Over the last several years, the collision repair industry has undergone tremendous change and continues to do so, said John Shoemaker, business development manager at BASF Automotive Refinishing North America.
During the November 2019 SEMA Show in Las Vegas, Shoemaker talked about how collision repair businesses can survive these changes and be successful and sustainable in the future. His presentation was part of the Society of Collision Repair Specialists (SCRS) Repairer Driven Education (RDE) Series.
“If shops just want to survive, we can stay where we are and last another two to three years; with luck, we might last five,” said Shoemaker. “However, we are not going to sustain our businesses and move forward.”
With the shift in how body shops operate, Shoemaker said it’s critical to work toward running a well-maintained and equipped business. This involves continuous improvement with training, certifications and developing best practices.
Prior to working at BASF, Shoemaker ran a three-shop MSO for a dealer group in Southwest Virginia for 18 years. When the business held staff meetings and talked about moving to the next level, he recalled sharing information from a book titled “Who Moved My Cheese” by Spencer Johnson.
“The book talks about the four characteristics that represent the simple and complex parts of ourselves: sniff, scurry, hem and haw,” explained Shoemaker. “Those who sniff, are open to change early; others scurry into action. Those who hem and deny, resist change fearing it will lead to something worse; and those who “haw,” eventually learn to adapt when they realize change can lead to something better.”
When you look at these descriptions in terms of a body shop, Shoemaker said businesses that are wanting to move forward should not “hem.”
“We have a lot of people in this industry who are sitting in ‘hem’ right now and hope things are not going to get worse, and that we reached the plateau and are going to be able to ride this out for the next four to five years,” he said.
Instead, he said more shops need to act like “sniff” and “haw” and adapt moving forward.
A Shift in Focus With OEM Certification Programs
In a conversation with Scott Biggs, CEO of Assured Performance Network, Shoemaker said the business owner talked about a series of events that created a perfect storm of conditions that led to the Original Equipment Manufacturer (OEM) certification model. These included commonization, where shops weren’t differentiating themselves from their competition; the negativity buyers associated with having a poor collision repair experience; and the realization of liability, which remains with the repairer or body shop. The majority of shops also didn’t have the necessary equipment and training to repair vehicles properly. These points are detailed in the following Autobody News article: “The Best Body Shops’ Tips: How to Leverage the Certified Repair Model.”
Meanwhile, the Collision Industry Conference (CIC) Definitions Committee was working toward creating an industry-wide definition for a collision repair provider.
Part of the definition states a requirement that repairers, sublet providers and third-party service providers meet OEM specifications regarding equipment, capabilities and training.
Shoemaker stressed the importance of following OEM procedures and getting involved in OEM certification programs to best meet the needs ahead. He then discussed the different types of training programs currently available in the industry. They include the Inter-Industry Conference on Auto Collision Repair ((PDP), the Automotive Management Institute (AMi) Professional Recognition Program, and OEM training.
When deciding on which OEM certification program to focus on, Shoemaker recommended looking at a shop’s competition to help determine if the OEM program will provide the best return on investment.
“Ask yourself, ‘do you want to get certified on vehicles you are already repairing or drive new business?’” he said. “There are two schools of thought.”
Many obtain OEM certifications directly through a car manufacturer. Shoemaker explained that the majority of programs are very selective, with an estimated 80 percent needing a referral. Assured Performance Network, a third-party provider, is the administrator for several of these OEM programs.
“Assured Performance Network’s collaborative approach allows shops to join several certification programs at one time and one price, which can save them a significant amount of money and avoid redundancy.”
Each certification program has specific facility and training requirements that meet the CIC definition of a general repair facility.
For example, as part of some of the OEM open networks, such as BMW, Mercedes-Benz and Nissan, there is an estimator management training requirement.
“Some of the OEMs are now requiring a certified estimator and certified management staff,” said Shoemaker. “That’s where AMi training comes in.”
He pointed out the new expectation of office staff being skilled and trained.
When it comes to equipment requirements, OEMs are brand specific. As a result, Shoemaker recommended that shops are forward-thinking to ensure the equipment will meet the shop’s long-term needs.
