structural differences between the aftermarket parts and the OEM parts," said Chen, a crash development engineer in Ford Safety Engineering.

One startling difference was in the Ford F-150 radiator core support. The OE part is made of lightweight magnesium and the aftermarket part was made of plastic.

"We could not get a metal replacement part, we could only get plastic," Massie said. "This part became the poster child in the OE vs. aftermarket debate. In this case, the airbag sensor would be mounted in plastic instead of high-strength steel magnesium. The aftermarket part will alter the sensing of the airbag and affect airbag deployment time. The timing of the airbag deployment is an extremely important safety feature."

He said the OEM radiator core support was twice the price of the aftermarket part because magnesium is more expensive than plastic.

Sections were cut from both OE and aftermarket parts and sent to Ford labs to determine material composition. Aftermarket parts were electronically scanned so their dimensions could be determined and compared to Ford OE parts using CAE testing. CAE models of the aftermarket performance were built by substituting the aftermarket parts' material composition and dimensional measurements for the Ford parts. This allowed engineers to predict how both parts would perform.

The differences were dramatic, according to Ford.

Aftermarket bumper beams did not meet Ford engineering specifications and would have been rejected by Ford based simply on dimensional differences.

In addition, aftermarket bumper beams were made of mild steel while the Ford bumper beams were made ultra-high-strength steel. Aftermarket bumper beams consisted of two stamped pieces spot-welded together while Ford bumper beam are one-piece rollformed, hot stamped at elevated temperature, water quenched in die and annealed through bake oven.

In describing what that means in terms of hardness and crashworthiness, Chen said it is like "tofu versus a rock."

Ford said the aftermarket parts it tested were substantially different from OE parts in raw materials, material weight and thickness, manufacturing processes to construct the part, dimensional and structural integrity and performance (for the tested bumper beam and radiator support.

"They do not meet the test of like kind and quality required by 20 states for use in collision repair," Massie said. "The use of these tested aftermarket parts will change the dynamics of the crash process resulting in a differing response from the vehicle safety system than those calibrated by Ford."

Massie said Ford will work with industry trade associations, automobile alliances, governmental and regulatory agencies and elected officials for oversight of aftermarket parts and their impact on the safety of the driving public.

What is Arizona's Aftermarket Disclosure Law?

2010-06-22T16:59:58Z

I recently received several calls with this question, thought it was worth sending it out to everyone. --- Luz

Current Arizona Statute
44-1291. Definitions
In this article, unless the context otherwise requires:
1. "Aftermarket crash part" means a replacement for any of the nonmechanical sheet metal or plastic parts which generally constitute the exterior of a motor vehicle, including the inner and outer panels.
2. "Installer" means an individual who actually does the work of replacing or repairing parts of a motor vehicle.
3. "Nonoriginal equipment manufacturer aftermarket crash part" means an aftermarket crash part which is not made for or by the manufacturer of the motor vehicle.
4. "Repair facility" means a motor vehicle dealer, garage, body shop or other commercial entity which undertakes the repair or replacement of those parts that generally constitute the exterior of a motor vehicle.

44-1292. Identification of aftermarket crash part
A nonoriginal equipment manufacturer that supplies an aftermarket crash part for use in this state shall affix to the part or inscribe on the part the logo or name of the manufacturer.

44-1293. Disclosure on use of aftermarket crash part
A motor vehicle repair facility or motor vehicle parts installer shall not use a nonoriginal equipment manufacturer aftermarket crash part to repair a vehicle unless the part meets the specifications of section 44-1292 and unless the consumer is advised in a written notice attached to or printed on a repair estimate which:
1. Clearly identifies each part.
2. Contains the following information in ten point or larger type:
"This estimate has been prepared based on the use of replacement parts supplied by a source other than the manufacturer of your motor vehicle. Warranties applicable to these replacement parts are provided by the manufacturer or distributor of these parts rather than the manufacturer of your vehicle."

44-1294. Enforcement
Violation of this article is declared to be an unlawful practice and is subject to all of the penalties and enforcement procedures provided in chapter 10, article 7 of this title.

ASA "Taking the Hill" Fly-In

2010-05-04T18:18:00Z

AMI Leadership Conference Update:
Registration closes Wednesday, May 5

BEDFORD, TEXAS, May 3, 2010 – The Automotive Service Association will hold the ASA 'Taking the Hill' Fly-In and Automotive Management Institute (AMI) Leadership Conference May 11-12 in Washington, D.C. The deadline to register is Wednesday, May 5. Event details and an online registration form are currently available at www.TakingTheHill.com. Travel and hotel accommodations are the responsibility of each participant.

