“Without KPIs, you're flying blind. And eventually you will smack a mountain.”
That’s how strongly one contributor to the 2017 FenderBender KPI Survey feels about the importance of key performance indicators (KPIs) to his or her business.
And, for the fifth straight year, the annual survey results found by FenderBender confirms that shop operator’s opinion: Those that track tend to perform at a much higher level; those that don’t, may hit a wall. Top industry performers have indicated in story after story that KPIs provide tangible, measureable views of their businesses.
Roughly 200 shop operators responded to the 2017 FenderBender KPI Survey, creating a diverse, national pool of collision repair professionals that represent all segments of the industry and provide a unique snapshot of overall industry performance. And while no two shops in this survey are the same, there are important trends to note as you and your industry move forward.
The Typical Shop
Just over 200 industry professionals completed the KPI Survey, and, while they were evenly dispersed across all U.S. markets, the majority of respondents followed a distinct demographic pattern that also closely aligns with our overall readership.
The Average Shop
Business Type |
Independent, single-location repair business |
64% |
Region |
Midwest |
40% |
Shop Size |
5,000-9,999 square feet |
29% |
Staff Size |
11+ |
42% |
Annual Revenue |
$1-$2.49 million |
26% |
Average Key-to-Key Cycle Time |
5-7 days |
45% |
Average Touch Time |
4-5 hours |
44% |
Average Repair Order |
$2,000-$2,999 |
50% |
Overall Gross Profit Margin |
40-49% |
34% |
Overall Net Profit Margin |
11-15% |
32% |
The KPI Tracking Mentality
A look inside why some operators stress the importance of KPIs, while others choose to stray.
Overall Tracking Rates on the Rise
Dating back to the 2013 FenderBender KPI Survey, adoption of regular KPI tracking did not exceed the 70 percent mark—until 2017, that is. At 73% this year, 2017 not only represents a 6% improvement over 2016, but also marks the highest total in the five years this survey has been conducted.
Tracking Percentages Year by Year
- 2017: 73%
- 2016: 67%
- 2015: 66%
- 2014: 68%
- 2013: 70%
The Mentality
While KPI tracking rates are up overall, the reasons behind why business owners track or don’t track KPIs has remained consistent: The active shops can’t imagine improving daily operations without their measurements; and 27 percent cite a lack of time, manpower, knowledge or resources to effectively manage their businesses by these numbers.
Why 73% Track
Question:
What is the significance of KPI measurement in today's collision repair industry, and what impact has it had on your business?
Answers:
- “In a production shop KPI is everything. If you're not doing it, you're not reaching your shop’s true potential.”
- “These numbers allow us to drill down within a category that we may be performing well in and tweak it even further.”
- “We track our stats and other metrics so as to make course corrections quickly to ensure processes are as efficient and as effective as possible.”
- “Insurance companies are using KPIs to determine which shops are performing better than others and choosing based on those numbers.”
- “It also helps keep estimators and technicians/painters grounded and focused on impacts to the repair facility.”
——————
Why 27% Don’t Track
Question:
Why don’t you regularly track KPIs?
Answer:
- “A management and tracking system is not currently employed.”
- “I don’t fully understand it and know how to.”
- “Not enough time in the day.”
- “As a small shop we spend our time optimizing our customer experience and high quality repairs.”
- “Haven't needed to. If it’s not broken, don't fix it.”
- “I don't have enough manpower in our office.”
KPI Tracking Trends
A look at the trends affecting business owners’ willingness to track KPIs and how they’ve changed over 2016.
Independents Gain Steam
While independent, single-location repair businesses have lagged behind their competitors significantly in their willingness to track KPIs, our 2017 results may indicate a new trend. Rates rose above 60 percent for the first time since 2013, and 2017 saw a 7% hike over 2016. This largely contributed to the overall rise in KPI tracking.
KPI Tracking by Business
2016 |
Business Type |
2017 |
| 64% |
Independent, single location |
57% |
| 93% |
MSO |
94% |
| 79% |
Dealer-owned |
88% |
| 100% |
Franchise |
100% |
Smaller Shops Gaining Ground
While the past four years have shown that the larger a repair business is—in terms of staff size and total sales—the more likely it is to track KPIs, 2017 found that shops with six or less employees and annual sales below $1 million are nearing the rates of larger shops.
Staff Size
2016
Number of Employees
2017
1-2
Annual Sales
2016 |
Annual Revenue |
2017 |
| 23% | Under $250K | 50% |
| 36% | $250K–$499K | 56% |
| 64% | $500K–$749K | 72% |
| 53% |
$750K–$999K |
62% |
| 78% | $1M–$2.49M | 77% |
| 88% | $2.5–$4.9M | 79% |
| 89% | $5M+ | 87% |
Non-DRP Shops Close the Gap
While the FenderBender KPI Survey results continue to show that shops reliant on DRP relationships are more likely to track KPIs, this year saw non-DRP shops closing the gap.
2016
Percentage of Work
from DRP Agreements
2017
Only 35% of shops with 0 DRP partners tracked KPIs in 2016, that rate rose to 66% in 2017, contributing greatly to the overall rise in KPI tracking.
