The YouTube Craze Âť Developing Leaders Âť Shop Best Practices
December 2014//Vol. 33 No.12
How Much Should You Pay Yourself? Guidelines to properly compensating yourself without breaking your business.
www.bodyshopbusiness.com
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Inside
December December 2014
Vol. 33 No. 12
24
ON THE COVER How Much Should You Pay Yourself? A good understanding of your P&L statement will allow you to pay yourself properly without hurting your business.
FEATURES
34 Follow the Leader MSO
Tips on how to hire the right people and identify those who have potential to be leaders so your business can prosper.
40 Forgotten Labor Part II BUSINESS
There are lots of things we do that we don’t charge for but should. Document your damage, and get paid for what you do.
46 The YouTube Effect MARKETING
More and more people are watching videos online, but is this trend carrying over into collision?
54 Looking Clearly Through the Glass Part II TECHNICAL
Some collision avoidance systems have made a simple windshield replacement a complex procedure.
SHOP TALK Editor’s Notes
8 10 Publisher’s Perspective 14 Clark’s Corner Web Presence Management 20
Who knew reality TV shows could teach so much? It takes a lot to get a top score on an ASE certification test. Sales, production and finance best practices. New Year’s resolutions to boost your Web presence.
BODYSHOP BUSINESS (ISSN 0730-7241) (December 2014, Volume 33, Number 12): Published monthly by Babcox Media, Inc., 3550 Embassy Parkway, Akron, OH 44333 U.S.A. Phone (330) 670-1234, FAX (330) 670-0874. Copyright 2014 Babcox Media, Inc. All Rights Reserved. Periodical postage paid at Akron, OH 44333 and additional mailing offices. POSTMASTER: Send address changes to BODYSHOP BUSINESS, P.O. Box 13260, Akron, OH 44334-3912. Member, BPA Worldwide
DEPARTMENTS Guess the Car ....................................................................................4 e-Buzz ..............................................................................................6 Industry Update ..............................................................................12 Buying Tips......................................................................................32 Product Showcase............................................................................76 By the Numbers ..............................................................................80
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Guess
SOLVED!
the Car Reader Contest! Win $50! What vehicle MODEL does this picture represent? Fax your guess to (330) 670-0874. Include name, title, shop name, city, state and phone number. Or submit your guess with our online contest form by visiting bodyshopbusiness.com/guessthecar. The winner will be randomly selected from “Well, I was born correct entries and in Oklahoma...” awarded $50. Entries must be received by Dec. 31. *Only one winner will be selected. Chances of winning are dependent upon the number of correct entries received. Employees of Babcox, industry manufacturers and BSB advertisers are not eligible to enter.
December 2014 | BodyShop Business
See the January issue for winner of Guess the Car #140.
Sub a ’roo = Subaru
!
WINNER #139
#141
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#140 “OK, Kid, time to get in the game!”
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Nathan Peterson, painter, Tom’s Auto Body, Winona, Minn.
For Esther = (Subaru) Forester
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e-Buzz
The latest online content from BodyShop Business
Check Out Our New Website!
@BSBMagazine: Can now be accessed through BodyShopBusiness.com! Take a look at our new Twitter feed.
Find 1,000’s of BodyShop Business articles online at www.bodyshopbusiness.com 6
December 2014 | BodyShop Business
They Said It On
bodyshopbusiness.com Forgotten Labor Comment by Zeke: I say stop chasing pennies and go after dollars! All the crap you mention about grommets, drain plugs and latch screws is chicken shit and isn’t worth the supplement. I’m a tech and I have a threehour rule: if it’s less than three hours, I eat it rather than stall the job and piss off the customer and the insurance adjuster. It’s just not worth the paperwork and aggravation that goes with it. I get my supplements approved without any bickering or whining because I don’t nickel and dime the job. It’s stupid to work stupid and whine over pennies on a job; it’s better to work the job smart and make it go down the road and get the next job. By the way, our shop has no DRPs, and I have always stood firm by what I just said: nickel and diming is a retarded way to work. Comment by Eric: Billing for those ‘chicken shit’ things like the last three hours, $20 in hardware and $15 in seam sealer is the difference between 4 percent and 8 percent net. The adjusters in your area will learn that writing an estimate at your shop takes a bit longer and will adjust. Get paid, Bro. Get paid. Comment by Forrest: Good article with a lot of valid points. This is why a thorough preliminary estimate is critical because nine times out of 10, you’ll sell a new part to the insurance company after you ram it into their head about what’s involved and needed will cost more to use the LKQ parts. As far as supplements, it doesn’t matter what the dollar amount is, you always lose because of the time and paperwork involved plus delays. Get it figured out and get it right at the beginning.
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Editor’s
Notes
Publisher
S. Scott Shriber, ext. 229 sshriber@babcox.com Editor
Jason Stahl, ext. 226 jstahl@babcox.com
Rescue Me
Managing Editor
ne of my favorite TV shows right now is “Bar Rescue,” where nightlife expert Jon Taffer tries to turn around a failing bar or restaurant. Maybe it’s because of Taffer’s epic meltdowns when he finds bugs in the liquor bottles or dead mice under the furniture. Or maybe it’s my abject horror that someone could actually let their hardearned investment spiral into the toilet so easily. Whatever the case, it’s highly entertaining. And now I think I’m an expert in nightlife, too. Like when I go to the corner bar and the owner (yes, the owner) is hogging the Golden Tee machine. Really? You’re the owner. Isn’t that game for the customers? He’s probably just another guy who wanted to own a bar for the sake of owning a bar and having a fun place to hang out with his friends. But isn’t the primary purpose of owning a business to make money?
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Anyway, I believe Taffer’s recommendations on “Bar Rescue” can benefit any business. For example, keeping a clean business. Yes, body work is dirty, but that doesn’t mean a shop has to be. A clean environment appeals to customers, shows you have pride in your business and keeps employees healthy. Holding people accountable is another thing Taffer espouses. He doesn’t pull any punches
in this department. If the place is a mess, and the owner or manager says, “Well, it’s the bartenders’ job to clean,” Taffer doesn’t let them off the hook. They’re the manager, and thus the responsibility ultimately falls on them. And if there is a problem employee – someone who drinks on the job or overpours for the sake of getting better tips – Taffer demands that the owner fire them or at least take some measure of action to solve the problem. Because that’s what an owner does. Being unique is big for Taffer, too. If you’re a sports bar in an area where there are dozens of them, what makes people want to come to you? You’ve got to have a hook. And so do body shops. Quality repairs and five-star customer service don’t cut it because every shop touts that. Check out an episode. Like me, you might get more out of it than entertainment.
Jason Stahl, Editor Email comments to jstahl@babcox.com
Gina Kuzmick, ext. 244 gkuzmick@babcox.com Contributing Editors
Mitch Becker, Mark Clark, Mark Claypool, Erica Eversman, Tom Ferry, Kristen Hampshire, Curt Harler, Hank Nunn, Carl Wilson Graphic Designer
Lisa DiPaolo, ext. 281 ldipaolo@babcox.com Advertising Services
Kelly McAleese, ext. 284 kmcaleese@babcox.com Director of Circulation
Pat Robinson, ext. 276 probinson@babcox.com Director of eMedia
Randy Loeser, ext. 285 rloeser@babcox.com Subscription Services
Ellen Mays, ext. 275 emays@babcox.com Tel: (330) 670-1234 Fax: (330) 670-0874 Website: bodyshopbusiness.com Corporate
Bill Babcox, President Gregory Cira, Vice President, Chief Financial Officer John DiPaola, Vice President Beth Scheetz, Controller A limited number of complimentary subscriptions are available to those who qualify. Call (330) 670-1234, ext. 288, or fax us at (330) 6705335. Paid subscriptions are available for nonqualified subscribers at: U.S.: $69 for one year. Canada/Mexico: $89 for one year. Canadian rates include GST. Ohio residents add current county sales tax. Other foreign rates/via air mail: $129 for one year. Payable in advance in U.S. funds. Mail payment to BodyShop Business, P.O. Box 75692, Cleveland, OH 44101-4755. VISA, MasterCard or American Express accepted.
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Publisher’s
Perspective Make Mine
Certified, Please... ...ASE certified, to be exact. I recently attended the annual ASE recognition dinner that was held in Frida this year. Technicians and counterpersons from all around the nation were honored for having the top test scores. BodyShop Business sponsors a winner every year in the collision category, and this year’s winner was Darin Morrison from Ankeny, Iowa. Morrison has been in the auto body business since he was 18. He started in the trade at a new vehicle dealer body shop and then migrated to an independent. It was then that he decided to buy his own shop, Fischer Auto Body. He still works in the shop occasionally and has three technicians, and he’s an avid car guy and always has a project going of his own. His score on four different components ranked him the highest in the nation this year. It’s an outstanding achievement – and one that’s only given out by us once a year. It takes lots of experience and
studying to achieve certification at this level. We’re fortunate in this industry to have training opportunities from I-CAR, SCRS, ACA, AASA and ASA. These organizations provide a wide variety of training possibilities and keep the industry up on all the latest trends and technologies. ASE is there to certify everyone on a fair and unbiased playing field. It’s a huge undertaking and requires much thought and commitment to quality. Whenever I travel, I’m reminded of the hectic pace of our industry. Nothing remains the same. It’s good to know that there are technicians and owners out there who are committed to staying up on it and keeping our repairs safe. Thanks, Darin!
S. Scott Shriber, Publisher Email comments to sshriber@babcox.com
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Industry
Update Executive Interview:
Scott Barone, Senior Manager, Wholesale Parts Operations, Volkswagen Brand After Sales cott Barone is an automotive parts and service industry veteran of 30 years. He spent 25 years with the Mopar parts division of Chrysler Corp. and was the co-founder of OEConnection LLC, where he served six years as a board member. Currently, as senior manager, wholesale parts operations for Volkswagen Brand After Sales, he is responsible for the strategic development and implementation of Volkswagen of America’s wholesale parts operations based in Herndon, Va. Barone recently shared with BodyShop Business the initiatives Volkswagen is undertaking to support the collision repair industry.
