COVER STORY
NJ Shops S With more than 1,100 locations across the US, Caliber Collision is a business on the move. Although its chief competitors in the consolidator market – Gerber and Service King – have yet to make their presence known in the Garden State, there were 26 Caliber locations in New Jersey as of June 2021. (New York had 27 locations, while there were still no signs of the company in either Massachusetts or Connecticut.) Although Caliber’s presence in the Northeast is still small when compared to its more established markets (including 250-plus facilities in California, for example), the fact that the company is even here to begin with warrants attention – and perhaps some trepidation – from DRP shops and independent facilities alike. Throughout its history, Caliber has been clear about its interest in growing relationships with insurance companies. Back in the late ’90s, it brought in Bill Lawrence – who made his name building DRPs for Allstate – as its senior vice president/ chief operating officer. The company has carried on this tradition under the leadership of its current executive chairman, Steve Grimshaw. “Insurance companies are pushing more and more volume to large operations like Caliber, because they can offer betterquality service overall,” Tim Patterson, a member of Caliber’s Board of Directors, said in a 2017 story in D Magazine. “They have the IT infrastructure and can provide faster turnaround times for repairs. That’s a big deal, because of the rental-car expense [to the insurance carrier]. Large operations also have higher customer satisfaction ratings, making for a win-win-win all around.” With the dust finally settling on COVID-19 and more drivers 32 | New Jersey Automotive | July 2021
hitting the roads, New Jersey shops that include DRPs in their business model are beginning to feel the effects of having a Caliber location nearby. One AASP/NJ member shop owner tells New Jersey Automotive that he lost a good 30 percent of his combined DRP work to Caliber in May and June alone. “It really feels like they’re out to squeeze the shops in a market that are doing well,” he says. “Insurance companies don’t think like body shops; they think like one big calculator.” Faced with such a deep decline in volume, he is looking to his various high-end OEM certifications as a way to push back against the trend and maintain his standing in his market. “How are you going to compete? You need to make yourself special. When we got a sense that Caliber was really coming into this area, we buckled down and put ourselves through extensive training, building modifications and a complete upgrade in equipment to get certified. I would imagine it helps my Direct Repair relationships because I’m certified for numerous vehicles.” Fortunately, this AASP/NJ member has been able to weather the 30 percent reduction in work thanks to “trimming the fat” and downsizing his crew at the height of the pandemic. “I did a lot of things based on the numbers I saw during COVID-19, and I haven’t reinstated the previous size of my staff. I realized it wasn’t necessary. Half of what I expect to lose this year with the loss of DRP work had previously been given away in overtime anyway. I like the small backlog I have now. It was too deep before; I was letting people down. We were having problems with our cycle time because we weren’t getting the cars out fast enough. Anybody who gets inundated with work gets in trouble eventually; you can’t keep up the pace.”
