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OE OH! (It’s not Oz, Dorothy)

03 Jun

I get calls every week from customers asking for “OE” glass. I try to explain that this is a very specious term with some shops because if one takes it in the strictest definition, the glass is almost always logoed with the auto manufacturer’s name or trademark and must be purchased from an auto dealer’s parts department. Glass from a dealer comes usually at a far higher price than everywhere else.

I then go into an explanation that sometimes an equivalent exists. A glass shop may be able to find a supplier who carries the very same brand of glass minus the manufacturer’s trademark or name, but with the same DOT number which signifies that the aftermarket glass came from the identical source as the dealer purchased one.

This past week I became very aware of how loosely the term “Original Equipment Equivalent” can be used and somewhat abused. I had installs on two different Toyota models that had famous glass brand names as suppliers imprinted in the bug. However when I ordered these easily available brands, I found that the aftermarket windshields had different DOT numbers than the OE ones and the quality of the part was nowhere close to the one I was replacing. Both parts I was replacing had USA origins while the new ones did not. The glass had alterations like the location of the frit and heating elements, along with distinct differences in the shape and application of the underlip molding. In one case, the purchase price of a Chinese made OEE windshield was twice as much as a branded competitor one. My customer paid almost $200 more for something we both thought was an identically made product that came in his vehicle. I believe almost anyone would have been able to detect the contrasts between the OE and the OEE ones, I guess I would like to know why? (Is it just the money, Honey?)

Automotive glass manufacturing has become a worldwide endeavor. While it may not rival the labor saving shopping country hopping antics of shoe manufacturers, AGR is not blind to the benefits of operating in countries that offer cheap labor and minimal environmental and other economic restrictions that may negatively affect the bottom line. As China opened itself up to become a center of manufacturing, its move into AGR instigated a tidal wave of change for our industry. Its flood of product that hit our shores drowned a few domestic glass fabricators, but more importantly, it unraveled the profit structure of both the wholesale and retail sectors of AGR.

In fact, a strong argument can be made that it also affected the craft side as well. As imports rose and inventory increased, distributors needed to find more customers and were able to in an evolving easy-entry industry. But I digress …

I have even discovered quality differences between Chinese-made OE and OEE parts. Volkswagen uses a Chinese glass vendor on some models. I have installed several well-constructed dealer purchased windshields that came from that vendor. However, it is another story when buying that same label in the aftermarket. The cowl retainer that comes bonded with a urethane type substance at the bottom of a VW logoed windshield is merely attached with double sided tape in the aftermarket model. Many times, due to shipping and handling, that retainer may already be pulling away or warped by the time a retailer sees it in their possession. In fact, this writer has a hard time recalling an aftermarket glass manufacturer that does not use double sided tape to secure cowl retainers. I would like to challenge those folks to try to explain to their end users why their cowl may not look the same when using their product, but the way I see it, they are just participants in a race to the bottom of the manure pit.

I understand the economics of this industry. The manufacturers want to make a profit. Distributors want to make a profit. Retailers want to make a profit. Auto manufacturers and the dealer networks make a hefty profit selling OE-branded glass. Insurers want to retain as much premium revenue as possible and the consumer wants to pay as little or nothing at all. All this creates a compression factor all the way down the supply chain.

So, OE logoed glass in many ways has become the “gold standard” to the consumer. I would be in the camp of those who believe that an OE glass is made to a higher standard, not much more, but at least the product is not reversed engineered and the tolerances of fit and finish are tighter than with its aftermarket copycat cousins. How much better is a matter of widely diverse opinion but I have told customers, I think it is usually 10 to 15 percent better. This is despite the fact that becoming OE is usually the end result of being the low bid on a contract. However, when a $1,000 difference exists between a dealer-purchased windshield and a generic-branded one, consumers and their insurers balk and demand cheaper alternatives and solutions to get around paying such high (and unjustified) prices.

