Auto Body Shops: Building a Foundation for the New Year

Auto Body Shops: Building a Foundation for the New Year

For the new year, it’s important to conduct a thorough audit of your finances to look for areas of opportunity and things to change.

It’s not enough to do good work all year, deliver the highest-quality collision repairs and keep your customers satisfied. You have to keep a firm grasp of the financial metrics throughout the year and use them to plan for your year ahead.

Your organization’s financial performance and metrics can help create a road map for improvements you need to make, investments to consider and even staffing improvements. With the start of a new year, it’s important to conduct a thorough audit of your finances to look for areas of opportunity and things to change. While you’re building your road map, you can flag items as green to proceed, yellow to review and red to discontinue or rework. Over the years, we’ve identified several key areas to evaluate as part of our strategic road map:

  • Balancing capital investment with equipment needs. With high interest rates, we reevaluated equipment payoffs to hold off purchasing new equipment right now. We’re working on refurbishing our existing equipment to get a little more life from it. We’re also evaluating the OEM certifications for 2024 to see what equipment we absolutely must have. 
  • Plan for your employees’ wages. Financial planning also goes into employee and technician compensation. Due to inflation and higher costs of living in the Bay area where we’re based, many of our staff work hard to pay for necessities such as rent, food, activities for their children and after school care. It’s important to determine how you can afford to pay wage increases and look at other benefits you can offer to remain competitive and retain your team members. 
  • Invest in growing your team internally. We’re forecasting our growth plans for next year and; as part of this, we’re setting aside time to groom our B and C technicians. This investment is critical to continuing to improve our team and allows employees an opportunity to grow and take on new challenges. We evaluate all of our technicians at the end of the year and look for opportunities to move B technicians up. 
  • Focus on quality improvements for 2024. We take the quality improvement opportunities from the previous year and build new processes for the new year. That aligns with the four steps in the repair process: body, paint, assembly and detail. We look at each repair area from space to workflow to storage and equipment needs and how we can improve efficiency and ensure we consistently deliver high quality at each point. We’re also implementing more photos and documentation into our process. Finally, we evaluate our KPIs and build new procedures about our results based on our insurance and OEM partners’ needs.
  • Map your metrics together. We have a staff meeting at the end of the year and set new goals for cycle time, length of rental, referrals back to the shop and key-to-key times. We then set new bars for performance for the new year. Everyone participates in the process to come up with new goals and metrics, agrees on them together and works collectively to achieve them. 


To achieve success, you have to plan for it. It is critical that you conduct a thorough analysis of your business, facility, team, challenges and opportunities. Then, collectively develop your goals and your road map to achieve them. This generates your team’s buy-in to the plan, and then everyone shares in the success.

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