All you seem to hear these days is how body shops across the United States are struggling and closing at an alarming rate because they can’t seem to make a decent profit. But that’s not the case at Fred Haas Collision Center in suburban Houston. Haas enjoys a growing customer base and record revenues despite its mega size and enormous payroll. Even more remarkable is that nearly 60 percent of Haas’s total sales come from direct-repair relationships with four insurers well-known for their tightfistedness: State Farm, Allstate, Farmers and Liberty Mutual.
Looking at Haas’s size, and taking into account that it has long been known that bigger is not always better meaning that higher volume shops often push quantity over quality you might doubt the quality of its work. But the shop’s customer satisfaction index is currently 93.2 percent. Also, it has won the Toyota Collision Center Shop of the Year Award four years out of the seven it has been available. To be considered for the award, shops must be outstanding in a number of areas, including customer satisfaction and growth.
“A shop can get really good when it specializes, and having the Toyota line is a huge advantage for us,” says Haas Collision Center Director Jeff Debner, who said that 78 percent of the shop’s work is on the Toyota brand. “We’re constantly trying to replace our non-Toyota business with more Toyota business so we can do more of what we do best. It’s tough, though, since so many of our customers own other cars and insurance companies direct owners of other brands here to have work done as well.”
Haas was the first body shop in the nation to be certified by Toyota. To date, there are 168 Toyota-certified collision repair shops.
“We embraced the certification early on and follow it to a tee,” said Debner. “Besides our people who are, of course, number one, the regimen of policies, procedures and processes we pursue by being part of Toyota’s certification have without a doubt been the biggest factor in our success.”
The Haas team practices all facets of Toyota’s program with zeal, and there’s no question that spirit has made them more competitive. Still, Debner is at a loss to explain why the shop he manages sits at the pinnacle, considering the high number of other shops that follow many of the same practices.
“We have some of the best people in the industry working for us. We all work hard and follow processes closely and care greatly about what we’re doing. And, we want it,” he said. “But I think those things can be said of most shops pursuing the award; and just wanting it certainly doesn’t make it happen. It’s a year-long effort of consistently following the basics and putting one outstanding job out after another.
“Perhaps the thing that differentiates us is that we’re pretty good about keeping our techs in the loop. I liken it to playing a football game where the players, in order to play their best game, need to know the score and see the goal line in front of them. So, we try to share with our entire team on an ongoing basis our monthly sales numbers, customer comments and where we are with regard to shop of the year.”
Many body shops today have trouble finding qualified technicians, but so far Haas has had no trouble filling its bays with qualified technicians due mostly to the volume of work it does.
Technicians go where the work is, and we’ve been fortunate to have work in abundance,” says Debner. “Our pay plans are about equal with the pay scale technicians receive in surrounding shops, but in some positions we pay more than competitors.” Specifically, Haas pays straight commission, which amounts to $12 to $16 per hour with performance incentives.
Plus, technicians like being associated with an award-winning body shop, Debner said, another reason Haas has a way of luring an ample number of skilled technicians. Added Debner, “There’s a lot of pride among our staff.”
Technicians aren’t the only ones who desire to be affiliated with Haas. Rental companies also seek exclusivity for car rentals among Haas’s customers by offering the shop a good number of days where it doesn’t have to pay when an occasional deadline isn’t met.
"We don’t have to take advantage of it very often because we’re pretty good at getting the work out,” said Debner. “But it’s nice to know those deals are there when we need to use them.”
Fred Haas Toyota World
Location: Spring, TX
Established: 1972, new facility built in 1999
Square Footage: 33,000 production/11,815 offices and storage
Owner: Fred Haas
No. of Employees: 47 1 manager, 1 assistant manager, 2 administrative, 6 estimators, 1 production foreman, 36 technicians, 1 Toyota Master Manager, 3 master certified technicians (6 certified for estimating, each tech certified in his particular skill)
Repair Volume (averages): $920,000 month/430 cars/2,400 labor hours per week
Average Repair Cost: $2,160
Closing Ratio: 87%
Leadership by Example
“It’s not a fluke that the Haas team always rises to the top,” said Travis Rice, regional collision manager for Gulf States Toyota. “They have a tremendous amount of support from dealership owner Fred Haas, who has a great deal of pride and wants to be a leader, not only in his community but also among the nation’s Toyota dealers.”
Rice says there are no weak links in the Haas dealership, and each department reflects the same pride and principles exhibited by Fred Haas.
