Following a record year in 2014 for sales, growth and industry performance, CARSTAR Auto Body Repair Experts offered a positive outlook for continued strong performance at its 26 annual conference as it outlined its growth strategies and market opportunities for the year ahead.

CARSTAR CEO David Byers shared the company’s financial performance for the year and detailed the corporate and store-level programs that he believes will continue to drive growth across North America.

Outlook

CARSTAR had previously announced that it finished the first quarter of 2015 with revenue of $195.6 million, which puts it on track to outpace its performance in 2014.  Last year, CARSTAR delivered North American revenue of $712 million, up nearly 10 percent from $649 million in 2013, a record for the company. It also reported same store sales growth of 12.5 percent for the first quarter, after ending 2014 up 11.3 percent over the previous year.

CARSTAR saw a significant increase in insurance work during the first quarter of the year. At the conference, Byers announced that several new major MSO insurance programs with the top 10 carriers had recently been signed. In 2014, its insurance carrier volumes increased 11 percent over 2013, and it added 179 DRPs to its network, a trend continuing in 2015.

The vendor rebate program also continues to deliver strong results, said Byers. In 2014, he claimed CARSTAR processed more than $7 million in total rebates, plus millions more in local and regional discounts. For a store owner using all of the CARSTAR rebate programs, that can equal up to 2 percent or more of a store’s gross sales back in rebates and discounts.

“We are on the right track for continued strong performance and confident that our key growth initiatives for 2015, combined with a positive market trends and an improving economy, will deliver another year of exceptional performance for our organization and our store owners,” said Byers. “We’ve had a long-term plan for improving our KPIs, helping our store owners improve their operations through our CARSTAR EDGE Performance Platform and CARSTAR Operating Procedures, and building our network with the best operators in the industry. We’re seeing this pay off, and expect to reap additional benefits in the years ahead.”

Byers cited the hard work and commitment of CARSTAR’s store owners in achieving this success. The past year saw many owners opening additional locations, expanding services to include aluminum repair and increasing their DRP relationships.

“Without the blood, sweat and tears of these independent owners, the CARSTAR network would not be able to deliver the repeatable, reliable outcomes, industry-leading customer satisfaction and the highest quality of vehicle repairs that we do,” he said. “Only CARSTAR can deliver the largest MSO network that is built on successful entrepreneurs.  This offers an incredible advantage over other collision repair chains with stores operated by hourly managers.”

Consolidation

Another factor that will contribute to CARSTAR’s growth, Byers said, is the number of recent mergers in the collision industry. The number of independent auto body repair facilities continues to decline, now down to around 34,000 from some 80,000 in 1980, according to CARSTAR.

While there have been a number of recent mergers in the collision industry, Byers said this provides CARSTAR an opportunity to grow by serving its customers and insurance partners with the highest level of customer satisfaction while its competitors are distracted with integrating their businesses.

“The integration of all these newly merged shops is going to be a tough job for the other MSOs,” he said. “They’ve got to get all these acquisitions aligned on culture, operating procedures, human capital, branding, business resources and technology. It’s a tremendous investment in time and money. So, while they are integrating, we will be executing. And, our independent CARSTAR store owners will be able to retain the equity in their businesses while receiving large company resources and benefits.”

Business Strategies

Byers detailed several key initiatives for the year ahead that he believes will drive the company’s performance and enhance its ability to serve customers, including a new partnership with Enterprise Rent-A-Car, an expanded CARSTAR EDGE Performance Group platform, further expansion into aluminum repair, and a continued national branding program to refresh its facilities and enhance its online presence.

CARSTAR also is now offering a “Masters in Bodyshop Administration” exclusively for body shop owners in its network that is teaching leading-edge business practices and financial management through its proprietary EDGE Performance Group (EPG) training program. The program has helped many of its stores achieve the industry’s highest KPIs and industry leading customer satisfaction, states CARSTAR. For 2015, the CARSTAR Operations team has expanded its EDGE Performance Group platform, with the goal of continuing to raise the bar in the CARSTAR CCC (Closing Ratio, Cycle Time and CSI/NPS scoring) initiative.

“As the collision repair industry consolidates and becomes more sophisticated, our store owners are tasked with becoming better business operators to meet the industry’s performance demands,” said Byers. “We’ve combined the business management principles taught in most business schools with an industry-focused curriculum that addresses the unique financial, consumer satisfaction and performance metrics of the collision repair industry. As the industry’s largest MSO network, we want to have the best operators, and can provide them the most advanced training and resources to run their businesses.”

CARSTAR also is focused on how – and where – it interacts with its customers and is enhancing that experience. Across the country, CARSTAR stores have been conducting interior and exterior renovations to reflect the refreshed brand look and improve the customer experience while they are dropping off or picking up their vehicle. This includes comfortable waiting rooms, beverage stations, wireless service and more.

CARSTAR continues to engage consumers looking for collision repair or checking on the status of their vehicle through an online platform and through national online directory listings. CARSTAR states that it is the only MSO network to offer store owners a free, fully mobile website customized for their location.

One critical need that CARSTAR is addressing is the ability to repair the aluminum-bodied vehicles of consumers, a growing trend with the advent of the new Ford F-150 aluminum pickup. CARSTAR states that it remains the only MSO in the country that has an aluminum certification program.

“We are already seeing repair volume for aluminum repair grow in key markets, particularly in those areas with higher ownership of the Ford F-150 and more exotic cars like the Tesla,” said Byers. “As the auto industry evolves to meet CAFÉ standards and more aluminum vehicles enter the marketplace, the shops that can deliver this advanced service will rise above those who don’t invest in training, technology and shop improvements.”

CARSTAR is actively seeking new franchisees.  Interested parties should contact Scott Robertson, vice president of development, at [email protected] or (888) 505-6815.