Thriving as an Independent
Kevin Rowe says that despite being in the collision industry for over two decades, he’s not a “car guy.” It’s not that the auto industry veteran isn’t in tune with his craft. He’s learned a thing or two since a body shop manager took a chance on him 22 years ago by hiring the then retail manager as an estimator.
“I thought, ‘I know people, I know how to run a business, I just have to learn cars,’” Rowe remembers. “I had a wonderful manager who worked with me to teach me auto body repair. So basically, I’m not a car guy at all—I’m a people guy.”
It’s that “people guy” attitude that has allowed him to flourish in the industry, Rowe says. For the past 15 years he’s owned I-17 Collision Repair in Phoenix, a company he brought back to life when it was on the brink of extinction.
“It was not a lot of volume at the time,” he said. “Thankfully, it worked out the right way ... with a lot of hard work and a lot of prayer.”
Today, his 9,500-square-foot, 13-bay shop cycles roughly 200 vehicles every month. Rowe expects to see $2.6 million in revenue this year, an all-time high. But the industry has changed dramatically in the past 15 years and the strategies that worked to bring his shop back to life are not the same as the ones that keep it breathing today.
Consolidation across the country is a major factor in the evolution of the collision repair industry. Many MSOs have resources single shop owners don’t have easy access to, including the added cash flow, larger employee pool, internal advertising and marketing departments, and technology that helps to streamline many aspects of the business.
But, as Rowe proves, single-shop owners can still compete.
“For me it’s about being at the top of the pile regardless of who is next to me,” he said, noting the closest MSO is five miles from his shop. “You have to be able to shine in the basic performance standards that insurance companies want you to have.”
The most important pieces, Rowe says, include tireless tracking of key performance indicators (KPI’s), innovative value-added services, and a robust marketing plan.
Key Performance Indicators
For the first five years he owned I-17, Rowe didn’t think much about keeping track of things like cycle time and aftermarket parts usage. But before long, he realized he had little choice in the matter anymore, if he wanted to stay competitive.
“I realized the need from the market and those insurance partners to have those standards for performance,” he remembered. “KPIs are the benchmark. When the industry started changing and started focusing more and more on the key performance indicators, I realized you have to go in tow.”
Today, Rowe and his team spend a couple hours every day tracking almost every statistic in the industry: cycle time, touch time, aftermarket parts usage, severity, average repair order, customer satisfaction index, net promoter scores, technician efficiency and productivity, among others.
While each person or insurance partner has a slightly different focus, the most requested number from insurance partners tends to be his cycle time.
He’s invested in technology that has helped to make the process more efficient, where he can track everything from the moment a car comes into the shop to after it leaves. The time and technology investments pay for themselves, he says.
While KPIs are where it all starts, it’s far from the finish line in terms of standing out to customers and insurance partners.
“Even with so much good information on my end as far as all the records we keep, all the KPIs and performance standards that we have, it’s still harder to get the insurance company’s ear than it was before,” he says.
It’s really what Rowe calls “value-added services” that help close the gap between him and his larger competitors just as much as tracking.
The term “value-added service” is an intangible for Rowe’s business, because it refers to any additional service he can provide for a customer to make their lives a little easier—even ones he hasn’t thought of yet.
At I-17, a value-added service can mean mobile estimating, providing one of the two loaner cars the shop has, coordinating rentals with insurance companies, vehicle pickup and delivery, and anything in between. Thanks to those services, Rowe has had customers who have never set foot in his shop, which he sees as a major strength for his business.
Rowe says he’s flexible in adding new services as needs arise, and that part of his business is growing quickly. His ability to adapt quickly and willingness to go the extra mile are what help him stand out from many MSOs, he says.
“In dealing with an owner who is invested, we know the value of every customer. One customer can really be a great thing as far a referral source, or if you don’t treat them right, it can be a really negative thing,” Rowe said. “I know what I am up against in the marketplace and it is inherent for me to just treat people right.”
Having an invested owner onsite isn’t only valuable for providing innovative services for customers, but it’s a powerful marketing and business-to-business relationship-building tool, Rowe says.
Even in a digital world, there’s a place for face-to-face marketing, and there is no better face for a company than the owner.
“When I go out to do my marketing, I go out personally,” Rowe said. “I am not sending out a marketing person to go out and pass out donuts. I meet business owners; I follow up on my current accounts.”
Personal, face-to-face interaction goes a long way for building relationships with complementary businesses like local auto repair shops, insurance brokers and lawyers, who can refer customers to I-17, Rowe says.
“I think the biggest impact that I have had is just out in the marketplace with mechanical shop owners,” he said. “Everybody has a mechanic. By the time people need a body shop they call their mechanic to get a referral.”
But while Rowe recognizes the value he can add to his business simply by personally pounding the pavement, he also says his online presence and customer reviews have gained him just as much business, if not more.
I-17 has a functioning website that is always kept up to date. Rowe admits it’s hard to keep up with an MSO’s higher-budget sites. He is also in the process of making his website compatible with mobile devices like tablets and smart phones.
—Kevin Rowe, owner, I-17 Collision Repair
Rowe also says asking customers to post comments on review sites is a surprisingly easy but effective way to increase online search engine optimization (SEO) and encourage new customers to try out his shop.
A 2013 study by BrightLocal, an SEO tool provider, said most consumers search online for local products or services two or more times a year, and more than 70 percent of study respondents said they trusted a company more based on positive online reviews.
Rowe has seen online reviews work for him, and the more he gets—especially on local review sites—the more new faces he sees. Sites like Yelp also allow customers to post reviews that have a high likelihood of being found in a Google search online.
“When we deliver a car and we give them a warranty pack and their receipt, we ask people to post a review for us, and a lot of people do. We are really intentional about asking for reviews. If you don’t ask, most people won’t do it,” Rowe said.
Often, when a customer posts a review, I-17 will even send a thank-you gift, like a movie ticket, to customers for taking the time to log online and contribute a comment to a review site.
“That’s one of those little marketing things that people like, and another thing that shop owners need to do,” Rowe says. “Just thinking outside the box about how to get customers to post reviews.”
“And, hopefully, they are good reviews,” he adds with a laugh.