an iga viewpoint
Losing Faith in Big Business
by Tim Smale
Editor’s Note: AGRR is pleased to welcome Tim Smale, chief executive officer of the Independent Glass Association (IGA), as its newest columnist. Smale will write Independent's Day bi-monthly about topics of importance to independent auto glass shops.
With the multi-billion dollar bookkeeping scams such as what happened at Enron and WorldCom, the perception of corporate deception is so widespread that the stock market recently fell under its 9/11 low. Time/CNN recently reported poll results indicating 72 percent of Americans feel there is a pattern of deception on the part of a large number of companies and that these cases are not isolated. Corporate deception has emerged as the big story of the year, and the American public and the federal government are poised to act. It seems like we've just learned something new about big business and are outraged that we have been deceived and ripped off somehow without our knowledge.
An Art Form
This topic isn’t new in the auto glass industry, where deceiving consumers has been elevated to an art form. The deceptive practices of third-party glass-claims administrators have reached an all-time high, and it's time we do something about it! The window of opportunity for government ears to listen to our complaints in the auto glass industry won't be open for long; the time to act is now.
Types of Deception
There are a number of different types of deceptive practices by third-party claims administrators (commonly known as networks) that independent auto glass retailers are reporting. The Independent Glass Association (IGA) has collected dozens of steering reports from its members that mirror the allegations that Diamond Triumph has made against Safelite in its current lawsuit (see page 28). Glass shops report that the network referred a job to their own shops without informing the customer that he had a choice of where the work could be performed. Fortunately, recent outcry by the IGA and its members has reduced the number of reports about this kind of steering. The most common type of steering that is being reported lately is a bit more subtle. The network attempts to dissuade the consumer from using the shop of his choice, if it is not a network shop, by using two fear tactics. The first occurs if the consumer mentions he has an independent shop in mind, he is told that he may have to pay out-of-pocket costs because the shop he wants to use is “not approved.”
The second tactic involves telling the consumer that he will not be covered by a warranty if he uses that shop. Even more shocking are the reports of the network stealing the job from the customer's chosen shop. Many independent glass shops have reported that they have received assignments, only to discover the work has also been scheduled by another “network” shop, or worse yet, by the network-owned shop itself. Perhaps the most maddening cases are those in which the independent shop calls the network with the consumer on the line, and the network’s system “goes down” or there is a “bad connection” and the consumer is forced to call back another time.
The networks that practice these techniques say they "honor policyholder preference and execute our clients' programs according to their directions." Is the policyholder's first preference really being honored? If the customer is not coached in advance about the wrongful information that the networks may use to get the job, he may give in to these fear tactics and change his mind. Networks could help consumers make informed choices if they agreed to keep accurate pricing and warranty information for all glass shops available on their computer systems. One IGA member recently reported that a network gave unsolicited and inaccurate information about his shop's pricing and warranty information to a consumer, then would not agree to keep the accurate information on file.
Now, what can be done about steering? If you are an independent glass retailer and you have experienced steering by the networks, you can contribute to the IGA’s efforts to end steering by sharing your evidence. I encourage you to obtain a steering-report form from the IGA and record the facts about steering incidents you encounter. The form can be found at www.iga.org, or faxed upon request by calling 909/659-5972.
Secondly, you can inform your customers up-front about the safety risks involved with improper auto glass replacement and the steering tactics they may encounter. Tell them about your company’s commitment to safety, your warranty and your pricing and billing methods. Many times consumers are surprised they have a choice, they will not have to pay out-of-pocket costs and they are covered by your company warranty, a nationwide guarantee offered by your franchise or our association’s warranty program, Ameri-Care Nationwide Guarantee.™
Finally, the best way for us to get around corporate deception in our industry is to take a strong stand against it. I encourage you to join your national and/or state associations' efforts to change state and federal legislation. Now is the time to inform them about the current corporate deception problem in our industry, as they will soon turn their attention to other issues of the day. With the current stories of corporate deception on their minds, legislators may now finally understand what we have been dealing with for years in our industry and finally help us take action to end consumer deception once and for all.
Tim Smale is the chief executive officer of the Independent Glass Association. Smale serves on the board of directors of the Auto Glass Replacement Safety Standards (AGRSS) council and serves on the AGRSS committee and three AGRSS sub-committees.
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