He encouraged attendees to think about their purchasing decisions. He used an example of buying a new welder.
“You need to do research and look at what’s going on in the industry and with cars,” said Shoemaker. “Then, determine if that welder is going to be the right welder to ensure it is going to be good for three to five years.”
Shoemaker then discussed the benefits of getting certified. Along with this comes a change to the way collision shops will find new business.
“OEMs are now using telematics to locate certified collision repair shops,” said Shoemaker. “With telematics, First Notice of Loss (FNOL) is going to connect vehicle owners with certified collision repair shops.”
Other benefits include better access to repair procedures and structural parts. With companies such as Volvo now restricting collision parts to its certified collision repair network, Shoemaker said this will become increasingly important. In addition, OEMs advertise for and refer shops that are part of their network.
The Importance of Creating Best Practices
Shoemaker also discussed the need for shops to change the way damage is documented and validate repair methods with OEM processes.
“Make sure you have the documentation you need to tell insurers how the car is going to be fixed,” said Shoemaker. “There is only one way to repair a car.”
Shoemaker said we have all of the knowledge needed at our fingertips. He suggested accessing the free SCRS Complete Guide to Repair Planning and look into SCRS’s new estimate optimization software: Guide to Complete Repair Planning – Blueprint Optimization Tool.
Other resources include the P-Pages (also called estimate guides), OEM1Stop, 3M Standard Operating Procedures (SOPs), I-CAR information, owners’ manuals and OEM procedures.
He also suggested “reprogramming” damage appraisers and training them to describe repair operations as they expect the technician to complete them, identifying each of the steps required, ensuring the information is communicated to all involved and being specific with the necessary processes.
“Not only is that how they get paid, but it also reduces your liability and ensures the car is repaired correctly,” he said. “Vehicles are getting too complex to not be educated enough to fix them, so we have to develop some best practices to harness all of this,” he said.
He shared information from Dave Dunn’s book “Liquid Amalgam,” which talks about non-negotiables and core values. It is based on four principles:
- Honesty—being truthful in all transactions and to all parties,
- Excellence—to meet customers’ expectations and be equal to or better than the standards,
- Accommodation—coming to an agreement with the customer and delivering on that agreement with the customer’s best interests in mind, and
- Profitability—which gives stability and attracts desirable employees.
“There is a lot of value in creating best practices and developing core values,” said Shoemaker. “I don’t think we spend enough time doing that.”
He advised attendees to be consistent with principles and make sure they are clearly understood by all employees.
“Ensure everyone knows their purpose; don’t waver and always accentuate, not sometimes,” he advised. “There is a big difference between always and sometimes. Always gets you where you want to be; sometimes takes you back where you were.”
Once a shop has changed its processes, Shoemaker said the next step is marketing them to customers.
After recognizing what enables the shop to stand out among its competitors—whether that is being OEM certified, I-CAR Gold Class or a family-owned business—the next step is to promote those differences to customers.
He also mentioned the book “How to Market to People Not Like You” by Kelly McDonald.
“The message of the book is to know where your business is coming from and where it’s not coming from and learn how to market to people who are not like you,” explained Shoemaker.
He talked about the eight-step process of successful change based on the book “Our Iceberg is Melting” by John Kotter.
- Create a sense of urgency;
- Build a Guiding Coalition;
- Form a Strategic Vision & Initiatives;
- Enlist a Volunteer Army;
- Enable Action by Removing Barriers;
- Generate Short-Term Wins;
- Sustain Acceleration; and
- Institute Change.
The challenge, according to Shoemaker, is creating a business culture for the future.
“You must move past the status quo to get to tomorrow to be successful. Get out of dark ages and into daylight,” said Shoemaker. “We have to pull our heads out of the sand and move forward. Today is the day to take control of our businesses.”
He recommended body shops read “The Secrets of America’s Greatest Body Shops” and ended the presentation with a quote from co-author David Luehr.
“Do not limit the majesty of your dreams to your current level of competence,” said Luehr. “Know that all the education you need will be available along your journey.”
Stacey Phillips Ronak