The ASA Fly-In will address the key issues facing both collision- and mechanical-repair professionals, and allow members to meet face-to-face with policymakers on The Hill. The AMI Leadership Conference sessions scheduled for May 11 will allow attendees to participate in two three-hour workshops focusing on ethical leadership. The workshops are designed to enhance attendees' business and personal success.

For more information or to register online today, visit www.TakingTheHill.com. The Web site contains conference times, travel suggestions and a downloadable flier about the event.

The Automotive Service Association is the largest not-for-profit trade association of its kind dedicated to and governed by independent automotive service and repair professionals. ASA serves an international membership base that includes numerous affiliate, state and chapter groups from both the mechanical and collision repair segments of the automotive service industry. ASA's headquarters is in Bedford, Texas.

ASA advances professionalism and excellence in the automotive repair industry through education, representation and member services. For additional information about ASA, including past news releases, go to www.ASAshop.org, or visit ASA's legislative Web site at www.TakingTheHill.com.

Masters Can Move Markets

2010-04-09T18:29:00Z

Author Daniel Pink in his book; DRIVE, The Surprising Truth About What Motivates Us tells a compelling story about the rise of Wikipedia, currently the largest online encyclopedia in the world. In less than a decade, Wikipedia has amassed over 13 million articles in 260 different languages. Their biggest rival for market share has been Encarta, the on-line encyclopedia software produced by The Microsoft Corporation. Encarta has been the standard for 16 years running and the giant, Microsoft, was the pioneer of the on-line encyclopedia.

On October 31, 2009 in a “David vs. Goliath” style upset, Microsoft permanently pulled the plug on the Encarta product. They simply could not compete with Wikipedia and bowed out of the fight. Now upsets happen all the time and by itself is not wildly impressive, but look at the facts behind Wikipedia;

Wikipedia is a purely free online service; no one gets paid to develop it.
There are approximately 10,000 people that contribute to the content every week.
Most have to commit close to 20 hours per week to keep it going

The largest software company in the world, with tons of paid professionals working full time, was taken out by a bunch of people, amateurs, working for free in their spare time. How was this possible? Was this some business world anomaly, a rare occurrence? It turns out that the truth really is stranger than fiction, but you will probably have to read the entire book to get the full picture.

Pink goes on to talk about two elements that were essential in making such an upset occur and what fueled the intrinsic motivation of all of those amateurs to participate consistently, for free. The first was the human desire for Mastery; That is to say our instinctive need as social animals to continue to learn, grow and find our individual excellence. In a sense it is, to own a talent or skill, to find a unique personal greatness. The Wikipedia team was all on a pursuit to mastery in their own way, the writers, historians, IT geniuses and organizational developers, all worked through Wikipedia as a vehicle to become better professionals and master their crafts.

That is not to say that the paid professionals of Microsoft are not experts in their field, I’m sure they must have a measure of expertise to have gotten to their current positions. The difference is in the level of disciplined effort and execution on the project. For the Wikipedia people, the project represents their life’s work and a desire to do and be more. For the Microsoft professionals, they are being paid to complete a corporate objective…that’s it. The difference is the intrinsic motivation and that comes from the instinctive human desire for mastery. But that is just the beginning of the story….

The second key element was Purpose; there was a shared vision of how things should be, what an online encyclopedia should really provide to people. For the Wikipedia team there is an entire belief system built around this vision, morays and norms, direction and each person could rally around the purpose.

There is also a third, more obvious, advantage that Wikipedia has over Microsoft; strength in numbers. Microsoft as a corporation may out number Wikipedia as a whole in size, strength and resources but not on this particular project. Microsoft had perhaps 100-200 people committed to the Encarta product, at best. Wikipedia has over 10,000 strong for their participation level. A 10 to 1 personnel advantage is pretty significant.

So what does this all have to do with the Collision Repair Industry? Well, after sitting in on the last ASA Collision Industry meeting it’s pretty clear…everything! Up on the board were half dozen topics ranging from licensing to aftermarket parts. Now I’m no expert by any means with any of those topics but it was not difficult to tell that these could all be challenging fights against some industry “Goliaths”. There was much discussion about which fights to take on, who will lead the charge and the obstacles they would face. And there was some doubt in people’s voices; are these fights that can be won?

