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www.wmaba.com
September 2018 Volume 12, No. 9 $5.95
www.grecopublishing.com
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September 2018
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It Takes Genuine Honda Collision Repair Parts To Achieve a Genuine Honda Fit. Honda collision repair parts are engineered and manufactured to Honda standards. In the collision-repair business, time is money, and you can’t waste time on parts that almost fit properly. Use Genuine Honda replacement parts. Your reputation depends on it. For Genuine Honda parts, contact these Authorized Honda dealers. Ourisman Honda 3371 Ft. Meade Rd. Laurel, MD 20724 Direct: 301-498-6050 Fax: 301-498-0157 www.laurelhonda.com
Honda of Tysons Corner 1580 Spring Hill Rd. Vienna, VA 22182 Direct: 703-749-6652 FAX: 703-821-4229 www.hondatysonscorner.com E-mail: sebastian.venegas@hondaoftysonscorner.com
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September 2018
Miller Honda 3985 Valley Pike Winchester, VA 22602 Direct: 800-296-5020 Direct Local: 540-868-9916 Fax: 540-869-1074 E-mail: bmorgan@drivemiller.com
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CONTENTS September 2018
30 COVER STORY WALKING AWAY: HOW TO SELL WITHOUT SELLING OUT BY JOEL GAUSTEN Stories and suggestions from shops who’ve said goodbye.
NATIONAL NEWS
ADVERTISERS’ INDEX
14 I-CAR ANNOUNCES KEY PROGRAMMING ENHANCEMENTS
AJK Industries . . . . . . . . . . . . . . . . .42
Major changes for the educational mainstay.
20 NEW IDEAS TO DRIVE EDUCATION AT SEMA 2018
Audi Group . . . . . . . . . . . . . . . . . . . .17 Axalta Coating Systems . . . . . . . . . .IFC BMW Group . . . . . . . . . . . . . . . . . . .18 Chesapeake Automotive Equipment 23
Evolutions in learning.
Crashmax Equipment . . . . . . . . . . . .25 Empire Auto Parts . . . . . . . . . . . . . .23 Fairfax Hyundai . . . . . . . . . . . . . . . .42 Ford Group . . . . . . . . . . . . . . . . . . . .42
INDUSTRY UPDATE
BY JOHN WALCZUK
16 DIMINISHED VALUE: FACT OR FICTION? More expert insight into DV.
GM Parts Group . . . . . . . . . . . . . . . .28 Goliath Carts . . . . . . . . . . . . . . . . . . .41 Honda Group . . . . . . . . . . . . . . . . . .4 Hyundai Group . . . . . . . . . . . . . . . . .19 Koons Ford . . . . . . . . . . . . . . . . . . . .25 Malloy Hyundai . . . . . . . . . . . . . . . . .3 Mazda Group . . . . . . . . . . . . . . . . . .37 MINI Group . . . . . . . . . . . . . . . . . . . .27 Mitsubishi Group . . . . . . . . . . . . . . . .33
INDUSTRY ADVICE: ASK MIKE 38 WHAT SHOULD OWNERS KEEP IN MIND WHEN SELLING THEIR SHOPS? Protecting yourself when it’s time to go.
Mopar Group . . . . . . . . . . . . . . . . . .24 Nissan Group . . . . . . . . . . . . . . . . . .24 Nucar . . . . . . . . . . . . . . . . . . . . . . . .36 O’Donnell Honda . . . . . . . . . . . . . . .22 Packer Norris Parts . . . . . . . . . . . . .IBC Porsche Group . . . . . . . . . . . . . . . . .32 PPG . . . . . . . . . . . . . . . . . . . . . . . . .OBC Reliable Automotive Equipment . . . .7
DEPARTMENTS 6 8 10
Sherwin-Williams . . . . . . . . . . . . . . .15 Toyota Group . . . . . . . . . . . . . . . . . .29
Calendar of Events
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JOEL GAUSTEN
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Editor’s Message
Executive Director’s Message JORDAN HENDLER
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WMABA Sponsorship Page
WMABA Membership Application
What’s WMABA Up To?
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WMABA Board of Directors WMABA Member Spotlight
VW Group . . . . . . . . . . . . . . . . . . . . .9 Wheel Collision Center . . . . . . . . . . .22 ZB Negotiations . . . . . . . . . . . . . . . .16
Stock Images © www.istockphoto.com
September 2018
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CALENDAR OF
Industry training opportunities and don't-miss events.
EVENTS CLASS LISTINGS
September 4, 2018 STRUCTURAL STRAIGHTENING STEEL Tidewater Community College, Chesapeake, VA
September 5, 2018 STEEL UNITIZED STRUCTURES TECHNOLOGIES & REPAIR Enterprise Holdings Inc., Linthicum, MD
September 6, 2018 VEHICLE TECHNOLOGY TRENDS & DIAGNOSTIC OVERVIEW Tidewater Community College, Chesapeake, VA STEEL UNITIZED STRUCTURES TECHNOLOGIES & REPAIR Gaithersburg High School, Gaithersburg, MD SECTIONING OF STEEL UNITIZED STRUCTURES RMS Pro Finishes, Charleston, WV HAZARDOUS MATERIALS, PERSONAL SAFETY & REFINISH SAFETY RMS Pro Finishes, Charleston, WV September 11, 2018 ADHESIVE BONDING Tidewater Community College, Chesapeake, VA
September 12, 2018 COLOR THEORY, MIXING TONERS & TINTING Hilton Wilmington/Christiana, Newark, DE ALUMINUM EXTERIOR PANEL REPAIR & REPLACEMENT North Point High School, Waldorf, MD AUTOMOTIVE FOAMS FinishMaster, Springfield, VA
September 13, 2018 PLASTIC & COMPOSITE REPAIR Gaithersburg High School, Gaithersburg, MD STEEL UNITIZED STRUCTURES TECHNOLOGIES & REPAIR Alexandria Training Center, Alexandria, VA STEEL UNITIZED STRUCTURES TECHNOLOGIES & REPAIR FinishMaster, Fredericksburg, VA September 15, 2018 WHEEL ALIGNMENT & DIAGNOSTIC ANGLES Fairfield Inn & Suites, Easton, MD
September 18, 2018 FULL-FRAME PARTIAL REPLACEMENT Tidewater Community College, Chesapeake, VA WHEEL ALIGNMENT & DIAGNOSTIC ANGLES FinishMaster, Springfield, VA COLOR THEORY, MIXING TONERS & TINTING LKQ Keystone, Halethorpe, MD
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September 2018
September 19, 2018 SECTIONING OF STEEL UNITIZED STRUCTURES Hilton Wilmington/Christiana, Newark, DE
September 20, 2018 VEHICLE TECHNOLOGY TRENDS & DIAGNOSTIC OVERVIEW Alexandria Training Center, Alexandria, VA HAZARDOUS MATERIALS, PERSONAL SAFETY & REFINISH SAFETY FinishMaster, Springfield, VA ADHESIVE BONDING Auto Parts Plus, Baltimore, MD WHEEL ALIGNMENT & DIAGNOSTIC ANGLES Gaithersburg High School, Gaithersburg, MD SQUEEZE-TYPE RESISTANCE SPOT WELDING Frederick Co. Career & Tech, Frederick, MD
September 25, 2018 STEERING & SUSPENSION DAMAGE ANALYSIS Tidewater Community College, Chesapeake, VA
September 26, 2018 SQUEEZE-TYPE RESISTANCE SPOT WELDING Frederick Co. Career & Tech, Frederick, MD
September 27, 2018 FULL-FRAME PARTIAL REPLACEMENT Alexandria Training Center, Alexandria, VA REPLACEMENT OF STEEL UNITIZED STRUCTURES FinishMaster, Fredericksburg, VA SQUEEZE-TYPE RESISTANCE SPOT WELDING Gaithersburg High School, Gaithersburg, MD October 3, 2018 PLASTIC & COMPOSITE REPAIR FinishMaster, Springfield, VA HAZARDOUS MATERIALS, PERSONAL SAFETY & REFINISH SAFETY Enterprise Holdings Inc., Linthicum, MD
October 4, 2018 MEASURING FinishMaster, Springfield, VA HAZARDOUS MATERIALS, PERSONAL SAFETY & REFINISH SAFETY Tidewater Community College, Chesapeake, VA AUTOMOTIVE FOAMS RMS Pro Finishes, Charleston, WV VEHICLE TECHNOLOGY TRENDS & DIAGNOSTIC OVERVIEW RMS Pro Finishes, Charleston, WV
October 9, 2018 REPLACEMENT OF STEEL UNITIZED STRUCTURES LKQ Keystone, Halethorpe, MD October 10, 2018 MEASURING North Point High School, Waldorf, MD
October 11, 2018 MEASURING Gaithersburg High School, Gaithersburg, MD
WMABA Fall Meeting For upcoming information visit wmaba.com
ADHESIVE BONDING Alexandria Training Center, Alexandria, VA CORROSION PROTECTION Tidewater Community College, Chesapeake, VA SECTIONING OF STEEL UNITIZED STRUCTURES FinishMaster, Fredericksburg, VA
