The Reintroduction of the Assembly Line
David Caulfield likes looking outside of the collision repair industry for inspiration. Take Starbucks, for example. It’s a company that’s known for its coffee, but there are customers that go to Starbucks that also want to eat food. Starbucks has to take care of all of its customers, but trying to take on food would slow everything down, so Starbucks outsources its food. This got Caulfield thinking: Why not take this model and make it work for collision repair?
“Let’s say that 85 out of 100 Starbucks customers only want coffee, 15 want a sandwich or pastry to go along with their coffee,” Caulfield explains. “That’s the same for collision repair. Eighty-five jobs that come in don’t need any structural work. They don’t need welding. We can achieve a 0–3 day cycle time if we separate those jobs.”
That was the thought processes behind Fix Auto Anaheim North, a specialized collision service center and the first of its kind for Fix Auto.
Caulfield, who used to own three Fix Auto locations with his partner, Erick Bickett, sold those locations and decided to focus solely on this new way of thinking about collision repair. Caulfield has envisioned a future where the heaviest repairs—those requiring $7,000 worth of work and up—will be outsourced to specialized collision centers and that the majority of shops will service jobs that should take, at the most, three days of work, creating a sort of hub-and-spoke system.
“It doesn’t make sense to do both of these jobs under the same roof,” Caulfield says.
In February, Caulfield launched his vision with the opening of Fix Auto Anaheim North, a specialized collision center that only works on the most extensive repairs. Caulfield explained to FenderBender how he envisions this working and why the industry needs to start thinking this way.
Where did you come up with the concept?
I’ve been doing research on this for years. I looked at repair orders and starting breaking them up and finding common denominators. What I found was that for every 100 jobs, 15 needed structural and or welding and or mechanical work related to a collision. These jobs were taking 15–22 days. The other 85 jobs that required no structural, mechanical or welding, averaged about $1,600 in repairs. These jobs took 5–7 days. The other 85 jobs, those $1,600 jobs, don’t need to be here longer than three days. We can bring the production line back to the business.
I’m a huge fan of Fix Auto. I’ve been with them since 1998. They have been steadfast at getting their brand name out there, touching on innovation and encouraging shops to be the best that they can be. With Fix’s model and their reputation and relationship with insurers, we felt like we could go ahead and get this started and get people educated on the process.
How exactly does this new shop work? How is it different than a traditional facility?
Our facility only accepts jobs that require structural and/or welded panels and/or any mechanical work from the collision.
We have 13 employees, 14 if I include myself, and each one has a speciality. We have a plant manager, CFO and myself. From there, we have someone in disassembly; reassembly; mechanical, structural; cut, fit and weld; metal smithing; a painter and a painter’s helper; detailer, shop runner; and a property and equipment upkeep manager. When the vehicles come in, they’re moved through the assembly line.
Visually, how is the shop different?
When you look in, it’s like looking at an assembly line. Each employee is responsible for his or her own speciality. The facility is 20,350 square feet. We had to purchase top-notch and compliant equipment for most OEs for frame and mechanical work. We don’t have traditional stalls. The car drives in and then slides on tracks—we never turn the steering wheel. We have escape lines in case the car is delayed.
How did you hire for this shop?
In order to pick techs, we held meetings over a four-month period on the weekends. We were looking for techs that were open-minded and were looking to do something different.
The first meeting, I had one tech show up. I pitched to him for hours straight. Three people were at the next one. At the end of four months, we had 13 people. We were fortunate, we didn’t lose anyone during that time period. We told them that we were going to go ahead and abandon the key-to-key method and that they could each pick their own skillset. When we opened, we had every position filled. However, that’s the last time that we’re going to hire like that.
Everyone that was hired understands that part of his or her commitment is to bring the next generation of techs in. The next hires we make will not be generally trained like the current staff is. They’ll be specialized. Each employee will bring on an apprentice and will go through 8–12 months of training. It’s going to be like a speciality in a hospital.
This is a brand new way of approaching collision repair. How are you getting work?
We have a couple of DRPs that are sending us the heavier work. We’re working with insurers, they’re intrigued by what we’re doing. We also get walk-in customers. If we get smaller jobs, we outsource them and local stores will load level to us. We’re having a lot of shops tour the facility so they can see what we’re about.
For our first 9 weeks, we did two cars per day at average repair of $3,800. Those vehicles resulted in a cycle time of 3.8 days, on average. We think that six per day at $5,500 is realistic. Depending on the amount of damage, we should be able to see 6-8 cars per day.
What advice do you have for a fellow shop owner that’s interested in doing something like this?
My advice would be to get with someone that’s doing it and observe. An owner that has five locations within 7–10 miles of each other could take one of those locations and use it as the location that houses the 15 out of 100 jobs. That could be converted in 30–60 days. Someone that has a couple of shops, they could align themselves with someone that can take on that heavier duty work. Shops should find ways to specialize in either the 85 jobs or the 15.