I suggest that they can because as I looked around the room, I saw something quietly familiar. I saw the very elements that Daniel Pink was indentifying in the Wikipedia story. There was Mastery; every person there was committed to continuous improvement of the collision industry, to their individual company’s success and growth, to themselves as professionals. In fact, that room probably was representative of 30-40 years or more of expertise in collision repair. There was purpose; everyone agreed on how the collision repair industry should be, what was right for the customers and the community. There was a call to action, to rally more troops and gain strength in greater numbers. The story of Wikipedia serves as a great example of how this winning formula can help create the intrinsic motivation and relentless discipline to move a team to consistent action. That consistent action, allows Masters of their craft to move markets.

In conclusion, I hope that as you read this it sparks some thought and serves as a reminder for what the ASA is all about. Each one of you is part of the ASA because you are masters of your craft, with a desire to continue to grow as professionals and people. This is your life’s work. There is purpose and collectively you all know how the collision industry should be, to best serve the community. Victory is possible; there are real examples even today where the Goliath falls. Be relentless, keep building your numbers and rally your strengths, keep fighting the good fight.

-Bryan Nann

Your last Update

2010-04-01T21:51:00Z

When was the last time you updated your State Farm Survey? It's the beginning of a new month and you're probably reviewing the changes that you have had in your business during the 1st Quarter of the year, include a few more minutes to update your survey. Have questions about the survey, click on the left hand column on "How to Complete Survey" and you will find a brief Q&A.

Collision Forum March 11

2010-02-15T19:38:00Z

ARE YOU GOING TO THE ASA MEETING ON MARCH 11^TH!

It has been said a million times – collision repair shops are their own worst enemy. Some agree to ridiculously discounted rates or will “save” deductibles just to get another job in the door. A lot of shop owners feel there is nothing they can do to improve these things. They think the insurance industry is too big and powerful and that trying to change anything is just a waste of time. Well, that is certainly one way of looking at it.

So if things are this bad, why go to the ASA meeting on March 11^th?

There are a lot of reasons to go. But the main one is that if you don’t go, you are basically giving up. Will you then just stand on the sidelines and complain about everything from rates to aftermarket structural parts?

Tell me, how has that worked out for you in the past?

If there is any hope of improving things, it will take your involvement. And your ideas. And maybe just a little bit of your time.

It is a proven fact that states with active auto body associations (like Minnesota, Rhode Island and Connecticut to name a few) are better off than those states with little or no participation by shops. Some states have actually made a lot of progress. In fact, one of them has even passed a law making it illegal for an insurance company to use only a portion of the procedure pages – they must use all of the P pages in the database the estimate is written in. I guess these states haven’t gotten the message that “nothing will ever change” in this industry.

We need as many people at this meeting as possible. Time to show up not give up! If you are planning on coming, call another shop and get them to come also. Accepting the way things are is just not an option.

Lets hear from you - what is your opinion?

Collision Forum March 11

2010-02-11T21:03:00Z

Two years ago we met to discuss the issues of our industry. At that meeting we defined important areas of focus, and selected volunteers who took the lead - and as a result, gained successes.

It’s time to regroup and bring our industry together to get input on the issues and challenges faced by collision repair shops today – redefining where we go from here. This is an ‘open invitation’ to members and non-members. Please consider the importance of this short meeting relative to the current state of our industry. We are asking for your participation, input and involvement in your industry.

Thursday, March 11, 2010
6:30 - 8:00 p.m.
ASA State Office
5060 N. 19th Avenue, Suite 216
Phoenix, AZ 85015

Email Luz at info@asaaz.org to confirm yur attendance.

How to Make More Profits With Just a Broom

2009-11-30T21:45:00Z

How much does it cost to write a supplement?
How much does it cost for a comeback?
Do you have SOP's for every task in your shop?
What is the average touch time by your techs?
Why is it important to have a computer in a tear down stall?

Get the answers to these questions at the ASA AZ meeting on Wednesday, December 9.

To download registration form: click here.

Embracing Lifetime Value

2009-11-30T02:56:00Z

Here is good post for our blog, I found on Seth Godin's blog.

If you walk into a company-owned cell phone store to sign up for a contract, what are you worth?

Given the huge gross margins at AT&T and Verizon and the standard two-year contract, I think it's easy to figure on more than $2000 in lifetime value.

If you ran a business where a customer represented an additional $2,000 in profit, how would you staff? How long would you make someone wait? If staff costs $25 an hour, how long would that extra person take to pay off?

Few businesses understand (really understand) just how much a customer is worth. Add to this the additional profit you get from a delighted customer spreading the word--it can easily double or triple the lifetime value.

