Sunday, 30 September 2007 10:00

Closest Sources of New Business

Written by Tom Franklin

Quality shop owners would generally prefer to replace a damaged part with an OEM part rather than a used part or an aftermarket part. They know that the part from the original manufacturer will be most likely to fit well and thus save them time and trouble. If they can find a used OEM part in reasonably good condition, this would probably be their second choice. The last choice would be the aftermarket part, possibly manufactured in Taiwan, and often lacking in correct dimensions and useablility.

As a general principle, it might be said that the farther you get from the original source, the more complicated and costly the job will probably be. This may also be true in marketing. The original source of business is the vehicle owner or driver who has just had an accident and is in need of a repair facility. Next removed from that original accident might be the tow company, a police accident report record, or an accident-chasing attorney.

The farthest down the line would be the insurance company, the insurance agent, the vehicle owner’s mechanic or friends and family he or she might turn to for a referral. Interestingly, most shops seem to spend more of their marketing efforts in pursuing these referral sources – the farthest from the original source of the accident. It isn’t surprising, therefore, that getting business from these distant referral sources can be complicated and unpredictable. How might the shop’s marketing person go more directly to the original source? 

Restrictions on Sources

Many shop owners have chosen to have their own tow truck (or trucks) so they have a shot at the business right from the start. In many states, it can be illegal to pay tow truck drivers to direct business to a specific body shop but I still see it done in states whether it is legal or not. 

The next best source of information may be police accident report records, but few states or municipalities permit the general public to have access to this information. Nevertheless, I hear about shops that somehow are able to tap into this potentially direct line to people who have just had an accident. 

Going Directly to the Vehicle

A while back I wrote about some shops that have estimators actively go to parking lots to write estimates to repair visible damage on a business card that they leave on the vehicle. This is simply a numbers game. The more estimators you have writing vast numbers of estimates will result in a proportional number of vehicles coming into the shop.

Other shops market where many small accidents occur daily. Valet parking services ding vehicles all the time and vehicles are damaged in parking lots on a regular basis. While this may not be great business, it is incredibly predictable. Some shops also do rental cars or taxicabs. These are known to pay poorly, but I know one shop that does repairs for several Enterprise Car Rental locations and they tell me that in the long run, the business is profitable.


A Labor Intensive Approach

Another great source of direct business is a shop’s immediate business community. Plumbers, electricians, contractors, pest control companies and a vast array of other service businesses with company vehicles are experiencing damage to their vehicles all the time. The reason more shops don’t pursue this business is the time and attention it takes to solicit deals. 

For the most part, these businesses won’t respond to direct mail, faxes or e-mails. Like you, they get hit with junk mail and ads all the time and throw most of it directly in the round file. The only way to get this business is by direct sales activity. I recommend a multiple step approach. Someone with time to make phone calls simply calls huge lists of local businesses and asks the following questions: 

1. Do you have company vehicles and, if so, how many? 

2. Is there someone who is responsible for seeing that your company vehicles are maintained, and, if so, might I have his or her name? 

3. (This call is directed to the vehicle manager): Would you mind if we sent a bit of information about our shop and repair capabilities? 

4. (After some promotional literature has been sent, directly to the vehicle manager) Did you receive our information and, if so, would you be willing to talk to one of our estimators about our rates, our quality, and our turn-around time? (If so, an appointment is scheduled to see this person). 

From this point on, it is a direct selling job that must be carried out by the owner, manager, or someone empowered to negotiate discounts and deals. 

One shop I assist a bit recently called on several local businesses and within a week or two, had ten commercial vans being repaired in the shop. It works. 

A Simple Principle

Once again, it might be said that the farther you get from the original source, the more complicated and costly a job will probably be. This also seems to be true in marketing, and it may also be true in management and other aspects of business. Just as it may be necessary to use recycled or aftermarket parts at times, it may still be necessary to market to insurance companies, agents, attorneys and other third party sources. But it’s always good to keep in mind that the most effective marketing of all will always be directly to the vehicle owner or driver; it is the original cause of the damage that ultimately provides the work that keeps the collision repair industry in business. 

Tom Franklin has been a sales and marketing representative and consultant for forty years and is the author of the books, "Business Battlefield Marketing for Body Shops," "Tom Franklin”s Top 40 Marketing Tactics for Body Shops," and "Strategies for Greater Body Shop Growth." His marketing company now provides marketing solutions and services for body shops and other businesses. He can be reached for questions or comments at (323) 871-6862, by fax at (323) 465-2228, or by E-Mail: tbfranklin@aol.com.