October 13, 2018 THE ART & SCIENCE OF ESTIMATOR INTERACTIONS Fairfield Inn & Suites, Easton, MD October 17, 2018 PLASTIC & COMPOSITE REPAIR Fairfield Inn & Suites, Easton, MD STRUCTURAL STRAIGHTENING STEEL FinishMaster, Springfield, VA
October 18, 2018 ADVANCED STEERING & SUSPENSION SYSTEMS DAMAGE ANALYSIS Frederick Co. Career & Tech, Frederick, MD 2015 FORD F-150 STRUCTURAL REPAIR TRAINING COURSE Gaithersburg High School, Gaithersburg, MD STEEL UNITIZED STRUCTURES TECHNOLOGIES & REPAIR Auto Parts Plus, Baltimore, MD PLASTIC & COMPOSITE REPAIR Tidewater Community College, Chesapeake, VA October 23, 2018 SECTIONING OF STEEL UNITIZED STRUCTURES LKQ Keystone, Halethorpe, MD October 24, 2018 CORROSION PROTECTION North Point High School, Waldorf, MD SQUEEZE-TYPE RESISTANCE SPOT WELDING FinishMaster, Springfield, VA October 25, 2018 STRUCTURAL STRAIGHTENING STEEL Gaithersburg High School, Gaithersburg, MD AUTOMOTIVE FOAMS Tidewater Community College, Chesapeake, VA WHEEL ALIGNMENT & DIAGNOSTIC ANGLES FinishMaster, Fredericksburg, VA
www.i-car.com or (800) 422-7872 for info
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Joel Gausten
EDITOR’S
(973) 600-9288 joel@grecopublishing.com
MESSAGE LETTING GO THE RIGHT WAY Change is inevitable, but suffering is optional. The past few years have brought tremendous technological advancements to the national collision repair industry. Unfortunately, these developments have added considerable stress to those business owners who are reaching retirement age or no longer feel they can make the financial investments necessary to stay in the game. It takes a lot of time and money to receive OEM certification and stay current on training. For some, making a commitment at that level is more than their age or patience can allow. In these cases, it might be time to finally let go of the ups and downs of the industry and hand the business over to a new owner. Of course, moving on in this way is a very big deal. Even if your shop is taken over by a family member or close friend, it can still be difficult to say goodbye to something you’ve built and kept going. There is also the threat of WMABA OFFICERS PRESIDENT
VICE PRESIDENT
TREASURER
SECRETARY
IMMEDIATE PAST PRESIDENT
Torchy Chandler torchy.chandler@gmail.com 410-309-2242 Bill Hawkins whawkins@mybmwannapolis.com 410-349-2578 Barbara Chase barbara@siskautobody.com 301-855-5525 Phil Rice phil@ricewoods.com 540-846-6617 Mark Schaech, Jr. markschaech@gmail.com 410-358-5155
BOARD OF DIRECTORS
Don Beaver (donbeaver3551@gmail.com) 443-235-6668 Rodney Bolton (rbolton@aacps.org) 443-386-0066 Kevin Burt (kevinburt@walkermillcollision.com) 301-336-1140 Barry Dorn (bdorn@dornsbodyandpaint.com) 804-746-3928
ADMINISTRATION
Ben Gibson (bgibson@richmondmarinecenter.com) 804-355-8151 Steven Krieps (srkrieps@live.com) 304-755-1146 Ashley Kruger (akruger@baughautobody.com) 804-285-8045 Danny Szarka (danny@dynamiccollisionservices.com) 410-500-9200
EXECUTIVE DIRECTOR Jordan Hendler (jordanhendler@wmaba.com) 804-789-9649 WMABA CORPORATE OFFICE P.O. Box 3157 • Mechanicsville, VA 23116
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things blowing up in your face if the sale is not handled in a proper and financially secure way. On top of that, you could face an emotional rollercoaster if a sale to a family member or former employee goes south due to an oversight or poor planning. This month, we share perspectives from a variety of former shop owners on the topic of exit plans and the impact their decisions to sell had on their personal and professional lives. What worked? What didn’t? What are the common mistakes to avoid? When did they know it was time to move on? These are some of the critical questions we explore in this issue’s cover story and our supplementary discussion with Mike Anderson of Collision Advice, whose insights are a must-read. The repair field is changing, and the future won’t be for everyone. Fortunately, it is possible to make a smooth transition to a new owner without sacrificing your integrity, your reputation or your bank account. We hope you find the information we present useful, and we welcome any feedback and additional ideas from readers on this incredibly important issue. H&D
September 2018
STAFF
PUBLISHER SALES DIRECTOR EDITORIAL DIRECTOR CREATIVE DIRECTOR EDITORIAL/CREATIVE COORDINATOR
OFFICE MANAGER
Thomas Greco thomas@grecopublishing.com
Alicia Figurelli alicia@grecopublishing.com
Joel Gausten joel@grecopublishing.com
Lea Velocci lea@grecopublishing.com
Alana Bonillo alana@grecopublishing.com
Donna Greco donna@grecopublishing.com
PUBLISHED BY TGP, Inc. 244 Chestnut St., Suite 202 Nutley, NJ 07110 973-667-6922 FAX 973-235-1963 Reproduction of any portions of this publication is specifically prohibited without written permission from the publisher. The opinions and ideas appearing in this magazine are not necessarily representations of TGP Inc. or of the Washington Metropolitan Auto Body Association (WMABA). Copyright © 2018 Thomas Greco Publishing, Inc.
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Alexandria Volkswagen 107 West Glebe Rd. Alexandria, VA 22305 703-684-7007 Fax: 703-684-4138 e-mail: parts@alexandriavw.com
Karen Radley Volkswagen 14700 Jefferson Davis Hwy. Woodbridge, VA 22191 703-550-0205 Fax: 703-643-0081
Ourisman Volkswagen of Bethesda 5415 Butler Road Bethesda,MD 20816 301-652-2452 Fax: 301-652-2589
Checkered Flag Volkswagen 3025 Virginia Beach Blvd Virginia Beach, VA 23452 Parts Direct: 757-687-3465 757-490-1111 Fax: 757-687-3514
Fitzgerald Volkswagen 114 Baughmans Lane Frederick, MD 21702 Toll Free: 800-545-4745 Fax: 877-696-1841
www.checkeredflag.com
e-mail: parts@fitzmall.com www.fitzparts.com
Ourisman Volkswagen of Rockville 801 Rockville Pike Rockville, MD 20852 Parts Direct: 301-340-7668 Toll Free: 855-417-4511 Fax: 240-499-2488
King Volkswagen 979 North Frederick Ave. Gaithersburg, MD 20879 Parts Direct: 240-403-2300 Fax:240-403-2398
e-mail: rockvilleparts@ourismanautomotive.com www.ourismanvolkswagenofrockville.com
e-mail: parts@vwking.com www.vwking.com
Fitzgerald Volkswagen of Annapolis 34 Hudson Street Annapolis, MD 21401 Phone: 410-224-4636 Fax: 410-224-4264 www.fitzmall.com
Ourisman Volkswagen of Laurel 3371 Ft. Meade Rd. Laurel, MD 20724 Phone: 301-498-6050 Fax: 301-498-0157 www.laurelvolkswagen.com
e-mail: vwwholesale@ourisman.co
September 2018
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EXECUTIVE DIRECTOR’S
MESSAGE BEFORE YOU SELL, CONSIDER THIS... Is it possible that maybe you’re not the right person for the job? Today’s vehicles and repair processes are complex, and the management of an elite collision repair facility is certainly no task for the squeamish. Before you throw your hands up and give in to sell, consider that maybe there’s a management candidate out there who can do your job better, more efficiently and run the day-to-day operation in a manner that will grow your business beyond your current expectation. This will leave you to focus on the brand, growing the client base and making sure the financial outlook is solid – or allowing you the freedoms you’ve been lacking in the waning towards retirement. My goal here is to open your mind to more possibilities than simply calling the “Big Four” and taking what you can to get out.
