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What Role Should a Current Backlog of Work Play in Auto Body Shops’ DRP Decisions?

A national survey in April found auto body shops on average have a work backlog topping four weeks, and during the Society of Collision Repair Specialists’ (SCRS) Repairer Roundtable this spring, a panel was asked whether that “unique scenario” in the industry should play into a collision repair business’ decisions related to participation in direct repair programs.

Three association leaders and two shop owners responded.

Jill Tuggle, who has been executive director of the Auto Body Association of Texas (ABAT) for five years, thinks it should play into a shop’s decision.

“If there ever was a time that you could test the waters on operating independently of those contracts, it would be now,” Tuggle said. “Because you’re going to get the work. The work is there. You already can’t repair everything you have. If that’s a business decision you have been toying with, now would be a good time to do that.”

Other association leaders with longer tenures offered some cautions to consider.

“In order to do that, they have to have alternative plans,” Jordan Hendler of the Washington Metropolitan Auto Body Association (WMABA) said of shops choosing to exit DRPs. “I don’t think you can just sever those relationships. I think you have to have a solid plan for either marketing or getting into OEM certifications. In our association, the most successful members are specialized and OEM-certified in at least five or six brands, minimum. You need to know how you are going to create your own customer stream and own your portion of the market in a smart way.”

Shop Showcase Some collision repairers have chosen locations with little street with Ed Attanasio visibility, Hendler said, lowering their overhead because they knew direct repair referrals would bring work to the door. Social Media for Shops with Ed Attanasio SEMA Show Goes On with Ed Attanasio Jordan Hendler said shops can end direct repair agreements, but first need to have a solid plan about how they can address the changes that will entail “If you just shut those [DRPs] off, you now have no customer vis-Media and Publicity for Shops with Ed Attanasio ibility,” Hendler said. “There’s a lot of pressure just to get rid of all your DRPs [without a plan] and think you’ll be fine. I think that’s a dangerous trap for shops. We’ve seen that happen.”

Aaron Schulenburg of SCRS agreed each business has to evaluate its own situation.

“I don’t think any one model is right or wrong,” he said. “There’s a lot of successful businesses up here [on this panel] and in the audience and in our membership base that have found success in every type of model.”

He said the current situation does provide collision repairers with an opportunity to “prioritize where their profitability lies,” noting even large multi-shop operations (MSOs) that focus on DRP work are saying they are evaluating which of those programs offer the best fit.

Ron Reichen of Precision Body & Paint, which is opening its fifth

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