How much should I spend on certification?
In today’s collision repair industry, that’s the $64,000 question, or maybe it’s a $40,000 question, or perhaps somewhere between $20,000-$100,000; possibly much more. Whatever the case may be, certification doesn’t come cheap. It’s also an investment many shops might have to make to continue competing in the industry over the long term.
Getting a firm handle on beginning costs is just one step shops must take as they being their certification journeys. They also need to look at ongoing investments, ROI and a host of other issues, such as ever-changing requirements. Unfortunately, even though OEM repair programs have been around for some time now and continue to grow in number, plenty of misconceptions cloud shops’ understanding of them. These misunderstandings can prove costly as shops struggle to make the best certification decisions for their futures.
It’s time for some clarity. Here are five bits of business information you should keep in mind while you consider making the plunge into manufacturer repair programs.
Truth 1: You’ll need to get some help
Presently, there are nearly two dozen OEM repair programs, with more on the way (for example, Cadillac recently introduced an aluminum repair program for a single model, the CT6 sedan). Reviewing the requirements for each takes a significant amount as time, as does deciding which ones will provide the necessary ROI for your business. As you work through this process, be sure to reach out to your local shop association or national organizations like the Society of Collision Repair Specialists (SCRS) for help. Ask to speak with shop owners and manager who have experience with repair programs. Also reach out to the manufacturers for more information or go to your vendors. Information providers and paint companies often classes or experts that can provide valuable advice.
Another resource is Assured Performance Collision Care, a non-profit consumer advocacy organization based in Laguna Hills, Calif. Assured Performance offers a program to help shops become certified in multiple OEM repair programs at the same time due to its partnership with Ford, FCA, Nissan, Infiniti, Hyundai and GM.
One of the aims of the program is to reduce certification redundancy.
“When a shop enrolls for any one of the automakers that are part of our joint-efforts approach, they have the opportunity to become certified-recognized by all of the other automakers that are participating with us,” explains CEO Scott Biggs. “The interested shop can literally become certified by several automakers for one set base price, saving them tens of thousands of dollars and reducing the complexity of certification significantly.”
Assured performance utilizes a business formula wherein shops step completes a 5-step validation process. Shop document how they meet the program requirements (for example, achieving I-CAR Gold Status and obtaining the necessary tools, equipment and training), provide electronic visual proof online, then pass an on-site inspection, followed by an internal audit and then finally an OEM review and approval. Biggs says his program has resulted in thousands of shops becoming certified.
Truth 2: You’ll need multiple certifications
Being certified in at least several programs is an absolute necessity for most shops. “It’s the only way to get back your investment,” says Barry Dorn, owner of Dorn’s Body and Paint in Richmond, Va. Dorn’s business posses 21 certifications, everything from Ford and GM to Tesla and Maserati. Most shops won’t need that many programs, but because of the significant investment costs required for certification, they’ll need to cover multiple vehicle models to assure their costs are not only reclaimed, but provide an addition boost in shop revenue.
What lines should your shop choose? Kye Yeung, SCRS Chairman and owner of European Motor Car Works Inc. in Costa Mesa, Calif., says shops should start with the obvious. Take a close look at repair records to determine which models they see most often. Yeung’s business, for example, holds certifications for Aston Martin, Jaguar, Land Rover, Lotus, Tesla, Rolls Royce Ghost and Corvette since it specializes in European and higher-end vehicles.
Chantilly Autobody, headquartered in Chantilly, Va., built much of its business performing dealer work, so some of its certifications come from programs requiring a dealer sponsor such as BMW and Infiniti. Always on the lookout to pick up more certifications, it’s a part of repair programs for Volkswagen, Ferrari, Maserati, Toyota, Honda, Ford and Chevrolet, as well.
More traditional shops that see mainly mass-produced vehicles should look at GM, Ford, Honda and similar programs.
Truth 3: You’ll need a significant investment.
There’s no such thing as low-cost certification. OEM programs demand expensive investments for tools and equipment alone (with facility upgrades another costly hurdle shops may need to leap). Even if you’ve made significant investments relatively recently, there’s a great chance you’ll be putting out money again, often for the same kinds of purchases.