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What is the Volkswagen of America After Sales Group doing to grow their wholesale business? Specific to the collision business, VWoA wants to ensure that all VW owners receive the highest quality 12
repairs, which includes replacing all damaged parts with VW original equipment parts. To achieve this, Volkswagen offers independent collision shops the opportunity to become a member of their Certified Collision Repair Facility program, or CCRF. The first step for an independent is obtaining a sponsorship from an authorized VW dealer in their area. Once the VW dealer nominates an independent shop, VW conducts a series of evaluations to determine whether the independent shop meets the CCRF program criteria. What business tools is VWoA providing to help their dealers form strong relationships with independent collision shops? We’ve introduced our CRM (Customer Relationship Management) initiative to create a greater working relationship between dealers and independent collision shops.
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Dealers can use the CRM tool to offer independents seasonal promotions, pricing discounts, product information updates and technical support. I believe it is by far the single most comprehensive customer management tool in the industry. I can say this because many of our parts directors – who work within multiple franchises – tell us that it’s the best. Can you elaborate on the importance of “technical support”? Technical information and support are critical to independent shops. Advanced repair technology is making life more challenging for the independents, and we want to ensure that repair information and assistance are readily available. To provide the support necessary, we offer free technical support to any repair shop that purchases a VW original equipment part from a VW dealer (participating in CRM).
The service is both free and unlimited. We’re very proud to offer this feature – at no charge – to all repair shops that purchase VW OE parts. Collision shops want OEM parts, competitive pricing and excellent customer service. What are VW dealers doing to meet these requirements? Over the past two years, a number of our VW dealers have received extensive training in all aspects of wholesale operations, including elite customer service. For example, they’re implementing advanced routing procedures, installing high-tech monitoring devices, expanding their delivery fleet and adding dedicated wholesale sales representatives. The end result has been an increase in collision part sales and improved customer satisfaction. We refer to these dealers as our Signature
Continued on pg. 66
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Clark’s
Corner
By Mark Clark
Sales, Production
and Finance y theory is that independent body shop owners split their time among three main job functions: sales, production and finance. As 2014 comes to a close, I would like to share some simple best practices I see the most successful shop owners employ in each area.
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Sales » As every survey ever done about collision repair confirms, Mr. and Mrs. Smith want to see a clean facility. I continue to be bewildered by shop owners who want to argue the point. “We’re too busy fixing cars to clean up,” they say. Or, “Our repair quality is our selling point, not our housekeeping.” If your parking lot and office don’t look spotlessly clean and tidy, Mrs. Smith won’t trust you with her car, no matter how good your repair quality might be. Like McDonald’s says, “If you’ve got time to lean, you’ve got time to clean.” Dust and vacuum twice a day, post professionally made signs listing your firm’s wonderful qualities and arrange the office space to look welcoming. If you’re not as spiffy-looking as your spiffiest competitor’s facility, you’ll never improve your close rate. Track your estimate writing success every month – by individual estimator! The goal isn’t to write the most estimates or the most complete estimates, but to get the keys to Mrs. Smith’s damaged vehicle. Called close rate, capture ratio or batting average, it’s expressed as a percentage. Nationally, a typical close rate is around 65 percent. Of 100 consumers who came to the local body shop looking to have their vehicle 14
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repaired, 65 had their car fixed and 35 took the shop’s estimate and walked out. Divide the repairs by the estimates. For example, if you fixed 52 vehicles and wrote 80 estimates, that’s 52 divided by 80 which equals 65 percent closed. Don’t spend a fortune advertising to more consumers until you close the ones already in your office. A percentage in the low 80s is a good goal. Curious about your shop’s number? Simply divide last month’s ROs by last month’s estimates. Smile and be sympathetic. Mr. and Mrs. Smith have a collision every seven years, and are upset and worried their vehicle will never be the same again. Greet them immediately, ask about their circumstances, listen to what they say and generally act like you’re happy they’re there. I contend the best closers speak specifics about the repair: “Mrs. Smith, we’ll remove the damaged panel with a special depth sensitive spot weld drill and restore the galvanized corrosion coating before we weld on the brand-new panel using the same squeezetype resistance spot welder (STRSW) they used when your car was built.” Do you think Mr. or Mrs. Smith know the difference between an STRSW and a hole in the ground? I don’t either, but at the other two shops the Smiths collected estimates from, both said, “It’ll be $2,000, let us know if we can help you.” They’re likely to choose the shop that sounded like they knew what would need to happen to make their car whole again. My last sales tip is the most common suggestion in every sales program anywhere: Ask for the sale in no uncertain terms. Don’t say,
»| Clark’s Corner |« “Let us know if we can help you.” Instead, say, “Mrs. Smith, as I hope I’ve explained, we have the highly trained technicians, state-of-the-art equipment, lifetime warranty and a hard-earned reputation for top quality work. I’ll personally see that your car receives our very best efforts. May we schedule you for tomorrow afternoon?”
Production » There is no shortage of collision repair philosophies. Repair or replace, aftermarket or salvage, tear-down estimating or bestguess and supplement – all have their advocates. My production tips are much simpler. Arrange your shop in logical order and stick to it. Sometimes called 5S, it’s simply the concept that efficiency will go up if everyone can find what they’re looking for quickly. Where’s the good wire welder? The new bat-
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tery charger? The booster box? High production shops all keep the techs in their stalls repairing the car, not wandering around looking for something necessary to complete their repair. At $44 per labor hour, every minute of every tech’s time is worth $0.73. No one profits when the techs are strolling through the shop looking for the missing items. Organize the shop with input from the techs. They know where the logical places to put things are located. Mechanize the task. In other words, use appropriate power tools to reduce the time to complete the repairs. First and foremost, stop hand sanding! Yes, I recognize that styling lines and odd-shaped contours don’t lend themselves to a power sander. So just do 80 percent of the sanding with a power tool and the last 20 percent by hand. Metalworking tools of every sort
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are available to repair collision damage faster. One of my favorites is a pin-less resistance welder. Like the Steck brothers advocated years ago, it’s much faster to remove damage from the outside of the panel rather than having to create access to the back side. Most shops own a pin welder, and I’m a big fan. But on many repairs, the time saved by welding the slide hammer directly to the panel rather than welding on pins, pulling on the pins, cutting off the pins and grinding off the heads will pay for the pin-less welder in just weeks. Use parts carts, one for R & I parts and one for R & R parts. Pay lowtech, high school-age help to check in, unwrap, examine for damage and load the parts onto the carts. Vow to never start work on Mrs. Smith’s car until all parts for that vehicle are loaded and ready on the carts. There
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»| Clark’s Corner |« will still be plenty of delay once the tech discovers the hidden damage, which will require even more parts. Control the pieces of the process you can. I contend poor crash parts management is the single biggest impediment to productive collision repair.
Finance » Track something! Then improve it. Every single insurance company that does business with your body shop has stats on your performance. From parts-to-labor ratios to the number of separate part numbers used per repair to cycle time in days and touch time in hours, they keep and value numbers. They’re actuaries, of course, and predict losses and therefore policy rates based on their excellent databases. Shops that say they don’t have any DRPs and therefore aren’t concerned with their business’s statistics are foolish. Insurance pays for 90 percent
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of all collision repair, according to the most recent BodyShop Business industry survey; if they paid your shop for it, they kept records of your results. Today’s body shops need to not only know where their results (often called KPIs or key performance indicators) fall in the insurer’s database but should be promoting their shop as the best choice because of their stellar collision repair stats. Don’t know what your shop’s stats are? Don’t know which ones your insurance partner is measuring? Uh oh. The days when one bottle of bourbon to the local agent and two bottles to the local adjuster were all the business math you needed are long gone. Without much investment income, insurers are striving every day to control repair costs, but not at the price of Mrs. Smith’s satisfaction with them. Be the shop that knows what the insurer is measuring; adver-
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tise your better-than-average benchmarks and set a plan to improve those that aren’t as good.
Take Control » Small business owners have many hats to wear, and collision shop owners are no exception. Sadly, I see too many of them focus most of their efforts on production improvements. While important, a concerted effort to improve sales and close rates and understand and improve their repair statistics will put more money in the till than a single-minded focus on cycle times or production efficiency. BSB Mark R. Clark is owner of Professional PBE Systems in Waterloo, Iowa. He’s a popular industry speaker and consultant and is celebrating his 26th year as a contributing editor to BodyShop Business.
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Web Presence
Management
By Mark Claypool
The New Year’s Challenge —
Version 2.015! t’s time for my annual column challenging you to set some New Year’s resolutions and commit to tackling some important issues related to your overall online Web presence. Resolutions are promises you make to yourself in hopes of making a positive difference in your life and others’ lives. These are promises you make now as you consider a fresh start. And more often than not, these promises are broken before the second week of January! Not in 2015, though! This time around, you’re going to keep those promises, right? After all, there’s too much at stake! The long-term health, competitiveness and profitability of your business depend on your making some changes to the same ol’, same ol’.
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Past Challenges/Resolutions » First, let’s take a look back at the resolutions I challenged you to make in the past couple years. These are still valid, and if you haven’t done them yet, then this is where you need to start. Freshen up your website (this holds true annually). Update your website content and make sure the copyright at the bottom is current. Sites more than five years old should probably be redesigned/updated. How is your site ranking? If it was ranking well in the past, is it still? If your 20
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site isn’t showing up on page one of a search using the most commonly used search terms (which are “auto body” and “body shop” plus “your town and state’s two-letter abbreviation”), you need to seriously think about having a true SEO specialist work on your site to help boost your rankings. Skip past the sponsored listings and map pointer listings and look for what are known as the “organic” search results. Are you on page one? Page one or bust! If you’re in a competitive market and aren’t on page one, you should seriously think about pay-per-click advertising. Build a mobile version of your website. Either have a mobilefriendly version of your site or have the site built in responsive design, which will adjust the resolution of your site to fit any size screen. Measure your online results. Google Analytics must be set up, and you should be reviewing your reports monthly. You should also be paying attention to Facebook’s Insights. Effective social media. Google+, Facebook and Twitter should be up and running effectively. Are you posting regularly and getting active participation from your followers? Are you adding new followers regularly? If you aren’t doing these things, then that’s a resolution for you in 2015. Get your business NAP (name, address and phone number) accurate and consistent on directories. Visit this link to see
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»| Web Presence |« how directories see your business: https://www.yext.com/partner/ optimaworldwide/diagnostic.html. Having these directory listings accurate and consistent helps boost your overall potential to have your site rank and gives you maximum visibility.
