agrrfpo.tif (135164 bytes)

March/April  2004

Mailbox
   letters

FROM OUR READERS

What’s Fair? 
Dear AGRR:
 I just received my January/February 2004 AGRR today and, as usual, I started reading it cover to cover to see what issues are facing the industry in the rest of the world. 

In Catherine Howard’s article, “What’s Fair?” the outgoing general manager/vice president of NAGS 
says that this industry is a commodity market; I agree with her (see January/February 2004 AGRR, page 12).

However, I disagree with this statement: “The whole market has agreed to bundle labor with the glass price.” The market has been forced to include labor as part of the price by the glass networks and the insurance companies. 

Howard also states that she “[doesn’t know many folks in business today who believed their labor costs have gone down.” I’m not sure the nature of the business to which she’s referring, but in the auto glass business labor is virtually non-existent compared to any other part of the automotive repair industry. 

Also, Howard said she wonders how we, as small glass shops, can feel that “NAGS is somehow responsible.” How can NAGS not be responsible for some of it? 

In the Fall 1997 NAGS Calculator, the DW1217GBY (Chevy pickup windshield) was priced at $1350.40 with 3.5 hours labor. Just a few months later, the Spring 1998 Calculator priced the DW1217GBY at $1620.50 with the same time allowed for labor.

Then, in the January 1999 Calculator, the retail price dropped to a remarkable $508.50 with only 1.9 hours allowable labor.

The price miraculously started to grow again in 2002 to $667.45, but allowed only 2.2 hours labor. 

Can you explain why my cost of windshields has not gone up or down by more than 15 percent when the NAGS retail price, which all insurance companies and glass networks (most of whom are owned by the glass manufacturers) use as their Benchmark, has fluctuated more than 100 percent in the past five years?

NAGS is not to blame for all the shortfalls of the small glass shop; it’s the small glass shop that thinks the only way it can compete is by doing what everyone else tells it to do. I, for one, will not do business like that any longer. I refuse to allow anyone else to dictate my profit margin, force me to charge different rates for different customers because they have different insurance companies and operate dishonestly. I would encourage all others to take a stand as well. Sell your service, honesty, integrity and workmanship and your customer will buy from you!

I take my profit based on my cost; I charge my $50 per hour labor and I let my customer, the customer that I have earned with fair pricing and excellent workmanship, deal with his own insurance company. I have been doing this for ten months now. Yes, my gross sales have decreased, and, yes, I have lost a few customers, but my profit has increased and I sleep better at night knowing that I’ve been fair and honest with everyone with whom I deal.

Randy Dietz
Owner
Atlas Windshield Repair
Beach, N.D.

NAGS Split Pricing
Dear AGRR:
Was split pricing a revelation someone at NAGS had? And will the insurance industry and the glass industry work to make this a reality?

I have been in the glass industry for several years and have worked for the largest company as well as having been a sole owner. I have always been intrigued by the fact that this industry makes such clatter about safe installations, proper urethane usage in different weather climates and, of course, now safe windshield repairs as well as tech certification, AGRSS/ANSI standards and the rest of the ball of wax. We have even had national recognition for doing unsafe installations in our industry. To the best of my recollection, not one time did the question of how much we make on our labor charge come up. It is about time that we, as an industry that claims to have such an impact on the consumer’s safety, get paid for our experience, knowledge and liability for replacing a consumer’s glass.

What sets a company apart many times is the experience and level of service it or its technician provides. I really don’t think NAGS should handle this alone at all; we all have a stake in the structuring or re-structuring of pricing guidelines and it is about time we say enough is enough. I can’t go to the local dealership and pay close to the labor. I must charge for work that has, in my opinion, more of a safety impact on the consumer than replacing a windshield or backlite, which has a direct correlation on the structural worthiness of a motor vehicle.

If a company’s work is poor, then it should make poor profits. And, if a company’s work exceeds consumer expectations, then it should relate to a fair price for the labor of that technician. Obviously, he is more valuable than the guy doing poor work. Glass is a product we all use. Show me why yours is superior to the next guy’s and I will be more than happy to pay the extra cost.

Adhesives are non-negotiable; proper adhesives, primers and preps should not be compromised by what we reasonably are allowed to charge, and these factors are determined by company size and volume used.

What I can charge is based on a cost comparison of smaller companies to large national chains and it will never be comparing apples to apples. We are our own company, so why am I being dictated a pricing structure based on averages?

Labor charges should reflect a realistic cost of labor. I have long felt labor should be structured separately from glass and not be a flat rate. The current system is the most insane pricing scheme some idiot ever divulged as useful knowledge.

I’m sure my list could grow tenfold with others’ additions, but this isn’t an article about Tim Smale bashing or safe windshield repairs. This is a great example of why the more things change in our industry one thing stays the same: our inability to focus, cooperate and resolve common issues as a collective industry of professionals. Perhaps this is why we are stuck with this poor pricing “reorgani-structure-ization.”

In the end, it all comes to one conclusion most of the time: it is the consumer who suffers our industry’s shortcomings, and it is we who suffer lack of credibility with the consumer. I get so tired of hearing the same old thing when we meet a prospective customer, “Oh, another glass shop.”

When will we see a return to being viewed as valued service professionals? A few things to keep in mind are these:
• Work on your vehicle mechanically; 
• Develop a labor time guide to go by in your pricing;
• Work on your own vehicle’s glass; and
• A flat rate for each job is the same. It involves exactly the same amount of time and the same amount of knowledge to perform.

Todd Sweet
Owner
D & D Auto Glass
Ashland, Ohio 

AGRR

© Copyright Key Communications Inc. All rights reserved. No reproduction of any type without expressed written permission.