MTA answers the real time real money hard questions.txt

While real time, real money (RTRM) is now launched, endorsed by Australia?s biggest car insurer and stipulated by various government codes of practice, the movement still has a way
to go to be accepted by all repairers throughout Australia.

THERE ARE SEVERAL REASONS for this. One is
a natural resistance to changing a system that,
although flawed, is understood. Another is a
susaround increasing the entrenched labour rate.
While there have been many RTRM
presentations not all repairers have been able to
attend and, of those who have attended, many
have questions they still need answering.
Based on our own research, Paint & Panel
has found the questions below are the most
often asked. We put them to the Body Repair
Division of the Motor Traders Association of
NSW which has supplied the answers.

If I go to the trouble and expense of switching to RTRM how will it benefit my bottom line?

It is unlikely that the day after you begin
quoting in RTRM you will see a change to your
bottom line. But going into the future is where
it will really kick in. Some people question
RTRM but they are ignoring wrong times
manuals, reducing returns, staff issues and the
inability to pass costs on. The industry has
absorbed every increase for the last 10 to 15
years; items such as parts increases (something
like 230 per cent), wages, superannuation rates
? to name a few. And as the price of oil
continues to increase so does the prices of
paint and consumables which are oil based.
With RTRM you can automatically pass these
increases on.
Future increases and specialist equipment
requirements will make the past look like
a
I know that NRMA is going to adopt RTRM, but how do the other insurers feel about it?

GIO conducted field trials throughout 2007
and is expected to come on board. Other
insurers are conducting trials right now. Many
are letting the biggest insurer, NRMA, break the
ice and then they will adopt RTRM.

Most of my business is done with AAMI using its two quote system. What use will RTRM be to me?

First, you can?t be sure that the AAMI two
quote (best bottom line) model will be
permanent, so chances are you?ll have to deal
with RTRM sooner or later. But there are
benefits just going through the RTRM exercise
because you will find exactly what your costs
are and what your shop rate should be. RTRM
has brought with it some excellent tools for
making the calculations.

If NRMA was serious about RTRM how come it still puts jobs on the internet and calls for the lowest bid through the WRM system where shop rates and times don?t come into it?

As we said above, shop rates might not be
shown on a quote but are essential for the shop
itself to know.

Why doesn?t the MTA just negotiate with NRMA and other insurers for a higher hourly rate on funny time and leave it at that?

The rate can never be usefully increased under the present system. If it was, what happens to times? If they were cut down to compensate, repairers would be no better off. But if times
were left ?funny? the market could not absorb the blowout in repair costs.

I?m a Perth repairer. We?ve got work coming out of our ears because there?s a critical shortage of technicians here. I don?t need RTRM. Why should I bother with it?

If the mining boom will go on for ever, then
your argument is okay. But we all know that
everything comes to an end, even a mining
boom. Switching to RTRM now won?t affect
your prosperity but you?ll better understand
your business and be ready for when things
return to ?normal?.

If NRMA agrees to my shop rate will that rate become public knowledge?

As far as NRMA is concerned shop rates are
confidential, but remember most shops will
reveal their shop rate on a quote, because they
have to multiply it by the number of real hours
a job will take.

If I don?t agree with an R&R time in the MTA manual, what can I do about it?

The times are actual times taken in an average,
well equipped workshop using best practice
with an allowance for set up time.
There is a possibility that some times are
inaccurate because of the complexity of some
operations. As they are brought to MTA?s
attention they will be adjusted. Remember the
manual constantly evolves as field reports come
in and are incorporated.
Any repairer is welcome to participate in or
observe operational times.

Also please note you now charge paint and
consumables, and have a percentage
allowance on a single panels and second
hand parts.
How would I go about changing my shop
rate if there were big changes in my shop?
Once established, your shop rate is not
permanent. It is subject to changes in your
shop and the trade at large. This requires
monitoring because if you want an insurer to
accept a changed shop rate, you must able to
show how you arrived at it.
How will RTRM affect negotiations with
assessors over panel repairs?
With your shop rate established you need only
agree on the time to repair a panel. If the panel
is badly damaged you may agree on a new
panel. If repairable, there are three ways to
handle the assessment: agree on a time or claim
an additional or (if there is a high level of trust)
carry out the repair and then tell the insurer
how long it took. Experienced repairers and
assessors don?t have much trouble in coming to
an agreement on panel repairs. The cheats are
soon found out.
I?m not an NRMA PSR, so where can I get
help with understanding RTRM?
The MTA will guide you. You don?t even have to
be member of the MTA to get help.
How can I quote competitively if my shop
rate works out at more than the $94 an
hour, the upper limit set by NRMA?
In the case of NRMA, all shop rates are subject to
agreement with each individual shop. NRMA is
quite open about the way it views shop rates. If
a shop maintains it has a rate higher than the $94
upper limit, it must justify its rate with figures.
I think I?ll just wait and see how RTRM
works out before becoming involved.
What?s wrong with that?
RTRM has been coming for two years. Now that
governments and the biggest motor insurer
have embraced it, why delay the inevitable? And
why not get the benefits by doing the exercise
of knowing your shop rate and then getting
paid for everything?
Will there be two times manuals?
Yes, there will be an MTA times manual and an
IAG times manual times will be the same, as
they have been agreed by the MTA times
committee in consultation with IAG.
Even though I know the current rates are
ridiculous I am worried about the change to
RTRM being too complicated.
RTRM is extremely easy to use. It takes less
time and there are virtually no areas of potential
argument. The procedure is to agree what has
to be done: what needs to be RR, repaired,
replaced and so on. For example, a small dent
probably takes about one hour while a larger
area of damage is monitored.
Do we have to accept the DeLoitte Calculator?
No it is strongly recommended that you obtain
assistance from the MTA or PPG or MVP or
AKZO ? to name a few. There is plenty of
help available.
What about future rate increases as we
know paint goes up every year?
You review your rate regularly as materials,
wages, CPI and all other costs increase.
What about rates for prestige cars?
Your shop rate is calculated to cover all expenses
and overheads, so the rate does not change.
What does change is that you get more time at
the rate to do a more complex task.