New Resolutions » Generate regular content (blog). Content marketing is the single most important thing for attracting the attention of search engines long term. That means regularly updating the content on your site, or blogging regularly, and writing keyword-rich content that captures the attention of search engines and your target audience. Updated content shows search engines your business is alive and well. Join LinkedIn. If you haven’t done so yet, you should. LinkedIn is great for networking with other business owners, insurance agents, etc. Plus, there’s the benefit of joining groups that are actively talking about topics important to all business owners and managers. Do less…better. If you’re trying to do too much with your online outreach, you probably aren’t doing any of it well. If you’re trying to manage six different social media accounts, regular emailing to your clients, texting, etc., there’s a point where maybe none of it is truly effective. You may need to make a change. Instead of trying to do it all, nail it on a few things or outsource. Incorporate more images/video into your website and social media. Images and videos are astonishingly powerful for online marketing. Incorporate them into
your social media efforts to get more “likes,” “plus 1’s,” comments and shares. Include these on your website, too. Google has been giving more weight to properly tagged images than text lately. And, consumers love eye candy, so give them some! Be a promise keeper. Be a person of your word. If you’re going to take me up on my challenge and select some of these resolutions as your own, then by gosh follow through. Set a goal, put a timeline on it and get someone who will help hold you accountable. Seek the help of your staff and qualified experts in the areas where you’re weak with your online presence, such as search visibility and social media.
Happy Holidays » I would like to wish you, your families and employees the very best during this holiday season. I hope 2015 is filled with happiness and prosperity. I’m pulling for you to honor your resolutions, which will truly help move your business to the next level online! BSB BSB Contributing Editor Mark Claypool has more than 30 years of experience in the fields of workforce development, apprenticeships, marketing and Web presence management with SkillsUSA, the I-CAR Education Foundation, Mentors at Work, VeriFacts Automotive and the NABC. He is the CEO of Optima Automotive (www.optimaautomotive.com), which provides website design, SEO services and social media management services.
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COVER STORY
How Much Should You Pay Yourself? A good understanding of your P&L statement will allow you to pay yourself properly without hurting your business. By Hank Nunn
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COVER STORY » How Much Should You Pay Yourself?
“I pay myself $100,000 per year, plus all the cash I can take!” hat was the response I got when, as a young shop owner, I asked an older, established owner how much he paid himself. I was curious about how much I should make and how I should pay myself. His answer didn’t help me. Compensation for employees is usually pretty simple. We know how to pay technicians and other employees. Flat rate within a market is pretty standard. Hourly rates are also marketdriven based on job and required skill level. But what about the owner’s paycheck? It may seem that the owner has the best job. But few understand the hours the owner puts into the business and the risk the owner has taken. There’s a large part of ownership that no one sees. Owners sacrifice. In a very young
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should or could make is best made with the advice of a good, businessfocused CPA. Owners should have a complete understanding of the company profit and loss statement. Remember: If the company isn’t profitable, the owner makes no money!
If the business is in its infancy, probably nothing. Remember, the company has to make a profit before anyone can be paid. Most business consultants suggest that new owners make sure they have sufficient cash on hand to go six months to one year with no income from the business. The first year is tough!
The Paycheck » As noted above, if the owner is functioning as a manager or technician (or both), the owner should draw a paycheck just like all of the other employees. Some owners of new or smaller business may simply “draw against the net,” writing a check to themselves and posting the money as an owner’s draw against profits. Obviously, if there is no profit, the draw is taken against the owner’s equity. But there are several problems with this method of compensation. Taxes are not taken into account, and benefits aren’t included. Thus, there is a significant risk
Business Plan » In a perfect world, the owner creates a solid business plan prior to opening the doors. That business plan may show the owner working for no compensation for the first six to 12 months, but after that initial period, the owner may plan for a minimal paycheck for the next six to 12 months, then increase owner’s compensation as the business builds. But the world is not perfect, and most new business owners don’t plan for living on no pay for six to 12 months. The new owner may be working for nothing, but other employees
It may seem that the owner has the best job. But few understand the hours the owner puts into the business and the risk the owner has taken. business, they sacrifice a lot! The owner works the longest hours, sometimes with no compensation so that payroll or other expenses can be met. The owner takes out and personally guarantees business loans. The owner is also on the hook for employee mistakes and can be sued for just about anything at any time. Owners earn compensation in two ways. First, the owner should earn a paycheck just like any other business employee for working in the business. Second, the owner should earn a return on their investment in the business. The decision on how much an owner
of “overdrawing” and running out of money before monthly bills are paid. Additionally, the P&L does not reflect a true picture of the business. Since the owner’s pay comes from net profit, overhead is not accurately presented and the net profit is overstated. It’s far better to make the owner an employee of the company so that owner compensation is shown on the P&L as an overhead expense. Taxes and benefits are deducted and paid just as with any employee, and the owner still has the option to draw additional funds from profits if warranted. How much should you pay yourself?
are getting paid. Resentment builds, the new owner decides to pay himself too soon and cash flow issues result. Cash flow difficulty is the No. 1 cause of new business failure. As a business matures, the owner can finally receive a paycheck. That’s a good thing! Owner pay comes in many forms. Obviously, there is the paycheck. As noted before, the owner should be paid just like any employee if the owner works in the business on a dayto-day basis. But there are other ways that the owner receives compensation, such as a company car, contribution to retirement plans, flexible hours, expense accounts, insurance benefits, etc. www.bodyshopbusiness.com 25
COVER STORY » How Much Should You Pay Yourself? Work with your accountant and tax advisor to make sure those additional benefits are appropriate. It’s really hard to justify a boat, plane or RV as a reasonable business expense for a threeyear-old collision center selling $80,000 per month. One rule of thumb: if the owner manages the business day to day, the
owner’s base pay should be equivalent to the amount the business would have to pay for a general manager. If a mid-sized shop in a market can attract a good manager for $75,000 per year, then $75,000 plus appropriate benefits would be a good base annual compensation for the owner. Be careful when adding those extra
benefits! The business needs to make money. Most use a minimum 10 percent of gross sales as a goal for net profit before taxes. That 10 percent net profit allows money to be reinvested in the business, loans to be paid and money to be paid to ownership as dividends if the company is a corporation. But if the total of owner’s compensation plus owner’s benefits such as the car, expenses, bonus, plane, boat and RV drive the net profit below 10 percent, the owner is being overcompensated and the business is being hurt. What if the owner is doing work in-shop? Maybe the owner works on customers’ cars doing some body or paint work. If so, the owner should pay themselves an hourly rate or flat rate, just as the other productive employees are paid. But make sure that the total owner’s compensation does not drive that net below 10 percent of gross sales. As the business evolves, many owners hire managers to run the company. As the owner’s active role in the business is reduced, the owner’s pay should shift from being an employee of the company to that of being a stockholder.
Owner Pay Do’s and Don’ts Don’t: 1. Pay yourself a salary within the first six months to a year of owning the business 2. Allow your compensation to drive net sales below 10 percent 3. Take cash from your business
Do: 1. Pay yourself a minimal paycheck after the first six months to a year 2. Pay yourself via a paycheck like a regular employee 3. Increase your compensation as your business builds 4. Pay yourself (if you manage the business) the amount the business would have to pay for a general manager Circle 26 for Reader Service
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COVER STORY » How Much Should You Pay Yourself? The manager’s wages should be shown as overhead, and the owner’s pay will come as a dividend payment. Some may wish to remain on the payroll in some capacity in order to stay on the health plan, continue to drive the company car and pay into Social Security and other taxes. That’s fine! But make sure that the owner’s
compensation is not driving the net profit below that 10 percent figure.
Equity » As a business grows, its value grows as well. We all understand how a home increases in value over time, and the payoff is reduced over time by making monthly payments. The difference between the fair market
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value of the home and the loan payoff is the owner’s equity in the home. Building a business is the same thing. Over time, the value of the business grows and the money owed against the business is reduced by making lease and loan payments. While business valuation is a complex issue, there are two basic methods of determining the value of any business: cash flow or net asset value. Net asset value is usually used to value a poorly performing business or one that’s very heavily invested in inventory. The business is worth its “net assets,” usually as shown on the balance sheet. Cash flow valuation uses the net positive cash flow to determine the value. In this method, the net positive cash flow (usually EBIDTA or Earnings Before Interest, Depreciation, Taxes and Amortization) is multiplied by a number to arrive at the business value. The number, or multiplier, is a negotiated number representing the number of years the buyer is allowing the net positive cash flow to repay the investment made in buying the business. Example: A collision center has a net positive cash flow of $150,000 per year. It has a strong business, is well managed without the owner’s fulltime involvement, has a solid crew and has shown several years of positive sales growth. Using that information, the owner negotiates a multiplier of 3.5. The business has a value of $525,000 ($150,000 x 3.5). Remember, that does not include the real estate! In selling the business, the owner should negotiate a fair market rent for the property. Rental income is an area frequently overlooked as owner compensation. Often, the business owns the real estate housing the company. As time passes, the loan balance diminishes while the fair market lease rate increases. The building and business should be separate entities, with the business paying a fair market rent to the owner of the real estate, usually the owner of the business. The difference between the fair market rent and the payment can
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COVER STORY » How Much Should You Pay Yourself? be income to the owner. In our example, the owner will receive $525,000 for the business plus rental income from the property. Rental income provides a terrific tool for allowing continuing income to a parent who’s leaving the business to their children or selling the business to an outside entity or MSO. Business owners should keep an eye on equity as they build their business. To maximize equity, the business must be profitable, should show steady sales growth and be systems driven so that the company is not dependent on the owner for daily operations. To illustrate the point, let’s remember the line given by the veteran shop owner at the introduction of this article: “I pay myself $100,000 per year, plus all the cash I can take!” Taking cash from the business may seem like a good thing on the surface. Naturally, taking cash avoids paying income tax and other taxes on the revenue. That’s why it’s illegal. But taking cash also causes a significant negative impact to the owner’s equity in the business. Let’s say the owner “pocketed” the customer’s $250 deductible, which was paid in cash. Being a smart owner, he backed the $250 out of the RO so that the sales and deposits matched, thinking no one would catch him. (Hint: The IRS can, and they do catch that!) The owner has money in his wallet, but that money did not go through the business and did not show up in sales. In fact, that $250 came right out of net profit! Since the business value is based on steady sales volume and profitability, taking that $250 reduces the net positive cash flow and the multiplier. If we use a multiplier of three, that $250 cost the owner $750 in business equity! Plus, the owner now has to wonder if “they” will catch up to him. All that to save $50 in taxes?
