Understanding your business revenue

The global collision industry comes down to three words: change; challenges and opportunities. Years of experience in an industry that doesn’t exist anymore doesn’t help one make the changes required. This is unprecedented territory we’re going into. The technology of cars is seeing massive change, beyond anything we have seen before, and your customers in the millennial age-bracket will expect you to be able to repair cars made of new materials.

This was the advice from Robert Snook, CEO of Business Success Global, a multi-site motor body repair group that was this year recognised ’the best in the UK’ to delegates at the 2019 SAMBRA (South African Motor Body Repairers’) Conference. SAMBRA is a proud association of the Retail Motor Industry Organisation (RMI).

According to Snook, there has never been a better time to be in the collision repair industry – because of the opportunities arising through consolidation. “There’s a five-year window, and the clocks have already been ticking for two or three years. Therefore, if you haven’t started already you need to do so today if you wish to emerge among the survivors,” said Snook.

Snook cited some global examples of consolidation. North America, for example, has already seen huge consolidation, with just four consolidated firms (some with 1,300 body shops) emerging backed by major venture capital firms. The UK too is dominated by two massive groups. He said there is also an evolving change in mindset. In Bahrain, its national insurance company arrived at a conference and decided the 300 suppliers it had been unsustainable and consequently reduced that number to 30 ‘partners’ who now do as much work as the 300 suppliers before.

Similarly in the entire Middle East region, a ‘Meeting of Minds’ group has been formed of insurers, MBRs, OEMs and suppliers to look at the same thing. The key point is MBRs need to be led by business managers, not workshop managers. The reality is that 83% of body shop owners and managers have no formal business qualification for running a business so one needs to be crystal clear in your market and brand yourselves as the leader in your niche - not second, third or an also-ran. “Offering extras creates positive energy - things the customer didn’t ask for. They will never go anywhere else ever again,” stresses Snook.

Final words of advice:

  • In sales, you can only sell two of three variations: Good, Fast and
    Cheap. Decide which two.
  • If there’s a problem in the workshop, don’t look at the workshop but
    further up the revenue chain, at sales, branding or systems.
  • Aim for high-profit, low-maintenance customers who walkout
    happy and come back to you every time, rather than low-profit
    high-maintenance customers.
  • We have to unlearn what we know and learn what we do not yet
    understand.