Not Everyone Is Poised for Leadership! I have a great family friend who passed away who owned a beautiful, highly successful collision business. He worked as a technician. Yes, that’s right; he worked ON the cars. He left the management to the fully capable team he had in place. He enjoyed working on the cars so much that he pushed for the managing of day-to-day operations to those who were qualified to do so. Did he have to become involved in aspects of the ownership? Of course! But on a daily basis, he was in the shop, training for new procedures and getting customers’ cars repaired. What I noticed most about this person was their happiness. He also had the flexibility to attend industry meetings and be the voice of the technicians. His advocacy for correctness in the databases led to the Database Enhancement Gateway (DEG – degweb.org) that we know today. Open Minds Are Open Doors In this tiny space I’m granted each month to encourage or motivate you to excellence, I ask you to implore your own
Jordan Hendler
(804) 789-9649 jordanhendler@wmaba.com
personality. Read up on management styles and principles, get in the know of what is happening with vehicle advancements and – most of all – position your business in front of that. Keep your mind open and eager to move with the change. If removing yourself from a position (or into a different role) is looking like a viable and more productive (profitable) option, then don’t wait! Especially if you find yourself in the latter part of your ownership track where retirement is coming sooner than later. Why would there be any shame in giving the minutiae to qualified folks? It’s what successful business owners do. Especially when you look outside our own industry. Willingness to evolve is something we all must do. Instead of pigeonholing yourself into a one-track option, just give yourself the benefit of the doubt to make the best business decision possible prior to that exit we all hope to have for a happy retirement.
H&D
Check the WMABA website and newsletters for regular updates and reports from the Executive Director’s perspective.
I appreciate WMABA working on my behalf at the state capitol(s)! Here is my contribution to the legislative efforts.
P.O. Box 3157 • Mechanicsville, VA 23116
Name: ______________________________________Company: __________________________________ Address: __________________________________________________________________________________ City:____________________________________________State: ______________________Zip: ________ Phone:
______________________________Email:
Donation Amount: Check Enclosed
$50
$100
____________________________________________ $500
Other ________________
Credit Card (Visa, Amex, MC)# __________________________________________________________ Exp: ________
Name on Card: ______________________________Signature: __________________________________ 10
September 2018
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WMABA THANKS
YOU WMABA thanks their generous supporters of the
LEVEL 1
Corporate Sponsor Program for 2018!
We encourage YOUR SUPPORT of those who SUPPORT US! For more information about the sponsorship program, please contact Executive Director Jordan Hendler at (804) 789-9649 or email jordanhendler@wmaba.com
LEVEL 2 Certified Automotive Parts Association
www.wmaba.com
FinishMaster • Mid-Atlantic Paint & Supply National Coatings and Supplies • WheelsOnsite
September 2018
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Find more association updates at www.wmaba.com.
WHAT’S UP TO? WMABA MEMBERSHIP: THE UN-SECRET PLAYBOOK It’s always a good time to get involved in WMABA. If you’re reading this, your first benefit is already being realized: Staying up to date on the news in our area and beyond.
Get Your Team Jersey Supporting WMABA is an investment in the future of your business and your industry. By becoming a member, you are represented in all the places the Board or executive director go. Whether at a trade show like SEMA, assisting with the SCRS OEM Technology Summit regarding certified repairs or locally at the state capitol meeting legislators or testifying at a hearing, your interests and the interests of all repairers are at the forefront. Though repairers often feel competitive, the association is a place for camaraderie and community. Here, we’re all on the same team. Get Educated WMABA offers issue-specific, topic-driven education throughout the year. Participation in special events and local meetings, such as the Audi Training Center-hosted seminar and tour, offers your business the best in opportunities to advance your understanding of changes within our industry.
JOIN TODAY!
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The Playbook The association is your resource for all things related to your business. Whether you have a question about current Labor Rate data, operations, customer interaction, insurer relationships, vendor products or national news, your association is the place to ask first. Through our relationships nationally, we can even take issues to the forefront of places such as the Society of Collision Repair Specialists, Collision Industry Conference or national contacts for insurers and vendors. Locally, we research governmental regulations and oversight to make sure the repair industry is protected from any negative legislation. Represented in both Virginia and Maryland, WMABA proposes and opposes recommended bills that come into the legislature during open session. Also, we work with consumer-related entities, government agencies and other related industry organizations to ensure that the voices of the repairer and their customer are heard. Many repairers take advantage of the knowledge and community the association has for navigating situations that arise. A simple phone call or email can circumvent many issues our members encounter.
Call the Game As a member, you decide your personal level of participation. Do you have interest in committees that address particular issues you feel passionately about? Would you want to be a Board member and assist in guiding the direction of the association? How about sitting on the sidelines so you can focus on your own business? All answers can be correct! While WMABA would like to encourage your spirit of volunteerism, it is solely up to you at what level you get involved. The minimum is getting your membership. This year can WIN with your commitment to the betterment of your business and your industry. Sign up today! H&D
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An association fostering the exchange of ideas and providing a voice and support for the collision repair professional.
Position Your Business as a Leader!
OFFICERS
PRESIDENT: Torchy Chandler torchy.chandler@gmail.com 410-309-2242
VICE PRESIDENT: Bill Hawkins whawkins@mybmwannapolis.com 410-349-2578
SECRETARY: Phil Rice
TREASURER: Barbara Chase barbara@siskautobody.com 301-855-5525
phil@ricewoods.com 540-846-6617
BOARD OF DIRECTORS
PAST PRESIDENT: Mark Schaech Jr. markschaech@gmail.com 410-358-5155
Rodney Bolton rbolton@aacps.org 443-386-0066
Kevin Burt Barry Dorn bdorn@dornsbodyandpaint.com kevinburt@walkermillcollision.com 301-336-1140 804-746-3928
Just like equipment and training, WMABA membership is not only a commitment to excellence, but also a valuable investment. WMABA is recognized both regionally and nationally as the key forum for the exchange of ideas concerning the D.C., MD, VA and WV collision repair industry. It is the venue to discuss, learn about and impact evolving standards and policies in the technical, administrative and legislative fronts of our industry. Shops and industry supporters can best develop themselves and their employees by actively engaging in the association and its activities. Automotive collision repair facilities in Maryland, Virginia, West Virginia and Washington, D.C. who are willing to adopt WMABA’s Standards of Membership and offer a guarantee to their consumers are encouraged to engage their business as an active member of the association. For over 40 years, the WMABA membership of professional collision repair businesses and affiliates have committed to operating at a higher standard on behalf of their industry and their consumers. Over the years, WMABA has proudly represented the collision repair industry at hearings on Capitol Hill, in Annapolis, MD, and Richmond, VA as well as almost every national collision repair event. While WMABA has a rich history of dedicated men and women serving the local collision repair community, WMABA also boasts numerous past and current accomplished Board members who represent our membership at the national level. WMABA offers current and dynamic discussion forums on topics facing collision repairers, technical information and educational seminars, opportunities to network and discuss pressing topics with leaders of the collision repair industry, an arbitration program that works with consumers to help resolve issues they might have, apprenticeship programs, legislative representation and the ability to receive and contribute to one of the nation’s leading collision repair magazines, Hammer & Dolly.
EXECUTIVE DIRECTOR: Jordan Hendler jordanhendler@wmaba.com 804-789-9649 Ben Gibson bgibson@richmondmarinecenter.com 804-355-8151
Ashley Kruger akruger@baughautobody.com 804-285-8045
Don Beaver don.beaver3551@gmail.com 443-235-6668
Contact Executive Director Jordan Hendler to find out how WMABA can amplify YOUR voice in the collision repair industry. Danny Szarka danny@dynamiccollisionservices.com 410-500-9200
Steven Krieps srkrieps@live.com 304-755-1146
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NATIONAL
Critical updates for I-CAR.
