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Auto Body Repair / Collision Shop 5 Ways to Increase Your Profits

Let’s face, your profit margins are consciously being squeezed. The way to combat this issue is to evolve into new products and services that are right at reach. Your collision shop is just another retail outlet; your business has much more potential than just changing a fender. The time to be nimble and creative is here. As with any retail center, the hardest part is getting the customer in the door. Once they have agreed for you to repair their vehicle, it is time to up sell them on numerous other products and services that they might desire. I have listed five ways to build your profit in this sagging economy.

·       Rentals: Do you offer any rental service? Do you have a free loner vehicle? A free loner does not make you money, it might add as a customer value item, needed to get the job, but in reality that is not necessarily your business. Well, let’s make it your business; maybe have a few vehicles that you offer for $30/day. Maybe waive that fee to loyal customers. Many insurance polices have rental coverage, maybe it is time to get a piece of that pie. Or better yet, do not have any rentals, contact all your local rental agencies and create an affiliate program with them. See who will give you the best rates for your customers and what referral they will pay. I would set it up so the rental agency can pick up your customer right at your shop, this could create better customer service, alleviate you owning and renting vehicles, and make a few dollars.

·       Value added products & services: This is where you need to think outside of the box. What kind of products can I sell this customer in need? 3M just came out with a great headlamp restoration system. You can polish the old composite headlamps to look like new, I am sure you could sell this to anyone with those fogged over yellow lamps. Seems like this could be somewhat of an easy sale. What about a vehicle polish, “exterior detail� Here is an example; Hi Mr. customer, I notice that your vehicle’s finish is looking a little dull, for $79.99 we can polish your vehicle back as close as possible to the factory finish.

·       Detail: Offer a $99.99 interior detail. Again, if it is viable and you have the space, do it in house. If it is not something you are interested in doing, start an affiliate program with a local detail company. I would contact all in the area and work something out. Have the detail company pick customer vehicle up and drop off. This way, you can collect the money from the customer at your detail rate, and pay the detail shop the rates you have worked out. I know this would be a good market, most people getting auto body repair work want they auto back in clean and as new condition as possible.

·       Suppliers: Wither it is a parts supplier or materials supplier, you need to squeeze their profit margin as well. I would contact all my suppliers on a quarterly basis and see if they can give you a deal. I am not suggesting dropping old ones and adding new, but just see what they can do. It never hurts to ask. Competition in these markets are fierce, let those forces work for you. You are the customer in this situation. Keystone is a leader in remanufactured wheels and bumpers, but there are numerous others that compete against them, just see what the comparison is. The same goes for OEM parts suppliers, they are very cut throat. Just like it is challenging to get a customer in the shop, it is as challenging for a vender to get and retain you as a customer.

·       Insurance Company Relations: Build your relationship with the insurance companies and appraisers. Wither you like it or not, insurance companies are your largest clientele. I am not suggesting any sort of “DRP†direct repair programs. I actually am a huge advocate against this sort of monopolistic rule. It is troublesome that the government allows this; these programs should be banned ASAP. Anyhow, I would work with the carriers and let them know we all have to make a living, if your walk in hourly rate is x dollars, that is what it is.

I hope that if anything, this article gets you to ponder all the revenue possibilities at hand. You own and operate a large retail center; with a little forward think you should be able to realize all the profit potential at hand. Once the customer is in your store, start selling them on all the other great products and services you offer. Affiliate programs I personally think work the best. Good luck. Please join our Auto Body Repair Industry talk at www.CrashChat.com .

About the Author

Networking and discussion for the auto body repair industry. Body shops, technicians, appraisers, estimators, adjusters, and anyone involved in the industry is welcome.

What is your opinion about me doing this?

I have been a mechanic for over 30 years and now because of some bad decisions on my part I am out of work ...I am considering opening my own shop ...in my shop tho I would be doing mechanical as well as auto body and paint ...I would like to mainly do restoration and custom work ...but I am capable of doing all kinds of repair work ...I can fabricate repair panels ...also if there is anyone who has shop that would work for me in this venture let me know what they would lease it to me for ...thank you for your opinion.

I think you should open your own shop. There seems to be a lot of work for mechanics. Stay honest and fair and you will put most of the other mechanics out of business once the word gets out about your work and it will<

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