G&C Auto Body has doubled sales and locations in the past five years, as a new Sonoma Valley spot gives the company 10 shops in four North Bay counties.
The Santa Rosa-based company run by the Crozat family is preparing to open a shop at 19285 Sonoma Hwy., a 4,500-square-foot former tire and automotive building purchased in the fall for $1.7 million. Renovations and tenant improvements added another $700,000 to the project, led by general contractor Pacatte Construction of Santa Rosa.
This new location comes during a spurt of rapid growth, according to Shawn Crozat, oldest son of co-founder Gene Crozat and chief operating officer.
“We added stores and kind of went on steroids for a few years, and then we needed to figure it all out and dial it in with growth,” Shawn Crozat said.
G&C (gandcautobody.com) started in 1972 in Santa Rosa then expanded to San Rafael almost two decades ago and Petaluma a few years later. Next came Windsor in late 2010, Novato and Rohnert Park in 2011, Ukiah and Fairfield in 2012 and
Vacaville in 2013. Revenues last year were $43 million, passing the forecast by $40,000, Crozat said. By comparison, sales in 2011 were $22 million.
Same-store revenue growth was 10.5 percent last year and 9.8 percent in 2014. That’s a standard retail metric for comparing location performance without the new-store sales spike. The new shops boosted overall revenue growth by 22.5 percent in 2013, 27.5 percent in 2012 and 19 percent in 2011.
The Sonoma location is expected to contribute $2 million in annual sales after one year, Crozat said. The four starting employees in the six-bay shop would increase the company workforce to 200-plus.
“We kind of feel it’s a market in which people have to drive out of town to have their car fixed,” he said about Sonoma Valley. “And it’s the only body shop in the main populated area directly on the main highway.”
A DECADE COMING
A Sonoma Valley location has been 10 years and four attempts in the making, Crozat said. The first try was a decade ago but didn’t work. The second attempt was four years ago. Though it, again, didn’t come together, one trip to Sonoma Valley led to an extended scouting mission in Solano County and a back-of-the-napkin deal in a coffee shop for the Fairfield location, now G&C’s third-most-profitable.
The latest, successful try came this past summer. On previous site-selection trips to the valley, Crozat had eyed the 19285 Sonoma Hwy. building, then occupied by McLea’s Tire & Automotive Centers (mcleastire.com). A mutual friend at a local radio station where G&C and McLea’s advertise told Crozat that McLea’s had relocated staff and equipment from the Sonoma shop in early July to a just-opened Windsor location.
McLea’s President Les McLea told the Business Journal he recommended that the Crozats buy the Sonoma building instead of rent it. The property was in escrow within a week, with closing contingent upon securing use permits for the project.
Crozat Family Properties LLC purchased 19285 Sonoma Hwy. from Gary and Terrie Heon on Sept. 14.
McLea said he didn’t renew the Sonoma lease because of a dispute with the property owner over a worker injury and increased workers’ compensation insurance costs.
“We outgrew it,” McLea said. “It was too confined for us, and parking was terrible with two parking spots for the 20 to 30 cars a day coming in to be worked on.”
McLea has a real estate agent scouting for another location in the valley, but alternatives are smaller than desired, he said.
“We have five stores on [Highway] 101, and they’re within 25 miles of each other, so we pretty much have Sonoma County covered for now,” McLea said.
EXPANSION TO NAPA
G&C also has been looking for opportunities in Napa Valley for years, but nothing has come together yet, Crozat said.
“In our business, usually you have to buy somebody — a competitor — or find a need in the market,” he said. “Sonoma has that need, so it works out great. Napa doesn’t, so what you need is someone to sell. In our industry, a lot of owners in
Napa are not old enough to sell their business.”
Valuation of the business and the potential for proceeds from a sale to fund retirement is key to that calculation, he said.
COLLIDING WITH INDUSTRY CONSOLIDATION
But G&C isn’t the only company looking to expand in Northern California by acquiring collision-repair businesses.
In the past several years, companies backed by large investment funds have been buying shops. For example, Richardson, Texas-based Service King Collision Repair Centers in November 2014 bought Car West Auto Body, which had seven California shops. Backed by The Blackstone Group and The Carlyle Group, Service King now has 290 locations in 23 states, including 29 in California, and topped $1 billion in revenue last year.
“Our industry is consolidating like crazy right now,” Crozat said. “Our business is not for sale. We love what we do — and our business and our community.”
We would like to thank The North Bay Business Journal for reprint permission.