NEWS ANNOUNCES KEY PROGRAMMING ENHANCEMENTS
Following a nearly five-year comprehensive process of gathering and applying industry insights and feedback about its education and recognition programs, I-CAR has announced a variety of new enhancements designed to better serve the rapidly evolving needs of the collision repair inter-industry. Together, these enhancements will elevate industry training standards and provide a more comprehensive, relevant and affordable solution to collision repair training programs while making it easier for customers to interact with I-CAR. They will also help shape the future of the collision repair industry and advance I-CAR’s vision that every person in the collision repair industry has the information, knowledge and skills required to perform complete, safe and quality repairs for the ultimate benefit of the consumer. A first quarter 2019 launch is targeted. I-CAR’s updated Automotive Collision Repair Industry Knowledge and Skills Protocol, revealed in early August for 2019 implementation, is what the organization calls a “complete refresh,” reflecting the knowledge required to repair cars of today and tomorrow. This same protocol provided the input required for a complete update to I-CAR’s core supporting curriculum. I-CAR’s future courses will be more hands-on, generally shorter, more interactive and with far less course-to-course redundancy. I-CAR will also be launching Spanish versions of all core courses. I-CAR will also play a more integral role in repair shops, visiting annually to conduct ongoing assessments and advise on knowledge and skill gaps that exist within the shop, thereby supporting achievement and ongoing renewal of its expanding Gold Class population, currently exceeding 5,800. The 2019 enhancements leverage the work I-CAR has done over the past several years to build more relevant offerings geared to current and future industry needs. These enhancements have been optimized and integrated with new products and programming to offer shops a richer educational program that better aligns with collision repair technical realities (or the “Technical Tsunami,” as I-CAR refers to it). I-CAR CEO & President John Van Alstyne announced these enhancements at NACE Automechanika in Atlanta. A summary of the key planned enhancements includes:
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September 2018
I-CAR Automotive Collision Repair Industry Knowledge and Skills Protocol;
updated and industry-backed knowledge and skills protocol that focuses more extensively on specific skills and role performance requirements;
enhancements to I-CAR’s recognition programs (Platinum and Gold Class);
heightened Platinum and Gold Class requirements aligned with industry benchmarks and repair requirements;
optional Aluminum Structural Gold Class recognition for shops that complete I-CAR’s aluminum structural requirements;
complete refresh of all core curriculum (263 courses) aligned to the updated protocol;
incorporating more hands-on live training, shorter course times and more online courses with increased interactivity – all leading to less time out of the shop and off the floor for technicians;
increased frequency of Welding Training & Certification skill reverification, moving from five years to three years (and no longer requiring course repeat when skills are reverified);
automatic recognition for training with other providers that are I-CAR Sustaining Partners through I-CAR’s Training Alliance;
industry training relative to I-CAR Knowledge and Skills Area published as a companion cross-walk to acknowledge both OEM and Supplier Training Alliance courses approved to protocol and Alliance qualification criteria; new tools for completing, planning and tracking I-CAR training;
new learning interfaces, mobile technology and reporting functionality to make completing, tracking and planning I-CAR training much easier for customers; and
an unlimited training subscription for Gold Class shops to protect shops from turnover and encourage building bench strength by better training for all technicians.
Additional details regarding the enhancements discussed are accessible at I-CAR’s new i-cartraintogain.com website. H&D
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Reality in the shop.
INDUSTRY
BY JOHN WALCZUK, ZB NEGOTIATIONS
UPDATE
DIMINISHED VALUE:
Fact or Fiction?
The concept of diminished value is often disputed by insurance carriers as fiction. This assumption by the carrier appears to be based on a simple fact: The actual loss has not yet been realized. Taking this approach, the carrier will often attempt to avoid any consideration for the current decrease in the resale value of a vehicle. Why should a vehicle owner need to sell their previously undamaged vehicle to recognize a loss? Simple answer: They should not. The fact that a vehicle’s resale value is less after an accident does result in an economic loss to the owner. That loss in resale value should be recognized by and paid for by the insurance carrier. Taking a moment to understand the concept of diminished value provides a clearer understanding. A vehicle once damaged in an
accident has a lower resale value when compared to one not involved in an accident. One can see this when referring to CARFAX, TrueCar or other services that consider prior accidents in determining resale value. So what is the definition of a diminished value loss? How do we determine what is the diminished value loss? The definition of a diminished value loss is the current reduction in the resale value of a vehicle that can be directly attributed to an accident. The process of measuring or calculating this loss is complex. In determining this loss, one must consider factors including the extent of damage, comparable vehicles and uniqueness of the make and model. Additionally, consideration must be given to the possibility that once damaged in an accident, there may not be a resale market for
that vehicle in the future. This is especially true with exotics, antiques or higher-priced collectibles. Draw your own conclusion. Is diminished value fact or fiction? Our position is simple. Diminished value does exist after an accident, and our settlement results prove it every day. H&D *This article is not legal advice and may not reflect the opinions of WMABA and Thomas Greco Publishing.
John Walczuk is the director of client services for ZB Negotiations. The company specializes in helping vehicle owners obtain fair market settlement offers for their totaled vehicles. John can be reached at John@ZBLLC.net or (516) 364-0713.
WE BRIDGE THE GAP We are different! We provide a unique level of claims settlement services. This level of service is not offered by other vendors and helps to ensure positive valuation settlements.
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September 2018
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Audi dealers strive to make you an Audi Genuine Parts fan •
Audi Parts Professionals are your subject matter experts on collision parts, replacement components and mechanical items.
•
Many Audi dealers offer technical service support hotline access that can reduce your repair times and help you meet an on-time promised delivery.
•
Installing Audi Genuine Parts contributes towards improved cycle time that makes both your customer and their insurance company happier.
•
Regardless of the age of your customer’s Audi, Audi dealers have access to over 200,000 part numbers. No other supplier comes close.
Helping you do business is our business. Order Audi Genuine Parts from these select dealers. Audi Arlington 3200 Columbia Pike Alexandria, VA 22204 703.739.7490 Fax: 703.684.8420
Audi Bethesda 5206 River Road Bethesda, MD 20816 Parts Direct: 240.762.5636 Parts Fax: 301.718.1847 www.audibethesda.com
Rockville Audi 1125 Rockville Pike Rockville, MD 20852 Parts Direct: 301.296.2870 Parts Fax: 301.762.5055 www.rockville-audi.com
Audi Owings Mills 9804 Reisterstown Road Owings Mills, MD 21117 Parts: 877-411-6825 Parts Fax: 410-372-3380 www.audiowingsmills.com
Audi Annapolis 1833 West Street Annapolis, MD 21401 Parts Direct: 443.482.3280 Parts Fax: 443.482.3281 www.audiannapolis.com
Audi Chantilly 14839 Stonecroft Center Court Chantilly, VA 20151 703.956.2100 Fax: 703.956.2139 www.audichantilly.com
Audi Silver Spring 3151 Automobile Boulevard Silver Spring, MD 20904 844.413.6929 Fax: 301.890.3748 www.audisilverspringparts.com
Audi Virginia Beach 2865 Virginia Beach Boulevard Virginia Beach, VA 23452 Toll Free: 800.277.2122 Parts Direct: 757.687.3483 Fax: 757.687.3490 www.checkeredflag.com
September 2018
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THEY’RE CALLED “ORIGINAL BMW PARTS” FOR GOOD REASON. FOR UNCOMPROMISING PRECISION AND INCOMPARABLE QUALITY, YOUR BMW CENTER IS YOUR ONE-STOP SHOP FOR EVERYTHING BMW. For Original BMW Parts, contact one of these authorized BMW centers: BMW of Annapolis 25 Old Mill Bottom Road Annapolis, MD 21409 410-349-2565 Fax:410-349-2586 mybmwofannapolis.com
Passport BMW 5000 Auth Way Marlow Heights, MD 20746 301-423-0733 Fax: 301-423-2717 passportbmw.com
BMW of Alexandria 499 South Pickett Street Alexandria,VA 22304 Direct: 703-684-5255 Fax: 703-647-1853 bmwofalexandria.com
Northwest BMW 9702 Reisterstown Rd Owings Mills, MD 21117 410-363-1461 Fax: 410-363-7749 northwestbmw.com
BMW of Silver Spring 3211 Automobile Blvd Silver Spring, MD 20904 866-737-8937 Direct: 301-890-3015 Fax: 301-890-3748 bmwofsilverspring.com
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September 2018
Richmond BMW 8710 West Broad Street Richmond, VA 23294 800-237-0130 Direct: 804-527-6860 Fax: 804-965-6254 E-mail: tdailey@crownauto.com richmond-bmw.com BMW of Catonsville 6700 Baltimore National Pike Baltimore, MD 21228 855-996-2906 410-744-2000 Fax: 410-818-2600 bmwofcatonsville.com
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Unsurpassed Quality. Genuine Hyundai Parts. HYUNDAI IS PROUD OF ITS REPUTATION FOR QUALITY AND SERVICE. SO ARE THE DEALERS AND BODY SHOPS WHO RELY ON GENUINE HYUNDAI PARTS. TO MAKE CERTAIN THAT YOU GET THE RIGHT HYUNDAI PART, ASK FOR A HYUNDAI WHOLESALE PARTS SPECIALIST. For Genuine Hyundai parts, contact an Authorized Hyundai Dealer. Fairfax Hyundai 10925 Fairfax Blvd. Fairfax, VA 22030 Phone: 703-273-5188 FAX: 703-352-3115 E-mail: parts@fairfaxhyundaiinc.com
Fitzgerald Lakeforest Hyundai 905 North Frederick Ave. Gaithersburg, MD 20879 Phone: 301-670-4881 Fax: 301-670-1595
Malloy Hyundai 1880 Opitz Blvd. Woodbridge, VA 22191 Parts Direct: 703-490-8263 Fax: 703-490-3864 E-mail: hmkparts@aol.com
September 2018
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NATIONAL
NEWS
New IDEAS to Drive Education at SEMA 2018
As we get closer and closer to this year’s SEMA Show, inter-industry anticipation for the latest installment of this legendary event is at an all-time high. More than 100,000 people are again expected to walk the Las Vegas Convention Center October 29 through November 2, and the WMABA-affiliated Society of Collision Repair Specialists (SCRS) will be there to serve the needs of the collision repair community. This year’s SCRS Repairer Driven Education (RDE) Series will feature first-time and returning SEMA speakers for in-depth discussions on all areas relating to the automotive repair industry. The already exciting RDE schedule will provide even greater value this year thanks to the debut of the IDEAS Collide Showcase, a two-hour
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New presenters and discussions set for Vegas.
