State Farm Offers PartsTrader Updates
Nov. 30, 2012—State Farm Insurance recently provided several informational updates regarding its parts procurement pilot through PartsTrader during a meeting with the Automotive Service Association (ASA).
State Farm’s PartsTrader program is currently piloted in four U.S. markets, including Tucson, Ariz., Birmingham, Ala., Charlotte, N.C., and Grand Rapids, Mich. PartsTrader will also be implemented in the Chicago market Dec. 10. At that time, about 600 State Farm Select Service shops will be involved in the pilot—roughly 6 percent of the 10,300 Select Service shops that exist across the country.
The ASA said PartsTrader has implemented at least seven program updates since it was initially launched last spring. The ASA was provided with the following informational updates from State Farm:
• Quote times: The pilot markets of Charlotte, N.C., and Birmingham, Ala., now have the ability to implement 30-minute periods for price quotes. Each of the four pilot markets now have a 30-minute quote window.
• Software integration: CCC Information Services, Mitchell International and Audatex, a Solera Company all have two-way estimating system integration in each of the four markets. PartsTrader is also moving forward with integration efforts with various collision management systems.
• Accommodation of alternative pricing: State Farm told the ASA that it recommends shops to write estimates with alternative pricing if it’s available through a different source—therefore utilizing price matching opportunities.
• Cycle time impact: At this point, State Farm said it was hard to prove any cycle time improvements that have resulted from use of the application. State Farm does not expect an immediate or large reduction in cycle time, according to the ASA.
• Prevention of total losses: State Farm said there is still insufficient data to validate whether the PartsTrader initiative is preventing total losses. There also is not enough data to demonstrate an increase in recycled or alternative parts.
• Profitability: According to the ASA, there is not yet any evidence regarding reductions in parts profits.
• Program cost: PartsTrader will not charge suppliers for use of the program until 2014.
• Program launch in the Chicago market: To date, 475 out of 477 Select Service shops in Chicago have registered for the program. The Select Service shops have been asked to identify parts suppliers, and between 500 and 600 suppliers have been identified thus far.
In addition, the ASA said State Farm has arranged meetings with all Select Service repairers in Chicago to provide them with program overviews, handouts and preparation materials. PartsTrader has been meeting with dealers and parts suppliers in the market since Nov. 12.
The ASA said the duration of the pilot is still unknown. According to State Farm, “once a change is introduced into the application in pilot, it is necessary for the change to ‘mature’ to determine the impact of the change. This, then, impacts the end date.”
“For the ASA collision membership volunteering on the operations committee, the focus continues to be one of information, engagement and impacting the outcome in the most positive way on behalf of repairers,” said Denise Caspersen, collision division manager for the ASA. “It was apparent early on that the ‘train had left the station’ in regard to stopping this application from being piloted. The ASA team made the decision to focus on accuracy and engagement, and will continue to do so as this pilot continues and future items arise.”
FenderBender conducted a series of video interviews regarding PartsTrader during the 2012 NACE Expo in New Orleans and 2012 SEMA Show in Las Vegas. Find interviews with George Avery, auto claims consultant-P&C claims for State Farm; Michael Quinn, vice president of industry and community relations for Caliber Collision Centers and member of PartsTrader's Industry Advisory Council; Rex Crowther, editor of New Zealand-based PanelTalk; and David Newton-Ross, editor of The NZ Collision Repairer, here.