I am like every other business owner that is looking for an edge to make a sale. If I can find and install an OEE brand of glass over a generic one, I make it a point to say so. From comments made by callers, many of my competitors may be descended more from Pinocchio than from George Washington because of the missing honesty gene. What is being declared OE or OE Equivalent is so wrong or misleading that some regulatory body would call it outright fraud. But what is as worrisome is that legitimate OE glass producers appear to have differing standards as well as plant locations for the very same glass part. The one being made domestically here for the auto manufacturer appears to be much better constructed than the “not made in the USA” one deemed for the replacement sector.

The mythical land of Oz has nothing on the world of AGRR. While we have our resident munchkins, tin men and scarecrows, it is the air of fantasy and illusion that is more disturbing. I can fully understand why a company competing in the aftermarket glass market makes manufacturing choices to improve their bottom line and their ability to sell their product. What I don’t understand is why substantial differences exist within the same company. A manufacturing line is already set for any one run of windshields. Why not just make X amount more instead of sending off the order to a foreign plant? Wouldn’t the increased set-up and shipping costs from a non-domestic plant offset much of any supposed expense increase coming from a U.S. plant? I, for one, would like to say with conviction that in some cases, I can provide a true OEE product to my customers. Then again, one might have a better chance of ordering online a set of FAA-certified ruby slippers that make traveling to Kansas faster and without TSA inspection.

 
 

Feeding the Pig

09 May

I have been laying low the past few months in the composition department. Work has been tough. I came face-to-face with my mortality as an elderly parent and also a former business partner passed since the New Year began. I’ll be honest in saying that auto glass repair has done little to restore an optimistic attitude within me. In fact, when I read upbeat blogs, I wonder how close to the street the writers actually work. How many real customer calls do these people actively receive and quote? The tone and tenor of the marketplace has changed so significantly, at least to me, it has evolved into a noisy bazaar—a bizarre one at that. Almost every day I run into a rude shopper that is so self-absorbed almost to the point of ill-informed righteousness that dealing with the public has become almost a dreaded chore instead of the positive economic event it should be.

I like people. I grew up with the Dale Carnegie’s “How to Win Friends…” book that was a permanent browsing fixture on the back of the family commode. As a proud Empire State native, I had the benefit of learning both urban and rural survival skills. My folks instilled in their three sons a strong sense of morality. “Treat people how you want to be treated” was practically a social law burned into our psyches.

Our culture has changed, in fact, it never has been stagnant. I understand that. In my lifetime, there have been many shifts and currents. My parents deplored the “hippy” freeloading lifestyle of the 60s. Not to worry Mom and Pop, you could accurately declare that the “Wolves of Wall Street” evolved from that same era. What did the “Woodstock Generation” spawn in both values and progeny? Well folks, it’s apparent that not too many people took to heart Marvin Gaye’s question of “What’s Going On?”

Advancements in technology always affect the surrounding culture. Consider in the past 50 years—what devices have changed our way of life? Huge, crude computers have shrunk into wireless devices giving the user so much data and the ability to seek even more. In fact, the word “wireless” was used more frequently years ago to describe an aspect of a women’s undergarment rather than am electronic communication instrument. So it goes.

Have people changed? I certainly have seen a seismic shift in consumer attitudes and the way a shopper does research. Online shopping or e-commerce has altered the landscape for so many retailers. Many in auto glass repair have responded to address the needs of a bathrobe-wearing, website-reading shopper by posting prices. What has that gained us? Are we in a race to the bottom or are just feeding the pig?

More and more, I get calls from people that shop on price alone and even worse, I get the “I want it now!” demand. I leave my cell phone on and will take calls from 6 a.m. through about 9 p.m. Just because they need to be at work 50 miles away at 8 a.m., doesn’t mean that replacing a smashed door glass before then is ever likely for a shop which is contacted at 7:15 a.m. There seems to be a sense of stunned disbelief from a caller that a mobile install for a ‘94 Integra windshield can’t take place within the hour on a Sunday afternoon.