BY ALANA BONILLO
session set for the final day of SEMA on November 2 that will focus on thought-provoking and innovative ideas and solutions. The event will feature 10 fast-paced presentations designed to stimulate thought, innovation and resolution of business challenges with brash, outspoken and thoughtprovoking concepts from thought leaders both in and out of the industry. Topics will range from evolving technologies to mindset changes that could change how industry members operate their businesses. “The RDE Series was built to create practical, tangible solutions to collision repairers to give them direct solutions to use to help them be more successful in their businesses,” offers SCRS Executive Director Aaron Schulenburg. “[IDEAS] is about exploring much bigger thinking. Looking outside the box. Taking dreamers and their passion for change and new thinking and putting it on a stage and using that as a way to inspire others to rethink the possible.” SCRS was still selecting IDEAS speakers at press time, but Schulenburg stresses that the participants will be individuals who are passionate about their vision for the industry, business models or solutions. “I love how our events continue to evolve year after year, and the team always works to make sure that happens. This is another example of the ways we are trying to push ourselves to get the industry to think about what we are trying to accomplish.”
Noted attorney Erica Eversman (Auto Education Policy Institute) will join industry veteran Wade Ebert (former owner of American Auto Body in Springfield, IL) in presenting “More than Just a Hand Shake: The Professional Administrative [Legal] Documents You Really Need to Operate a Successful Shop” on October 31. The discussion will focus on consumer protection and what shops need in order to be compliant with state and federal laws. It will also address the crucial documentation repair shops should have in their toolbox to establish a better relationship with their customers. “Shops are not doing a well-enough job [with] documenting. Their arrangements with the customer and their responsibilities and rights in relation to the customer is complicated, and they are not laying this out for them,” explains Eversman. In her mind, the consumer needs to be engaged in the process between shops and insurance companies. The repairer’s job is to make sure the vehicle gets repaired safely and properly, and it should not be dictated by the insurance company. She says many shops don’t make this known to their customer. “If they focused more time on educating the customer and better understanding what the repairer parameters need to be, they could probably spend less time doing the administrative work for the insurance industry.” Ebert will be on hand to provide an outsider’s
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NATIONAL NEWS perspective – as the former auto body shop owner has now built a career as a realtor –
as well as firsthand knowledge on what shop owners deal with on a daily basis. “There is no tougher trade than what they do every day.” These days, Ebert plays an ancillary
role in the automotive industry by providing support behind the scenes. His appearance at SEMA is his first in some time. He and Eversman have a long history of working together, and she asked him to come on board and share his insight on the subject. “The discussion is all about documents, document management for shops and
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keeping folks out of legal trouble,” he says. First-time presenter Pete Tagliapietra, business development leader at NuGen IT Inc., will discuss “The Imperative of Accessing and Retaining OEM Repair Information on Every Structurally Repaired Vehicle” with colleague Will Peck, NuGen IT software development leader. Tagliapietra is eager to address attendees at SEMA – which he believes is the best forum available to repairers today – on the importance of documenting every step of the lifecycle of a repair. “The collision shop owner needs to have proactive access to OEM information [for] the make and model of the car, and they need to be able to capture that information and retain it through the lifecycle of the repair so they access it when they need it. Then, they must memorialize everything from estimates to pre- and post-repair scans so they have it as ready reference if the information is ever required or called upon by anyone or any entity in the future.” Through his RDE presentation, “The Importance of ADAS System Resets When Performing Wheel Alignments during the Collision Repair Process,” John Shewbridge of Hunter Engineering Company will help
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collision repair professionals increase their understanding of how these systems
interact across various vehicles. The program is designed to help promote
knowledge regarding how to obtain system repair information across vehicle platforms
and offer insight into recent advances in
ADAS technology (as well as future enhancements). Shewbridge hopes to make repairers aware of several commonly overlooked factors during the collision alignment process, including the benefits of performing it in-house. He believes that although many shops don’t want to make the monetary investment (or perhaps feel
they don’t have ample space for such equipment), these facilities are likely losing money by subletting this work to other parties. “[Shops] will sublet the work to others who have the equipment, but they may not understand what is needed and may not be taking safety into consideration – and that can be a real problem.” A former collision repair owner himself, Shewbridge is passionate about this industry and is eager to share this knowledge at SEMA. He invites attendees to come to him with questions and promises that if he doesn’t have the right answer during the seminar, he will get back to them with the answer they seek. For the complete SEMA Repair Driven Education schedule (plus information on how to register), visit semashow.com/scrs.
More information on the Society of Collision Repair Specialists is available at scrs.com. Look for more SEMA pre-show coverage in next month’s Hammer & Dolly. H&D
Executive Director’s Thoughts There’s just no two ways around it; you need to be at SEMA and SCRS’ RDE! The only way to keep up is to get out there! - Jordan Hendler
September 2018
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GENUINE NISSAN PARTS
MAKE ALL THE DIFFERENCE.
Only Genuine Nissan Parts deliver the fit, reliability, and performance to meet your shop’s collision repair needs. So keep it original, and keep it real with Genuine Nissan Parts.