So, a chiropractor might see a new patient being worth $2,500, easily. And yet... how much is she spending on courting, catering to and seducing that new customer? My guess is that $50 feels like a lot to the doc. Instead of comparing what you invest to the benefit you receive from the first bill, the first visit, the first transaction, it's important to not only recognize but embrace the true lifetime value of one more customer.

Write it down. Post it on the wall. What would happen if you spent 100% of that amount on each of your next ten new customers? That's more money than you have to spend right now, I know that, but what would happen? Imagine how fast you would grow, how quickly the word would spread.

Here's how you'll know when you've really embraced this--a good customer at your podiatry practice (or supermarket or tax firm) walks out the door in a huff and you turn to your partner and say, "There goes $74,000."

How Do I Join ASA?

2009-11-18T19:57:00Z

Why Belong to ASA…

All of us are in business to provide goods and services to the motoring public and to provide a living for our families. Unfortunately, in today’s economy it is not enough to hang out a sign and serve our customers well in order to prosper. We must also stay aware of changes in the industry that affect our bottom line. We need to be sure we understand all of the requirements and regulation imposed by various government agencies. We have to stay on top of changes in technology and keep our employees trained. Finally we need to control our costs where ever possible.

ASA-AZ was founded on the principle that by joining together we can advance the common interests of all our members.

To download the membership application and learn more, click on ASA Logo Below.

If you have any questions or comments, just click on the add comment label below and you will receive a response.

Cycle Time Is A Joke And A Lie!

2009-11-11T03:41:00Z

Posted on 08. Jun, 2009 by biggs in Uncategorized

Cycle time is a joke and a lie when used as a benchmark comparison between shops or as a accurate key performance indicator shop-to-shop evaluation tool. Sure, it can have value for an individual shop for internal comparison, but it is totally and completely inaccurate and misleading when used as it is today by insurers and others to compare the performance of multiple shops in multiple markets with a wide variety of repair types and work force. As it is today, it is damaging the lives and livelihood of thousands of businesses and consumers throughout America.

Can you imaging trying to synchronize watches with thousands of others to ensure timely coordination, but everyone uses a different definition of a day and has differing length hours, and even a different number of hours in a day? It is a ridiculous scenario, yet the collision repair and insurers employ measurements with nearly the same absurdity to evaluate and rank body shops. The result is thousands of lives are adversely affected and until now, no one has offered to improve the measurements or even acknowledge that they are arbitrary and ignorant.

The most ridiculous of all of the key performance indicators (KPI) that insurers and repairers use is “cycle time.” The collision and insurance claims industries have used a measurement of cycle time that contains neither consistency of how large a repair is or how many hours of repair time is applied. If one shop happens to be in a rural market where speeds are higher and hits are heavier, the cycle time will be far longer than in a suburban area where a shop specializes in lighter hits. According to industry and insurer cycle time measurements, one shops is far better performer, but that may be only because the measurements are inaccurate, illogical and insufficient.

The definition of cycle time even varies from industry segment to industry segment as it should, but again there is no factor that normalizes these units of time. Consider these varying definitions from a CIC task force committee charged with determining the definition and addressing this issue.

-Repairer Cycle Time: From the Time the Vehicle Arrives at the Repair Facility for Repair Until the Vehicle is Completed and Picked Up by the Consumer, (includes weekends). Commonly Referred to As, “Keys to Keys”.

-Insurer Cycle Time: “The Time From the First Notice of Loss to When the Claim is Paid”.

-Consumer Cycle Time: “From the Time of the Accident to the Time the Vehicle is Repaired and Returned to the Consumer.”

INVALID AND INACCURATE: To be used as a valid measurement, cycle times must include normalizing factors that will mitigate distortion and ensure consistency in application. In the case of cycle time of a repair, there are several factors that change the duration of the repair the most obvious is the severity of the repair. This is illustrated in today’s terms best by the dollar amount of the repair. Therefore, the most logical “normalizing” factor should be to calculate the number of days according to the overall dollar amount of the repair. For vernacular, the terms might be “repair days per repair cost”

SAMPLE CASE:

Consider this sample case of three shops with cycle times of:
Shop A = 10,
Shop B = 6, and
Shop C = 12.

From this data using today’s non-normalized calculations, shop B would have the best cycle time. On the other hand, if we add per repair cost factors, the results reflect a far different scenario.

