Most Common Estimating Mistakes
Hastily written estimates can be costly—a fact collision manager Gerry Rosenbarker learned the hard way.
One of his anecdotes clearly illustrates that truth. Consider: In the past, Rosenbarker’s Mohawk Collision Center in Scotia, N.Y., received $62 for materials from insurers to replace a door skin. While that number was significantly better than what competitors received, Rosenbarker soon learned that his facility actually sold itself short; once Mohawk started writing with a newer, more in-depth invoicing program, the facility began receiving about $93 per door skin.
“We were losing $30 per door skin—on every single skin, on every single car,” Rosenbarker recalls. “We just didn’t know, because we didn’t know.”
Starting in 2017, he made certain that his employees thoroughly invoiced and documented the types of products they used during repairs by utilizing 3M’s collision repair materials planner (CRiMP) collision repair materials planner.
“Shops shortchange themselves like crazy,” Rosenbarker notes, because “estimating, for the last 30 years, has been guesstimating; there hasn’t been strong accuracy to it. More often than not, it’s an underestimate on behalf of the body shop, which is one of the main reasons why collision centers struggle to make money on materials.”
That doesn’t happen often these days at Mohawk, however. The facility rakes in nearly 63 percent gross profit on materials—one of the best such figures in the nation. Of course, in the past, Rosenbarker learned some lessons the hard way, which recently inspired him to look at the most common estimating mistakes made by body shops.
Not Getting Compensated for Tools.
Mohawk Collision Center brings in a gross profit percentage on materials that’s nearly 40 percent better than the industry average, Rosenbarker pridefully notes. He feels a key reason for that is using tools like a Mitchell Refinish Materials Calculator to submit estimates that fully reflect refinish costs.
“It all comes down to properly invoicing the products that you’re using,” Rosenbarker explains. “An estimate from an insurance company [might say] $25 worth of seam sealer on a quarter panel; shops accept that all the time. But, when you invoice it properly—and you do measurements on how much seam sealer you actually used, it’ll probably actually come out to be around $100. So, you just lost $75 right there, by not properly invoicing.”
Estimators Lacking Education.
In Rosenbarker’s view, employing estimators with a lack of training is a top issue these days in the collision repair industry. All too often, he notes, fledgling estimators aren’t taught by their employers what all needs to be documented on a written estimate.
“There are a lot of line items that you can get paid for on an estimate, if you simply ask,” Rosenbarker says. “An insurance company is not going to pay you if you don’t ask for it. But the lack of education in our industry, and the lack of properly trained estimators, leads to a lot of money being left on the table.”
Typically, he says, if dealerships hire hard-working, diligent estimators, they can be trained to see any task through to its completion, even if they’re new to the auto industry.
Poor Communication with Customers.
Few things infuriate customers like unexplained charges. That’s why the staff at Mohawk makes sure to explain each line of an estimate to clients.
For customer-pay estimates, Rosenbarker says, “we’ll write that estimate for OEM parts. We present that to the customer, walk them through everything. When you have to pre- and post-repair scan the vehicle, we supply them with the position statement from the manufacturer, so they understand that it’s not some added charge. In some cases, we’ve even showed them some basic repair procedures.
“Because I want to educate my customers. Having those conversations with a customer so they really understand an estimate is extremely important.
“Otherwise, a customer’s just going to glance over an estimate and [ask], ‘Why are they
charging me [that]?’ And then you’ve lost your credibility.”