Can the Auto Glass and Collision Repair Industries Co-Exist
By Keith Beveridge
Part 2 in this series looks at how to compete with collision shops-and succeed. Read Part 1 here.
Gone are the days when every-one focused on their niche. Now, auto glass shops have to compete with collision shops among others. I went into this in great deal, while outlining the history of auto glass and collision industries in the September-October issue (available at agrrmag.com/digital), and in this article we will look at how to compete within your niche.
1. Take Control of Your Destiny
Yellow Pages are out but digital marketing is in. Depending upon your market, digital marketing can be cost effective and drive business to your shop. Investigate using a digital agency to help with placement and also assist with your website. Regularly review what sources provide your customer leads. Continue profitable relationships with insurance agents (particularly independent agents of smaller insurance companies), local fleets, body shops and other business sources. Consider eliminating lead sources that no longer produce and refocus those resources. At the end of the day, you want to become top of mind for auto glass. Many consumers still do not have a preference for an auto glass service provider so if you can get them to choose your shop and educate them, you can control your sales.
2. Network then Network Again
Even during the CVOID-19 crisis, it is possible to participate in local networking opportunities at local service clubs or your chamber of commerce. Become recognized as the local glass guy or glass gal. The U.S. Commerce Department indicates small business accounts for nearly half the U.S. economy. Provide business opportunities for your fellow small business owners and they will reciprocate.
3. Support Shop Small Movement
It is interesting that one of the world’s largest organizations, American Express, started the nationwide Shop Small movement. The main objective is to support small, independent businesses and call attention to the valuable and distinct contributions they make to their communities and the economy. A 2019 study sponsored by American Express found that an average of $0.67 of every dollar spent at a small business in the U.S. ends up staying in that local community. When consumers are aware of this impact, 75% say they would be more likely to purchase a product or service from a small independently owned business. Be sure to promote and leverage your shop as part of your own shop small movement in your community.
4. Review your Windshield Repair Program
Contrary to some old fashioned industry thinking, an effective windshield repair program enhances your business. You improve your business’s reputation by optimizing your customer’s expenses. This, in turn, improves your local brand reputation and increases consumer satisfaction.
5. Increase Throughput
If technician availability does in-crease job cycle times (job cycle time is the total elapsed time when the vehicle owner calls to schedule the job and the repair or replacement is completed) then you should plan to do this work either same day (especially if a windshield repair) or the next day. Vehicle owner behavior has not changed in the past 30 years: they procrastinate over the decision to repair or replace their auto glass but when they do decide, they want it done immediately. Furthermore, staff your business to meet your customer’s need. Make sure your website can handle online scheduling and consider employing a call center service that will answer your phone 24/7.
6. Increase Operational Efficiency by Choosing the Right Systems
Review your current point-of-sale (POS) provider and decide if it is the right choice for your shop. There are a number of POS providers, but you want one that is fully integrated with your vendors. Your website’s online scheduling will assist in choosing the right part, help manage your mobile workforce and integrate with your accounting services and/or software. Most of the shop purchasing, administration and accounting can likely be semi or fully automated. Re-allocate this time to improving sales and/or your customer satisfaction.
7. Operational Excellence
“Hire” a mystery shopper to review your operations. This does not have to be expensive as the mystery shopper could be a friend or a relative. If you prefer, engage a professional mystery shopping service. Better yet, become a Registered Member of the Auto Glass Safety Council. Once COVID-19 allows, the AGSC regularly conducts independent third-party audits of your operations. Yes, you will have to pass your AGRSS audit to become a Registered Member, but this audit may identify deficiencies in your current operations that you get to address which will improve your operations.
8. Best Practices
Review your operating procedures and identify the best practices that work for your shop. Make your lead tech and your CSR responsible to implement these best practices. Ask the rest of your staff to suggest new best practices and reward them when they do.
9. Invest in your Employees
Train your employees regularly–this does not have to be expensive. AGSC offers online training, and your auto glass adhesive urethane manufacturer should provide training to your shop either individually or at a local event. If you do not know who your auto glass adhesive rep is, call your auto glass distributor. Besides, you will need this training if you want to become an AGSC Registered Member Company. Go one step further and have your technicians become AGSC Certified Replacement Technicians and have your lead tech become an AGSC Master Technician. Also have your repair techs become NWRD Certified Repair Technicians. By employing Certified Technicians, you improve your customer satisfaction and lower both your costs and business risks by ensuring that every repair or replacement job is done right the first time.
