Why its important to implement
Estimates are binding documents like sales offers. Missing items affects profitability and work provider relationships. Cross-checking minimizes losses and increases profit.
Profitability and Relationship Protection
By missing items, over or under estimating will affect the business' profitability and relationships with work providers if to many additional damage requests are submitted.
Work Provider Approval Risks
In some cases work providers do not approve frivolous claims that were missed, meaning the business will have to repair missed items at its own cost.
Quality Control Benefits
By checking for missed items even by estimators swapping and checking within the estimating team as a standard practice the business will ensure minimum loss through poor estimates is achieved and profit can be increased.
Workshop Delay Prevention
Having to ask for approval for missed hours/repairs and parts will stall the vehicle in the workshop till approval has been given.
Binding Document Nature
It is good practice to recheck each estimate before submitting them as it is a binding document that the business submits to the work provider with its declared price for repairing damage, therefore it is no different to a sales offer.
Business Impact
Missed items cause revenue loss and relationship damage with work providers. Production stalls waiting for approval of overlooked repairs and parts.
Profit
If parts or hours are missed on the estimate and submitted the business will miss out revenue.
Profit
If parts or hours are missed on the estimate and submitted and the business regularly requests additional claims for things missed the relationship with the work provider can be damaged and work could be steered to other body shops.
Productivity
When these missed points are found in production, the vehicle will stall due to waiting for approval.
action steps
Implement single VDA double-checking or multi-VDA cross-checking programs, measure missed items, enforce review policy with warnings.
Estimate Review Policy Enforcement
Regularly check that this is being carried out for every job, strong internal warnings if policy not followed once established.
Multi-VDA Cross-Checking Program
If there is more than one VDA establish a program of estimators swapping and rechecking with the goal of finding any missed items and finding additional items on every job. (Even $50 for each estimate over a year will have an impact on the business revenue)
Single VDA Quality Control
If there is only a single VDA then it is good practice to have them double check, their own work at a later time and just prior to submitting to ensure a fresh view of the estimate.
Related tasks
Milestone:
02: Streamlining VDA Processes