center?” But we can illustrate a solid owner’s compensation plan. Let’s assume that the owner also manages a collision center. The shop is doing $2 million per year in annual sales and has a net profit margin of 10 percent, or $200,000. The owner is being paid a monthly salary plus benefits, with a company car and expense account. The owner also owns the property, which has a fair market rent value of $10,000 per month. Loan payments plus maintenance expenses, insurance and reserves total $8,000 per month. A good general manager would cost $80,000 per year. A fair owner’s compensation would be a base pay of $80,000 per year plus the current benefits. Additionally, since the business is profitable, the owner may reasonably take a quarterly dividend of 30 percent ($60,000) of the net profit. That would probably be paid on a quarterly basis, leaving 70 percent of the net to be reinvested in the business. The owner is also making $2,000 per month as rent. Let’s add it up: Base pay of $80,000 plus benefits, $60,000 in dividend income, $24,000 in rental income = $164,000 in annual income. Plus, as time passes, the owner is earning increased equity in both the real estate and the business. Yes, that’s a simplistic illustration. The numbers and percentages used are for illustration only. In the real world, owners should work with their accountants to decide just how much the business can afford to pay the owner and how to structure that compensation in such a way that tax impacts are minimized. In our example, maybe that dividend being taken should be made as a 401K contribution? By truly understanding the financial structure of a business, and working with a business-focused CPA or accountant, a good compensation structure can be created for the owner. BSB
Summary » There is no simple answer
Hank Nunn is a 35-year collision industry veteran. He can be reached at h_nunn@msn.com.
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Buying
Spanesi
Tips Welders Elektron www.chiefautomotive.com/elektron Vehicle manufacturers are increasing their use of high-strength steels, exotic materials and proprietary manufacturing processes, making the repair of “sheet metal” more complex. To properly and efficiently repair these vehicles, make sure your next welder comes with an OEM-approved automatic mode. OEM approvals and homologations show that the welder meets specific squeeze pressure, output amperage and other criteria set by a manufacturer, and automatic settings save considerable time during the repair process. Advanced automatic welders – like the Elektron MULTISPOT MI-100control T inverter spot welder with TrueAutoMode technology – adjust weld parameters during use, providing perfect OEM-approved spot welds regardless of surface.
Motor Guard www.motorguard.com For years, performing “no-holes” dent repair has been possible due to stud welder technology. Stud welders work by temporarily attaching a stud to the bare metal at the body damage. Various pullers are used to pull out the dent and then the stud is twisted off, leaving a panel that can be finished with little or no filler. The workhorse has been the handheld, portable stud welder kit, which comes with various accessories and costs less than large
www.spanesi-americas.com Considerations on purchasing a resistance welder starts with power requirements for the welder. Does your facility meet these needs, or will your building’s power need to be upgraded? Second, are OEM approvals part of your business model? If so, does the unit you are purchasing have the OEM designation? In some cases, they will need to be purchased from the OEM program. In addition, does the welder come with local support, consumable parts on hand and backed by a nationally supported system should repairs be necessary? The welder should also be upgradable as future steel materials continue to change. Today’s welders should recognize and auto-adjust for materials and thickness for today’s materials, taking the guesswork out of the welding process. Spanesi Americas markets both Tecna and Spanesi brand spot welders to fit the needs of every collision shop.
shop systems. When choosing a kit, consider that the welder should have enough power for heavy sheet metal repair, 1,500 secondary amps minimum. It should also have a long and sturdy power cord, at least eight feet in length. The cord should have a heavy, oilresistant jacket that can withstand a lot of abuse. The slide hammer should have a twist-lock nosepiece to firmly grasp the weld studs. With few moving parts, stud welders will last for many years. An extended warranty is a sign that the seller has confidence in the product.
Cebotech www.cebotechusa.com The first consideration when buying a welder is identifying the work you want to be able to do with it. Once the application has been determined, the next thing is to make sure your shop has the power available for the welder. And if you are considering a resistance spot welder, make sure you also have enough air. You shouldn’t buy a “just enough” welder; think of your shop’s future needs and buy a welder to last you awhile. Many shops are buying a welder to satisfy a particular OEM collision program – make sure you buy a welder with more than one OEM approval just in case you decide to widen your OEM certifications. Even for shops that don’t have an interest in OEM certification, it is a good idea to buy a welder that has OEM approvals. An OEM approval means that the welder is not only capable of welding the new metals; OEMs also check into quality, reliability, and after-sales support. OEMs have more than one welder approved, so call the suppliers and ask questions. Find out all you can about the different welders you are considering, compare features objectively and make your decision that way. Don’t let yourself be hypnotized by flashy, unrealistic claims. 32
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MSO
Follow the Leader Hiring the right people and identifying those who have potential for leadership roles is crucial for companies to grow and prosper in today’s business climate.
By Jason Stahl
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nterviewing prospective employees is kind of like drafting an NFL player: you can do all your homework and give a battery of tests to the candidates, but ultimately it’s a crapshoot. You just never know if a person is going to work out or not. It doesn’t get any easier trying to find out if the person you hired has the potential to rise through the ranks and become a leader. But there are specific steps you can take to increase the odds of fortifying your future workforce with key decision-makers.
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Fitting the Mold » Daren Fristoe of The Fristoe Group has spent his entire career helping companies with human resource issues by identifying and developing key employees. He knows exactly who fits the mold of a leader. “Someone who has the ability to learn, has a higher level of intelligence, is adaptable and willing to change, and has a vision in terms of understanding the entire business, not just their silo,” says Fristoe. “They understand how the pieces fit together, and they show that high potential pretty early on.”
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MSO » Follow the Leader Unfortunately, not every person can be trained to be a leader. There are certain things that can be taught, but there are some leadership attributes that people either have or don’t and there’s not much you can do about it. “For example, that intellectual curiosity and wondering how things fit together,” says Fristoe. “If they have those muscles, you can develop them, just like an athlete. I think there are layers of that that are hardwired and remind us of the term ‘natural born leader.’ Those are the people who are confident, understand how things fit together, and are willing to learn, willing to listen and, at the end of the day, willing to lead. And others readily follow them and pay attention.”
Finding a Leader » Even though not everyone has what it takes to be a leader, there are actions a company
can take to increase their chances of finding one. The first question companies need to ask themselves, says Fristoe, is, “Are we hiring people who have the potential to become leaders? Or, are we just hiring people to work for us?” Second, companies need to determine if they’re developing the people they already have into leaders. “I encourage companies who are hiring to think about it as a proactive succession planning process,” says Fristoe. “Who’s the next [insert name of existing quality leader in your company – let’s say Mike]? We need to bring that person in and develop that person so Mike has other opportunities. That person has to be confident in the organization and think about what the company needs to do in the future to be competitive.” One way companies can find that person is through predictive testing. Fristoe says there are a number of personality profiling tests that companies can use to find out if a person has the potential to be a leader. But
Mastering the Interview nterviewing well is crucial for companies to find the right employees who will fit into their culture and potentially fill the role of a leader in the future. Fristoe uses the example of hiring for a junior or assistant manager. In examining a resume, he would look to see if a person had any experience in leading other people and if they were held accountable for their performance. To him, the title of manager on the resume isn’t good enough. He wants to see a project the person may have led that they owned from start to finish. And then it’s all about phrasing the question right to elicit the kind of behavior that can be telling. “You might ask, ‘Tom, tell me about a time when you led a project,’” says Fristoe. “If you have someone who is a skilled interviewee and they try to dance around the question, they’ll
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companies also need to understand their business and have a vision of what they’re looking for. “If you’re looking for the next controller, and the controller you have has only two years of experience as a controller and 20 years in the marketplace, you’re not in the right focus,” says Fristoe. “But if you’re looking for someone to take over a different department or position, that’s a different story. Do you need someone who’s a cheerleader, a bridge to other departments or a mediator...or all of those things?” The person should probably have strengths in multiple areas, someone who can fit well in a number of different departments. Ultimately, says Fristoe, it comes down to a company having solid performance management processes and an employee development program, which will allow it to easily identify high-potential employees. Fristoe related a story about a personal experience that, at the time, seemed like the worst moment of his life but one that he now knows was the best from a career standpoint. His
probably use the word ‘we’ a lot. ‘We worked on a plan, had a party and celebrated when it was over.’ But you were the project manager, so what did you do? I need to know that they did more than arrange the party or bring in the whiteboard. I need to know that they not only collaborated with other people but really formatted that into an endgame.” Another thing Fristoe looks for on a resume is progression of career, meaning that they started on a lower level but then rose to a level of higher responsibility. He also looks for unusual gaps between employment, which he says that lots of people unfortunately have right now. “Obviously, those gaps right now are primarily due to the economy,” he says. “They’ve gone to different places and things didn’t work out the way they wanted or the company changed and it’s a different game than it was when they started 20 to 25 years ago.” Fristoe is also a stickler for eye contact. He knows that there are people who are uncomfortable with it but he thinks it’s incredibly valuable. And when they don’t offer eye contact, it’s unnerving. “Remember, they’re trying to sell themselves,” he says. “I want them to look me in the eye, show me confidence, intelligence, willingness to learn, adaptability, coachability and any other ability to lead other people.”
