Well, over the next few weeks...

[Advocate]

We will learn whether reporters for the industry’s rags are lazy and stupid or simply hard of hearing.

We’ll also learn whether a certain insurer talking head was telling the truth about his company’s new DRP agreement, or instead demonstrating his company’s lack of respect for its “partners”.

Then again, he could be a mushroom.

Just so we all are on the same page, the rags have reported thusly: (In Body Shop Business)

"There are new changes in store for Select Service shops, but State Farm spokesperson George Avery says they're minor and shouldn't concern shops too much.

"It is simply an ongoing update of the original agreement devised in 2006."

In sum, the new provisions are as follows:

Take a photo of the vehicle prior to a complete teardown.
Follow environmental guidelines and laws from federal and state governments.
Follow the law regarding licensing and/or certification."

http://www.bodyshopbusiness.com/Article/39117/state_farm_lays_out_new_revisions_to_select_servic e_agreement.aspx

And in CollisionWeek:

“Avery pointed out that this change is nothing major, like the switch from the old Service Select program, and the changes are mostly editorial in nature.

According to Avery, the revised contract contains some "repairer friendly" provisions to improve workflow.

Avery said the new contract also includes a section on part pricing agreements and parts locating services. That section includes "…changes to match requirements of the enhanced parts-ordering process that is currently being tested in Indiana and California," Avery said. No further details were given… " (Hmmmm :D )

Avery said the revised agreement does not ask repairers for new concessions or discounts.

Other changes to the agreement include:
Estimate Preparation and Upload changes such as:
- the ability for repairers to prepare a complete initial estimate, which may require disassembly
- provide a single initial estimate and single final bill whenever possible…

http://www.collisionweek.com/cw/news/2009/0116-stat.asp

So, what say you Biggsy, Gomer, Darrell, R&D Mikey, Arie, “Elect me please” Diane, Barry, Math Wiz Lippy, Jeannie, Leader Lee, Nicky, Drunken Billy et al? Are these early reports accurate? Did the Farm simply make some editorial changes? :D

Of course, I don’t know nuthin’… :D

[Raul]

Here is the agreement in full. Let's discuss.

http://www.dropbox.com/manager/SFSS_Rev.pdf (http://168.158.41.69/manager/SFSS_Rev.pdf)

:rolleyes:

[Pam]

Those you mention are too fearful to even risk breathing a word of objection to the revised SF agreement. And as far as industry trade rags, they have formed close, working "relationships" over many years with insurer sources and they, too, risk being alienated if they attempt to dig too deeply into any story.

Sheila Loftus, Charlie Barone and Tom Slear were the last of our true investigative industry writers. They would work tirelessly and dig deeply for the facts surrounding a story, and never got paid enough for those efforts. It's reall too bad.

[Advocate]

Or Gomer, Arie, Nicky, Biggsy Darrell? Are ya game for a few questions? Come on stand up straight and try to focus.

Anyway, let start, shall we? What do you ankle-grabbers think of the “fairly minor” change of having to beg…err ahhh. I mean “seek prior approval for any work performed on total losses?” Does this mean that any labor and costs expended tearing down a vehicle that subsequently “totals” are free to the Farm if ya didn’t ask for the amount before hand? Sure reads that way doesn’t it. But, maybe this was just an “editorial change”.

No biggie, right?

Okay, what’s up with all the brouhaha regarding pictures? Are you dolts such bad photographers that new guidelines were necessary….or, are more desk reviews forthcoming. Just asking. :D

So what, right?

Then let’s move on.

In Section 4, “Competitive Price” (a), did ya notice a “minor”, “editorial” change? Specifically, in (a)(2), what happened to the words “associated with the prevailing competitive prices determined by SF’s survey process”? The new agreement simply states that you ankle-grabbers must bill the “lower of” (among three choices) “(2) Current labor rates and paint and material pricing identified through SF’s survey process”.

Well, with the “survey” process” undefined, and the parameters of “prevailing and competitive” gone, what do you suppose this “minor editorial” change means? LOL :D

WOW, hey dolts, guess what? “Prevailing and competitive” was also removed from Section c, “Recycled Parts” as well. Oh, Oh, doesn't one major insurer "allow" lower than low salvage part mark-up? But hey, you fools don’t use many junk parts, do you? (LMAO)

Getting brain freeze? Okay, Okay, just one more. Let’s examine the “minor editorial” changes made to Section 4 (e). It reads:

e. Part Pricing Agreements. Provider acknowledges State Farm may enter into agreements with manufacturers, distributors, or suppliers of automotive parts.

