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Q&A on CARSTAR Growth

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CARSTAR recently celebrated 30 years in business and now that the company has reached this milestone, only plans to grow more.

Since the news of the Caliber Collision Centers and ABRA Auto Body Repair of America merger was announced on Dec. 5, 2018, an industry’s landscape has changed.

Recently, the president of CARSTAR North America, Michael Macaluso, in a FenderBender article touched on how that merger has affected CARSTAR.

“Something like this is big news that does require a lot of focus and attention,” Macaluso, who oversees a company with 325 U.S. locations in its own right, told FenderBender. “It doesn’t change our plans. It could potentially accelerate those plans. We would love to continue to build our scale quicker.

“These types of changes within the competitive landscape may force individuals to think about their future in a different way.”  

In 2019, CARSTAR plans to open 120 collision repair locations and is on track to reach 1,000 locations by 2022.

Since the company’s infancy, CARSTAR has been involved in charity organizations that have helped it grow. Beginning in Canada, CARSTAR began its work with cystic fibrosis research, when a franchisee partner’s grandchild was diagnosed. This initiative has expanded to North America.

FenderBender sat down with Dean Fisher, chief operating officer, CARSTAR, and dived into how the company plans to grow and how factors like charity and operational structures affect that growth.

 

What can shops expect to see in 2019?

CARSTAR’s growth will come through four key initiatives—additional locations from current CARSTAR franchise partners, small MSOs joining the CARSTAR network, the independent shop owner, and expansion in automotive dealership body shops. Most of this growth will occur in the U.S.

CARSTAR is continuing to grow its performance-based agreement (PBA) relationships with the top carriers. As the carriers streamline their business model, the MSOs are required to self-manage their programs. CARSTAR’s brand model aids in this consolidation and provides scale to insurers. This makes desk review, KPI metric tracking, operational management, and customized reporting critical. Companies like CARSTAR have the scale and insurance expertise to deliver this.

It is focused on key markets where it can build scale, underserved markets where it can meet the needs of an insurance partner, and new markets, like Minnesota, where it is now seeking franchisees.

 

How do you get employees to buy into the charity work?

It starts with corporate leadership on down. The corporate team members are hands-on working at cystic fibrosis events and this inspires the franchise partners and their employees to do the same. CARSTAR franchise owners have a vested interest in their communities, and as independent owners, have a wonderful culture of giving back.

 

Will there be any major operations restructuring in 2019?

CARSTAR moved its structure in 2018 to a zone structure for operations, marketing and insurance that is performing well for all parties. We’ll continue to structure ourselves to intake 100 plus stores per year, an maintain the integrity of our business model.

 

What should shop owners know going into the new year?

Technology, training and certifications will be key going forward. With ever-changing vehicle design, safety systems and advanced materials, repair professionals are tasked with a tremendous learning curve.  Shop owners must be dedicated to ensuring their repair professionals have the training and certification to work on these vehicles.

CARSTAR offers the proprietary CARSTAR EDGE Performance Platform and the revamped CARSTAR University to help franchise partners and their team members efficiently and affordably get the training they need. Our focus will on the industry needs to merge OE repair modeling with insurance needs that deliver a safe quality repair to our joint customer base.

 

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