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MSO » Follow the Leader manager threw him in front of a crowd of sales reps to deliver a very bad message. He says it was awful, but he got through it and now knows that only a person with leadership qualities could endure such an exercise. “Not all leaders have to be able to stand up in front of a crowd and deliver a message like that, but they do have to be able to enunciate what they want to do and why, especially in this day and age,” Fristoe says. This “day and age” is full of Generation Y people, or the “employees of tomorrow,” Fristoe says, who want to know why you’re asking them to do something. “It’s not the good ol’ days where you can respond, ‘It’s because I told you to and I’m your boss. There’s a pretty healthy skepticism of the way things are done now,” says Fristoe. The new employees in the marketplace are not big believers in precedence, says Fristoe, but believers in doing things the right way fast and then moving on to the next task and learning and growing along the way. Important leaders, Fristoe says, understand the value of teams, communication, motivation, recognition and coaching. He says individuals who are responsible for hiring should look back in their careers and recall the best leaders they ever had and figure out what made them great. They can then look for the same qualities in prospective hires. So you make it through the interview process and hire someone. Then what? Fristoe goes back to the development plan he referenced earlier. First, you have to have a plan; unfortunately, not every company does. And it’s more than just managing their performance – it’s setting up a plan for the year where the employee is given steps to take to achieve a goal in a certain timeframe. “If you have a timeframe attached to it, it’s tougher because you’re wed to that,” says Fristoe. “But you’re trying to figure out a way for the employee to buy in and become part of the process.” Circle 38 for Reader Service
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Maybe the supervisor of the new hire tells them that, over the next three months, they’re going to take certain classes and they’re also going to fill in for a manager who’s going on vacation. “They’re getting their feet wet,” says Fristoe. “They’re not empowered to burn the house down, but they do have the ability to make some lower level decisions, which will allow you to see what they’re doing and how they’re doing it. There’s no reason to throw them in the deep end in the beginning...unless you don’t want them to stay.” No one likes to think negatively, but another plus to measuring a new employee’s performance is that, if something blows up, you’re essentially documenting why it blew up. If Fristoe could pick just one quality he likes to see in a potential leader, it would be the ability and willingness to adapt. “They should have the confidence to say, ‘I’m going to do this for awhile because I’m going to go there, and to get there I have to go through here,’” he says. “But a manager has to tell them that, which again is why it’s important to have a process in place to develop those employees you’ve designated as having high potential.” Hiring the right people is more critical today than ever, says Fristoe. Through staff reductions, companies have been forced to do more with the people they have. And it’s important to spend the time and money on those individuals who show the most potential so it doesn’t go to waste. “If you put managers on rotation to teach them the rest of the business, that’s hugely valuable,” says Fristoe. “If you connect them to senior leadership as mentors or mentorees, that’s hugely impactful. It gives them a platform to start growing.” The bottom line is that if you hire people right, develop them right and communicate all along the way, you’ll win. And you’ll be able to do it with a smaller headcount, which will increase your bottom line. BSB
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BUSINESS
Part II Special clamps, foam, frame repair, used parts – there are lots of labor operations we perform that we have every right to charge for. By Joe Palumbo
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hen you work for a dealership body shop, you typically see more of a particular make/model of vehicle coming in for repairs rather than a variety of makes and models.
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Clamp Down Âť I work at a Buick GMC dealership, and we see a lot of Buick Enclaves and GMC Acadias. Same platform, similar body. These two models have 24 rocker molding clips on each molding. After you remove the moldings, the clamping technique is unique (photo 1). These
December 2014 | BodyShop Business
1. A GMC Acadia set up in clamps.
vehicles sit higher than other passenger cars, so you have to use extended height clamps, which means breaking
BUSINESS » Forgotten Labor
2. Measuring is a necessary operation.
down the clamps used for regular height vehicles and bolting on the height extension clamps for the Acadia and Enclave. Also, they have to be used in reverse, or tightened from underneath the vehicle as opposed to outside the vehicle, in order to avoid crushing the rocker drains. Acadias’ and Enclaves’ need for special clamps is not unique. The Solstice/Sky platform and Corvettes also need them. Also, earlymodel Hondas had a vertical pinchweld that needed a clamp to be added to the horizontal clamps. Whatever clamping system is required, if a changeover is necessary to properly lock down and secure the vehicle for pulling, document it with photos and charge for it.
Anchoring » Another addi3. An LKQ quarter panel assembly being pre-assembled and fit prior to welding
4. A sleeve, or insert, as I-CAR calls it.
5. An example of the flexible foam found in most vehicles today.
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tional and sometimes forgotten charge is what’s necessary to do a major correction on a frame. On a heavy hit, you may need additional anchoring points. This might be as simple as a chain or a cable wrapped around a crossmember, or even another tower attached to one of the stands for a stronger pull. Again, take photos and document your additional labor. Adjusters don’t try to be difficult; they simply have to answer to their superiors and justify why they authorized additional repairs and, more importantly, additional money. Photo documentation will tell your story and back you and your adjuster up. Along with set-up, we have measuring (photo 2). Whether you use Arnwood gauges or a modern laser system, measuring is a necessary operation. Along with photo documentation, a printout of before and after specifications is even better. All computerized measuring systems are capable of a printout for your adjuster and your records. One nice feature on some systems is
December 2014 | BodyShop Business
point-to-point measurement, which can verify a bent subframe before you get a nice surprise on the alignment rack. You can measure a lower ball joint to see if you need a lower control arm or the subframe mount bolts to determine if you need a subframe. This eliminates the issue of performing two alignments because you catch all the damage up front. An adjuster can’t argue with a printout. At the end of the day, you save yourself (and XYZ insurance company) because there were no surprises when it came time for a four-wheel alignment. This can make the difference between a Friday night delivery and an extra weekend of rental.
Used Parts » I would like to address LKQ quarter panel assemblies (photo 3). I like installing them for a few reasons, the main one being that if you need the wheelhouse, it’s already welded on the quarter panel with factory (hopefully) welds. An often overlooked operation is time to inspect a used assembly, whether it be a door, fender or quarter cut. We’ve all been there. The salvage yard wants to drop off the part. Your parts department will issue a P.O., and the driver leaves. The tech is told his parts are here, only to find out they’re the wrong model, options or any number of different reasons why they’re unacceptable. Your main concern should be rust and previous repairs. My shop has had to reject several parts on the basis of rust and previous repairs. We need to inspect these used parts, and that takes time – time that we’re not repairing automobiles. Even a mere .5 might make the difference between a Friday afternoon delivery and another weekend of rental. OK, we now have an acceptable used quarter panel assembly. It’s time to decide where to section and start drilling spot welds. I-CAR guidelines will direct you to manufacturer specifications explaining where and if you can section. A general example would be a 25-millimeter backer in the sail panel and a 50-millimeter backer in the rocker panel. We used to call this a
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BUSINESS » Forgotten Labor sleeve (photo 4). Sleeve fabrication is an extra operation, which insurers know and will pay for. If you’re not charging for it, start tomorrow. The carriers I work with never deny it.
Foam » What about foam (photo 5)?
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Flexible foam is expensive, and you use about one half of a cartridge on a typical quarter panel. And don’t forget removal because it’s flammable and must be taken out before welding. I personally prefer to install used quarter panels with the wheelhouse because it leaves the factory spot welds intact on the quarter panel, but this process is not always possible. Some wheelhouses are integrated into the upper sail panel and become the inner wheelhouse/sail panel at some point. This brings us to pre-assembly. I would never commit to welding a used assembly on without pre-assembling the deck lid, door and tail lamp on the side I’m replacing. I need to see the fit and gaps before I weld. Pre-assembly or mock-up is a necessary and valid operation. It takes time, and you might need to fit your quarter panel a few times to achieve an acceptable fit.
Funny Money » Insurers save a boatload of money by using LKQ parts. There would be no funny television commercials without money. There would be no Flo or Mayhem. That, my fellow technicians, is the money we saved them by not asking to be compensated for all the labor we do. Recently, I had an experience with an adjuster from the company with the green lizard, with whom we have no DRP. He was fair with his repair times, and all he asked was that we document additional damage so he could justify to his superiors why he authorized additional labor. The money is there for the asking. Document your damage, and get paid for what you do. Flo and Mayhem don’t work for free, and neither should we! BSB Joe Palumbo is a body and frame technician with Haggerty Buick GMC. He can be reached at jbondojoe@aol.com. Circle 83 for Reader Service
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MARKETING
The
t c e f f E
More and more people are watching videos online. How are manufacturers in the collision repair space capitalizing on this trend? By Jason Stahl onsumers are increasingly leaning toward watching videos online, as the rapid growth in mobile devices continues. But how does that translate to the collision repair industry? It’s one thing for people to become obsessed with cat videos, but in the business world, are collision repair professionals increasingly turning to videos for training purposes and connecting with the companies that manufacture the products that make their jobs easier?
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Urethane Supply » For Kurt Lammon, YouTube literally saved one of his products. He was about to pull PlastiFix, a two-part methacrylate adhesive system for repairing plastics, because he wasn’t selling very much of the product through his traditional collision repair channels. And then the YouTube video hit. “A lot of people who own street motorcycles with expensive plastic fairings saw it and said, ‘Hey, wow, this is a great product!’ and sales started to jump,” says Lammon. “And that’s our most watched video on our YouTube channel to date.” It has more than 390,000 views, to be exact. Lammon saw the merits of using YouTube to reach his customers as 46
far back as 2009, understanding that it was the perfect medium to show potential customers how his products work. “A lot of our products require a visual presentation,” he says. “There is a certain technique you use to weld or apply PlastiFix adhesive. It would take me five minutes to describe it on the phone, and you probably wouldn’t get it. But if you saw it on YouTube, instantly in 30 seconds you would get it. It’s a great way to do a technical explanation of how to use our products.” Lammon also uses YouTube to train his distributors and jobbers, and for convenience and cost savings. “It’s a really good way to go versus flying trainers and myself all around to do it face to face. It’s a much lower cost on YouTube. It doesn’t replace
Urethane Supply Company Sample video: http://bit.ly/1AgUtGh The Benefits of a Nitrogen Welder Keep more labor dollars in the shop by repairing many of the plastic bumpers and headlights you’re throwing away now with the Nitro Fuzer plastic welder.
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face to face but augments it and allows people to get up to speed to make your face-to-face time more productive.” The Urethane Supply YouTube channel currently has 2,300 subscribers, and Lammon is always shooting for more. Every time he comes out with a new video (every two to three months), he sends out an email blast to let everyone know and encourage them to subscribe to the channel to receive regular updates.
Evercoat » Evercoat launched its YouTube channel in 2011 with six videos and now has almost 60 in eight different languages. The company’s main purpose for being on YouTube is to provide information on its new products. “It may seem that filler and putty never changes, but actually the technology does, so when we post videos, we have two reasons to post: we’ve either improved the standard operating procedure, so if you follow these steps you’ll get a better repair, or we’ve improved the product itself,” says Beth Skove, director of global marketing. Skove knows Evercoat’s competitors are on YouTube and have varying types of videos, but Evercoat has shied away from “Hey, use our product because it’s so great” messages in favor of more practical information. “We prefer to walk people through step by step so they can duplicate those same procedures and get the same results. I like marketing because I’m the marketing person, but I see the value in sticking with the ‘this is how you use the product’ philosophy.”
