Tony Passwater

At press time, there remain many unanswered questions and concerns of what exactly this "test" entails. Of course, a great deal of information leaked out before Industry Week in Las Vegas. Many of the mandatory informational sessions for current select service facilities were just reinforcements of what already has been expected. However there are several points that were unclear, but now have been "clearly defined" with a great deal of fuzziness and uncertainty.

One initial puzzling component of these tests is why a new agreement is being required. If it is simply a "test" and not a permanent rollout, why is a new agreement necessary? I am, and always will be, a firm believer in technology and how it can positively impact our industry to address a number of inefficiencies. These inefficiencies do cause vehicle delays and poor communication between all parties, and as an industry we need to work to improve them.

The new "test" program is expected to run through Feb. 29, 2008, in Indianapolis. The concept of receiving a "parts rebate" from 2.8 percent to 3.4 percent based on the vehicle manufacturer is evidence that State Farm staffers spent some time with select manufacturers, such as General Motors, Ford, Chrysler, Nissan, Honda and Toyota, to get their agreements in place.

Apparently there was little-to-no thought given during these discussions to include a provision for directly handling rebates, which would avoid imposing additional administrative processes on the shops. If a vendor will not agree to the additional discount, how is this really a "no cost to the shop" program if they still are required to give the discount? And will this in the future affect the vendor discount structure to the shops?

I also wonder about the "sales pitch" and promises included from the vendors of the ordering software? One vendor currently has marginal acceptance due to many technical, reliability, support and usability issues with their program. The other is new to the market. What promises have been made to actually improve the process and demonstrate benefits to repairers who use the system? Or was this even a consideration?

Is the goal really to improve inefficiencies, or just to provide for a parts discount? It looks like an average claim will net $35 to $50 in additional savings. Will this offset the time delays that will occur since the new "bidding process" does not do any of these transaction in "real time." It reportedly takes up to three days to get a response — only to then need to order from another supplier. What additional cost burdens will be placed on repairers over and above the increased training and administrative tasks when ordering through current management systems?

Did anyone think to ask the users about the current issues they see? What about the challenges by local dealers attempting to interface with their parts inventory systems? What about the management system developers who have attempted to interface for some time now with little success? What promises were given to make sure these changes improve the process and don't just hinder it further?

Many years ago the top shops in the country sought out solutions to assist in parts ordering and processing. Many have since dropped the current programs available as well. The new "bidding" process is going to include inherent time delays. How is this going to improve the efficiency of the parts process?