“These programs demand the latest tools that are required to fix modern cars,” says Dorn. “You could have spent $20,000 on a new welder seven or eight years ago, but you’ll need a newer one if you’re going to be certified today.”
Dorn further notes that even in cases where shops save money by leveraging programs that incorporate similar requirements, repairers still should expect additional costs due to program variances.
“For example, we can use the same type of bench for several vehicle lines, but each OEM program is going to require a different set of jigs,” he explains. “All the programs have different specs so you have to account for those.”
Mindful of these expenses, manufacturers have taken steps to cut costs where possible. Yeung notes that OEMs are trying encourage interest in their programs by lowering costs in some areas. “A number of them have opened up the number of choices for tools. Years ago, they may have required a very specific tool model, but today shops are given several options,” he says.
As OEMs continue to look for ways to certify more shops they very well may create other savings. Still, repairers must count on outlaying a significant investment for certification.
Truth 4: You’ll have to keep spending more money to maintain your certifications.
OEMs regularly update repair program requirements. With each new model year, and with the addition of all new models, newer repair resources are necessary to bring vehicles fully back to specification—which, of course, is the goal of manufacturer programs.
“You’re probably going to need to order new equipment each year,” says Dorn. “For some of these programs, sometimes it just arrives.”
How much these costs add up to can vary widely based on the OEM program. This is another area you’ll want to thoroughly research as you decide which certifications will provide your business with the best ROI.
Truth 5: You can do business without certifications and still thrive, but your shop might be missing out.
Thousands of shops possess OEM repair certifications. Many thousands more do not, including a number of successful, growing MSOs. Dorn notes that shops don’t necessarily need certifications to survive, though these shops stand to lose out on a number of benefits.
For starters, certification can be one of the best steps shops can take to protect the health of both their business and their employees.
“Vehicles grow in complexity all the time. You need to have all the best training and tools and other things that come with certification to ensure you’re repairing them correctly,” Dorn explains. “The shop has the liability if the vehicle isn’t repaired right. Why risk your business? Your employees can be seriously injured if they’re not repairing the right way.”
Biggs similarly notes that certification makes good economic and business sense. “First and foremost, certification increases the value of the business itself,” he notes. “Then there are numerous ways in which shops can leverage certification to make more profits and gain higher customer satisfaction.”
When it comes to costs, Biggs points to the investments repairers already must make to compete.
“Shops need to have the tools equipment, training and facilities to safely and properly repair the car anyway. Why wouldn't they gain the official credentials by becoming certified as one small last step?” he says. “Anything else would just be illogical and could have devastating effects on a business in the future even, if today, an uncertified shop is the dominant competitor in its market area.”
Echoing this notion, Yeung notes that certification is growing in importance to both insurers and vehicle owners. “They want their vehicles repaired by the best qualified shop,” he says. “Even if you’ve done work for a customer before, they’re going to start taking their business to another nearby shop because that one has the certification.”
Reading the tea leaves
Indeed, taking that trend a bit further, forces in the collision industry could be aligning to make certification not just a highly desirable but potentially a mandatory element for shop success. Yeung says auto manufacturers are producing so many different models, including all-new ones, that it’s increasingly difficult for repairers to repair everything the market offers. “Even now we see new models with similar technology to what we’re familiar with, but we’re truly unfamiliar with the vehicle,” he says.
Throw in ever-growing vehicle complexity, and the result is an industry where shops are going to struggle to repair every possible vehicle or even a large number of models. Yeung envisions a scenario in the not too far off future where many shops would specialize in a limited number of brands/models and be certified to repair those.
This view is shared by a number of other industry leaders and prognosticators. It just makes sense. Automakers want high-quality, certified repairs to ensure their vehicles, even those being sold as used, retain their value to protect the vehicle brand. Insurers and owners desire the same repair quality, which would necessitate a thriving repair market with plenty of available options to keep cycle times optimal. Repairers require a path forward to help them succeed in this environment.
While this scenario may not play out next week or next year, plenty of other industry leaders and prognosticators believe it’s on the way. Maybe that’s the best reason of all to keep certification on your radar and be formulating a plan to make it happen at your shop.