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MARKETING » The YouTube Effect Skove feels the dedication of time and resources to YouTube has been well worth it, and the numbers don’t lie. Evercoat’s number of subscribers has grown 1,200 percent since 2011, and 600 percent over the past year. Views have grown 900 percent over last year, and views on mobile apps have grown from 10 percent last year to 24 percent this year. Ninety percent of the viewers are male, with 38 percent being in the 35 to 54 age range and 35 percent being 25 to 34 years old. And the typical viewer watches for four to five minutes. “When we go out in the field and talk to [collision repairers], we’re finding they’re using the videos in their shop to reinforce the training they may have received,” Skove says. “Our sales team has given body shop managers access to the videos so they can teach them using our videos. Plus, a lot of our repairers will use our SOP
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Evercoat Sample video: http://bit.ly/11VsNuz Visit Evercoat’s YouTube channel for all of your product SOP needs. Filler, adhesives, plastic repair to primers – all your repairs needs on one channel.
training for new employees. Sales reps and TSMs use them to reinforce training in shops, and we’re now coming out with some tech tips, which are really short videos to answer frequently asked questions.” Skove and her team – two product managers, a graphic designer and a training manager – work together to create the videos in-house, which includes editing, writing scripts and uploading. As far as promoting their YouTube channel, Skove says they’re including
December 2014 | BodyShop Business
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QR codes on all their literature, ads and products to drive mobile views since each code links to a different video.
PPG » PPG says its primary purpose for being on YouTube is to showcase what it has to offer to the market, from product to color to programs and services. And videos, the company says, are a good medium to do so.
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MARKETING » The YouTube Effect “There is so much to take in from a customer standpoint that the videos help to relay a message in a nice and neat, compact format, as well as a chance to go back and review the message to understand all that is available from a world-leading coatings company,” says Steven Martinez, interactive marketing supervisor, Automotive Refinish. “Moreover, it also gives us the chance to help people learn and grow.” Martinez also emphasizes the convenience factor YouTube offers from an accessibility standpoint, reaching anyone anywhere. “We realize that not everyone will be able to get to a PPG Business Development Center to learn every nuance to every product or program, but the use of video gives us the chance to share nuggets of information that they would otherwise miss,” he says. Videos PPG posts include customer
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PPG Sample video: http://bit.ly/12nMLhv How to perform a proper repair on some of today’s highly chromatic, translucent colors and finishes utilizing PPG’s easyto-follow process of determining the correct spectral grey (g-shade) groundcoat.
testimonials, product software demos/tutorials (such as PPG Paint It and ColorMobile) and videos talking about PPG’s coatings capabilities. But by far, their most popular videos are product demos/technical tips, such as “How to Repair OEM Translucent Finishes.” “The positive responses we have seen with our videos is amazing, and we hope to continue to provide more video coverage that can assist our customers with a better final finish,” Martinez says.
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PPG has an “interactive communications team” that’s responsible for videos, although some videos are part of other projects that the company eventually launches on YouTube. They also work together with some other video producers to create videos which they will post and PPG will share through their own social media channels.
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MARKETING » The YouTube Effect BASF » BASF got in on the YouTube craze early in 2009, then heavily increased their presence on the site in 2013. It was a no-brainer considering how popular YouTube has become. “That’s where everyone goes to watch videos,” says Tina Nelles, marketing services manager. “YouTube is the No. 2 search engine next to Google. Everyone is so visual, so it’s obvious we had to do it. Since last fall, we’ve tried to optimize it more so it’s more searchable, using better titles on videos and descriptions. So far, it has made a huge difference.” That optimization has paid off. Views in 2014 have more than doubled over 2013 to 137,000, and average watch time is up to two minutes and 15 seconds compared to one minute and 36 seconds in 2013. In 2014, 49 percent of their traffic came from organic search versus 15 percent in 2013.
BASF Sample video: http://bit.ly/1vowaWL Add capacity, increase sales and maximize profits for your collision repair center with Advanced Process Solutions.
Nelles says she feels it’s important to not just peddle products on YouTube but use the opportunity to make a connection with customers, often times through a shared passion. “Obviously, you want to talk about your products and do training videos showing how to use your products properly, but it’s also a way to connect with customers,” she says. “One of our most popular videos is Chip Foose talking about the build of his first Ridler winner.
We also feature a lot of testimonials. It’s not just about how great we are. In order to get a handshake from customers, you need to extend your hand.” BASF’s stated mission with YouTube and all social media is telling: “Create relevant and dynamic content as a platform for ongoing conversation to humanize the BASF brand, increase customer loyalty and help drive paint sales.” BSB
BASF Advanced Process Solutions Add capacity, increase sales and maximize profits for your Collision Repair Center with Advanced Process Solutions. Built on Lean fundamentals, APS is a customizable repair process that creates the right environment for a continuous workflow, effectively eliminating many of the issues that typically lead to interruptions and inefficiency. Most of all, APS is about fostering a culture of positive change throughout every area of your operation, leading to sustainable success and future growth. APS Business Coaches help you achieve championship performance, coaching, motivating and elevating your high-performance team to position your shop for success. Utilize our fully integrated package of products and services as your own personal trainer to fine tune your collision center’s productivity, create preferred status among insurers and maximize your bottom line. To learn more, please call 800-758-BASF (2273) or, to see APS in action, visit www.basfrefinish.com/aps. Circle 52 for Reader Service
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TECHNICAL
Looking Clearly Through the Glass II The introduction of collision avoidance systems has made a simple windshield replacement a complex issue.
By Mitch Becker t’s late Thursday afternoon. The shop is on target for the delivery of all vehicles that were written for the week. Overall, it’s a pretty good day. A new Honda Accord sits in the cleanup area waiting to be prepped for delivery. This 2015 model was a pretty straightforward repair. The last thing to do before detail is to replace the windshield. As you look at the car, a nagging thought enters your mind: What else am I supposed to do? The mirror assembly, when removing the glass, caught your attention. The technician needed instructions to remove it. What about reinstalling it? You wonder: 1. Did anybody check the P-pages? 2. Did anyone look up the procedure in ALLDATA? 3. Because there is no code or light on the dash, does that mean I’m done? 4. What is required?
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Without the answers to these questions, you could be putting your customer at risk. The liability of not following through or finishing the repair could be devastating to a shop.
Collision Avoidance » The new Honda Accord has Lane Departure Warning partnered with Forward Crash Warning. This safety electronic system was designed to help prevent the age-old dilemma of driver distraction. Distracted drivers are the main reason for the majority of all crashes in the U.S. The government, through the National Highway Traffic Safety Administration (NHTSA), has been studying how to prevent these types of collisions. In Europe, vehicles have begun featuring driver assist electronics to avoid these crashes, too. The result is mandated electronics to help prevent or reduce
December 2014 | BodyShop Business
the severity of a crash. These electronics were introduced to the U.S. in limited models. Although not mandated by NHTSA, they’re being considered. Honda is not the only manufacturer to offer this in the U.S. These electronics are currently an option on many manufacturers’ models. On many European vehicles, they are not an option but have made their way to standard equipment. People purchase vehicles for these electronics in their quest to buy a safer vehicle. They’ve come to rely on the proper operation of these systems. If a person has bought a vehicle equipped with these electronics, we’re governed by the liability of rendering a safety device inoperative during or from a repair. Even though it can be turned off, we do not have the option of not finishing repairs before delivery to the customer. The question
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TECHNICAL » Looking Clearly Through the Glass II of is it a performance feature or a safety feature will be decided by 12 people who could not get out of jury duty.
Two Features » There are two main operations: 1. Driver warning: warns an operator of safety issues in driving.
2. Driver assist: Activated counter measures to prevent unsafe conditions In either type of system, a series of sensors and/or cameras in various parts of the vehicle give inputs to a computer that’s designed to either warn or activate systems such as steering or brakes to control the vehicle.
The electronics are known by names such as Adaptive Cruise Control, City Stop/City Safe, Self-Parking Control Systems and others. Many of these electronic assist systems are part of the autonomous operation of a vehicle. The systems I’m referring to in this article are the systems that have sensors tied into the windshield. Although these sensors may not be directly attached to the windshield, they may go through the windshield, using it almost as a lens. If the lens is distorted, the picture is not going to give proper input. Lane Lock/Lane Change systems are a feature that may use the windshield. Another name is Lane Departure Warnings or LDW, or Forward Collision Warning or FCW. No matter what the name, the sensors act similar in that a laser, infrared beam or camera is sent through the windshield. Other sensors may detect light or a beam, or a computer will recognize images it’s seeing and compare them to its database. As long as the system is functional and everything is well, the system operates correctly. If the system is slightly off tolerance, it may confuse the computers and not act as required. If the tolerance is off severely, the computer may shut down and send a warning message that the system is not operational. These computer systems are designed so that if the weather interferes with their function, they’ll disable until the weather cooperates. No matter the outcome, it will not be good for the shop as a very unhappy customer may be calling.
Differences » Why can differences in windshields be a problem? Not all glass is the same. There are slight differences in manufacturing of windshields and materials used. A bracket mounted in the wrong location that holds a camera can cause vibration or an incorrect angle. The “frit” or black band around the edges and top of the glass could be different and block the line of view. The plastic or vinyl inner Circle 56 for Reader Service
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TECHNICAL Âť Looking Clearly Through the Glass II
Some sensors may go through the windshield, using it almost as a lens. If the lens is distorted, the picture is not going to give proper input.
layer between the glass could be different in tint and clarity. The clarity may distort images, fooling the system or shutting it off like bad weather conditions would do. I can add more to the list, but with these differences in glass and in-
Lane Lock/Lane Change systems are features that may use the windshield.
stallation errors by technicians, you can see the need to verify or recalibrate the systems. Honda recently sent out a bulletin warning service shops of these issues, and explains this to consumers in owner manuals. Rock chip repairs will also be
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affected as they cannot be done in any sensor area. The list of vehicle manufacturers that are adding these features is long. The shorter list would be those that don’t offer these systems. It used to be that only the more ex-
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TECHNICAL » Looking Clearly Through the Glass II How to ID Glass Collision Avoidance Systems 1. Inform estimators of these systems. Like airbag seat recalibrations, there will be no light on the dash. The procedure will be mandatory no matter what. 2. Learn to identify what they look like. Take pictures or discuss vehicles periodically to note changes. Make a list or cheat sheet of models. 3. Look up vehicles features and options. Know what the vehicle may have and look for it. 4. Look up the P-pages, one of the most valuable tools for repairs to identify what has to be done. 5. Use ALLDATA. Look up instructions and follow them. 6. Understand that even a windshield R&I may require a recalibration. 7. Train your people to understand this is a network of electronic systems working together. A failure to complete a procedure will impact many other components of the vehicle as well.
pensive or top-line models would have these features, but today’s midand lower-range priced vehicles are also starting to carry these safety systems as options.