Contact these Nissan dealers for all your parts needs: Passport Nissan 5000 Auth Way Suitland, MD 20746 Phone: 301-423-6930 Fax: 301-423-2965
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Sheehy Nissan of Manassas 9010 Liberia Ave Manassas, VA 20110 Toll Free: 800-969-4778 Local Direct: 703-361-0377 Fax: 703-361-5165 martinfisher@sheehy.com
September 2018
Sheehy Nissan of White Marsh 8115 Belair Rd. Nottingham, MD 21236 Parts: 443-270-9001 Parts Fax: 443-270-8993 wmparts@sheehy.com sheehynissanofwhitemarshparts.com
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MEMBER
SPOTLIGHT Keaton’s Collision Center
Keaton’s Collision Center is a multi-location business in West Virginia that has been family-owned and-operated since 1975. It is currently run by Jake Keaton, a fourth-generation member of this auto repair family. It all started with Jake’s great-grandfather, Rick Keaton, who was the first in the family to get involved with auto body work. Jake’s grandfather, Bob, also did some light work in body, but it was Jake’s father, Rick, who started the business and helped it grow considerably over the years. Many other Keatons are still involved with the family business, including Jake’s sister Jessika Steinbrecher and uncles Roger and Rodney. Keaton’s Collision Center now has 44 employees among three locations in West Virginia. Their main shop is located in Huntington, and they are also based in Barboursville. This past April, they opened their newest location in Hurricane. In addition to collision repair work, Keaton’s also performs restoration work on cars, trucks, vans, RVs and fire trucks. They are also noted as the go-to place for general vehicle maintenance and state inspections. Jake got his start by working at the shop during high school and college. He stayed on board and eventually began writing estimates, managing the shop and then some. “You name it, I do it,” he says. The thing he enjoys most about being in the automotive business is trying to make a difference when it comes to repairing vehicles. “Hearing people compliment us that we did a good job and seeing them bring their cars back to us time after time makes me feel good.” Jake believes the keys to a successful business lie in treating employees well and making them want to come to work. Keaton’s Collision Center also focuses on making sure they are providing customers with a good experience. The enterprise keeps its name out there through a local TV ad, which Jake says has been especially helpful with promoting their newest location in Hurricane. They also maintain an active social media presence on Facebook, but he feels that overall word of mouth has been the most beneficial tool in a small-town atmosphere. Like many WMABA members, Keaton’s Collision Center is committed to always keeping up with their certifications and training. He sends his technicians to as many seminars as possible and also tries to personally make the time to
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Stories from WMABA facilities. BY ALANA BONILLO
Keaton’s Collision Center is one of WMABA’s newest members.
Left to right: Jessika Steinbrecher, Rick Keaton and Jake Keaton attend industry training and events. The business holds Kia, Ford and Honda/Acura certifications. Keaton’s Collision Center recently became a member of WMABA and is excited about being involved with the association. Jake looks forward to getting together with like-minded shops and building new relationships. He hopes WMABA will fight for issues the industry currently faces, such as the ongoing battle over LKQ and aftermarket parts. The addition of the Hurricane location is proof that Keaton’s Collision Center is still thriving. Jake’s goals for the future is to nurture his business’ newest location and see it strengthen the Keaton name in the community. “We’re doing well right now, especially our main location, but I’d really like to see our Hurricane shop grow.” H&D
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IF OFFERING ONLY ORIGINAL MINI PARTS IS A CRIME, THEN YEAH, WE’RE GUILTY. At your local MINI dealer, we believe that using Original MINI collision replacement parts will speed your repairs and increase your profitability. Original MINI parts assure an absolute perfect fit and function.
For Original MINI parts, contact any of these authorized MINI dealers. MINI of Annapolis 25 Old Mill Bottom Road Annapolis, MD 21409 410-349-2565 fax: 410-349-2586
Crown MINI 8710 West Broad Street Richmond, VA 23294 804-527-6860 fax: 804-965-6254
MINI of Alexandria 5990 Duke Street Alexandria, VA 22304 703-461-6250 fax: 703-751-0595
MINI of Montgomery County 820 Russell Avenue Gaithersburg, MD 20879 Parts: 240-238-1204 Parts fax: 240-238-1493
MYMINIANNAPOLIS.COM
MINIOFALEXANDRIA.COM
CROWNMINI.COM
MINIOFMONTGOMERYCOUNTY.COM
© 2018 MINI USA, a division of BMW of North America, LLC. The MINI name, model names and logo are registered trademarks.
September 2018
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KEEP IT GENUINE
INSIST ON GENUINE GM PARTS
We stand behind our product, providing collision repair professionals and vehicle owners peace-of-mind and confidence. Contact these Genuine GM Parts dealers for all your parts needs: NU CAR CHEVROLET 172 North Dupont Highway New Castle, DE 19720 Phone: 800-633-6606 Fax: 800-346-5285 e-mail: parts@nucar.com www.nucar.com
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OURISMAN CHEVROLET 4400 Branch Avenue Temple Hills, MD 20748 Phone: 301-899-6990 Fax: 301-899-9375 www.ourismanchevrolet.com
September 2018
POHANKA CHEVROLET 13915 Lee Jackson Memorial Highway Chantilly, VA 20151 Phone: 888-266-2993 Direct: 703-502-3729 Fax: 703-968-0932 www.pohankachevrolet.com
RADLEY CHEVROLET 3670 Jefferson Davis Highway Fredericksburg, VA 22408 Phone: 800-355-8202 Direct: 540-898-0055 Fax: 540-891-2074 www.radleychevrolet.com
OURISMAN CHEVROLET OF ROCKVILLE 807 Rockville Pike Rockville, MD 20852 Direct: 301-424-5332 Fax: 301-294-6381 www.rockvillechevrolet.com
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WE KNOW WHAT YOU’RE THINKING. YOU WANT TO KNOW IF THE PART’S IN STOCK , HOW MUCH IT COSTS, AND WHEN IT’S GONNA GET THERE. We get it. You want the best part for a Toyota, but you’ve got to know when and how much. Well, now you can. In addition to tools that can help you find and order the right VIN-based parts, now you can see if it’s in stock, schedule the delivery, even see your shop’s net price from your participating Toyota Dealer.* Now you’re thinking: “Cool!”
ToyotaPartsAndService.com
©2014 Toyota Motor Sales, U.S.A., Inc.
For Toyota Genuine Parts please call one of these authorized local Toyota Dealers: Antwerpen Toyota 12420 Auto Drive Clarksville, MD 21029 Phone: 410-988-9272 Fax: 443-539-4022 darnold@antwerpenauto.com
Ourisman Fairfax Toyota 10441 Lee Highway Fairfax, VA 22030 Toll Free: 800-626-2236 Direct: 703-273-2236 Fax: 703-385-8411 fairfaxparts@ourismanva.com www.ourismanva.com
Younger Toyota 1935 Dual Highway Hagerstown, MD 21740 Phone: 800-296-1190 Fax: 301-733-5465
Koons Toyota Annapolis 1107 West Street Annapolis,MD 21401 Phone:(800)262-3330 Fax:(410)280-6361
dthompson@youngertoyota.com
roy.easter@koons.com
September 2018
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COVER
STORY WALKING AWAY: How to Sell without Selling Out Collision repair is an amazing field, but we’ll all say goodbye to it eventually.
Selling your business can be a scary and confusing concept. Do you pass it along to a family member or employee, or do you sell it to an MSO or another outside entity? Can you really let go and simply hand the keys over to someone else? Above all, do you have a solid exit plan in mind that will guarantee a successful selling experience? This month, Hammer & Dolly shares stories and perspectives from those who’ve been there.
All in the Family After decades in the auto body field, former WMABA Board member Bobby Wright retired in 2012 and sold his longtime business, Burkeville Body Shop, to his stepson, Colin Sheffield. These
continued on page 34
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September 2018
Life beyond auto body. BY JOEL GAUSTEN
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Diagnostically speaking, there is no substitute. Porsche technology. Porsche Genuine Service & Parts. Contact one of these authorized dealers. Porsche Bethesda 11990 Rockville Pike North Bethesda, MD 855-683-3144 Fax 301-945-4341 bethesda.porschedealer.com
Porsche Silver Spring 3141 Automobile Boulevard Silver Spring, MD 844-413-6929 Fax 301-890-3748 silverspring.porschedealer.com
Porsche of Arlington 3154 Jefferson Davis Highway Arlington, VA 703-684-8835 Fax 703-518-0467 arlington.porschedealer.com
Š 2018 Porsche Cars North America Inc. Porsche recommends seat belt usage and observance of traffic laws at all times.
