Resolutions Plus Change

Well, it is a New Year, and change has become so much a part of the Collision Repair Industry landscape that we have all come to expect it. Get used to it - the Collision Repair Market has shrunk and we expect it to stay at about this level for this coming year and beyond! We do not expect to see it back to what it once was, even if we have a spectacularly long winter.

The New Year, however, will provide opportunities for collision repair facilities to prosper with these New Year's resolutions:

• Develop good relationships (with all segments)
• Institute a good marketing plan
• Implement efficient operations in the shop and in the office
• Account for every penny and every minute
• Grow a good team (or teams) of technicians
• Produce quality repairs quickly and consistently.

The number of collision repair facilities nationwide is estimated at just under 50,000. As anticipated, 2003 was a year that shook loose many (about 3,000) small to mid-size shops that had been barely making it in an economy that has been bumpy since late 2001.

Anecdotal explanations abound that may have had some impact on the collision repair market. Many shop owners have observed that people curtailed road trips in the wake of the September 11 attack, and in the slower economy. Air travel certainly took a bigger hit, but statistically, automobile travel was only slightly lower.

I heard at NACE, from a few insurer and shop owner speakers: "Severity is what it is" and "The primary goal of any repair is a quality repair for the customer's safety." Wise words!

I think that software is finally getting to a place where shops and insurers can both expect a fair estimate for work that needs to be done and that ultimately both sides will make a reasonable profit. A fairy tale or is this the very near future business reality?

This is not to say that all controversy about estimates will disappear. Insurers will continue to tighten their belts and scrutinize shop billings. On the other hand, shops, to protect themselves legally, must list everything - no more, no less - on a consumer's invoice. They also must be sure to talk with insurers and estimating system providers if procedures and times in estimating software are not accurate in the real world of 2004.