Recalibration » Here is where it gets to be perplexing for many shops. There is no one scan tool that does it all. The process of scanning a vehicle can be as simple as clearing a code, but not all procedures are that simple. A scan tool is the start. Vehicles such as Audi require a target board to be used, which is placed in front of a vehicle to allow the computer to calibrate its sensors. This sensor board is large and needs to be adjusted specifically to the vehicle orientation, such as ride height and angle. The process can take one to three hours depending on the vehicle. Other manufacturers use a similar device. Check out the video on YouTube from Hella Gutmann Solutions that shows the procedure for an Audi and VW. Another technique being used is the proper placing of rods or targets in front of a vehicle. A rod or target is measured to a distance and placed in front of the vehicle. A scan is done to teach the system the distance. This is repeated a number of times to orientate the computer. These types of target systems require an Circle 60 for Reader Service
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open area and a controlled environment. There’s a number of videos you can watch on YouTube to see differences and procedures. A road test may be required by two technicians to drive the vehicle and teach the computer road signs. This would be difficult without a second person. Also, the weather would need to cooperate, and the scan tool would need to have camera capability to see road lines and markers.
Prepare for Change » As you can see, if you were not prepared for change, you should be. The introduction of these devices makes a simple windshield replacement a complex issue. If it’s a required procedure, the computer should be recalibrated before returning the vehicle to the customer. This will add a great deal of time to replacing the windshield, which could affect cycle time. The other side of this equation is, are the dealerships prepared and trained to do this? And how much? The impact this has on the auto glass industry is yet to be seen. This will be covered in Looking Clearly Through the Glass III next month. BSB Mitch Becker is a technical instructor for ABRA Auto Body & Glass. Contact him at (763) 585-6411 or mbecker@abraauto. com.
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»| Industry Update |«
I-CAR Repairability Technical Support Portal Connects Industry Pros to OEMs -CAR has announced that it is continuing to promote the launch of its Repairability Technical Support (RTS) Portal, a collection of resources to help provide repair industry members with valuable information, technical support and repair solutions. The portal offers realtime OEM information and announcements, collision repair articles, and technical questions and answers. Stemming from an initial request from the Society of Collision Repair Specialists (SCRS) and peer groups to establish an entity to address and rectify gaps in OEM repair procedures and processes, the RTS Portal aims to
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provide a one-stop resource of collision repair information and knowledge. As Jason Bartanen, director of Industry Technical Relations for I-CAR, tells SCRS, the RTS Portal has been compiled to help foster greater understanding to all members of a rapidly evolving industry. “We’re just trying to make sure that all the information is out there to help facilitate complete, safe, quality repairs,” says Bartanen. “A lot of this information has been available for a number of years, but we’ve brought everything over to the RTS portal so that it’s all in one spot and easily navigable. We’ve updated and refreshed some of the information
December 2014 | BodyShop Business
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with new photos and a revamped look as well.” Nearly every vehicle manufacturer selling vehicles in America is represented in the “OEM Information” section of the RTS Portal, which contains links to manufacturer-specific repair websites, position statements, body repair manual guides, news and available training opportunities. “This is information many of the automakers have asked us to push out to the industry,” Bartanen says. “The manufacturer may be connected to their dealer network, but may not always be connected to the insurance and independent repair communities. This provides a way to bridge
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»| Industry Update |« any information gaps. Additionally, we’ve gone ahead and recorded ourselves going into each OEM’s website to help show repairers how to find the information they’re looking for. No two websites are alike, and so it’s often difficult to find the specific information you’re seeking.
We’re trying to take out the guesswork and give people the answers they need as quickly as possible.” Repairers will also find repair solutions through the Portal’s “Ask I-CAR” feature, which allows the user to search by make, model and year to search for re-
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pair questions and answers on a particular vehicle. “If the visitors can’t find an answer to the question they have, they can either submit an inquiry online with the click of a button, or they can call our full-time, onstaff technical experts,” says Bartanen. “Inquiries are forwarded directly to the staff, and if our experts are unable to answer the call, we have a policy of getting back to the caller in a two-hour window. We may not always have an answer in that time frame, but we will always get back to them with an update.” Additional features on the portal include collision repair news updated as published industrywide with updates announced via Twitter (@Tech_Briefs), an airbag replacement and partial part replacement search and Uniform Procedures for Collision Repair (UPCR). I-CAR is also in the process of adding a hybrid search matrix for additional information and resources on hybrid vehicle disablement to protect collision industry professionals working on and around these vehicles. “Our OEM link pin activity creates an interactive method of sharing information,” says Bartanen. “If someone has a question we can’t find an answer to, we can reach out to the manufacturer and then post that resulting information online. Additionally, as we get feedback from our repairers, we can approach the manufacturers and ask them to approach new ideas.” The portal has also facilitated the creation of repairability summits and industry segment advisory councils (ISACs) which have representation and active participation from manufacturers on a variety of subjects. “We equate these summits to topic-specific focus groups, and they’re extremely helpful,” says Bartanen. “For example, on the
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»| Industry Update |« topic of high-strength steel, we brought in a number of experts and asked, ‘What are some of the best practices?’ We took that information and actually built a training course around it. We’re also holding OEM ISAC meetings, where our OEM contacts come in to talk about overall is-
sues and what we can do better as a group to perform a particular process better. We have been working with industry groups like SCRS, and notify them immediately when information is presented. And they let us know when they have information they would like us to share.
It’s all about networking and interaction. “We’re getting feedback from the industry on what gaps need to be closed; it’s a great concept, and we’ve found it to be working really, really well. We’re really busy, and we’ve got a great team in place. We’re excited to see what the future holds and how we can continue to collaborate to get the best information out there to the industry.”
Volkswagen continued from pg. 12 Wholesale Dealers, and they’ve made the commitment to be the best of the best wholesaling dealers. What type of corrosion perforation does VW provide? Depending on the model, Volkswagen provides limited corrosion perforation coverage up to 12 years on all body sheet metal panels. Are there any other initiatives that VWoA is undertaking to support the collision market? Absolutely. VWoA has made a major commitment in human capital. We’ve established a new Wholesale Operations Parts team solely dedicated to helping VWoA dealers and their wholesale customers grow the business. We have a wholesale specialist in each of our five regions, along with a field manager, working with our dealers in all aspects of the wholesale business. These specialists have many years of experience in the automotive business and understand the needs and wants of the independent repair shops.
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»| Industry Update |«
National GM’s Competitive Pricing Platform Rescheduled to Launch Early 2015 eneral Motors (GM) announced a new initiative to effectively change the way collision repairers obtain list pricing on parts from the manufacturer. The tool – www.MyPriceLink. com (MPL) – would eliminate GM’s provision of a list price to information providers in favor of a Webbased portal that would allow GM to provide a more dynamic list price direct to the repairer based on the market at the time the estimate is written. GM executives arranged meetings with the Society of Collision Repair
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Specialists (SCRS) prior to the initial launch, and during the 2014 SEMA Show, GM’s Wholesale Dealer Channel General Director Kris Mayer sat down for an interview with SCRS. He explained that the new process has been designed to simplify the repair process for customers while providing competitive pricing and encouraging OEM part use. “Today, we provide a list price and then a body shop can use our Conquest program to try and get a more competitive price to compete against the aftermarket parts,” Mayer said.
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“With MPL, we’ll be able to provide a competitive price without having to use any Conquest initiatives or program disruptions at the end of the estimate process. We’ll provide more competitive pricing up front, versus after the fact.” In response to questions about the decision-making process leading up to the unveiling of MPL, Mayer stressed providing more fluid pricing and improving a “clunky” process. “We felt that it was [previously] an after-the-fact way to be competitive. With this, based on market conditions, we can look at the market or a particular price and its competition and offer a price based on our intelligence and market pricing. Our pricing is currently updated once a month; in the future, we’ll be able to update pricing more dynamically.” Read more of this story at www.bodyshopbusiness.com.
»| Industry Update |«
Auto Care Association Says OEMs Failing to Provide Consumers Control of Cars’ Data he Alliance of Automobile Manufacturers and the Association of Global Automakers recently released “Consumer Privacy Protection Principles,” which are intended to provide car owners with a set of principles regarding the sharing of the personal information available over vehicle telematics systems. While the Auto Care Association applauds the car companies for taking this initiative to inform consumers of the sizable amount of personal information that is being transmitted to manufacturers from their customers’ vehicles, the association believes that the manufacturers are still failing to provide car owners any choices regarding the
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information that is available from their vehicle. According to the Auto Care Association, car owners are currently at the mercy of vehicle manufacturers as to where information on their vehicle is sent. This includes vehicle diagnostic, mileage and geolocation information. All of this information is sent directly to the manufacturer, and they decide with which third parties to share that information. “In many cases, car owners have established trusted long-term relationships with repair shops and other vehicle service entities to which they would prefer their diagnostic and other personal data be sent, in order to ensure more convenient and efficient service for their vehi-
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cle,” the Auto Care Association stated. “Since these third parties often compete with the franchised dealer, it is unlikely that the data produced by a car owner’s vehicle will be made available by a manufacturer to an independent service entity.” The Auto Care Association urges the vehicle manufacturers to build into their vehicles a secure gateway which will allow motorists to have information that is transmitted by their vehicle and sent to the third party of their choice, not the car companies’ choice. Such action, the Auto Care Association believes, will permit car owners to have full control of the information available from their embedded vehicle telematics systems.
