Fix Auto - Index

Fix Auto - Magazine02-en - Index

with a network that is really focused on the
body shop’s needs because it comes from the
body shop perspective. It’s very comforting to
me as a shop owner to know that the network
is representing my best interests.
M Do you think that, in the U.S. market in
general, body shops are working together?
RS I think the body shop industry in the
United States is very fragmented. Most of
the people are still trying to hold on to the
old way of doing business. They don’t want
to see that a single point of contact when
dealing with insurance companies is soon
going to be a reality. They hope to survive, but
they don’t quite know how to do it. So I think
there’s a real need for strong networks that can
aggregate the repair power of lots of different
repair centers while providing a better structure
for them to communicate with their
main customers, the insurance companies.
M What are the other problems facing the
body shop industry?
RS One of the problems is that, in most cases,
body shop owners look at their business more
as a hobby. Forgive me for saying that, because
I am one myself. I’ve had the luxury of moving
up the ladder, from being a repair person to
being a business owner, to being the manager
of the same business. Some people in this field
never move into professional management.
I repeat: some owners consider their business
more like a hobby instead of assuming
responsibility for its continuing growth and
fiscal health. The individual repair centers out
there look at their business as repairers, not as
businessmen. As a result, they don’t allocate
the necessary resources to information technologies.
They don’t require a proper return
on investment to allow them to keep making
it grow. I think that’s a big problem. To put it
bluntly, I think that most body shop owners
look at it from the standpoint of what kind of
lifestyle they can afford. Can they buy a new
car, a new boat? If they meet their lifestyle
needs, then they’re happy with the business
performance. Unfortunately, they’re doing
their stockholders a disservice, even though
the only stockholder is them.
M Do you think things will change?
RS I think that, as networks continue to
grow, they will control the market and the
customer’s freedom of choice will be taken
out of the equation. The consumer will
naturally be drawn to the greatest value
opportunity. And it’s the networks that
will create the greatest value: they’ll have
the best marketing approaches; the best
equipment; the best procedures; the best
customer touch... or they’ll offer the lowest
prices. One of those combinations will exist
in the networks. Meanwhile, the market
share of individual repair centers will continue
to shrink and they will have to choose to
invest enough in their business to make it
attractive to a group that has the strength to
gain access to the work flow from insurers.
I think there’s going to be some attrition:
people are going to go out of business,
largely in the metropolitan markets. I don’t
see that as much of a reality in the smaller
markets. Ones with populations of 250,000
to 500,000, and less, those will be the
markets that will be hit later. But those of
more than a million people will be the first
hit because that’s where the insurance
companies have most of their policy-
holders. That’s where insurance companies
spend most of their money, so that’s where
they’re going to need the best performance
first. As for the people that can’t perform,
their business will decline and they’ll either
go out of business or be bought out, I suppose.
“
WE FEEL THAT WE’RE IN A
UNIQUE POSITION BECAUSE
WE’RE A LITTLE BIT BIGGER
THAN SOME ORGANIzATIONS.
HOWEvER, WE HAvE OUR
LIMITATIONS. WE DON’T HAvE
THE INFRASTRUCTURES TO
MARkET OUR SERvICES TO
”
THE HIGHEST LEvELS.
MARK MAGAZINE || 21