(by Sue Johnson, who works on the IGA Legal Fund from her office in Hopkins, Minn.)
NAGS is scheduled to roll out their "rebalanced" benchmarks in January. This rebalancing represents the most dramatic change ever in how the industry must now formulate invoices.
The NAGS rebalancing will drop the list price to an average of approximately 67 percent off the current list price - depending upon your mix. NAGS does not establish an hourly benchmark for labor. Labor rates are up for grabs. Can you stay in business at 67 percent off list with a flat labor rate of $40? The IGA is concerned that if NAGS goes forward as scheduled, before most of the shops are aware of the change, it will do enormous damage to many businesses.
While we recognize that it is the responsibility of the business owner to understand the consequences of this rebalancing, the reality is that the vast majority of shop owners are not aware of what is about to happen. While NAGS has been good about accepting invitations to do presentations all over the country, 99 percent of shop owners do not attend such presentations, conferences and do not catch all the press announcements. The word has simply not yet reached the vast majority of shops.
We believe the competition for the quality of the benchmarks and the accountability that comes with it will cause NAGS to do a better job.
NAGS correctly points out that it is the market, not NAGS, that establishes price. NAGS has spoken of their support for letting the market establish price, as do we. Just as competition is good for auto glass shops, insurers and consumers, so is competition good for publishers. We hope NAGS will welcome the ideas from CAGG, will make their methodology more transparent and will show a genuine openness to working with CAGG.
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