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Car Mending On A Mega Scale

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Name: Chesrown
Collision Center

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Location:
Denver, Colo.

Owner: The
Chesrown Automotive Group and Republic Auto Nation Group

Established:
1987

Square Footage:
60,000 (total); 20,000 (body shop

and mechanical shop)

Number of Employees:
63 (total); 27 (body and paint)

Repair Volume:
350 cars per month (collision only)

Average Repair Ticket:
$2,000 (collision)

Ever wonder what it’d be like to work in a
shop with room to spare? One with all the latest equipment? One
that even has room enough to have an indoor delivery area? Dave
Cox, general manager of Chesrown Collision Center in Denver, Colo.,
knows what it’s like. As a matter of fact, when speaking of the
shop’s huge reception desk, Cox says he’s had customers say that
they thought they were in the lobby of a Ritz-Carlton Hotel because
"it’s so elaborate."

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The size of the facility alone makes the shop
special; it’s a mega shop – nearly 60,000 total square feet –
and it sits on nearly five acres of property with parking for
about 400 cars. Part of the Chesrown Automotive Group, the shop
services five (differently franchised) dealerships in the Denver/Boulder
metro area. In addition, the shop is affiliated with the Republic
Auto Nation Group, the largest associated group of car dealers
in the country.

This new 60,000-square-foot facility opened
in February. Prior to this location, the shop was situated at
Chesrown Chevrolet in a small, 14,000-square-foot facility about
one mile away.

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Lots of Traffic

The shop currently runs 350 cars per month
through the body shop, "and we’re probably at a third capacity,"
says Cox. Chesrown participates with several direct-repair programs,
so a lot of work, in addition to dealership work, comes by way
of insurance companies. A lot of work also comes from walk-ins
and referrals. According to Cox, 80 percent of the shop’s customers
come from DRP and dealership referrals (these overlap each other),
and 20 percent are walk-ins and "other."

Mother Nature also contributes to a percentage
of the shop’s volume. The region in which Chesrown is located
has high deer and elk populations (you know what that means!),
and hail damage from spring through summer – and even into the
fall – is quite common.

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"We have tremendous hail storms that
bring in a tremendous volume of work," says Cox, adding that
being located in a huge metropolitan area – in this case, the
Denver metro area – guarantees lots of business due to "tons"
of traffic accidents.

The glass business in this area is also thriving.
"Almost every car you see on the road has a broken or extremely
chipped-up windshield," says Cox, explaining that the roads
are loaded up with gravel during snow storms, but because the
snow melts quickly, drivers are soon left with a really fine,
ground-up gravel to kick into each other’s windshields.

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This gravel also creates paint work. Cox says
the nose of almost every car needs stripped and refinished after
a winter season. "Hoods, fenders, bumpers," he says.
"They all have these little rock chips all over the front
of them, so there’s just tons of reasons to need paint and body
shops in this area."

With all this going for it, Chesrown doesn’t
go overboard with advertising. The shop is listed in the Yellow
Pages, but it focuses most of its efforts on radio advertising.
During the facility’s grand opening, two radio stations aired
broadcasts from the shop. Another promotion for Chesrown took
place in June, when NASCAR driver Jeff Gordon – whose name is
frequently linked to first place – visited the shop for a three-hour
autograph-signing event, which was also promoted via radio.

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The Whos and Hows

With a huge building and a high volume of
work, Chesrown needs a lot of employees – and a lot there are.
A total of 63 people currently work at Chesrown, 27 of them in
the body and paint departments. Of those workers, 14 are body
people and three are apprentice body techs.

The body department runs in a lateral, support-group
concept. There are four group leaders and four estimate writers,
and each writer works with one of the group leaders. After work
is dispatched to a group leader (of the team with the least amount
of work at that time), the group leader then dispatches the work
to his group. The group leader is responsible for quality-control
checks, for follow-up and for helping out with any problem a tech
may have.

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To keep production moving, the shop has a
production manager and an assistant production manager who oversee
daily operations. They have a daily "out list" of the
cars that need to go out each day, and they perform quality-control
checks on work as it moves through the process.

The paint shop consists of four paint teams,
each consisting of a head painter and two preppers – with the
head painter being responsible for his team. The preppers concentrate
on getting cars ready for the painters.

"We try to keep the painter in the booth
as much as possible, spraying, mixing and spraying," says
Cox. "It’s almost an assembly-line process." Following
the same procedure as the one employed in the body department,
the paint team with the least amount of work gets the cars.

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Chesrown’s five mechanics work on suspensions,
alignments, engine cradles, air bags, A/C evacuation and recharge,
etc. The mechanical department also includes a manager and an
assistant to the manager, while the parts department employs two
full-time parts people.

Profit Centers

Being affiliated with dealerships leads to
some great profit possibilities, and Chesrown has taken full advantage
of these opportunities. The facility, in addition to its mechanical
shop, also has a mechanical reconditioning center that reconditions
all the used cars for the Chevrolet store – which brings through
another 150 cars a month; some of these need mechanical repairs,
others need light paint and body work or touch-up work. This department
employs four full-time mechanics and a reconditioning manager,
and it’s currently generating about $100,000 a month in revenue.

