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Page 1 of 3 Jim Salazar said fleet work may account for only 10 percent of his business—but it’s an important 10 percent. “There are times when the industry as a whole gets slow, so you really shouldn’t overlook the added revenue that fleet work offers,” said Salazar, who with his brother are the second-generation owners of Royal Coaches Autobody & Towing, a 23-employee company in Baldwin Park, California. “It’s a dependable source of work.”
Many shops have shied away from fleet work in the past, viewing it—rightly or wrongly—as low-profit work for fleet managers that tend to be focused far more on price than quality. But as insurance-paid consumer work becomes increasingly controlled, more shops are giving fleet work another look—and some are liking what they see.
The pros and cons Salazar is the first to admit that a lot of fleet work is not paid at full retail rates. “They’re simply looking for the best deal, and particularly if you participate in some of the national fleet networks, you have to pay them a percentage of each job,” he said. “But that’s not really any different than being a direct repairer for an insurance company because they ask for concessions, too.” He also views fleet work as a good way to keep his business from becoming too dependent on any one or two sources of work. And some fleets understand that quick turn-around time can be worth paying a premium for. “Time is money, and they want the vehicles up and running again as quickly as possible,” Salazar said. “Some fleets that are self-insured don’t require any inspection of the vehicle other than mine. The fleet manager brings it in and says, ‘Estimate it and fix it and get it on the road.’” For other fleets, he said, the process is similar to non-direct repair insurance work, with required estimate approvals, required photos and, at times, on-site vehicle inspections. Some shops say that national fleet management companies don’t assign one person to a particular claim and so have found themselves on the phone with up to six different people over the course of a repair. “Every fleet is different, but yes, in some cases, it can be a longer process than insurance-paid work,” he said. But Bill McElroy of Bill McElroy Auto Body in Bensalem, Pennsylvania, likes fleet work because it generally involves smaller repairs that can flow through the shop quickly. While it often comes in unscheduled, it also offers potential fill-in work during slow times. “They often have small cosmetic damage that doesn’t keep them from using the vehicle,” McElroy said of some of the fleets he works with. ”So if we run into a slow patch, we can call and tell them we can get a job in and out in a day or two. They’ll check their vehicles and often come up with a couple jobs.” Salazar, McElroy and other shop owners who do fleet work also point to a number of other advantages it offers, including: ● It can keep your shop busy even at times when shops that focus primarily on insurance work are slower.
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