“I Can’t Make Money On Paint!” (a.k.a Why Johnny Kicked The Dog)
At first, this shop owner thought his problem was paint, but after working with his jobber and accountant, he realized it was actually a sales problem. Now he’s making good money on paint and focusing on improving other areas of his business as well.
Examining the State of the Industry
Too many shops, not enough work, not enough profit, too much insurer involvement and not enough business expertise on the part of shop owners are all contributing to the sorry state that is the collision repair industry.
“I Can’t Make Money on Paint!” (a.k.a. Why Johnny Kicked the Dog.)
Too many shops post their entire jobber bill to materials – even though much
of it isn’t paint. Shops then sell these items as miscellaneous parts, with the sale going to parts and the cost to paint. To make matters worse, shops are working off adjuster estimates – which can easily cost them hundreds of dollars per RO.
Is State Farm’s New DRP Good or Bad for the Industry Long Term?
Point CounterPoint
The Process of Efficiency
Our industry has focused on gross profit issues for far too long. The key to success lies in the way we work, not in what someone else is doing to us. It’s time we shift our focus to ‘fixed’ costs — repairing more cars with the same ‘fixed’ cost or repairing the same amount of cars with a lower ‘fixed’ cost.
Dirty Little Secret No. 3: Shops Can Steer Too
Despite what you’ve been led to believe, you can legally steer your customers away from ‘problem’ insurers and toward ones that know how to fairly settle claims.
On the Spot
Due to the misconceptions and lack of knowledge regarding squeeze-type resistance spot welding and its equipment, we conducted a welding machine challenge — a test that would simulate working on a vehicle and help shop owners make
better decisions when purchasing a machine.
Seeing the Big Picture
You can’t improve individual pieces of your business and expect overall improvement. Instead, you must examine the relationship between all the steps and begin to incrementally improve problem areas.
Your Lungs, Your Skin, Your Life
Many collision repairers still aren’t properly protecting themselves from isocyanates. It’s time that changed.
“I Can’t Make Money on Paint!” (a.k.a. Why Johnny Kicked the dog.)
Many shop owners think their problems would be solved if they could just get their paint cheaper. But paint materials profitability problems are often just a symptom of larger troubles – paint labor profitability issues, lack of standard operating procedures, sales shortcomings, etc.