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By being associated with the Auto Nation Group,
Chesrown also reconditions 75 cars a week for the group’s Las
Vegas location. After completing the reconditionings (no interiors),
the cars are shipped to Las Vegas to be sold on an Auto Nation
used-car lot.

Chesrown also has a separate detail center
that details all the reconditioned used cars. According to Cox,
this center details the 300 Auto Nation cars and performs the
collision-customer details – which adds up to about 500 cars each
month moving through the detail department. Usually, there are
about six full-time employees – a detail manager and five detailers
– in this department.

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In addition to these profit centers, a rental
department was created when the shop opened in February, and 130
rental cars have been put into service. Chesrown has 12 rental
employees, along with two rental agents who are available at each
of the five dealerships. Between 20 to 30 cars are kept at each
location, so customers don’t have to go anywhere else. "The
office is right here in our office," says Cox. "We exchange
keys, and they’re on their way. And they also drop off [the rentals]
here."

Equipment and Training

While a good location, organization and profit
centers all contribute to Chesrown’s success, so, too, does having
reliable equipment. For example, the paint department has eight
Garmat downdraft prep stations and eight Garmat downdraft paint
booths. Llined up four across and two deep (in quadrants), two
in a line, four booths are on one side of the paint shop and four
are on the other. A mixing room, along with a clean room, is located
between each set of four booths.

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A Garmat jamming tunnel is located in the
body shop area as well. A full-time parts-jamming person constantly
cuts in the edges of parts for the body techs, which eliminates
time delays for edging parts because techs never have to wait
on a painter to get to the parts.

The shop also has two Chief Continental frame
machines, two Chief EZ Liner Posi-Trak machines, a Chief Universal
Measuring System with all four machines, a Chief Genesis 2 electronic
computerized measuring system, a Hunter P411 computerized alignment
machine and Viper A/C recharge/recycling equipment for both R-12
and R-134a. Other than the Continental machines, which are five
to six years old, Chesrown’s equipment is all new.

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In addition to having the latest equipment,
Cox says the shop is currently working to achieve I-CAR Gold status.
According to Cox, every body technician has been through the I-CAR
2000 course. Likewise, all the painters have been through the
I-CAR refinishing course, and most of the shop’s managers and
estimators have been through the I-CAR 2000 course, as well as
some other I-CAR courses.

Big Building, Big Bucks

Given the shop’s great region and facility,
Chesrown is enjoying the kind of success you’d expect. Cox is
projecting the shop will, this year, generate more than four times
what it generated in sales when the business was still operating
out of the small shop last year.

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He’s also projecting that – within the next
two to three years – the shop will double total monthly sales.

Now that’s car mending on a mega scale!

Writer Eileen Benedict is associate editor
of BodyShop Business.

Space, Space, Space!

Chesrown’s 60,000 square feet are broken down like this: 22,000
of them make up the paint department (something Cox says makes
Chesrown’s paint shop unique); 20,000 are for the body and mechanical
shops; 11,000 for in-door delivery, drive-in claims areas and
the detail department; and 7,000 square feet for offices and the
shop’s parts department.

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Cox is proud of Chesrown’s large, indoor delivery area, where
every car is placed when repairs are completed. "Customers
can walk around their cars in a clean, well-lit, indoor area,"
he says. "They never have to stand outside in a snowstorm,
pick up their car in a rainstorm or have it dirty because it sat
outside for two or three days.

"It’s been a real customer-satisfaction issue. … Customers
have a good opportunity to see all the repairs before they pick
up their vehicles and pay their bills."

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The showroom, as Cox calls the delivery area, is located off the
reception/waiting area, which Cox describes as an open area with
two-story, vaulted, dome-shaped ceilings. And to add even more
class to the operation, a two-story glass wall allows customers
in the waiting area to look into the delivery area.

Adjacent to the indoor delivery area is an indoor, drive-in estimating
area that has room for eight cars, and five offices for the shop’s
estimators are located near the reception area. Adjacent to those
offices sit five more offices for insurance companies to use for
drive-in claims. The offices are set up with computers, phones,
calculators – everything adjusters need to do business at the
shop’s location.

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From a Business Standpoint …

The collision repair industry is big business, so to focus on
the dollars-and-cents side of things, BodyShop Business asks Dave
Cox some business-specific questions.

BSB: How do you make sure jobs are profitable?

DC: "We’re currently using the CCC estimating system,
and it has the ability to calculate our gross profit on each job.
Our in-house system, an ADP dealership management system, also
[does this]. Job costing is done through the [CCC system and the
ADP system]."

BSB: Are profits reinvested into the business, or are they
invested elsewhere?

DC: "We’re a publicly held company now. The company
has been incorporated for the 10 years we’ve been in existence,
but since we joined the Republic Auto Nation Group [in ’96] –
a publicly held and traded company through the NASDAQ market –
… the profits help the stock of the company."

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BSB: Where do you get your financial advice?

DC: "Mostly through our network of dealership management,
through our controller of the company."

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