Shop A = Average RO = $2,200 = 10 days = 4.54 days per thousand dollars
Shop B = Average RO = $1,500 = 6 days = 4 days per thousand dollars
Shop C = Average RO = $3,200 = 12 = 3.75 days per thousand dollars

You can take acception to the random sample numbers I used or disagree with any specific example, but the point is still valid and undeniable. A non-normalized measurement of cycle time does not accurately reflect efficiency either. For example, it does nothing to reflect how many repair hours were applied to the job since cycle time does not reflect how many technicians worked on the vehicle and how many hours were estimated on the repair. Therefore, another normalizing factor might be to how many hours of estimated repair time was used. This again would reflect a far different scenario than any arbitrary measurement of cycle time without any consideration for severity of damage or hours estimated or technician hours worked.

Isn’t it time for fix these inaccuracies and come to a common agreement surrounding consistent measurements? If and when they are fixed, these KPI’s will be valuable again. Cycle time will have meaning, consistency, accuracy and value. It will no longer be a joke or a lie, but become an essential measurement that could be the foundation for the most important aspects of making a body shop profitable and an relationship between insurers and repairs based upon logic and reason!

As of July 2009, those assembled at the mid-year Collision Industry Conference (CIC) voted to accept the condition that there should be a disclaimer when using cycle time by any group, entity or business. Here is the language accepted by the body:

Disclaimer: Cycle time is only one component of shop performance. The measurement of Cycle Time should be used in conjunction with other critical KPI’s to determine the overall efficiency and performance of a repair facility.

Normalizing the Variables

Drivable vs. Non-Drivable
Performance Relative to Your Market
"Keys to Keys" vs. Production Time
Specialized or Luxury Vehicles
Possible Subsets for Each of the Definitions

Cycle Time Definitions

The Committee Identifed the Need for Three Different Definitions for Cycle Time:

Repairer
Insurer
Consumer

The following are the definitions that we are recommending to the CIC body for approval.

Repairer Cycle Time: From the Time the Vehicle Arrives at the Repair Facility for Repair Until the Vehicle is Completed and Picked Up by the Consumer, (includes weekends). Commonly Referred to As, “Keys to Keys”.

Insurer Cycle Time: “The Time From the First Notice of Loss to When the Claim is Paid”.

Consumer Cycle Time: “From the Time of the Accident to the Time the Vehicle is Repaired and Returned to the Consumer”.

How to Overcome the Top Ten Negotiating Tactics

2009-10-30T22:01:00Z

I found an interesting article, there are some good nuggets in there!

By John Patrick Dolan

Everyone uses negotiation tactics to get what they want, whether they’re haggling over the price of an item in a garage sale or discussing potential salary with a future employer. Most of the time, when you enter a negotiating situation you can expect the other party to use certain maneuvers to tip the scales in their favor. For example, you can expect a potential employer to offer you less money than they are actually willing to pay to give themselves negotiating room. And a buyer will usually act surprised at your stated price, no matter how reasonable it may be, to pressure you into lowering it.

Everyone uses these tactics, but that doesn’t mean that negotiations can’t be fair. Some tactics are acceptable, while others are downright sleazy. Tactics are part of the process, and you can use them and still maintain your negotiations on an honest level. In other words, the use of tactics doesn’t necessarily mean tricking or manipulating people.

Some tactics are simply tools to expedite the negotiation process; others are used to take advantage of the other person. To be successful in sales and business, you must be able to differentiate between the fair and unfair negotiation tactics so you can use the good ones to your advantage and deflect the questionable ones. Consider the following ten negotiation tactics and the methods you can use to deflect them:

Tactic #1: The Wince: The wince can be explained as any overt negative reaction to someone’s offer. For example, you might act stunned or surprised when your negotiating counterpart names their terms. This tactic tells your counterpart that you know your limits, which isn’t under-handed or dishonest. And wincing at the right time can potentially save you thousands of dollars. Keep in mind that when deals are negotiable, your counterpart will start high.

Of course, you won’t always be the wincer. Many times, especially in the sales profession, you’ll be on the receiving end of the wince. In this case, you can counter with the next tactic.

Tactic #2: Silence: In the negotiation process, silence can be your strongest tool. If you don’t like what your counterpart has said, or if you’ve made an offer and you’re waiting for a response, just sit back and wait. Most people feel uncomfortable when conversation ceases, and they start talking automatically to fill the void. Almost without fail, your counterpart will start whittling away his or her position when you use this tactic.

So what if you find yourself negotiating with a person who understands the importance of silence as well as you? Rather than wasting time in silence, restate your offer. Don’t make suggestions; just repeat your terms. This maneuver forces the other person to respond, and more often than not, they respond with a concession.

Tactic #3: The Good Guy/Bad Guy Routine: This sleazy tactic is often used in movies, where two detectives are interrogating a person who’s just been arrested. One detective seems unreasonable and inflexible, while the other tries to make it look like he or she is on the suspect’s side. This tactic is designed to get you to make concessions without the other side making any in return.

