BodyShop Business recently sat down with Michael Macaluso, president of CARSTAR North America, to discuss consolidation in the collision industry and strategies CARSTAR is undertaking to take on some of the challenges the industry faces.
BodyShop Business: There are constant rumors about a mega consolidator buying another mega consolidator. Can you see that happening sometime in the near future?
Michael Macaluso: In my opinion, it’s very logical to think that the larger consolidators will to continue to grow and develop our industry. From a CARSTAR and Driven Brands perspective, we are very committed to growth within our franchise network and we feel the marketplace is very well positioned for the CARSTAR model, not only for prospective franchisees but also insurance carriers. Market change presents both challenge and opportunity. The growth of mega consolidators will bring even more benefits to the industry as well as our franchisees.
BSB: Lots of MSOs are now creating their own workforce by starting training academies. What is CARSTAR doing in this area?
Macaluso: CARSTAR is very committed to providing solutions to our franchisees in the training space. This is an existing challenge in our industry, and we are building a wide variety of programs to help our franchise owners attract, retain and develop their teams. The “CARSTAR Learning” program is one great example of our offerings on this essential topic. Being a franchised network, our structure is different than the corporate consolidators, so our training academies are custom designed and delivered for our network.
BSB: What about OE certification? Is there a big push from corporate to help CARSTAR franchises get certified?
Macaluso: Yes, OE certification is an extremely important area within our business. Through continued, strategic discussions, we are making the necessary strides to ensure our stores have the training and equipment needed to produce quality repairs. We have been actively involved in this area for several years now and will continue to provide the guidance, leadership, support and programs to accelerate the certification of our locations.
BSB: It has been awhile since Driven Brands acquired you. What has the acquisition done for you? How has it worked out so far?
Macaluso: We are approaching the 12-month mark since the acquisition of CARSTAR Canada, and it has been more than a year since the U.S. division joined the Driven Brands family. The integration part of the acquisition process is nearly complete, and we are accelerating the execution of our strategic plans across North America. From unit development to operations, our alignment with Driven Brands has worked out extremely well, with continued improvement in every segment of our business. We now have a procurement division that leverages over 1,000 body shops under the Driven Brands Paint & Collision vertical – securing maximum savings for franchisees. Our IT teams have taught us even better practices in data collection, and marketing has layered on expertise in the digital space. I am extremely excited about our partnership with Driven Brands and look forward to witnessing CARSTAR grow even further.
BSB: Word is consolidation has slowed as a lot of shop chains have now been snapped up. Granted, CARSTAR’s model of growth is different, but comment on whether your growth in 2016 has increased, slowed or stayed the same.
Macaluso: 2016 has been a banner year for CARSTAR. We have had record same center sales growth, added nearly 50 locations across North America and are engaging in very strategic and important conversations with our insurance partners. Growth has certainly not slowed down for us, and we are focused on accelerating our plans and delivering world class KPIs for our partners. Joining CARSTAR complements and augments our existing stores’ performance through our EDGE Performance Platform. Overall, the franchise model is one that enables continued, proper growth with the delivery of the required performance. With franchise owners in every location monitoring shop success on a daily basis, CARSTAR is growing faster and stronger than our competitors.