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Beat the Consolidators with Consistency

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Mergers and acquisitions are running rampant in the world today. The Daimler-Benz/Chrysler deal was the largest industrial merger in history. Banks and telecommunication companies are merging at a record pace. In the collision repair industry, we also see consolidators buying up shops, with many smaller operations closing their doors.

Is it futile to attempt to compete against these emerging giants?

In case you haven’t noticed, these giant operations often pay a dear price for their mergers and acquisitions. First of all, they generally take on a great deal of debt to finance the transaction, which can mean that they pay their people less and lose some of their very best people. That, in turn, can lead to less-personal service, and in a personal-service business like collision repair, impersonal handling can be deadly.

If the big guys have taken over near you, there’s another thing you can do: snap up their talent.

If there’s one thing customers also value, it’s consistency. We go back to the same restaurant, the same barber or hairdresser, and the same mechanic over and over because we’ve come to know what to expect there. And when a place changes hands, we dread the changes we’ll probably encounter. The menu we enjoyed suddenly no longer has our favorite items. And the reputable mechanic we trusted has been replaced by a fast-talking, slick sales type who wants to sell us unneeded extras. The consistency that we valued has gone, and we must go in search of a new place that will service us like we’ve come to expect.

DO what you do best

Here you have the clue to how you can beat the big merger and acquisition guys: Chances are you can deliver better consistency. You’ve been there a long time. You’ve built a good client customer base because they know what to expect from you. All you have to do is make certain of two things: 1 — that you don’t change what your clients or customers value most; and 2 — that you let them know that in a world of fleeting consistency, you are still there delivering the same predictable quality.

If one of the big guys has taken over in your area recently, there is a third thing you would be wise to do: It is almost certain that some people will be leaving that company, so snap up some of its best talent — immediately! Former employees might know which major customers or referral sources might now be available for you, and it can be an opportunity for you to contact those prospective accounts to let them know there is a local alternative willing to deliver CONSISTENT quality and service.

It would be nice if business came in at a steady pace, but we all know that’s not possible. You can go along for weeks with business being slow. Then, when business does pick up, it can come all at once, overwhelming your resources. A few years ago, Entrepreneur magazine’s award for the fastest growing U.S. small business went to a clothing manufacturer in California that had grown by more than 3,000 percent! I would like to ask the owner of that business, “How did you survive it?” — because rapid growth can kill you!

Slow and Steady wins the race

Managing a rapid-growth business is much like driving a high-speed racecar. At high speeds, consistent control is vital for survival — there can be no hesitation or indecision. When you’re rushing full-speed ahead, control must be firm, confident and, above all, consistent.

So, if it’s at all possible, a shop owner seeking business growth should aim for a gradual, consistent climb, rather than the proverbial great leap forward. We have seen big consolidators spend massive amounts of capital to immediately spark higher production and return. But many have also consumed that capital quickly and then dropped to a point even below where they started.

A while back, Insight magazine ran a comprehensive article on consolidators, concluding that “money is not what makes a consolidator strong. It is simply good, sound business practices and a really strong desire to succeed.” If that’s what it takes, it is within your power to increase those key factors at little or no cost. If you project a consistent message of professionalism and credibility, and also have front-line people who consistently treat people with warmth, respect and professionalism, you will have little trouble beating your competition, regardless of its size.

Tom Franklin, author of Strategies for Greater Body Shop Growth, has been a sales and marketing consultant for more than 40 years.

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