CRACKING the CUSTOM market

"You have to do it for the love of it," says Frohlich, owner of ARA Automotive, a 15,000-square-foot collision repair business in Pittsburgh, Pa., that almost always has one or more custom vehicle or restoration projects under way. "Is there money in it? You can make money as long as you know what your expenses are. But you have to have fun. Because if you have fun doing the project, the profits will follow."

"Customers are willing to pay what they weren't willing to pay for custom work some years ago, and smart collision shops are starting to see that," says Randy Cremeans, collision segment manager for PPG Automotive Refinish, which offers the Vibrance Collection line of custom colors and special effect finishes. "More shops are realizing, 'Yeah, bring those cars in because we know we can make some money on them.' "

So what does it take to crack into the custom market? And what's required to make it a profitable venture? Here's a look at some of the opportunities and possible pitfalls for collision repairers interested in moving into vehicle restoration and customizing.

Driving the trend

As someone who grew up in the collision repair business, Cremeans remembers when most shops would have at least one or two custom or restoration jobs regularly in the shop.

Like Cremeans, Brent Wallace said he believes that's changing. Cable television, he said, is among the key drivers of the upsurge in public interest in — and willingness to pay more for — restored and custom vehicles.

"Several channels, from MTV to the Speed Channel, have been producing car customization shows," says Wallace, manager of brand marketing for BASF's R-M Carizzma line of custom paint products, which have been used on TV's Overhaulin'. "This has fueled a resurgence in all age groups toward personalization of automobiles."

"The more vehicles there are on the roads, and the more and more cars look alike, the more people want to individualize their own cars," agrees Skip Chance, director of specialty coatings for Valspar Automotive Finishes, which offers the House of Kolor line of custom refinishing products. "I think, too, the economy has been very good and people have money to spend on their toys. We see people custom painting their boats, then painting the trailer to match the boat, and then painting their truck to match the boat and trailer."

Cremeans points to the rising sales prices of vehicles at such events as Barrett-Jackson auctions.

"Years ago, someone wouldn't think about putting $20,000 or $30,000 into an old jalopy," he says. "But now when you see Barrett-Jackson selling these cars for $100,000, $200,000, even $300,000, people start scratching their heads saying, 'Maybe I'm missing out on something here.' "

A good option for shops?

So does it make good sense for a collision repair shop to go after a piece of this growing market?

"Shops certainly have to provide a job that's worth the money they're charging, but it's another viable stream of income for them," Chance says.

BASF's Wallace agreed.

"We all remember when every quality shop had several weeks worth of work sitting in the back lot," he says. "But for most shops, those days are gone. Collision shops can add a strong revenue stream by adding custom work. I also believe this type of work can actually increase employee satisfaction and therefore retention. Every technician takes pride in creating invisible repairs, but creating one-of-a-kind work builds pride and enthusi- asm. Not many collision technicians keep a portfolio of their work, but many customizers do."

Wallace is careful to point out, however, that even though pricing for custom work is not insurer-controlled, some car owners are just as cost-conscious as insurers.

"But as shops increase their reputation, they can also increase their prices for such work," he says. "Most will never reach the million-dollar-car level, but that segment does exist."

Even those that don't aspire to that level can command $5,000 to $20,000 for custom paint work, he said.

The investment requirements

"Just changing a shop's name from 'collision' to 'collision and custom' won't drive business to the door," Wallace says.

A key first step, Chance said, is choosing a custom refinishing system and getting employees trained on its use.

"They have to elevate their artistic skills for such things as laying out graphics on cars," Chance says. "We offer training classes on custom paint, or a shop may go out and find a person who already has the ability to do it."

The other paint companies also have added training in such topics as airbrush-ing or use of their custom paint lines, which often include some products not normally used in collision repair. Sherwin-Williams Automotive Finishes Crop., for example, recently introduced two new clears for use with its Planet Color custom paint line. One is designed as a "knockdown" clear when creating multi-layered graphics. The other is designed to "lockdown" basecoat to allow for taping, rubber spray masks for graphics and other special effect techniques in customization.

All the paint lines emphasize they don't require learning a new system.

"In our case, if a shop is using Deltron on a daily basis, they just use Vibrance in combination with it for the special effects people are looking for," Cremeans says.

Bringing in business

Marketing your shop's ability to handle custom work is critical, whether it's done on a large or small scale. Signage inside and outside your building, and a direct mail piece to your existing customer base is a good way to announce your vehicle customization services, Cremeans said.

Cremeans agreed that such vehicles can be a great way to attract more custom work and collision repair work.

"When you're walking around a parking lot and you're looking at cars, are you looking at the 2004 Lexus or the 1966 GTO?" Cremeans says. "It captures someone's attention. And what an advertisement. The very first thing people always ask me about my restored vehicle is, 'Who did that?' That's the best marketing and advertising you can ever do. And it rolls over into collision; 'If a guy can put a paint job like that on that car, when I take my 2004 Lexus there, I know I'm going to get a good job.' It speaks to the quality of the people at your shop."

Paint companies are developing ways to help shops market custom paint work. PPG inked a deal with Mattel to offer 12 of the Hot Wheels Spectraflame colors many adults will remember from playing with the toy cars as kids. PPG is now holding a contest to help promote interest in custom painting that will include showcasing a winning vehicle painted with a Spectra-flame color at the 2008 SEMA show. The same paint scheme will be featured on a production Hot Wheels toy car.

"Probably the biggest challenge that a body shop could have with custom work is the guy who comes in who wants his car different but doesn't know what he wants or how to achieve it," Valspar's Chance says.

On its Web site for its Hot Hues custom paint line (www.hothues.com), DuPont offers a Hot Hues Paint Shop where customers can check out different color/graphics combinations on street rods, muscle cars and classic vehicles.

For his part, shop owner Frohlich encourages anyone starting a custom project for themselves or a customer to hire an artist to sketch a rough idea of what the finished vehicle will look like.

"I've gotten into projects where the owner of the vehicle had a totally different vision than what I had, yet we're sitting there discussing it and both nodding our heads," Frohlich says. "You need to know that you're both envisioning the same thing in your minds' eye."

Getting started

"You certainly can get into buying plotters to cut graphics maskings and stuff like that, but that's not necessary depending on how deep you want to get into it," he says. "There's different levels of commitment you can make."

For his part, Cremeans likes that the pendulum seems to be shifting back from the extreme of shops offering only collision repair work. Adding custom work gives shops more opportunity for labor profit, he said, while using virtually the same equipment and types of materials they are for doing collision repair work.

"It's getting more like years ago when shops were doing both collision and cus-tom work," he says. "That's great, because custom work is both fun and profitable."