Starving artist

An excellent article,"Blending Panels Takes Longer,"by G. Henry Hancock rekindled visions of refinish days past-Dark Ages of unstable paint products and zero support. I have few fond memories of the 12 years I spent in my Sheetrock paint booth. If there was any saving grace to painting back then, it was that consumers considered their vehicles "just transportation" and matching original equipment manufacturer (OEM) finishes wasn't difficult.Today's refinishing professionals, however, have to turn out a product of infinitely higher quality deal with the quirks of consumers who worship the ground their vehicles occupy and offer a lifetime guarantee on materials, parts and workmanship.Within very defined parameters, today's refinish technicians must skillfully use very costly catalyzed and sensitively formulated paint products.And blending paint, the most critical of procedures, is also the most abused by insurers.

In his article, Mr. Hancock itemized the essential steps, and some of the many difficulties, encountered in blending paint. He then wrote, "In my opinion and in the opinion of all the experienced refinishers I've talked to, it takes as much time, or longer, to blend a panel than to completely color coat it." Every paint professional will admit Henry is right. Everyone, I suspect, that is except in-denial insurers, insurer-influenced information providers and shop owners who use the "cost-shifting" system of accounting.

Attaining undetectable blends is nothing short of an art form. Blending undamaged panels adjacent to repaired panels is tough enough, but we're supposed to perform blending in less than half the time and with less materials than we need for basic full panel painting. Additionally, we're being "encouraged" to blend paint within the confines of collision-damaged panels. When enough shops have been mesmerized into believing this procedure is profitable, the P-pages will proclaim it an accepted practice. I don't fault insurers for trying, but I do fault repairers' lose-on-every job-but-make-it-up-in-volume philosophy which degrades my industry one labor operation at a time.

I'm also more than a little miffed that paint manufacturers don't tangibly support shops' claims concerning the ever-increasing costs of paint materials. When I brought this matter up at an Autobody Craftsman Association (ACA) retreat board discussion, which was attended by several paint manufacturer representatives, they generally brushed me off. If paint manufacturers want us to continue purchasing their products, they should back up shops, making it clear to insurers that the overall costs of paint products increases about 8 percent every year. Factoring this percentage of increased costs into the common, archaic dollars/paint hour formula, our paint material costs should rise about $2 per refinish hour every year just to maintain the status quo.

Joe Sanders, when he was with the Automotive Service Association's Executive Committee, wrote of paint manufacturers, "They do a great job training our painters to tint...and blend...but why don't they tell the [insurance] industry how often blending is recommended and how many steps are required to do it properly? In addition, they could clear up the myth about the great material savings realized when you blend." Elsewhere, he noted,"Blend formulas, as posted by information providers, were only designed to facilitate color match on `non-damaged adjacent panels.' They were not designed to be used for repaired panels...Featheredging and primering over repairs or broken existing paint is a `non-included' item, and additional time should be negotiated for such panels."

According to John Loftus, executive director of SCRS, paint-specific products alone represent about 70 percent of the cost of materials involved in a repair job, [and] from 1989 to 1996, the cost of (refinish] materials increased by 62 percent. Meanwhile, he says, insurance company payout for paint materials has increased a mere 13 percent. "While insurers insist paint material caps are `benchmark' levels for alerts...they also indicate they are aware that many times these `benchmarks' should be revised," Loftus said. "Repairers point out that insurers require documentation that is unrealistic...and (insurers] know it is unrealistic to (require shops to] send them the individual receipts for the paint by RO [repair order]...These pricing structures that set the price below the actual cost of materials create a potential for shortcuts in the repair process."

In a memo to Mr. Loftus regarding "capping," which appeared on Autobody Online in March 1998, Farmers Insurance Director of ADP Claims James Cawley stated, "If a particular repair of a vehicle requires additional material or labor expense, the field claim representative and their local management have the authority to authorize any justifiable additional cost. `Caps' are not a part of our business operation." (Quite testy about that nasty little four-letter word, aren't they?)

After one insurer took us on a paint-materials-cap ride for more than a year, we appealed the abuse to our insurance commissioner, thereby forcing the insurer to pay us for all the material costs they had withheld. For several years thereafter, paint "caps" vanished from our shop, especially after we included with each estimate and supplement, a photocopied statement from our insurance commissioner stating capping is illegal here. But of late, it appears "caps" are back to haunt us again, only morphed into additional forms.

Because SCRS has confirmed that the insurance commissioners of 35 states and provinces have stated that arbitrary caps are illegal and 12 others have stated caps may be illegal, the burden of proof should fall on insurers to prove their claim to limiting reimbursement to shops. Let them disprove shops' labor and materials figures on a case-by-case basis.They've wasted thousands of our hours and withheld untold millions of our refinish dollars. It's time the tables were set straight.

Several resources are available to help calculate, document and collect true costs of refinish materials and a reasonable markup. Among them are Paint-Ex and the Mitchell Refinishing Guide. For more information on Paint-Ex, call (888) 888-5501. Mitchell's product can be ordered through SCRS by calling (877) 841-0660.Accurate documentation and legislative watchfulness is the only legal defense we have against continued deterioration of fair reimbursement and a fair profit.

Dick Strom and his wife, Bobbi, are the owners of Modem Collision Rebuild in Bainbridge Island, Wash. They have four adult children, two of whom work at the shop and plan to take over the business. Strom started the business 26 years ago and today has 12 employees in the 10,000-sq.-ft. shop. Modern Collision is not a direct repair shop but instead works for the vehicle owner and negotiates with the insurer on the owner's behalf. The Stroms are members of the Coalition for Collision Repair Equality (CCRE), the Automotive Service Association-Washington (ASA) and the Autobody Craftsman Association (ACA), as well as the authors of articles that have appeared in numerous industry publications.