Tuesday, 13 April 2010 14:13

Make Secure Connections to Create a Better Future

Written by Tom Franklin

I recently learned that a shop owner in my area had dropped a couple of DRPs, including Farmers and 21st Century (which had been absorbed by AIG). I heard that he had decided that between his Toyota and BMW dealership relationships plus his many-year prior customers, he no longer needed the hassle of increasingly onerous demands and low profits from the insurance companies.

Naturally I applaud his courage in seeking to prosper without the insurance connections, but I had to wonder if he adequately considered the long-term ramifications of his decision. Over the years I’ve observed that body shop relationships with dealerships are often similar to marriages. Many end in divorce.

I also thought about the rising role Farmers Insurance is playing in the industry. Since absorbing Bristol West and recently 21st Century with its prior AIG connection, I see Farmers becoming a much greater force to be reckoned with. Is it wise for a shop to sever a connection with Farmers at a time when it may become a source of far more business? Of course I can’t answer that question for this shop owner. I don’t have access to his financial records and this move may make perfectly good sense financially.

Several years ago I had the opportunity to speak with two very different kinds of body shop owners. One was bemoaning the past, saying that fifteen years ago the business was fun—there were fewer regulations and fewer forces nibbling away at profits at every turn. Today he said he was earning less and working more and the fun was gone. He was pessimistic about the future.

The other owner was expanding, buying out a near-by shop and increasing his reach into a wider market. He was optimistic about the future! Today it’s harder to find shop owners who are that confident about a better future ahead. Which viewpoint will better serve a shop owner who wants to grow but also wants to hedge his bet in case the economy doesn’t bounce back very quickly?

The creation of a desirable future is what inspires us to work, and especially to put out that extra effort to build the kind of future life we wish to arrive at. If we are optimistic and believe it is possible to create that better future, it is easier to get up in the morning and to eagerly attack the tasks of the day, knowing that each day is bringing us closer to the better future we have envisioned. If we see the future as being doomed to continuous decline with diminishing returns for the efforts we make, it will become more and more difficult to make that effort.

Remember, for a moment, where you wanted to go when you started your business. What were your goals? What kind of future did you want to create? Have you arrived where you intended? Have you gone farther? Or have you fallen short and lost sight of what it was you wanted to achieve? If so, when were things last going well? What shifted or changed? What could you do to get back on track? Try to recreate for a moment, those original intentions. How could your intentions be modified to fit the present? If you were just starting out today, how would you go about striving to reach your objectives?

I come back to thinking about the shop severing that connection to Farmers Insurance. In today’s world, more than ever, our forward thrust is determined by our connections. We’re much like our power tools that have to be plugged into an electric outlet to draw power to be energized. If we don’t connect to referral sources, reliable suppliers, informational databases, competent workers and numerous customers, we’ll find ourselves disconnected from the power sources we need to operate.

It may be that this shop has sufficient connections to thrive without the insurance connections. But if I were to advise a shop owner who wanted to create a secure and growing future, my first advice would be to diversify his or her sources of business and to open up as many channels as possible for business to flow in. Connections in this economy can be fickle. Someone offering a little better price, better discounts and/or faster service may very well steal one source of business out from under you when you’re not looking. If you have enough other sources to survive the loss and keep growing, you may be able to continue to create the better future you have envisioned.

Read 1442 times Last modified on Thursday, 15 December 2016 06:32