Body Shop Process Improvement Manager Brad Brahe runs Toyota’s collision shop certification program in the United States. The Haas dealership and 167 additional Toyota dealership body shops fill Brahe’s roster. Brahe calls these shops the “best of the best” and the ones Haas competes with for the Shop of the Year Award. Brahe attributes Haas’s success to its high level of cohesiveness and consistency.
“Personnel, especially those in upper level positions, don’t often change,” Brahe says. In fact, Debner, who’s a Toyota Certified Master manager himself, has been with the dealership nearly a decade and was on board prior to the construction of the present facility in 1999.
Customer Care = Profits
At a time when many body shops have gutted staffs to minimal levels to maximize profits, Haas has taken the opposite approach, overstaffing in nearly every department including the body shop. This approach allows employees to maximize attention given to customers, and it’s paying off handsomely. The Haas dealership has been around for 36 years, and attention to detail even in matters that seem insignificant garner it excellent reviews from customers.
Travis Rice says that he once held the door open for a woman who drove up in a late model Toyota Camry with a damaged front bumper that had been estimated and scheduled a few days before. As he and Debner attended to business, the “on-time line,” one of two fast lanes specializing in minor repairs, went to work replacing the part. During the 45 minutes it took Rice and Debner to conclude their meeting, Rice looked out the window to see the woman’s vehicle drive away, beautifully detailed and free of damage.
“That’s the level of service that puts the Haas dealership head and shoulders above anyone else in the area,” says Rice. “It’s the ‘wow’ factor and the reason why customers keep coming back.
“Customer referrals are the core of Haas’s growth business. Customers that experience Fred Haas continue to recommend the shop over and over again to their friends and families.”
The “on-time lines” repair only cosmetic damage on four or less panels, and parts must be in stock before work begins. Once a job gets rolling, team members don’t waste a minute. The average cycle time for on-time jobs is only eight-tenths of one day. Among jobs as a whole, Haas turns more than 40 percent of its work in 72 hours or less a minimal benchmark to be considered for the shop of the year award.
While customers benefit from the speedy service of “on-time” jobs, the shop benefits, too, in that these jobs represent Haas’s most profitable work. On average, on-time jobs are in the $1,200 range and have a total of 12 labor hours six body and six paint. These smaller jobs move through the process faster and with fewer glitches than heavier hits. It helps profitability and cycle time, too, that they’re often simple bolt-on jobs that can be performed by lower skilled, lower paid technicians.
Debner, Rice and Brahe attribute at least a portion of Haas’s outstanding turnaround time to the fact that the shop rarely has to wait for parts.
“Very often, insurance companies will actually slow a shop down a bit by their insistence on the use of aftermarket and used parts,” Rice said. “In reality, insurance companies would save money if they would just go ahead and use OEM parts that are already on the shelf. This would allow a better job to be delivered to the customer and one that wouldn’t invade the integrity of the car. There would be no downside to it.”
To help dealers in its distribution chain beat cycle time and keep quality high, Gulf States Toyota instituted a program called “Meet The Competition.” Toyota is said to have a similar program in the works that hasn’t yet been launched.
“If we have to back down the price of parts to meet aftermarket or used prices, we’ll share that loss of gross with the dealership,” said Rice.
When asked what independents could learn from dealerships like Haas, Rice responded, “Many of them could learn from the professionalism and work ethic our dealers exhibit.”
Behind the Bays
Estimating System: Pathways and ADP
Prep Booths: 2 Blowtherm double prep stations with full heat
Spraybooths: 4 Blowtherms
Straightening System: 2 10-ton Chief frame machines, 4 Chief Streamliner machines
Measuring/Dimensioning System: 1 Chief Velocity
Paint: Sherwin Williams Ultra line
No Secret Here
The ingredients that keep bringing the Haas team to the top are more fundamental and basic than top secret. Over the years, it has been proven that when businesses consistently follow time-tested processes, perform high-quality work and wow patrons with outstanding customer care, people take notice and spread the word. It begins a perpetual success cycle that, once rolling, seems unstoppable. Not surprisingly, this back-to-the-basics approach has put the Haas team in the top one percent of body shops in the country.
But Debner isn’t content to let the Haas team rest on accolades of the past. He’s already guiding his shop toward what he hopes will be another award-winning year. And in case you’re wondering, this year’s strategy is the same as last: “Following the basics and putting one outstanding job out after another.”
Writer David Williams produced award-winning show cars and high-quality collision repairs from his Ohio-based shop, Precision Collision, from 1977-1999. Williams was the first WreckCheck licensee to operate in a mobile capacity, primarily assisting attorneys in the states of Ohio, Kentucky and West Virginia. Learn more about Williams and his work at www.SafeCollisionRepairs.com.