Speaking of a Sunday call, this past one I heard a great new line. Around 7 p.m., I received a call from a woman seeking a price on a door glass for a 2005 Kia Forte. Since it was a fairly limited production vehicle and I had no idea of local part availability or internal cost, I punted, with the statement that I could call her back at 7 a.m. Monday morning with a firm price and, if amenable, a time that day for an install. When pressed for a price, I responded with the statement that I really did not know but oftentimes a door glass of that kind could run $25-plus or minus of $150 for an installed price. I was then hit with this great line, “Well I need it done right now but I am not prepared to pay for something in that price range.” The tone was not of pleading poverty but of assuredness that she had or could find something substantially cheaper. Please, be my guest.

This past Monday I had perhaps the worse contact ever with a consumer. A person broke the rear hatch glass of a 2014 Nissan Versa Note. The part was a dealer item and only available at the regional Nissan warehouse of which they had one in stock. List price was very low—$241. I quoted that along with my labor and was told to order the part for a next-day install. I verified that twice by text. At 7 p.m., I got a text saying to cancel job. I called the guy and was told that he had found someone to do the installation on Craigslist for $35. “What about the special order part?” I asked. The guy agreed to buy it. The next morning I got a text saying to cancel the part as well, as his new vendor can provide one. I called the guy and questioned him knowing that the 2014 Note is a new design and I have in my possession the only new hatch glass within 200 miles. He informs me that since his new vendor installs glass at an auto wreckers that he must be aware of the differences. I rolled my eyes and secretly wished that rats eat him in his sleep.

What also is occurring is the outright dishonesty of job-seeking glass concerns that will do or say anything in order to get an installation or poison the well for others. There is such a lack of ethics and technical ability in this industry that is astounding in its breadth and scope. I cannot tell you the number of times that a caller has told me that a competitor has quoted “an OE windshield” installed for less than $200. The list of lies and misstatements from glass vendors fueled by consumer ignorance derived from online posts and videos has created a maelstrom that drowns out truth and facts. This quagmire affects honest and competent shops negatively. Separating fact from fiction is something most consumers are not good at. They only want to hear favorable outcomes.

What also is distressing is the lack of respect for others that seems to be lost. Take our own AGRR forum. How many examples of snarky vitriol gets posted weekly, if not daily? We shout at, we condemn those we disagree with, usually within the anonymity of the Internet and user name. Courtesy is diminishing as quickly as glaciers recede. Rudeness in both word and deed is increasing. My freeways look more like a movie set for “Fast and Furious” as drivers weave in and out of traffic at breakneck speed. Is auto glass repair just reflecting the current social mindset?

There are times I feel so old. I always hated hearing from my folks phrases like, “When I was your age,” or “The good old days.” I really try to refrain from repeating clichés like that to my younger relatives or associates. Yet, I will always appreciate the honesty of a handshake agreement and a person’s affirmative promise.

We as an industry can use some retro concepts. Provide quality materials at a fair price and install them in a professional manner beneficial to every consumer. Consumers need to learn that you get what you pay for. Obesity is an unhealthy condition even in pigs and I wish this madness could stop. Sad to say, that’s wishful thinking.

 
 

Privacy and AGRR Industry

19 Mar

What if your largest competitor knew your buy rates for product and had access to your customer list? Would you feel vulnerable? What about if that competitor controlled market access for you and actively worked to reduce it? Would that make you angry? What if that competitor marked you for acquisition or destruction? How helpless or scared would that make a you feel?

Looking back, 1984 occurred 30 years ago and it is indeed a brave new world out there. AGRR, about 15 years ago, began a corporate philosophical shift that has moved to big brother-like mentality, but without the family ties. As more time passes, I believe we are in real danger of losing not only choices, but our existence as well.

I have heard stories and boasts that store managers and salesmen from both the wholesale and retail side of Belron’s U.S. operations have shared confidential data of competitors acquired from each other or from its glass claims’ administration arm—Safelite Solutions. They seem to know how many insurance jobs go where and to whom and for how much. Enough stories have come in from trusted sources to make me take notice and worry that many companies are forced to work through their biggest and most powerful competitor.

