The auto repair industry that bolts on the parts you sell is shrinking. It's OK. It needs to. There are too many bays for the work out there. Remember those who said the manufacturers were conspiring to direct all the repair work to their facilities? How does that theory hold up now that manufacturers are encouraging dealers to close and the National Automobile Dealers Association (NADA) is saying that the industry is going to lose more dealers in 2009? The independent sector just inherited an even larger portion of the roughly 75 percent piece of the service pie they already had.
But it is not just the dealers that are closing their bays. Many of the independent shops are closing, too. The primary reasons shops fail are the lack of resources to weather the storm and failure to effectively market, engage positive peers in their industry and educate themselves and their staff. You might be able to overcome any one of these issues individually, but more than one in the current market will take the legs out from under the business.
The positive side is that strong shops and dealers who can respond to the market with timely and thoughtful approaches are in a position to grow. You can spot them — the shops that are marketing, networking within the industry and investing in education and training are busy. The shops that aren't are fading out of the picture.
Rather than counting the number of shops you do business with when some of them might not be around tomorrow, focus on working with those customers you know are successful. Don't worry about how many auto repair super centers that buy $500 a month in parts and return $450 you have as customers. It is not about who has the most in pennies, it is about who has the most in dollar bills.
Those of you who deliver parts, manage your customer support lines and any other expensive or time-intensive parts of your business with a mantra: Do more with less. You have great customers who are loyal and spend thousands with you every month. They are professionals who know your products and their business. Your opportunity to hold the line financially lies in your ability to generate the same or more revenue with less strain on your customer service resources.
Are you spending more time worrying about losing a bunch of $500 customers instead of focusing your efforts on supporting and growing your bigger accounts? At the end of the day the balance sheet does not show how many customers you have, it shows how much money you made.
Donny Seyfer is a second-generation repair shop owner and ASE Master Technician. An active industry educator, Seyfer hosts two automotive radio shows, serves as chairman of the Automotive Service Association of Colorado, works nationally to help repair shops with IT and service information utilization and writes for Motor Age, a sister publication of Aftermarket Business.
