Between the technician shortage, regulatory compliance, interaction with insurers, new technical capabilities, and marketing in order to keep work flowing to the shop, there’s no shortage of collision repair issues for business owners to tackle. So where are they focusing more of their attention and resources this year?
It varies by shop, of course, but here’s how five collision repairers recently answered that question.
Training, Promoting OEM Certifications
Andy Kerby, operations manager for Jim Marsh Auto Body in Las Vegas, NV, said his focus currently centers around the technicians repairing the 450 cars the shop processes every month.
“Paying and retaining the technicians that we’ve invested all the money and time in to get them to do repairs the way we want them done in the shop,” Kerby said. “Keep getting these guys to manufacturer training and to I-CAR is going to be key. Collision repair is now more precise, and it requires these guys to really know what they’re doing. I think the liability of a repair today is so crucial on these new cars. You can’t overlook anything. You have to dot your I’s and cross your T’s.”
Robbie Windham, owner of Windham Body Shop in New Albany, MS, said his 12-employee shop has moved away from insurers’ direct repair programs, so his current focus is on OEM certifications and marketing.
“Those certifications are great, but they only work if you work them,” Windham said. “You have to educate your people, and be completely transparent with [customers]. It’s that upfront conversation. Make sure they understand the difference between OEM parts and aftermarket parts. The insurance contract is their contact, and there’s not a lot you can do there other than educate your customer and give them the opportunity to pay the difference for OEM parts. Some won’t, but a lot of people will.”
Playing up those OEM certifications is one piece of his marketing focus.
“We’re doing some digital billboards outside of the normal area we do business in, and we’re doing the geofencing, more of the digital advertising,” Windham said. “The local newspaper here has that service. And we’re supporting the local schools, because it’s a good community service and helps the kids out, but it also puts us in front of the people we work for. We’re fixing those cars for the moms and dads at the soccer field who are bumping cars in the parking lot or opening doors into one another or whatever. I just feel it’s a good spot to spend that money.”
Getting Adequately Compensated
When asked where he’ll be focusing added resources this year, Tanner Kemna said it will be getting paid for the work being done to keep the business successful despite “all the insurance company denials that we are getting even though we give them everything they ask for” in terms of documentation. Kemna is one of the second-generation owners of Kemna Collision Repair, a 15-employee shop in Jefferson City, MO.
“We try to keep the customer’s payment to just their deductible,” Kemna said. “I try not to take the short payment I’m getting from the insurance company and put that onto the customer as much as possible [unless] they’re not going to pay for something that’s black and white, I’ve got to have it, I have to do it this way, and I can’t make money doing it the way the insurance company is saying that’s the way they’re going to pay.”
But that’s becoming more common, he said.
“We [need customers to understand we are] doing everything we can, we’re providing everything we can to your insurance company, and I’m going to do that two or three times, but by the time the final bill comes and they’re still saying no, here’s all the information you need to take it to small claims court and get your money back,” Kemna said. “I don’t have the exact numbers, but I know that is 90-plus percent effective in customers getting their money back. That’s probably the biggest challenge I see moving forward in the next 12 to 18 months.”
Nikki Anderson has a similar focus on getting paid for the work her shop does, a challenge, she said, when “competing with DRP pricing or losing the job.”
“We are at a point where I’ve looked at the numbers and set our rates so I can say this is how I came to this rate,” said Anderson, who co-owns D&B Auto Body in Sauk Rapids, MN, with her husband. “So if insurers want to say that’s not fair and reasonable because that’s more than what they pay their DRPS, well, that’s just what it will have to be.”
She said she has the ability to show customers the shop’s rate is within range of others in the area.
“So when the insurance company calls them and says, ‘The shop isn’t being fair,’ the customer has the knowledge that we’re right in the middle of everybody else,” Anderson said. “We are getting to a point where there are some things that, yes, we won’t bill for even though we’re doing them, but there are just some things where we can’t do that anymore. We’re either going to bill the customer, or we’re not here anymore.”
She said the shop parted ways with one DRP which, at the time, accounted for more than half its revenue. “But we dropped it, and it made absolutely no change at all,” Anderson said. “It actually meant less work, and more money. We were able to charge for storage on all totaled vehicles instead of just those that are not DRP.”
Dealer Relationships, Apprenticeship
Gene Lopez.
Gene Lopez of Seidner’s Collision in Southern California said the 13-shop company relies heavily on direct repair work for the 1,250 to 1,300 vehicles it processes each month. But he too said the company is focusing on other sources of work as claim counts have declined. They are, for example, currently working to add more relationships with dealerships that don’t have their own collision repair facility.
“We have 18 right now that we do, I think, between $3,000 and $5,000 worth of lot damage a month, which we absorb,” Lopez said. “But on the other side, their referrals are pretty strong, and those referrals can either turn into a DRP assignment or, if we’re not with that [customer’s] insurer in a DRP, we’ll charge them our door rate. That works for us, and so the future means more dealer relationships.”
The company is also working on a Seidner’s Collision apprenticeship program.
“I’m looking for some grant money, and there’s a ton of it in California,” if you can meet all the requirements, Lopez said. “For example, one grant provider said our curriculum doesn’t include electric vehicles or hybrid electric vehicles. But they were basing that on a grant they gave to a mechanical shop. So I explained that we do work on electric and hybrid electric vehicles, but in the collision environment, a lot of that work is the same as if it were on an internal combustion engine vehicle. It’s no different. And they then understood that. So there’s some language in the grants that that you have to [work through], but that's definitely one of our 18-month goals.”
John Yoswick