Belron is not the only company that has both retail and wholesale distributing outlets. They just have far more of them than anyone else. Add the fact that Belron also manufactures automotive glass products, which gives the company a distinct price advantage in every marketplace. This is all perfectly legal and somewhat admirable. They have rightfully earned the nickname of being the “Walmart of automotive glass.”

Any shop that does business with a distributor/retailer should expect a certain amount of pricing information to be shared internally. Belron is different since it has grown to national scope and influence

I feel the real privacy culprit is Safelite Solutions, the third-party glass claims’ administration arm (TPA) of Belron’s U.S. operations. If one believes that this company operates as an innocent standalone company whose only mission is as a clearinghouse for insurance glass claims, he is sadly mistaken. Not only is Safelite Solutions a golden funnel for profitable glass installs for Safelite AutoGlass, with service as a direct beneficiary, I believe it may provide real data for the entire corporation for use against any and all competition. Are we to believe any sort of disclaimer that Safelite Solutions operates in a confidential vacuum?

Safelite Solutions has the easy ability to report every claim that they process, where they occur and how many of those claims that Safelite AutoGlass completed. That alone can prove the efficiency of the Safelite Solutions CSRs and spoken scripts that make up first contact with an insurance client.

However with Safelite Solutions being a TPA for 18 of the top 20 insurers (the company’s statement, not mine) and an unknown number of lower tier auto insurance providers, it possesses the capacity of having the most comprehensive overview of the national automotive glass claim scene. Belron could easily discern the market percentage and penetration of any competitor in every marketplace where it competes. Safelite Solutions could provide data that identifies what competitor is doing best where and for which insurer. As Belron continues to acquire regional glass companies, would one opine that this can be a revealing and potentially a useful leverage point during negotiations.

Does being small mean one is safe with data sharing? If one is an “affiliate” with the Safelite Solutions network, what privileges does that bring? Can the firm receive favorable buy rates? In a crowded market place, do they receive referrals? One would think the greatest amount of presumptive referrals go to affiliates which are in geographical areas that Safelite feels it is not profitable to operate in. Since my one man shop is not an affiliate and I operate in an urban area with a Safelite store, I have never received one unsolicited referral in my entire career despite thousands of successful and apparently satisfied clients. That is not a complaint but just a fact. Safelite, however, knows what I charge, my tax ID number, and which insurers I have connections with. For all I know, they may have a video of my truck, the constant need of mine for a haircut and are aware of when my companion dog Peabody needs his grooming as well.

Belron seemingly is not bashful at all when it comes to aiding the National Insurance Crime Bureau (NICB) in gathering statistics. And, from what I understand, providing photographic and data evidence when fraud is suspected. In fact, how much of a straw organization the NICB actually is for Belron is a question some observers would like answered. I applaud any chance to root out fraudulent actions within our industry but what restraints if any exist when a company with an enormous amount of concentrated power and influence decides to wield it to maintain its supremacy?

Privacy and corporate data sharing are national issues that can be addressed through Washington, D.C. and not state-by-state. One may also be able to avoid the well-placed and financed political influence that the insurance lobby has used to fight anti-steering measures. This gathering of meta-data for specific business reasons is just as potentially harmful to an independent glass shop owner as if a key employee was hired away by a competitor.

Any abuse of privacy underscores the single greatest need for reform when it comes to the insurance sector of automotive glass. No TPA should ever have any financial ties to any automotive glass-related company. Whether it is Safelite Solutions or Pittsburgh Glass Works-owned LYNX Services, the foxes are guarding the chickens and they are simply using their positions to fatten themselves up.

Never forget that AGRR’s big brother may be watching over you and he is not your guardian angel. Far from it. It is up to the rest of the industry to push for change to restore some balance to the automotive glass marketplace. Dismantling corporate glass-owned third-party administrators would go a long way in doing so.