Thursday, 22 July 2010 19:08

Pacific Collision Centers Says Relationship with PPG a “Wise Move”

Written by Ed Attanasio
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Steve Vettel, owner of Pacific Collision Centers, with six locations located in five Southern California counties, learned the collision business by working at the dealership level for many years, and gleaned much knowledge from that perspective.

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Since then, Vettel’s shops have flourished and consistently generated rave reviews, while establishing a reputation for embracing the latest technology and operating on the cutting edge. His relationship with PPG, his paint supplier for more than a decade, is one of the reasons why Pacific Collision has hit impressive numbers, even during a recession.

Together, Pacific’s six locations repairs an average of approximately 500 cars monthly, operating out a total of 140,000 combined square footage and employing 100 people, including 25 paint crew members, Vettel told Autobody News.

At his peak, Vettel said he was repairing 750 cars per month, but the recession dropped his numbers, just like everyone else’s in the country. “So much has changed within the last 18 months that we don’t know where we’re headed right now. The larger operations will survive and a lot of the smaller independents will be closing or getting absorbed by the larger chains. That’s the reality of it, so we need to prepare for these developments if we want to survive and stay profitability.”

One of the things Vettel calls a “smart move” involves his 12-year relationship with PPG. “They’ve helped us in so many ways,” he said. “We’ve used their assistance on how to dial in our processes and we’ve tapped into their knowledge and experience time and again. PPG is a great supplier, because they have a good product, Envirobase® High Performance, but they also help us on so many different levels.”

 

“It’s a product that’s easy to use and that’s one of the biggest benefits of using PPG’s products,” Vettel said. “Over the 12 years, we’ve really learned to appreciate everything about PPG, including the process, which is streamlined; the simplicity of the mixing and the color matching and the ease of application.  And it was easy to teach our people about the product, which is a time savings, obviously. It’s a very user-friendly product.”

Vettel started using PPG waterborne for a full nine months before the mandate in his counties took effect. “We’ve been using it for two years, so we’re completely comfortable with it by now. My philosophy was that I didn’t want to be on the bleeding edge, but I certainly wanted to be on the cutting edge. We wanted to convert before it was mandated, just so we could work out the kinks, and that’s what we did.”

Vettel’s path to becoming an owner of six locations is somewhat unique. “I started out as a dealer auditor for Chrysler Corporation right out of college. My job essentially was to audit dealerships for profitability and it was very interesting to find out the body shops were busy and generated a fair amount of revenue, but they were never profitable on paper. I would sit down with these dealership principals, and they would always tell me that you can’t make money in the body collision industry. It was a very educational experience.”

Vettel discovered that the dealership’s collision facilities were successful, but were always saddled by all of the fixed operations associated with selling new cars. “The rent, the insurance, the advertising--all went to the body shop’s expenses, so the owners viewed the collision aspect of their company as a loser, but they were actually making money.”

After seeing this again and again, Vettel decided to go out on his own. “This can’t be this difficult, I thought. So, in 1987, I opened a small body shop in Huntington Beach with just two techs. And that was the genesis of my career in collision repair.”

When each new location opened, Vettel worked there until he knew it was time to open another one. “I am a very hands-on guy. Every time I opened a new store, I was the one working with the techs and training them myself. I’d get the model running in the back, and then I’d be the person writing the estimates and pushing the production. The entire time, I’d be growing my managers. When we were stable at the location, I’d start looking around for another area or opportunity. That’s how I was able to grow.”

Jim Downey is the senior PPG regional manager who oversees half of Southern California and Hawaii. In the past few years, he’s been involved in helping more than 600 body shops to convert to PPG waterborne, including Vettel’s six locations.

Vettel was an early adopter and made the changeover to waterborne one location at a time, Downey said. “Steve Vettel is probably one of the most astute businessmen I know in this industry. He’s always on top of the newest trend. He’s got an incredible background and he was able to foresee the economic crunch before others did and that’s why he’s surviving while a lot of other shops are struggling and don’t see any  relief in sight.”

Twice a month, Vettel, his managers and Auto Color Specialists, his local PPG distributor, conduct a conference call to stay in touch, discuss issues and monitor things like profitability and how they can do a better job, Downey said.

“Every once in awhile, we’ll participate in the conference calls to find out what Steve’s shops are doing and to explore how we can make their lives easier. Feedback from the shop managers is very important and being proactive is the key. Anticipating rather than reacting is a smarter way to go, because when you have six locations, there is a ton of moving parts.”

In the early days of waterborne, Vettel tested several other paints before deciding on PPG’s product. “Steve evaluated another product specifically, testing our product and a competitor’s for three months to see which would give him the highest quality. In the end, he continued working with us, and Steve said he avoided a grave mistake by sticking with us. We proved ourselves to him and that was all he needed.”

Downey believes that customers appreciate the greening of the industry in  using waterborne paint and that body shops can leverage that approval to get more business, he said. “In Southern California, people are very aware of the green movement, because the media is always talking about it. They’re very informed about what’s going on with the environment around here, so they do care. Will people gravitate toward shops that will be greener? Based on my experience, yes, so we all win.”

Where will Vettel and Pacific Collision Centers be in five years? “We’re operating in what’s been referred to as the ‘New Normal’ in collision repair.  I think today’s business environment requires you to have the ability to change and adapt quickly and that requires a very fluid five-year plan. I wish I could pinpoint where we’re headed, but I can’t. I believe there will be a certain amount of attrition in the collision repair business. It’s an uncertain time in this industry, right now, but we’ll know a lot more in the next 12-18 months.”

Pacific Collision Centers
1621 Orangethorpe Avenue
Fullerton, California 92831
(714) 888-9000
www.pacificcollision.com

 

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