If you find yourself in a good guy/bad guy situation, the best response is to ignore it. Recognize this game for what it is, but don’t play along and don’t allow the good guy to influence your decision. The best technique is to let your counterparts play their game, while you watch out for your own interests.

Tactic #4: Limited Authority: This tactic is a variation on the good guy/bad guy routine, but instead of two people working over you, the one person you’re dealing with tells you that he or she must approve any deals with an unseen higher authority. Sometimes, this higher authority exists, but other times your counterpart will create this figure to gain an edge in the negotiation process.

So just because your counterpart tells you, “It’s out of my hands,” don’t automatically assume the person is being honest. In this type of situation, two options exist: one, ask to deal directly with this so-called higher authority; or two, test the limits of your counterpart. You may find that although the other person has used this tactic to force you into backing down, if you keep at him or her, you may get what you want.

Tactic #5: The Red Herring: This technique comes from fox hunting competitions, where one team drags a dead fish across the fox’s path to distract the other team’s dogs. At the bargaining table, a red herring means one side brings up a minor point to distract the other side from the main issue. Effective and ethical negotiators generally agree that this tactic is the sleaziest of them all.

When your negotiation process is bogged down with a minor problem, and your counterpart insists on settling it before they’ll even talk about more important issues, then you are probably dealing with a red herring. In this case, use extreme caution, and suggest setting the issue aside temporarily to work out other details.

Tactic #6: The Trial Balloon: Trial balloons are questions designed to assess your negotiating counterpart’s position without giving any clues about your plans. For example, you may ask your counterpart, “Would you consider trying our services on a temporary basis?” or “Have you considered our other service plans?” Essentially, these types of questions put the ball in your counterpart’s court, and the nice part about them is they aren’t really offers. They allow you to gain information without making a commitment.

When you’re on the receiving end of a trial balloon question, you may feel compelled to answer it thoroughly. To maintain your edge, resist this temptation and counter with another question. For example, if someone asks, “Would you consider financing the house yourself?” respond, “Well, if I did, what would your offer be?”

Tactic #7: Low-Balling: Low-balling is the opposite of the trial balloon. Instead of tempting you to make the first offer, your counterpart will open the process with a fantastic offer. Then after you agree, they start hitting you with additional necessities.

For example, say you see an ad for a product priced lower than other stores. But then after you agree to buy, the sales representative uncovers the hidden costs, such as shipping or installation. In the end you probably pay more than you would have at another store listing a higher price on the product. To avoid falling victim to this tactic, ask your counterpart about additional costs before agreeing to any deal.

Tactic #8: The Bait-and-Switch: Similar to low-balling, the bait-and-switch tactic should be avoided. Your counterpart may try to attract your interests with one great offer, but then hook you with another mediocre one. This tactic will almost always burn you, unless you can recognize it. If your counterpart were really able to offer a genuinely good deal, they wouldn’t have to resort to bait-and-switch.

Tactic #9: Outrageous Behavior: Outrageous behavior can be categorized as any form of socially unacceptable conduct intended to force the other side to make a move, such as throwing a fit of anger or bursting into tears. As most people feel uncomfortable in these situations, they may reduce their negotiating terms just to avoid them.

However, the most effective response to outrageous behavior is none at all. Just wait for the fit to die down before reacting, because emotional negotiations can result in disaster.

Tactic #10: The Written Word: When terms of a deal are written out, they often seem non-negotiable. For example, when was the last time you negotiated a lease, or a loan, or even a service contract that was typed up in advance in an official-looking document? You probably assumed these deals were non-negotiable, and for some reason most people make the same mistake of accepting terms that appear in writing.

The best defense against this tactic is simply to question everything, whether it appears in writing or not. You’ll inevitably run into some standard, non-negotiable documents, but it never hurts to ask questions. You may be surprised how many contracts actually are negotiable when challenged.

Better Negotiations in the Future: People have used these ten negotiation tactics for years, but that doesn’t mean they are always fair. So before you rush into your next negotiation situation, make yourself aware of these tactics and how they affect the process. When you learn the uses and defenses of these negotiation techniques, you can reach more mutually beneficial agreements and win more sales on better terms.

Read other articles and learn more about John Patrick Dolan.

[This article is available at no-cost, on a non-exclusive basis. Contact PR/PR at 407-299-6128 for details and requirements.]

