Who Are Collision Repairers’ Fiercest Competitors? - BodyShop Business

Who Are Collision Repairers’ Fiercest Competitors?

Regardless if you’re a small mom and pop, large independent, DRP shop or MSO/consolidator, it’s a good bet that your largest and fiercest competitors are the insurance companies.

Whenever I interview potential shop clients, one of the questions I ask has to do with the competitors in their market. The responses I receive are usually, “The shop down the road,” or “The MSO(s) that recently took over a local shop(s),” but never has a shop owner/manager told me who is their truly largest and most aggressive competitor. The next question I ask is, “What levels of service do they offer compared to you?”

Your Fiercest Competitor

Regardless if you’re a small mom and pop, large independent, DRP shop or MSO/consolidator, it’s a good bet that your largest and fiercest competitors are the insurance companies who have developed DRP relationships with other shops in your market.

When you consider that most consumers are totally unprepared for the unexpected, it’s not hard to see how the insurer has the first crack at controlling the customer’s decision-making process.

Planning Ahead

Let’s face it, other than buying insurance, the average consumer doesn’t plan ahead for the need to use it. There are several things that the average American would rather not plan for, including the need for a root canal, burial arrangements, parachute, life vest, heart defibrillator or…selecting a body shop!

When the unexpected does occur, the first course of action for most consumers – because they’re not prepared – is to call:

  • 911 or local law enforcement
  • Their spouse or parent (significant other)
  • Their work (if they’re on their way to work)
  • Their insurance company (or insurance agent, who will instruct them to call the insurer)

Of course, insurers make it easy to call their claims centers by providing an insurance card, which most states require them to carry as proof of insurance. How convenient is that? And who is that convenient for? 

The Moment of Loss

Originally, insurers wanted to be contacted as soon after a loss as possible so they could mitigate damages for bodily injury claims by controlling the claim. And, at the same time, assist the policyholder with their claim, giving the impression that they’re offering good service. In reality, insurers want to control the claimant’s (victim’s) claim to reduce costs (i.e. rental car), but more importantly to make contact and gain control of the claim before the victim or insured feels ignored and seeks legal counsel to assist them in the handling of their claim. 

That scenario, of course, would increase the odds of the victim making a claim for bodily injury and/or the policyholder seeking additional benefits such as med-pay and/or uninsured motorist (UM) claim, as well as extended rental costs. Expediting the handling puts the victim and/or insured at ease in meeting their needs for rental and repair and relying on the insurer, who responded quickly and showed concern. This is simply good claims handling and good business practice. After all, every dollar an insurer can retain is a dollar earned. With the DRP arrangements today, there is even more opportunity for insurers to save a significant amount of money and increase profitability while reducing their risks.

Following an Accident

So when an accident occurs, depending upon the damages, several things will likely happen. When a call comes into the insurer’s claims center, the insurer will expedite the handling by determining the severity of the claim. If the vehicle was not rendered inoperative in the loss, the insurer may, in some instances, request that the owner take some pictures of the damage and submit them for a quick email-based estimate and settlement payment by mail. How convenient is that? If the damage rendered the vehicle inoperative, the insurer may encourage/steer the vehicle owner to one of their DRP shops with the promise that the repairs will be guaranteed and the claim will be expedited. Sounds great, so why wouldn’t the average unwary consumer not take advantage of such a program? 

This is why today’s insurer is the collision repairer’s greatest competitor regardless if the repairer is a DRP participant or not because DRP shops and non-DRP shops both get steered against.

Competing Against Your Competitor

So what should a quality repairer do to compete against their fiercest competitor? You can’t merely hope for referrals from family, friends and prior customers as you have in the past. Repairers need to advertise to their community why they’re the best choice for collision repairs and why relying on insurer referrals may not be in their best interest. 

Quality repairers have a professional, moral and ethical duty to their community members to edify and educate them on things they need to know to make an informed decision when selecting a collision repairer. The basic information I encourage Auto Damage Experts (ADE) clients to share in their marketing messages are:

  • All body shops are not alike
  • All parts are not alike
  • All insurers are not alike

Many insurers would have consumers believe that all body shops are alike, which is why they try to mandate one labor rate for every shop in a particular market area regardless of the level of service and quality they offer. Whether it’s a high-volume/low-value provider or a high-quality/high-value one, insurers believe they should all be paid the same labor and material rates.

Anyone reading this knows that not all parts are the same. But if that’s what a customer wants, repairers should at least educate them on the various levels and their options. 

Just as not all parts are the same, not all insurers are the same. Some want consumers to receive a proper and thorough repair at a fair and reasonable cost. These carriers will not overlook or deny OEM-mandated and recommended procedures, parts and materials. Others…well, not so much. And the members of your community need to know this. As a repair expert and professional, not sharing your knowledge would be a disservice to the community and the collision industry at-large. 

Such information is not made readily available to consumers, and quality repairers would be ill-advised to wait until those consumers come in the door to inform them. They should come to your company because they learned beforehand (preferably from you) that there is a difference and they only want the best for their vehicle. This will only happen when repairers inform them well before the unexpected happens.

Let’s assume you had the opportunity to address a stadium full of the residents of your community, and you ask over the loud speaker: “By show of hands, if you leave here today and get in a car wreck on the way home, how many of you would take your vehicle to a shop that the insurer recommended?”

My guess is that the majority of the crowd would raise their hand simply because it sounded reasonable, especially since they wouldn’t have a clue about what to do and would figure the insurer could probably help them. 

Then, you follow up with another question: “By show of hands, if you were injured in that accident and make a claim against your insurer, how many would of you would go to an attorney that the insurer recommended?” 

In that scenario, my guess is that few hands would go up. 

Another question: “Taking into account your last response, by show of hands, if you get in a car wreck on the way home, how many of you would take your vehicle to a shop that the insurer recommended?”

My guess is that, after a little whispering, a lot less would raise their hands simply because it would no longer make sense for them to take advice on how to collect money from someone who owed it to them.


The collision industry has evolved to the point where it is no longer your dad’s body shop business and you can’t rely merely on word-of-mouth referrals – not when your fiercest competitor has the upper hand by taking control of the claim before you can enlighten the members of your community on what they don’t know. 

Depending on your area, there are very effective and inexpensive opportunities to market your business and convey to the community why you’re “the only one” and why that’s a good thing for them. B

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