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September 2018
Euroclassics Porsche 11900 Midlothian Turnpike Midlothian, VA 804-794-3399 Fax 804-794-9771 euroclassics.porschedealer.com
Checkered Flag Porsche 2865 Virginia Beach Boulevard Virginia Beach, VA 757-687-3483 Fax 757-687-3490 checkered-flag.porschedealer.com
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For Genuine Subaru Body Parts, contact these Authorized Subaru Dealers. Wilkins Subaru 6913 Ritchie Hwy #2, Glen Burnie, MD 21061 410-689-8066 Fax: 410-689-8008 subparts@wilkinsautomotive.com www.wilkinssubaru.com
Fitzgerald Lakeforest Subaru 905 North Frederick Ave., Gaithersburg, MD 20879 Phone: 301-670-4881 Fax: 301-670-1595
September 2018
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COVER STORY
days, you can usually find Wright on his tractor out on the 76 acres of land he purchased across the road from his Blackstone, VA home. “It’s just so nice to work with your hands where you don’t have any interaction with anyone else!” he laughs. Throughout his years as an owner, Wright worked hard to grow a positive, family-oriented culture at his shop. Many of his in-house team had been with him for decades by the time he decided to move on. In his mind, this made selling to a complete stranger or a corporate entity completely out of the question. “I was afraid that if I sold to a consolidator, they’d move all the old [employees] out.” Thankfully, Sheffield was the perfect person to take over the business. He began working at the shop at the tender age of 12 and stayed there until he was 16. After graduating high school, he returned on a part-time basis before leaving again to successfully pursue a business degree with a concentration in financial planning. A year later, he decided to make the shop his professional priority. “Bobby mentored me for sure, but then he kind of stepped back and started working maybe three days a week,” he recalls. “He did that for probably about a year, and it just kind of allowed me to get my feet wet in a sense of having to deal with the day-the-day things. If something arose, he was obviously here three days a week, so it wasn’t the end of the world.” At 25, Sheffield officially became the owner of one of the area’s most revered facilities. Initially, it took some time for him to find his voice among a shop full of seasoned professionals. “I think I worried about that a lot more than I needed to. Everybody has been here for a really long time, so we’re more or less a family. They were really supportive of me and helped me along the way. They still do.” Now 30, Sheffield continues to grow as an owner – and his stepdad continues to let him run things without interference. “When you’re ready, you have to be ready to let go – and Bobby was. A lot of times, I think people struggle with giving up ownership, even after the sale. As soon as it was sold, he stepped away. In a way, that’s kind of scary; at the same time, there was no [issue with] who was in charge and making decisions.” “I’ve probably been there 15 times in four years,” adds Wright. “I don’t get involved with his business. I go around and see the old guys who worked for me and speak to them for a moment, but I’m not in his way at all.” The smooth transition was certainly helped along by Sheffield’s mother, Judi, who still works at the shop and handles bookkeeping and accounting. “My mom has a very similar personality [to mine]. We’re both hard workers and easy to get along with. We have zero conflicts. It’s tremendous
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September 2018
having her here, because she’s been here a long time. She actually does all of our accounting, so I didn’t have to worry about having someone new when I was new and that old trust issue you run into sometimes with someone who’s a bookkeeper and may not be a family member.” Having spent nearly 20 years working alongside her husband, Judi was well-versed in what her son would be dealing with as a new owner. Although she was always available to offer guidance, she allowed him to establish himself at the front of the business. “As we get older, we’re not as receptive to change,” she says. “When [the shop] became Colin’s, there were changes that he wanted to make. The first instinct was to come back to him with, ‘Why do you want to do this? It’s always worked this [other] way.’ But when [we were] just receptive, the things that he wanted to change were for the best.” With the shop still thriving, Wright has no regrets over his decision to pass along his former pride and joy to the next generation. “Everything is just moving right along – probably better than it was when I was there.”
Selling to the Big Guys The collision repair industry is full of folks who got into the business because they simply love working on automobiles. Unfortunately, the regular grind of the industry sometimes wipes people out to the point where they lose their enthusiasm for the craft. After spending years guiding his own very successful shop, one WMABA member decided that “the constant fight” simply wasn’t worth it anymore. “I was worn out by the problems we dealt with on a daily basis. To be quite honest, with the amount of energy and time that I put into my old shop, the returns weren’t what I expected to see from someone who worked as hard as I did.” For the next year, he met with a number of potential buyers before cutting a deal with a major consolidator. The shop was re-branded, and he went from being the owner to serving as the general manager. Additionally, every single member of the shop’s former staff was retained. “For now, it’s nice. We got a fantastic value on the collision center, we have a solid lease for our space, we put money in the bank and they’ve taken really good care of our people.” Throughout his years as an independent shop owner, he built an impenetrable reputation for consumer-focused business dealings and standing strong against insurer control. How has that changed now that the business is in the hands of an MSO? Despite consolidators’ reputations for following an insurer-centric philosophy, he notes that he has yet to encounter any pushback on balance billing and other practices that were commonplace at his former establishment.
“They have me running this business exactly the same as my previous business model. It’s unusual, but they did their homework and knew what my store did.” Ultimately, he believes he made the right decision to step aside and let another party steer the ship. “It’s been kind of a relief. A lot of things have been taken off my plate. I was HR, and now we have an HR department. I don’t have to figure out what we’re going to offer our employees on 401(k)s or health insurance. We were the accounts payable department; now, we have a finance department. I’ve never worked in a corporate environment like this before, and it’s kind of nice to be able to just focus on production, quality, CSI and the things I’m best at.”
Warning Signs and Sound Advice While no two collision repair shops are the same, every owner needs to gain a true understanding of their financial strengths and weaknesses long before they sell. Stuart Sorkin, a managing member of The Business and Legal Advisors, LLC in Potomac, MD and co-author of the book Expensive Mistakes When Buying & Selling Companies, advises readers to start their selling journey by getting a firm, realistic handle on the amount of assets they will need for a comfortable retirement – and then compare that amount less their other assets to the actual value of their business in order to see if the sale will generate the money required for a comfortable retirement. “If the value of your business is less than what you need to achieve a comfortable retirement, then how are you going to get there? Can you get there from internal growth? Do you need to acquire one or more shops? Have you ‘golden handcuffed’ your key employees, which will add value to your business? Are there ways we can increase utilization at the shop? I had one client who was in a more rural area, and they set up a drop-off storefront near the city so that customers wouldn’t have to go to the shop location. That increased utilization of their existing shop, which significantly improved their bottom line.” Shops that go through the process of getting their financials in order prior to a sale could also end up with some unexpected insight into the factors that drove their decision to sell in the first place. “A lot of times, owners don’t realize what they’re spending their time doing. One body shop I worked with was doing $7 million-plus and was owned by a husband and wife. The husband had already started the exit, and the wife was CFO. She was hating life; she said, ‘I’m working 80 hours a week; I don’t like this anymore.’ I said, ‘Do a time report. I want to know what you spend your time on over the next two weeks.’ When she did it, she
continued on page 42
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INDUSTRY
ADVICE
Do you have a question for Mike? Contact Hammer & Dolly Editorial Director Joel Gausten at joel@grecopublishing.com or (973) 600-9288, and we’ll ask him in a future issue.
ASK MIKE
What Should Owners Keep in Mind When Selling Their Shops?
This month, we “ASK MIKE” to discuss his experiences selling his popular businesses, Wagonwork Collision Centers, in 2010 and offer some advice for shops looking to sell in the future. We at Hammer & Dolly hope you find this following exchange useful, and we encourage you to reach out to us if you have a question for Mike on this or any industry-related matter that he can answer in a subsequent issue. Hammer & Dolly: You ran two very successful collision repair businesses in Virginia. Why did you make the decision to sell those facilities and launch your consulting business, Collision Advice?
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Mike Anderson: There were quite a few things that really contributed to my decision to sell. There were a lot of myths out there about why I sold. Some people thought that insurers blackballed me out of business and stuff like that, and that’s not true. When I decided to sell, it wasn’t like I was looking to sell; it was just that [former WMABA Board member] Chris Pohanka [Pohanka Collision Centers, later sold to Caliber] and I happened to be talking one day, and he expressed an interest. It was just the right time. Because Chris and I were friends, we were able to cut a deal pretty quickly. He intimately knew about my businesses. It was just the right time at the right place. At the time, I wasn’t married; I didn’t have any kids. I was just looking for a change in my life. Honestly, I was pretty much consulting full time before I even sold my businesses. I was only at my businesses probably three or four days a month. I had a really great staff. Probably the most important influencer was that it allowed me to secure my mom and dad’s future. I also got to spend more time with my parents, which in hindsight was a hidden blessing because my mom passed away about a year later. So it was the right decision.