So far so good, no changes yet. You dolts already bent over for that part. Let’s move on:

State Farm will send Provider a notice in writing of any such agreement. Provider may, at its option, participate with State Farm and such entities in obtaining parts for repairs when performing under this Agreement.

Not really much a change here either. The farm is being magnanimous, right Ankle-Grabbers? Let’s move the next sentence:


Provider further agrees that any part pricing agreements negotiated by State Farm are in addition to the price offered by the Provider to State Farm under 4.b, 4.c, and 4.d.

Huh?, What? What does this “minor editorial “ change mean? This language wasn’t in the old Agreement, was it? Must be a typo, right? Well, let’s read the next sentence:

State Farm shall receive the benefit of both the Provider's pricing offer under 4.b, 4.c, and 4.d and the price or discount negotiated through any part pricing agreements.

WHAT? Holy Crap Batman, does this mean the Farm will be applying previously offered ankle-grabber discounts to any new lower parts pricing that the Farm might negotiate with “manufacturers, distributors, or suppliers of automotive parts”. If so, won’t the dolts lose even more revenue and margin? Just wonderin'... :D

I also wonder what those dolts in Minnyhaha are thinking. That new parts law appears to have been rendered worthless. All that time, money and political capital wasted...

Ain’t “minor, editorial” changes wonderful?

Then again, what do I know… (Except this ain’t all the "minor editorial" changes. LMAO) :D

[Roger Walling]

Comments on agreement

Things that I though were interesting, All comments are my own opinion or interpretation and may or may not be an accurate description of the agreement.

Reattaching disassembled parts in the case of a total. (Under Total clause,) no charge.

Provide electronic images sufficient to prove needed work (guaranteed or no pay?)

On the subject of Prior damage: you cannot charge SF, and if owner does not want to pay, how do you align sub structure if previously damaged? How can the Provider state that all necessary repairs have been made? (Required statement by SF.)

Provider agrees to use an estimating system designed by SF.

Provider will charge no more for a part than SF. Can buy it for (plus a limited mark up).

No sublet markup.

SF. May “adjust” the amount of “providers’ due to …”Estimate competitiveness” (Translation, If you are not the cheapest on the block, you will be gone!)

SF considers you an “Independent Contractor” even though you must abide by all terms, conditions, supervision and inspections. (Look up Independent Contractor in your IRS booklet if you want a laugh)

These three items seem to be the only thing that SF seem to agree on:

First agreement by SF: they will review bill and pay if in order.

Second agreement by SF., Will allow shop time to be certified or trained if necessary.

Third SF. Agreement, They may provide your name to customers if the amount of the bill will be under their deductible.

[Roy Smalley]

how cars will be repaired; a major escalation that totally alters the shop-owning business model.

Folks have used the medical field as analogous to what has happened in our industy, and while the analogy was barely accurate then, now this agreement is far beyond what any medical professional would accept.

Of course people that work within the agreement....and there will be plenty....have been called everything from dolts to fools and worse. And the really worst part of that, by their capitulation to be destroyed is that it forces the same business model on those that don't want to participate and don't.

The options are now exceedingly clear. Fight or die.

[Pam]

...from 5 years ago.http://www.search-autoparts.com/searchautoparts/article/articleDetail.jsp?id=77619

It would be nice if ABRN would do a follow-up with these people. Of course Risley is now working in Northbrook, so he may not be allowed to comment openly. Shame. But there are certainly plenty of participants who could provide commentary...but they won't. Right, Advocate? :cool:

[dwilliams]

Those you mention are too fearful to even risk breathing a word of objection to the revised SF agreement. And as far as industry trade rags, they have formed close, working "relationships" over many years with insurer sources and they, too, risk being alienated if they attempt to dig too deeply into any story.

Sheila Loftus, Charlie Barone and Tom Slear were the last of our true investigative industry writers. They would work tirelessly and dig deeply for the facts surrounding a story, and never got paid enough for those efforts. It's reall too bad.