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»| Industry Update |« Nissan Introduces Certified Collision Network Consumer Referral Program Nissan has announced new enhancements to the Nissan Certified Collision Repair Network program, launching a consumer-focused referral initiative that ties Nissan vehicle
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owners with Nissan Certified Collision Repair Providers. To enhance relationships between certified shops within the network and Nissan owners, Nissan North America is launching an OnDemand-Marketing (ODM) tool that simplifies marketing for certified shops through a one-stop-shop process that grants them access to Nissan owners geographically. Now, Nissan certified shops can send marketing messages via mailer or email promoting their certified shop location directly to Nissan owners. The Nissan Collision Repair Network combines collision shop certification, consumer awareness and education elements along with shop locators so that Nissan customers can locate the certified repairer wherever and whenever they might need one. This program assures that certified collision shops have the right tools, equipment, training and facilities to repair Nissan vehicles to the company’s exact specifications for fit, finish, durability, safety and value. “In some cases, Nissan customers have endured a collision repair experience – and the resulting repairs – that have been controlled by third parties who don’t necessarily have the customer’s best interests in mind,” said Mark Zoba, collision parts manager, Nissan North America. “Nissan values our customers
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and is willing to do whatever we can to enhance our customer’s experience. With this program, Nissan is addressing this critical issue by assuring their vehicle drivers are able to select certified shops that are able to properly and safely repair Nissan and Infiniti vehicles.” Nissan has teamed up with Assured Performance, a non-profit consumer advocacy organization and third-party administrator for OEM certification-recognition programs. Working jointly with Assured Performance to determine certification practices, the Nissan Certified Repair Network program is ongoing with focus on identifying and completing certification of the best-in-class body shops across the U.S. “Nissan’s bold customer referral program is the ultimate payoff for shops who are willing to reinvest in their business and retool and train to ensure they are able to properly repair the new generation of vehicles being introduced by all of the major automakers,” said Scott Biggs, CEO, Assured Performance. “This is a positive step for the entire industry. No business or person should be able to touch a vehicle if they are not equipped and trained to do it properly, and customers and insurance companies should not be paying for substandard work.”
»| Industry Update |« Mississippi Shop Owner Gives Free Flights to Veterans As a way of saying thanks to veterans and their families, John Mosley, owner of John Mosley (center) with some Clinton Body Shop in free plane ride recipients. Mississippi, and his fellow pilots offered free plane rides to them on Nov. 8 in three World War II aircraft. More than 200 people were given rides, eight at a time. Mosley flew a T6 all day and could only take one person at a time, but he flew from 10:30 a.m. to 4:45 p.m., stopping only twice to refuel. “We burned 600 gallons of fuel Saturday and would have burned twice that much if time had allowed,” said Mosley. “I saw nothing but smiles and tears. Most people laughed and cheered, but there were a few who had tears in their eyes and couldn’t talk. I can only imagine what kind of memories they experienced. One thing is for sure: they were all grateful, and we were honored to show our appreciation for their service.”
GM Welding Breakthrough Enables More Use of Aluminum General Motors Research & Development announced it has invented an industry-first aluminum welding technology expected to enable more use of the lightweight metal on future vehicles. GM’s new resistance spot welding process uses a multi-ring domed electrode that does what it says smooth electrodes are unreliable at doing – welding aluminum to aluminum. By using this process, GM expects to eliminate two pounds of rivets from aluminum body parts such as hoods, liftgates and doors. The process will also allow GM to avoid the hundreds of millions of dollars Ford spent to retool their assembly plants for the metal. GM already uses this patented process on the hood of the Cadillac CTS-V and the liftgate of the hybrid versions of Chevrolet Tahoe and GMC Yukon. GM plans to use this technology more extensively starting in 2013. Read more of this story at www.bodyshopbusiness.com.
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»| Industry Update |«
Consolidation Caliber Collision Increases Footprint in California aliber Collision Centers has announced its acquisition of FCC Collision Centers, expanding its presence in California. This acquisition increases Caliber’s network to 203 locations nationwide. FCC Collision has been an industry leader for more than 35 years in California and has four convenient locations in Silicon Valley. “The FCC Collision facilities and management team perfectly complement Caliber’s purpose, vision and mission with the California market,” said Steve Grimshaw, CEO of Caliber Collision. “FCC has consistently delivered unparalleled customer satisfaction and industry-leading operational consistency in Silicon Valley for decades. We are very excited to add these new members to the Caliber family.” Added Adam, Jason and Matt Piper, owners of FCC Collision, “Our family has built a company that delivers high-quality service and gives back to the communities we serve. We are pleased that Caliber Collision will offer our associates a bright future, with continued involvement in our local communities.”
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Service King Finalizes Car West Auto Body Acquisition Service King Collision Repair Centers announced it has finalized the acquisition of Car West Auto Body, a multishop operator in Northern California. Service King now offers collision repair services to customers in the cities of Dublin, San Jose, Santa Clara, Fremont, Yuba City and Mountain View, Calif. These locations currently repair more than 1,800 vehicles a month. With the addition of Car West, Service King now operates a total of 18 collision repair centers across the state of California.
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»| Industry Update |« CARSTAR Records Record Growth, Sales in 2014 CARSTAR announced that it has achieved a record year for the company in sales, growth and industry performance. At the 2014 SEMA Show, the MSO shared its performance highlights and discussed its outlook for the year ahead. CARSTAR ended September with same store sales up 11.4 percent over the previous September. For the third quarter, CARSTAR states that it delivered some of the industry’s highest same-store sales and is looking ahead to record revenue for 2014. CARSTAR finished the quarter with same stores sales up 8.3 percent over that quarter in 2013, and is on track to deliver more than $650 million in revenue for the year, a record for the company. “That growth is fueled by several key factors,” said David Byers, CEO of CARSTAR. “We’ve seen increases in repair volumes from the top 25 insurance carriers, driven by CARSTAR’s EDGE Performance platform and continued KPI performance. New car purchases have remained strong throughout the year, which leads to higher repair values. Weather continues to drive repair needs, from winter ice and snow to spring hail to summer storms. And, advanced vehicle technology such as back-up cameras and on-board sensors are more expensive to repair.” CARSTAR claims it is the only MSO in the country that has an aluminum certification program, is continuing to roll out their aluminum plan to their network, and is identifying specific CARSTAR shops in each major market that will be aluminum certified, then “load leveling” work to those stores as necessary. “Aluminum repair will be a ma-
jor differentiator in our industry moving forward,” said Byers. “As the auto industry evolves to meet CAFE standards, the shops that
can deliver this advanced service will rise above those who don’t invest in training, technology and shop improvements.”
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Three Tools in One The DF-DB69 Dead Blow Hammer is three paintless dent repair tools in one. The dual head gives the user two striking ends to knock down high spots on dent repairs. Blowback is eliminated thanks to the dual flex neck that cushions each strike. The user can flip the tool over and use the chisel end for prying off door panels or removing glue residue. Dent Fix Equipment www.dentfix.com Circle 153 for Reader Service
OEM-Replicating Finishes Valspar’s De Beer Mysterious Colours offer state-of-the-art technology through color-shifting pigments, which replicate modern OEM paint effects. They’re available in five liquid color additives and are designed to work with existing De Beer Refinish products, including WaterBase 900+ and BeroBase500 series. Valspar Automotive www.valsparauto.com Circle 151 for Reader Service
Multi-Panel Clearcoat Welding Hand Tool
The Welper is designed specifically for use with MIG welding guns and offers eight functions in a single pair of pliers. Ideal for any MIG welder, the Welper can be used to remove spatter from the nozzle inside and out, cut wire, remove and install tips, pull wire, remove brushings and even hammer when necessary. Lincoln Electric www.lincolnelectric.com Circle 152 for Reader Service
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PPG’s MC2910 EUROPLUS MultiPanel Clearcoat is a 2.1 VOC clear coat suited for multiple panels and large repairs. It has been engineered to economically provide an exceptional gloss finish. It features a 2:1 mix ratio and is easy to apply. It can be used with either of two OMNI LV hardeners – MH2918 or MH2919 High Temp – allowing it to adjust to job size and working conditions. PPG Automotive Refinish www.ppgrefinish.com Circle 154 for Reader Service
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MarkiNgpeNdepot.coM Collision Shops, Towing, Auction Sites, Dealers, Recyclers, OEMs
CleanSheets® “The Original Patented Mixing Pad”
Tow Pro $2.50 Autowriter $3.50 Posca $3.50 Bopagla $2.00 Unipaint $3.86 MPD-15 $1.30 Volume Discounts!
Stop wasting valuable time looking for cardboard or cleaning mixing boards! Clean Sheets® Mixing
Boards are used by thousands of repair shops to mix epoxies, body filler, fiberglass, plastics, gel, putty and touch-up paint. • Prevents costly reworks • Non-absorbing, heavy-duty paper with grip for mixing • Bonded on 3 sides • Pays for itself the first week you use them! CALL YOUR LOCAL JOBBER or
800-365-1308
Call 888-906-9370 or online at
www.cleansheetsmfg.com
markingpendepot.com BodyShop Business Classified
Quality Solutions for the Collision Industry
Help wanted • Business for sale • Equipment for sale • Software... and so much more! Call Jennifer Hazen today at
330-670-1234 ext. 224
1.800.529.2640 W W W . K AY C O S P R AY B O O T H S . C O M
• Original Equipment Wheels In Stock • Limited Lifetime Guarantee • 1000s of Wheels In Stock • Affordable Prices
We ship from eight different locations: Dallas, Houston, San Antonio, Los Angeles, Philadelphia, San Francisco, Chicago, Miami
Alloy Wheel Remanufacturing Order your Wheels at:
www.newwheel.com or 800-486-0931
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December 2014 | BodyShop Business
Become part of the BodyShop Business Readers group and participate in lively conversations with industry professionals on hot topics in the collision repair industry! Visit: http://linkd.in/18aL71K
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By the
Numbers Vital collision industry stats
Do You Purchase Aftermarket Crash Parts?
The majority of shops which purchase aftermarket crash parts do so because they feel pressure from the insurance company.
Source: 2013 BodyShop Business Industry Profile
Average Jobs Per Week By Sales Volume
Average Jobs Weekly
$125,000$249,000
$250,000$349,000-
$350,000$749,000
$750,000$1 million
$1 million$2 million
Over $2 million
3.6
7.3
8.2
13.9
15.7
30.3
Source: 2013 BodyShop Business Industry Profile
Average Painter Pay Up to $30,000
9% 16%
$40,000
24%
$50,000 $60,000
16%
$70,000
16% 10%
$80,000 Over $80,000
8% Source: 2013 BodyShop Business Industry Profile
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December 2014 | BodyShop Business
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