H&D: What are some of the major factors people need to keep if mind in they want to implement and follow a successful exit plan? MA: When I do seminars, I tell everybody, ‘Every single thing you do from this day forward should be focused with your succession plan or end result in mind.’ You need to ask yourself about your succession plan. Number one, if you decide that you want to sell one day to an MSO or something, understand that your sell price is going to be based off a couple of things. An ‘asset sale’ is pretty much your easiest, cleanest way to sell. Make sure you know what assets you have, and keep that list up to date with depreciation with your accountant. Some people sell at a multiplier of EBITDA [earnings before interest, tax, depreciation and amortization]. A lot of body shop owners take a lot of personal perks out of their business. If I know I want to sell my business in three years, I would start minimizing some of my personal perks. You want to have a truer idea of what your net profit is, because it might be a multiplier of your net profit. At the end of the day, if I know that my business is going to be sold at a
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Selling made smarter.
multiplier, I have an accurate reporting of what my net profit is. I want to make sure I really have the financials to support my asking price. You really want to remove the personal perks and improve your bottom line. You also always want to work on increasing your gross sales. You also need to consider if you need a broker to help you sell your business. If you think you don’t want to sell for another seven to 10-15 years, you need to do everything you can to grow sales. Also, try to get as debt-free as possible. Every business owner should get with their corporate attorney and run a uniform commercial code [UCC] report, which will tell you if there are any liens on your business. It’s not uncommon for you to go buy a spray booth that has a lease or a loan. Equipment companies will sometimes put liens against your building to secure the debt. You may
have paid off a frame machine, but nobody ever got the lien removed. You may have a lien against your business that you’re not even aware of. A lot of business owners think their businesses are worth a lot more than they are. If somebody is buying your business and you haven’t upgraded your equipment in a long time and don’t have people who are ICAR Gold Class, the business might not be attractive if the buyer needs to purchase and invest in these things. Most major MSOs are not looking to buy the property, only the business. If you own the property and it’s part of your business, you need to separate that. I would recommend that [shop owners] put that into a family trust. It is also important to keep track of all of your leases and contracts. If you subscribe to ALLDATA, Mitchell Estimating or a CCC management system, then you want to see if
any of those leases are transferable. This also applies to any contracts you have with a uniform company or a trash company. When you go to sell your business and you get whatever money you do for that business, you’re going to be responsible for all of your receivables and payables. If you’re in a paint contract, you need to make sure that is transferable or if you need to pay that off. You might have received an upfront discount, commonly referred to as a ‘prebate.’ You are obligated to those terms. A lot of times, people tell me that they want to sell to a family member. There are some pros and cons to that. If you’re going to sell the business to your kids and that is going to be part of your retirement or income, understand that family members – even with the best of intentions – can run the business into the ground. You may consider gifting your children the 20 percent down payment they September 2018
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INDUSTRY ADVICE: ASK MIKE would need to have for the Small Business Administration (SBA) or a bank loan or hold the note on that part, and then get them to get a loan for the other 80 percent. You may also want to consider giving them a credit line to assist with cash flow purposes. That way, you at least have some equity and some cash out to protect you as a parent. If you’re going to hold the note for your kids, I think it’s important that you put into the agreement that they can’t spend over x amount of money without your approval. You should also put in there that you get to look at the financials every quarter so you can make sure that the kids are not getting themselves into trouble. If you’re going to sell to several of your children – like two brothers or a brother and a sister – make sure there’s some type of arbitration clause in there that says if the brother wants to do one thing and the sister wants to do something else, there is going to an arbitrator upon your death to make sure the business doesn’t get paralyzed because two siblings want to go in different directions. Most MSOs that rent the business from you are going to do a ‘triple-net lease,’ where
they’re going to be responsible for the taxes and insurance. Before you sell your business, make sure you know what the going rate is for rent for a building of your size. If you decide to sell your business and you rent your property, find out if the lease on the property is transferable. A lot of times, people want to sell their businesses to their employees. Most employees are probably never going to save enough to be able to give you the 20-percent down payment that the SBA would require. If your exit plan is to sell to some employees 10 years from now, you should maybe start giving them a bonus every year that you put into an interest-bearing account. This could go towards the down payment they will need.
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There is something called ‘golden handcuffs,’ which is an agreement you have with your employees that if you ever sell your business, those employees will stay on for at least a year afterwards. That makes your business more valuable to someone else. Let’s say you were going to sell your business for $1 million and you tell an employee, ‘If you keep working for me and managing the store for a year and promise not to leave, you’ll get $100,000.’ That makes your business more attractive to a buyer, because they won’t have employees leaving right away and they have a chance to transfer the business to their type of culture. If you think having a bunch of OEM certifications is going to make your business worth more, that doesn’t always remain true. When you sell that business, the buyer may actually have to get approval from that OEM. That OEM may not choose to renew that certification with that new buyer. If you go to sell your business, there is certain information that potential buyers are going to want to see. They’re going to want to see your tax returns, and they’re going to want to see a list of your employees, how you pay them and how long they’re been with you. Let’s say you give your employees two weeks’ vacation. If you have 20 employees and they have a week they haven’t taken yet when you sell, you have to actually give that money back to the buyer so they have it to honor those vacations. If you offer a 401(k) or a retirement plan to employees and then you sell your business, sometimes there is a cost to you as an owner to discontinue that plan. Anyone who buys your business is generally going to look for a non-compete agreement that says you won’t open up a shop or go to work for anybody within a certain timeframe – usually one to three years and within a certain mile radius. The more
information you can have prepared in advance, the quicker you’re going to get to that finish line to sell your business. It’s very emotional to sell your business. The name ‘Wagonwork’ was built by my dad. If there was one thing that I really wrestled with, it was giving up that name. You always have that concern that if you sell your business and it then gets bad online reviews, it’s still a reflection on you – not that Pohanka did that; I’m just using that as an example. It truly is an emotional decision to sell. My father and I had employees who worked for us 10, 15 years. When you sell, you can sometimes feel like you’re selling out your employees. They’re like your second family, so you’ve got to prepare yourself for that. Of course, this is not everything you need to keep in mind, but it’s a start. H&D Mike Anderson is an Accredited Automotive Manager (AAM) and the former owner of Wagonwork Collision Centers, two highly acclaimed shops located in Alexandria, VA. He has served as a member of many industry organizations throughout his career, including
the WMABA Board of Directors, the Mitchell Advisory Board, the MOTOR Advisory Board, the ASE Test Review Committee, the National Auto Body Council, the Collision Industry Conference and the Society of Collision Repair Specialists. Additionally, he is a past Virginia SkillsUSA chairman, serves as a facilitator for Axalta Coating Systems’ highly recognized Business Council 20 Groups in both the US and Canada and facilitates numerous courses for Axalta Coating Systems’ Educational Series. He currently offers expert industry consulting via his latest venture, Collision Advice (collisionadvice.com).
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COVER STORY continued from page 34
found out she was spending 25 percent of her time handing CRS [customer relations specialist] issues. I said, ‘That points to a problem. Either you’re sticking your nose in where it doesn’t belong, or you don’t have the right CRS people there.’ She brought in the right CRS person, and she started saying, ‘You know, maybe I don’t want to sell right now; I’m making so much money.’” While selling to family members can be a positive experience for many, Sorkin cautions that emotions can often cloud decision-making and prove fatal to a shop’s future growth. “If the senior generation is looking at [selling to family] as their retirement, does the next generation have all of the necessary skills to make this business successful without that senior generation? In some cases, that could mean hiring or bringing in a key employee who has equity to do that work. You may need to force the next generation to take in a partner or pay someone significant dollars to be an employee to provide the services that are needed to make the company successful.” Saying goodbye to something you’ve built isn’t easy, but these insights prove that change doesn’t need to be painful. A solid financial plan, a focus on integrity and the desire for your professional legacy to live on are among the keys to a successful exit from one of the most challenging and rewarding industries in the world. For a further discussion on this topic, read this month’s Ask Mike feature on page 38. H&D
Executive Director’s Thoughts
It is a positive experience recounted by those who took the time to plan ahead. Other owners I’ve talked to in my day-to-day who sold without a lot of foresight or felt pushed in a tight time window have seemingly more regret. Do your homework, know what you want to get out of the business and try to make it a balanced transaction. Leave the business – and your industry – better than you found it! - Jordan Hendler
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Get it right from the source.
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