Adding new collision repair shop revenues

Oct. 1, 2020
Shop owner pencils out how to turn a $3,000 customer into a $10,000 customer.

In two recent columns, I shared what I’ve seen Baker’s Collision Repair in Mansfield, Ohio, do over the years to build a team and a culture that fosters innovation. That’s been the basis for the company’s ability to accomplish what I see as a primary key to success in this industry right now: developing new revenue sources. 

So I recently asked DeLee Powell, the second-generation owner of Baker’s and someone I’ve known close to 20 years, how and why she’s found added ways for the business to bring in revenue. Strangely enough, DeLee said some of it started years ago when she was donating blood to the Red Cross. 

“I remember that moment like it was yesterday,” DeLee told me. “The guy from the Red Cross is chit-chatting with me, probably to distract me from the fact that he’s about to stick a needle in my arm. I had my Baker’s shirt on, and he said, ‘I had my car fixed at your place. I kind of forgot about that. I just recently had another accident, and the insurance company told me to take it to [another shop’s name], so I did.” 

DeLee said that probably sent her blood pressure up during that donation. She talked with the Red Cross worker more and found everything had gone fine when her shop had repaired his vehicle. 

“We did nothing wrong. It was just that statistic of a person only having an accident every seven years,” DeLee said. “It’s really hard to have a relationship with a customer you see only every seven years. In this case, he had an opportunity to forget that he had a good experience with us. I decided right then that I need to do the best that I can to make sure that never happens again.” 
Her first tactic: Adding mechanical services to the shop’s offerings. The numbers made sense to her. 

“I knew that statistically people get their cars fixed at a body shop every seven years, and the average RO was, say, $3,000,” she said. “Once a car hits three years old, statistically the consumer spends $1,000 a year on that car. So for every vehicle we do the body work and the mechanical service work on, we just changed that customer from $3,000 every seven years, to $10,000 every seven years.” 

Beyond that, she said, interacting with the customer more regularly cultivates a relationship. 

“So they come back to us, no matter what,” she said. 

Back then, Baker’s had a part-time employee doing all of its wheel alignments. DeLee brought him on full-time, and he started also doing the air conditioning and suspension work the shop’s body technicians had been doing. 

“At the time, we had more body work than we could do anyway,” she said. 

She started promoting the mechanical work, and having her team look for opportunities to sell collision customers on mechanical work their vehicles needed. Every car that comes in for collision repair gets a courtesy safety inspection of the tires, brakes, etc. Today, Baker’s now has four mechanics, along with a service advisor and a manager overseeing that department. 

“It’s challenging. I won’t say it’s an easy thing,” DeLee said. “For one thing, it did affect our cycle time. If we figure out a car needs brakes or tires, the customer often doesn’t want to pick it up until all of that’s done. So it’s negatively affected our cycle time somewhat, but not enough that we’ve been thrown off any programs. Our challenge is to try to get all of the mechanical work done in the same amount of time we could get just the body work done.” 

She said offering mechanical work has successfully helped the shop build stronger ties to customers, who over time are learning that no matter what they need on their car, they can come to Baker’s. 

“We have so much more top-of-mind awareness than we had when we just did collision repair,” DeLee said. 

In my upcoming final column about DeLee and Baker’s, I explain the other new revenue sources the company has developed, which are helping them weather the current economic situation. 

About the Author

Steven Feltovich

Steve Feltovich of SJF Business Consulting, LLC, works with dealers, MSOs and independent collision repair businesses to make lasting improvements and achieve performance goals. He has more than three decades of automotive industry experience, including 17 years with Sherwin-Williams Automotive Finishes. Connect with Feltovich on LinkedIn. 

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