2016 |
Number ofDRP Partners |
2017 |
| 35% | 0 | 66% |
| 75% | 1-3 | 71% |
| 86% | 4-6 | 75% |
| 84% | 7-9 | 100% |
| 91% | 10 | 85% |
Individual KPIs Still Lagging
While overall tracking rates are on the rise, 2017 marked yet another year where operators tend to show some KPIs more love than others. While cycle time, average repair order and gross profit margins are tracked regularly across the board, productivity and efficiency tracking rates hover around 85% and 70%, respectively.
What is Being Tracked?
- Average Repair Order: 97%
- Job-Start-to-Job-Completion Cycle Time: 96%
- Key-to-Key Cycle Time: 95%
- Gross Profit Margin on Parts Sales: 94%
- Touch Time: 93%
- Gross Profit Margin on Materials Sales: 92%
- Overall Gross Profit Margin: 91%
- Gross Profit Margin on Labor Sales: 89%
- CSI: 88%
- Net Promoter Score: 87%
- Estimate Closing Ratio: 87%
- Technician Efficiency: 85%
- Technician Productivity: 70%
The Big Picture
The 2017 survey looked at 14 metrics many identified as being critical to business success, and several of them stood out—in both good and bad ways.
Better Touch Time = Better Cycle Time
As noted by the president of Autobody Management Solutions, Rich Altieri, in the January issue of FenderBender, the industry has long focused on cycle time, which, as he says, “is too dependent on vehicle mix and crash severity.” Touch time, however, represents the number of hours per day technicians are physically touching a car. When waste is eliminated and touch time improves, he says cycle time does as well. And the 2017 FenderBender KPI Survey data backs up that claim.
Touch Time vs. Cycle Time
Touch Time |
Key-to-Key Cycle Time Under 8 Days |
Key-to-Key Cycle Time Over 8 Days |
| 2-3 hours | 48% | 52% |
| 4-5 hours | 82% | 18% |
| 6-7 hours | 88% | 12% |
——————
NPS Awareness Grows
Unlike traditional CSI scores, the net promoter scores (NPS) measures how likely a customer is to refer a business. Understanding how to determine and maximize your NPS can help any shop improve its customer service experience and overall sales. Yet, for the fifth straight year of FenderBender’s KPI surveys, shop operators are much more likely to track CSI over NPS. However, 2017 saw a 5% uptick over 2016 in participants tracking NPS, which coincided with 41% of shops eclipsing the $2.5 million mark, compared to just 26% of shops accomplishing that last year.
Annual Revenue vs. NPS Score
Annual Revenue |
NPS Score Over 90% |
| Under $250K | 57% |
| $250K–$499K | 50% |
| $500K–$749K | 65% |
| $750K–$1M | 82% |
| $1M–$2.49M | 77% |
| $2.5M–$4.99M | 82% |
——————
Supplement Ratios on the Rise
This is the second year that the FenderBender KPI Survey has tracked supplement ratio, and we’ve seen a massive increase in the percentage. While just 44% of shops saw a supplement ratio above 16% in 2016, that number rose to 56% this year. To no surprise, shops with lower supplement ratios had drastically better cycle times than those with high supplement ratios.
Supplement Ratio vs. Cycle Time
Supplement Ratio
Key-to-Key Cycle Time Over 8 Days
——————
Less Emphasis on Gross Profits
While the percentage of shops tracking gross profits has remained steadily high in each of the previous four surveys, the 2017 survey saw percentage of shops failing to track gross profits essentially double. In particular, the percentage of shops failing to track gross profits on labor sales rose 6% over 2016. This overall trend may have coincided with dwindling net profit margins—while 85% of shops had a net profit margin over 6% last year, only 78% hit that mark this year.
Percentage Tracking vs. Not Tracking Gross Profits
Gross Profit Category |
Percentage Not Tracking in 2016 |
Percentage Not Tracking in 2017 |
| Overall Gross Profit Margin | 4% | 9% |
| Gross Profit Margin on Materials Sales | 4% | 8% |
| Gross Profit Margin on Parts Sales | 5% | 6% |
| Gross Profit Margin on Labor Sales | 5% | 11% |
Technician Stats
While technician efficiency and productivity were among the least-tracked KPIs in our survey, our data demonstrated the importance of each metric. In short: The individual performance of techs is critical to the success of your business.
Average Technician Efficiency
| 99% or lower | 8% |
| 100–119% | 16% |
| 120–139% | 23% |
| 140–159% | 25% |
| 160%+ | 13% |
| I don't track technician efficiency. | 15% |
Average Technician Productivity
| 79% or lower | 4% |
| 80-89% | 11% |
| 90-99% | 8% |
| 100-109% | 24% |
| 110%+ | 23% |
| I don't track technician productivity. | 30% |
How They’re Equipped
Type of Paint Sprayed
| Waterborne | 50% |
| Solvent-based | 42% |
| Both waterborne and solvent-based | 8% |
| None | 0% |
Utilizes Electronic Management System
- Yes: 65%
- No: 35%
GET THE COMPLETE RESULTS
To purchase the complete survey results, visit fenderbender.com/2017KPIsurvey
