AASP/MA Paves the Way Toward “Getting More in ‘24”

For the past 12 months, AASP/MA has made “Breaking Free in ‘23” its mantra. Every step that the Alliance has taken has been geared toward its battle cry, helping body shops declare their independence from the confinements of insurer control.

As a result, collision repairers across the Commonwealth have been successfully taking the reins of their businesses back with the goal of being able to make more and do more as 2024 draws near.

On October 21, AASP/MA held its final installment in a series of meetings designed to set up members of the collision repair industry with the tools and resources needed to retake control and ultimately work toward getting fairly compensated for doing proper repairs. 

“We need to understand no one can do it alone,” AASP/MA Executive Director Lucky Papageorg reminded the audience who filled the Assabet Valley Regional Technical School for “Breaking Free in ‘23 – Part Three.” “None of us can be Superman, but through education and understanding, we can move in the right direction.” 

This third “Breaking Free in ‘23” installment had something for everyone in the shop – from shop owners to technicians and front office staff. The agenda was geared toward painting a healthy financial picture, exploring ADAS technology and discussing the legal forms and contracts shops need to implement in order to protect their business and their customers’ best interests when properly repairing vehicles. 

Rachel James (Torque Financial Group) used her background as a former technician and former major paint manufacturer employee, along with her expertise as a financial advisor, to paint an eye-opening picture about what finances should look like from the perspective of a shop owner as well as an individual employee. James illustrated what planning should involve from managing profits and losses, to preparing for the future and being ready for emergencies. 

Managing finances takes discipline. So much has changed over the past few decades which influences the way the average person spends money. From smartphone apps driven by marketing that is specifically designed to show us items we want which leads to impulse buys to the average household growing from one vehicle to three or more, things have changed dramatically, and therefore, the way money is managed must change as well. 

More vehicles in driveways may be “good for our industry as it means there’s more for us to repair, but on the personal side, it means we are committing ourselves to more debt.” 

The introduction of more consumables has cut the average savings rate in half. “It’s easy to lose sight of the things we are spending our money on,” she pointed out. 

“The real trick to financial planning is having different buckets. Being prepared for the things you hope will work out, may not work out. Do you have different things in place to help you manage the unexpected?” James queried. “COVID was really a great lesson about being prepared for the unexpected.”

Having conversations about money is considered a touchy subject, but according to James, discussing money is necessary.

“You can’t blame employees for needing to go somewhere for $2 more,” she expressed. “Start talking to your people about finances. The more comfortable people are about it, the less stressful it will be.” 

When it comes to setting financial goals, business owners need to think through their business and their personal finances because “if one suffers, the other will too.” 

She also suggested they set up times to look at their finances to catch things that could be easily missed, like a forgotten payment or overspending. Cash flow is important, and if one can catch errors right away, it will eliminate the need for chasing missed payments later on. 

Ed and Scott Rachwal (Designer Office Systems) and Mike Johnson (Crown Collision Solutions) teamed up to exhibit what ADAS means for the future of the industry, including how to effectively make these repairs part of one’s business. Together, they worked to drive the point home that there is only one mindset to have regarding these repairs, and that is to make sure they are done right in order to keep vehicle occupants safe. 

“A lot of people I’ve spoken to question why they need to worry about ADAS as they are getting close to retirement or they don’t have the space,” shared Ed Rachwal. “Don’t think of it as something you have to do but rather as something that compliments your business.”

Whether one decides to invest in the equipment to bring ADAS calibration in house or they choose to outsource the work, the liability for that repair falls on the body shop that took the vehicle in for repair. Johnson stressed there is no other way to do these calibrations other than correctly and by manufacturer procedures. “If you don’t do what the manufacturer says to do, and you skip a step, it will cause failure, and you’ll ask yourself why it is happening. When I first bought ADAS equipment, I spent seven hours on a windshield. I thought I had bought a dud of a machine, but it turns out it wasn’t the machine. It was because the windshield was aftermarket. Once I replaced the windshield, it worked.”

Another important factor about procedures is making sure to document it all. “You have to pull that documentation every time and store it, so if something happens, you are covered,” suggested Scott Rachwal. 

Documentation and proper paperwork are crucial in not only protecting one’s business and the best interests of their customers, but it also aids a shop in obtaining proper payment. Attorney Sean Preston of Coverall Law set out to not only share solutions but to also collect feedback from the audience as he sought to obtain intel needed to create a “corporate legal strategy,” something the collision repair industry does not have as opposed to the insurance industry. Strength in numbers is key, and “the more members who give us a call and let us know what is going on, the stronger we get, because somebody is actually paying attention to what is going on in this state.” 

The lengthy session touched on everything from litigation to replevin to the appraisal clause as Preston suggested to the audience that they “show what has worked and what hasn’t worked; it’s only going to benefit one another.” 

Upon addressing ownership, Preston explained, “I’ve created a lot of companies for people over the years. If all one does is file with the state or via an online service, it’s like going down the freeway on a skateboard. It’s not a good idea. Every little piece you do right is like adding paneling, protecting you so that vehicle is secure. When you have that vehicle, that company, you put assets inside of it, and that company becomes the entity.” 

He also spoke of good business practices, which includes having the right documentation. For example, if one uses a company for ADAS, it should be outlined via forms. Preston also educated the audience on situations where a shop owner could be held personally liable for the company’s debts.

Preston emphasized the importance of reviewing customer forms regularly, on a quarterly basis and also updating them according to operation changes. Customer forms do a number of things including defining the relationships of the body shop, customer and the insurance company.

“You don’t have a relationship with the insurer; you have a relationship with your customer, and the customer has a relationship with their insurer.  You align yourself better with your customer by saying ‘we’re on the same team. You agree that I need to get paid for what I’m doing, ans I agree that your insurance policy ought to take care of this, so how can we work together to make sure that’s the case?’ I like that idea a lot. Defining those parties and defining the rights of those parties is going to be crucial in your forms.”

Another important consideration is making sure standard terms and conditions are included in forms.

“‘Terms and conditions’ is an opportunity to talk about some of your licensing agreements,” Preston notified attendees. “There’s a separability clause you could put in there to say that if any sentence in the document is found to be unlawful or unenforceable, the rest of the contract holds to the greatest ability in the law, because you don’t want the court to just throw out the baby with the bathwater, so it’s the little standard terms and conditions that you ought to have. My recommendation is not for you guys to spend a ton of time learning about that stuff but to have your attorney go in and put in those terms and conditions.” 

Every shop represented at the event received a thumb drive with materials discussed to be used in their daily business operations. Shops interested in obtaining the materials from the event can contact Lucky Papageorg via lucky@aaspma.org. Stay tuned for more information on future related events by visiting aaspma.org. 

Want more? Check out the December 2023 issue of New England Automotive Report!