Market conditions have changed the dynamics of our business, drastically affecting every aspect of the collision repair industry.
One of the largest impacts is to independent store owners. For them, going it alone isn’t producing the value it once had. Independent shop owners are choosing franchising as a solution and here is why.
The shift of a decrease in direct-repair performance (DRP) agreements to a rise in performance-based agreements (PBA) has only accelerated in recent years. Although it may have been a subtle shift and unknown to most independently owned facilities, performance has become more important than ever before.
In several instances, it is not enough today to just be partnered with an insurance company through a DRP. More insurance companies have moved away from referrals based on proximity-based geocoding. Now, referrals are based on performance ranking. Having the support of an operations team, access to operational playbooks, and online training can give a shop the edge it needs to enhance its performance – resources you get access to when you become a franchised facility.
The market conditions also play a massive role. You may have stellar performance metrics, but still not see business flooding in.
According to CCC Information Services, the number of auto insurance claims in the U.S. reduced by about 21 percent in 2020. This is due to less congestion on the road and an overall decline in vehicle miles driven. Our insurance partners are faced with their own sets of challenges because of this environment. They have fewer resources to manage shops. Therefore, it is simply easier for an insurer to have one point of contact with a franchisor, as opposed to 100 independent shops to manage.
Growth in Popularity
Many independent owners recognize they need to make a change to grow their business. The options are to continue as an independent, sell to a consolidator or join a franchise network.
Franchising is a popular choice for owners who don’t want to sell to a consolidator but want to make a change. Joining a franchise network allows independents the ability to still locally own and operate their shop, while also gaining access to the resources they need to grow their business.
Colleagues in Collision
When an independent body shop joins a franchised network, they instantly get access to hundreds of other owners as well as a team of corporate staff to support their shop. Fix Auto USA and its owners are renowned for the close relationships formed within the network. It’s a step up from the traditional 20 groups and has become an extended Fix Auto USA family. Owners become incredibly close with one another both professionally and personally.
“We were the first Fix Auto USA franchise, joining the network in early 2011 with our Fix Auto Pasadena location,” says Vatche Derderian, owner of Fix Auto Montrose, Fix Auto Pasadena, and Fix Auto Santa Ana. “The culture at Fix Auto USA is unlike any other, as we have transparency with our network of owners and Fix Auto USA corporate team, giving each other honest feedback and always pushing each other to become the best in the industry. Being able to call another owner if you need support, get some advice, or just see how each other’s families are doing, it’s just awesome. I got into the industry because of my father, as he opened his first body shop in 1965. Having that family-feel at my shop today while still being able to grow my business has felt like the best of both worlds.”
To ensure you do not miss your moment to join a premier collision repair franchise, contact Dennis O’Mahoney today at [email protected], to start the conversation on what it takes to join the Fix Auto USA family.
This article was sponsored by Fix Auto. For more information, please visit https://fixauto.com/us/en/.