Best Regards,

Bill Park

Posting on the ASA Blog

2009-10-28T01:50:00Z

We welcome your comments to our Collision Industry Blog. To submit a new comment email: info@asaaz.org your comments, include a title of your post. Also indicate if you would like to include your name at the end of the post. Your comments can be posted anonymously, please indicate that in your email. All posts are subject to review and the ASA AZ staff may edit your comments. No offensive comments will be posted.

If you have any questions, prior to posting feel free to contact Luz Rubio at 602-544-2600.

Am I The Only One?

2009-10-16T02:34:00Z

Most would agree that the Geico gecko is cute. But for the vast majority of collision repair shop owners, managers and technicians, there isn’t much else that can be said about Geico that is positive. Virtually every decision they make seems to be focused on one thing only, bottom line profits.

Companies like Progressive and Allstate that once acted much like Geico does today, have changed their policies somewhat. For the better. They currently focus more of their energies on customer satisfaction than in prior years. Along the way they must have determined that body shops play some small role in improving CSI. Both Progressive and Allstate show increased flexibility when settling a claim. Not that either is a shining example of fairness but at least they seem to be moving in a direction that is better for consumers and collision repair facilities.

So what does Geico do? They refuse to recognize the first labor rate change in 5 years. No matter that costs have risen dramatically or that every other insurer that I know of in this state has allowed for some increase.

When it comes to steering, Geico is re-writing the book on this. Estimates are that 75% to 80% of all Geico paid repairs are performed by shops under contract to them. They will say almost anything to get the customer in one of their shops.

Untested structural aftermarket parts are no problem to Geico. Apparently, consumer safety is not as important to them as profits.

Is anybody out their as sick of this companies strong arming and arrogance as I am? Few in this industry would argue that there are a lot of “fair” insurance companies out there. But, in my opinion, if you made a list of Geico’s good qualities, you couldn’t fill up the back of a postage stamp. There is nothing to indicate that they care one bit about what is necessary to properly repair a vehicle. It is all about profits. So what if they lose a few policy holders along the way. The money they save by underpaying claims lets them run even more ads so that they can replace those customers that, because of a bad claims experience, figure out Geico does not have their best interest in mind.

Personally, I have had it. It hurts for me to tell customers that they will need to pay extra to cover what Geico refuses, but enough is enough. They are the worst of the worst. And if Geico has continued “success”, other insurance companies will follow in their footsteps. It has always been that way.

What say you? Am I the “only one”?

Performance Measurement

2009-10-05T22:43:00Z

The illusive means to understand company behavior by using a 'draw by numbers' methodology is a challenge all organizations face. There is no doubt that company performance, consumer loyalty and client relations are developed and nurtured through the analysis of numbers; also known as 'performance metrics.' The inherent problem with metrics is that no matter how well run your organization is you cannot prevent the gaming of those numbers. The moment you choose to manage by a metric, you invite manipulation. Metrics are only proxies for performance, and thus should be treated as such.

In the following, I will describe five strategies that can allow an organization to better utilize the power of performance metrics. These strategies are not exhaustive by any means, however, they will provide a top-level perspective that can build a long-term means to collect relevant data for decision making paramount to out-pace your competition. Let's face it, if you cannot do that, good luck growing your business.

1) Evaluate your current metrics and ask: Does your current metric provide a means for you to determine how you are competing in the market? Can you or do you compare against industry benchmarks? Do they provide a means to analyze how you will fair against your competition in the future?

2) Beating last years numbers is not the point, and today we can really see the value of that statement. A performance measurement system needs to tell you whether the decisions you are making now will further your efforts towards the achievement of the organizational goals in the coming months. The secondary question that arises is does your organization effectively communicate the goals?
     a. You want the measurements to lead you rather than lag the profits in your business.
     b. You need to evaluate the things that you say no to as well as those that you say yes to.

3) Avoid low quality data.
         a. Avoid using a financial metric to compare a non-financial activity. A good example of that would be trying to establish an ROI for (IT, HR & Legal). This is commonplace from departments that are looking to justify there existence rather than being outsourced. How are these casual links justified? This requires a robust and qualitative approach that probably cannot be drilled down to a number. Do not get caught in that trap.

     b. Does your data collection capture the essence of the organizational goals?

4) Avoid gaming of the numbers.
    a. o minimize gaming you need to diversify the metrics and create a holistic platform. Here is an example:

Use current income and cash flow statements.

ii.

Measure actions on emerging business activity (sales & marketing).

iii.

New business opportunities.

