Growing a Dealership Shop
If dealership shops are supposed to be on the downswing, no one told Scott Knose, manager of the collision center at Ken Barrett Chevrolet Cadillac in Batavia, N.Y.
Bucking the decades-long trend of nationwide closures and consolidation that has plagued the dealership segment of the industry, Knose has achieved incredible success, building revenue from $300,000 to $2.5 million since 1996. The shop is just completing an addition that will increase it from 7,500 square feet to 16,300 square feet. Knose expects the extra capacity and efficient layout to make the facility a $4 million operation within the next five years.
“If we were maximizing the shop, we could probably do $500,000 a month,” Knose boasts. “The flow through this place is going to be ridiculous.”
But what’s not ridiculous, Knose says, is how his shop got to this point. He’s maintained laser-like focus in three key areas:
• touting that the shop fixes more than the makes in its name,
• eliminating waste and improving efficiency wherever possible, and
• making sure his staff works for the greater good of the company rather than individual gain.
“We’ve done a ton of stuff that is just basic, common sense stuff,” Knose says. “We just did it and made it happen.”
In a town of about 17,000 people, he estimates the shop does about 50 percent of all the business within a 10-mile radius. And it’s not stopping there.
“I want it all,” Knose says. “Which is slowly happening.”
Beyond the Brand
When Knose started at the shop as a body tech in 1992, repairing Chevys, Cadillacs and Oldsmobiles (the latter make used to be part of the shop’s name) was pretty much all the facility did.
Knose thought the shop could be doing a lot more than that, so his first order of business after rising to manager four years later was to reach out to insurance partners to explain the shop’s capabilities.
—Scott Knose, collision center manager,
Ken Barrett Chevrolet Cadillac
“I went around with the agents right away and explained that we’re a repair facility with trained techs, and I asked why they only sent us Chevys,” Knose says. “They never really thought about it. I said if it’s got tires on it, we’ll fix it.”
Soon after those conversations, the shop’s handful of DRPs started referring customers with all types of vehicles to the shop. And after proving that it could perform quality repairs on any make and model, more insurance companies wanted to get involved with the business, Knose says. The shop also started hosting continuing education courses for insurers, which further boosted relationships.
Today, the shop has about a dozen DRP partners, which Knose says is just about every insurer in the area. Those partners are the main reason for the roughly 120 vehicles the shop repairs each month.
“We’ve pretty much got it locked up now,” he says.
As more vehicles started rolling into the shop, making sure staff could get repairs done on time was a top priority, especially as cycle time grew more important to insurers. So Knose, who had learned about lean processes through involvement in 20 Groups, tours of other facilities and educational courses, decided it was time to make things more efficient.
The shop eliminated all of its workbenches and added tool carts, invested in new equipment including a modern downdraft paint booth, started meticulously mapping out each repair in advance and performing complete teardowns. Detailers also started giving vehicles a full wash before the teardown process, so no damaged parts were missed. Over time, supplements have virtually disappeared and the average touch time has increased from about two hours to almost six hours, Knose says.
The shop also hosts all-staff meetings every morning to go over the stage of each repair, due dates, what’s coming in and in what order. That way, everyone is on the same page and there’s never any confusion about where a car is supposed to be.
Even during construction of the new addition, when shop space shrunk to about 4,500 square feet, the shop actually improved its output because everyone works so well together, Knose says.
“These guys are actually pulling harder than I can produce right now,” he says. “They want to see how fast they can go.”
The new addition will make things even faster, especially in the paint department, he says. Two new waterborne booths will be set up next to ample prep space that will allow seven vehicles to be lined up in the paint department at once. And when the cars are done, they can move straight to reassembly without returning through the metal department as they used to.
“We’re going through a huge change, and all of these guys are really excited,” Knose says.
A Team System
Another big contributor to the shop’s efficiency is the way its technicians function as a team.
Back in June 2010, the efficiencies of each technician were measured as part of the development of a new team pay plan. Knose modeled the plan after one developed by an operator in his Sherwin-Williams A-Plus Network group. Now rather than working individually, his shop’s four technicians work together on jobs and are paid based on their efficiencies, which are regularly updated in the shop’s CCC ONE management system.
Knose and his techs were a little nervous about the new structure at first, but after thoroughly evaluating how the plan worked at other facilities and how it could improve workflow, everyone jumped on board.
“It was a necessity,” lead technician Devin Bacon says about the team structure. “We were at capacity. We had some pretty ambitious goals and were looking for ways to become more efficient and leaner.”
Bacon assigns his fellow techs their tasks for the day, and he likes how well the new system works. So does Knose.
“Instead of each individual guy working on their own car in their space, they’re working as a team and are able to get more cars in,” Knose says. “They’re not worried about ‘me, myself and I.’ The only goal is to get cars done.”
Ken Barrett, owner of Ken Barrett Chevrolet Cadillac for the past 17 years, says the collision center is a significant contributor to the business, and he’s quick to invest in initiatives to help it improve.
“One of the competitive fronts that we face in the collision business is a competition on investment,” Barrett says. “With the advent of waterborne, the level of service insurance companies demand in terms of cycle time and customer care, we have to have the investment in people and processes.”
Part of the reason for expanding the collision center, Barrett says, was to keep competitors out. As Knose noted, the shop is on a mission to be the go-to repair center in Batavia, which is sandwiched between the larger cities of Rochester and Buffalo.
“[Knose] does an outstanding job,” Barrett says. He’s worked very hard to help his staff grow, and to grow personally.”