10. Invest in Your Business
Protect your shop’s image and reputation by reviewing your operations and assets regularly. Most consumer-facing franchise organizations require their franchises to perform a minor image refresh every three to five years and a major refresh every 7 to 10 years. Their research shows that consumers react positively to these changes. This does not mean you should go and chase the next big thing—just stick to the basics. If you have a shop, look at the facility. Is it clean (particularly the bathrooms), safe, well-lit and properly maintained? Is it time to replace the old mangy couch in the customer waiting area? Are your mobile trucks clean and well serviced? Is your customer service up to the challenge (see mystery shopping above)?
11. Diversify Your Product Line
What products have you added to your portfolio in the past couple of years? Have you asked your customers what they would like you to offer? How many ADAS calibrations have you turned down in the past month because you did not offer it? Do the math, but if over 50% of the new vehicles have ADAS, then recalibration may be the next big thing. What other products make sense? Restoring cloudy headlamp lenses? Consider at-tending the trade show at Auto Glass Week June 7-9, 2021 to look for other product and service ideas. This year, for the first time, you can attend in person or online. (See page 19 or go to autoglassweek.com for more details.)
12. Attend Auto Glass Week in June
In addition to researching new products and services, attend the conference at Auto Glass Week. You will come away with more knowledge and new ideas for your business and most importantly you will make connections to other industry professionals. If you are an AGSC or NWRD member, consider volunteering on a committee as in-person meetings are usually held at Auto Glass Week.
13. Improve Your Supply Chain
Now is the time to meet with your auto glass suppliers. Ask them what they are willing to do to assist you with your business. Your auto glass business should be earned. There are usually two to four auto glass wholesalers in any given market so make sure you are getting the best service, support and price for your business.
14. Manage Your Expenses
Cash is still king, so cost containment is crucial. You should review your operating budget versus your actual expenses continually. Make expense reductions (or increases) when appropriate, and manage for profitability, but more importantly, cash flow.
15. Manage Your Footprint
It is not easy to make changes to your “real estate” quickly unless your lease is expiring, but review what makes sense long-term and plan for this change. Your lease or mortgage payments are usually one of your biggest fixed expenses. As we have seen with the demise of shopping malls, your location may have become problematic. When I worked for a major fabricator, we evaluated our real estate footprint continually. We looked at our planned customer service levels and how to optimize our customer service with an appropriate return on our local assets. If we could not provide the appropriate customer service and earn an acceptable return, we would redeploy these assets to either a new location and/or new market. This is the same for you. Is all your business mobile? Then why do you have a retail shop? Move to a small warehouse in a showroom space and lower your expenses. Conversely, are your customers asking for in-shop service? Or do you need a space for recalibrations? Again, do the math but look for an acceptable space. Is your business a mixture of both in-shop and mobile? Can you move the in-shop business to mobile? Or is this part of your value proposition that your customers enjoy?
16. Develop a TPA Strategy
Do you join, quit, or stay active? This seems to be a controversial issue in our industry. However, with the addition of several new collision group networks working to increase their share of the auto glass market, it probably makes sense to join them. If you have done your job above and your shop is the vehicle owner’s choice, then you will get this work.
The jury is out on whether medium or large collision groups will be successful in penetrating the auto glass repair and replacement market. Auto glass shops are well entrenched with consumers in the market. With the advent of automotive technology making auto glass and collision repair and replacement more challenging and the global shortage of technicians, will these collision networks be successful? The answer is likely yes to some extent but one of their challenges will be do they have their techs work on $5,000 collision jobs or $500 windshield replacements. We might find collision shops continue to subcontract their auto glass work. And what about windshield repair? Nearly all insurance companies “demand” windshield repair. Are collision shops going to offer windshield repair? Again, probably not.
By doing some or all of the steps identified above, you can defend your business and your market share.
KEITH BEVERIDGE operates Beveridge Consulting which specializes in strategy development, marketing and operational review. He is an authority on windshield repair and customer experience. He is a former member of the boards of directors of the Auto Glass Safety Council (AGSC) and the National Windshield Repair Association (now NWRD) and a former chairperson of the Repair of Laminated Auto Glass Standard (ROLAGS) Committee. He is a former senior vice president of Novus.
To view the laid-in version of this article in our digital edition, CLICK HERE.