5) Sticking to the numbers too long is dangerous. Although cash and growth are paramount to sustainability, looking at last week, last month and last year are dangerous. As stated earlier, it is clear in today's climate that historical data is less relevant than it was say two to three years ago. The focus moving forward has to be around profit and the relative position to your competition.

a. A one-size fits all strategy does not work, you need to know your customer, client and your competition.

What is ASA National Up To?

2009-09-18T23:58:00Z

ASA Leaders Meet with Sponsor of McCarran Ferguson Repeal Bill

On Wednesday, July 29, ASA leaders met with Rep. Gene Taylor, D-Miss., sponsor of U.S. House Bill 1583, which would repeal the McCarran-Ferguson Act. Since 1945, insurance companies have had a "limited" exemption from federal antitrust laws that apply to most other industries ensured to them through an act of Congress. The McCarran-Ferguson Act provides that federal antitrust law applies to the "business of insurance" only to the extent that such business is not regulated by state law. The anti-competitive consequences of McCarran impact both consumers and small businesses that have to deal with insurers.

ASA supports H.R. 1583, which is co-sponsored by Rep. Peter DeFazio, D-Ore., because:

• Insurers have argued that this exemption allows them to keep insurance rates low. This is simply not the case. A competitive marketplace will only enhance consumers' options.

• The state insurance regulatory structure has failed for consumers and collision repairers. Without federal regulatory recourse, consumer and small business complaints are left to generally ill-equipped state regulators. After years of complaints, many states lag in addressing important consumer and small business property and casualty issues: i.e., consumer steering, insurer pressure to use inferior auto parts, paint caps, etc. These problems are increasing for consumers and repairers, not decreasing.

• State regulators are less likely to recruit top professional employees to oversee increasingly complex insurance products offered by insurers as well as deal with more complicated insurance issues that arise. Federal regulators have access to a degree of human resource and other capital that state agencies do not enjoy.

The Sad Truth of Our Industry

2009-07-31T23:01:00Z

It appears that the Collision Repair Industry in our state and some others has become completely controlled by the Insurance Industry and the shops that allow the continued deception of the American Public. The blatant disregard for the laws that protect and provide what little rights the average consumer and shop owners have is astonishing. I am in the court system on a regular basis fighting for the money that we have spent to properly repair a vehicle to its pre accident condition, that’s right, fighting for the money that the insurance companies are responsible for. The insurance companies have influence or lets just say “ Contributions “ in all areas of our state providing them with a blanket of protection to continue to deceive the general public. We all know what is going on and most are afraid to speak out against it, but would not hesitate to prosecute their neighbor if they stole from them. Oh I get it, the neighbor doesn’t own you like the Insurance Companies do therefore there is a reasonable “NOT” justification of some owners continued participation. I know that the list is long to sign on the dotted line and that there are many that can not wait to get into some of your positions and play this manipulative game agai nst the public, but keep this in mind those that are waiting are and will be willing to cut you out in any way possible to be able to sign that contract. There are no loyalties here my friends, none. The practice of underpayments, not paying for necessary procedures, not paying the posted labor rates and the many other things on the list is completely in direct conflict with the policies that are purchased on a daily basis. I have never heard on any insurance advertisement that “ The insurance companies have filled out a survey and all the participating general public should review and determine what they can charge for the policies in that market area” Do you see the rationalization of this.? The independent collision repair facility is involved in an all out war of survival and needs to be prepared to disclose all of these unlawful practices that are being brushed off as a common business practice. I understand that “No one said business is fair “but I also know that no one said that it is okay to be an accessory to the deception or manipulation of the general public for monetary gain, in fact I think that that could be construed as illegal. If your business model was built around the continued participation of the insurance industry for your longevity, then your more than likely to continue business as they instruct you and will cower when the big bad wolf comes into your office to review your files all the while hoping that they do not find anything that they could use to give you the boot or destroy your business. This industry has been completely compromised by the people that participate in the condoning of the well known tactics and manipulation of the public and the shops by the insurance industry, information providers and our elected officials. The Sad Truth of Our Industry in my opinion is that! We are playing against a stacked deck and some of the players are shuffling the cards for the dealer making it almost impossible to have a level playing field.

Rate Increase in Phoenix

2009-06-28T21:00:00Z

I just learned that State Farm has raised their rates to $48 for Body and Paint, $50.00 for Frame and $28 for Paint & Material in the Phoenix Metro Market. Go figure, Phoenix has finally crossed the line. Flagstaff, Yuma, Tucson and all other surrounding areas have had split rates for years. I guess Phoenix is WAKING UP. HAVE YOU! Now that you have the bone what are you going to do with it? POST IT, ENFORCE IT AND GET WHAT YOU DESERVE!