Pam...You have obviously forgotten about the last story Tom Slear wrote for BP&E about the Ridealong with State Farm. If you'll recall, SF sent him out for a day or two with a claims adjuster of the opposite gender. He came back singing the praises of how hard SF adjusters work to try and resolve claims and how the big, bad body shops are always trying to cheat the Farm out of their money. The article was to be an written in two or three installments. I think the first one was all that made it the paper. And it was printed with a disclaimer that his views did not match those of BP&E.

[Pam]

But I also haven't forgotten the many years of really good, detailed investigative articles researched and written by Tom, such as his recount of his dealings with ASA, and their leadership at the time, and the IRS. This one clearly illustrated the disdain ASA's leadership had for its membership.

http://www.princetonautobody.com/Docs/PDF/PE1996.pdf

[Biggs]

The Piped Piper with his smooth delivery stood in front of CIC and said, "It is simply an ongoing update of the original agreement devised in 2006."

THAT WAS POSSIBLY THE BIGGEST MIS-STATEMENT OF THE CENTURY SO FAR!

This simple update is a kiss of death using a slow acting poison. These points are an outright disaster for shops. it is a ticking time bomb. This gives them total control over any profits a shop may have ever made. RUN, RUN FOR THE HILLS, SAY NO, SAY HELL NO.

Consider just the points in #4 of their new agreement:

Section 4. Competitive Price
a. Repair Pricing. Provider agrees to estimate and bill for repairs using the lower of the:
(I) Most recent labor rates and paint and materials pricing information submitted by Provider to State Fann through State Farm’s survey process; or
(2) Current labor rates and paint and materials pricing identified through State Farm’s survey process; or
(3) Labor rates and paint and materials pricing offered to or agreed to with any other insurer.
Provider agrees to include on estimates the cost of competitively priced paris for the types of repair or pans replacement operations to be performed.
b. New, Original Equipment Manufacturer (OEM) Replacement Parts. When estimating new, OEM replacement parts, Provider agrees to estimate and bill for repairs using the lower of the:
(I) Manufacturer’s retail price; or
(2) Current competitive local market price; or
(3) Resulting price based on any agreement between Provider and State Farm; or
(4) Price offered to or agreed to with any other insurer.
c. Rceycled Replacement Parts. When estimating recycled replacement parts, Provider agrees to estimate and bill for repairs using the lower of the:
(I) Most recent recycled parts mark-up percentage submitted by Provider to State Farm through State Farm’s survey process; or

(2) Current recycled parts mark-up percentage identified through State Farm’s survey process; or

(3) Current competitive local market price; or

(4) Resulting price based on any agreement between Provider and State Farm; or

(5) Recycled parts mark-up percentage offered to or agreed to with any other insurer.

d. New, Non-OEM Replacement Parts. When estimating new. non-OEM replacement parts. Provider agrees to estimate and bill for repairs using the lower of the:

(I) Manufacturer’s retail price: or

(2) Current competitive local market price; or

(3) Resulting price based on any agreement between Provider and State Farm: or

(4) Price offered to or agreed to with any other insurer.
If new, non-OEM parts arc included on the repair estimate. Provider warrants the parts and the estimate comply with applicable state law and further agrees the use of such parts will be discussed with the vehicle owner and clearly identified on repair estimates. Provider further agrees that if new non-OEM parts are included on the repair estimate, such parts will be Certified Automotive Parts Association (CAPA) certified if the parts arc subject to CAPA certification.

e. Part Pricing Agreements. Provider acknowledges State Farm may enter into agreements with manufacturers, distributors, or suppliers of automotive parts. State Farm will send Provider a notice in writing of any such agreement. Provider may, at its option, participate with State Farm and such entities in obtaining parts for repairs when performing under this Agreement. Provider further agrees that any part pricing agreements negotiated by State Farm are in addition to the price offered by the Provider to State ...

[Observer]

The benevolent Farm would not take advantage of their partners and of course they take care of their insured.

The Farm Promise (http://www.statefarm.com/insurance/claim_center/auto/promise.asp)

[bodyman]

we did a re revue of your estimate and you overcharges us 500 dollars and we will be deducting that from your account?

one shop i know of just repainted a 911 after it was determaned by state farm it was bad workmanship, yet there was no SF estimate covering the Overall paint job to begin with, this was done after the estemate was done, yet the owner call SF and the provider had to redo the whole job or risk loosing SF work!

other shops get hit weekly by SF for overages they (SF) says are do them well after the car is delievered, and these dummies pay it, wheres the profit in that!

mark