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John Yoswick

John YoswickJohn Yoswick is a freelance automotive writer based in Portland, Oregon, who has been writing about the collision industry since 1988. He is the editor of the weekly CRASH Network (for a free 4-week trial subscription, visit www.CrashNetwork.com).


He can be contacted at john@crashnetwork.com 

Friday, 07 August 2020 19:44

Survey Finds Shop Sales Down, But Employment Steady, Optimism Improving

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An industry survey this summer not surprisingly found a significant decline in shop revenues this spring, but it also found shops were not continuing to lay off employees and were actually growing less concerned about weathering the storm.

About 250 shops responding to a survey in June reported data on the number of full-time employees they had in June compared to pre-pandemic. Those shops combined said they had 3,718 full-time employees, an average of about 15 employees per shop, in early March, but had dropped to 3,293 employees in June, a decline of about 11%, to an average of about 13 employees per shop.

 

That was an improvement from earlier months, when surveys found employee counts were down as much as 18% in April and 15% in May. Additionally, nearly three in five shops in June had the same number of full-time employees as they did pre-pandemic.

 

“This is a family business, and the owner cares greatly for his staff and their families, and is committed to keeping all of his staff working,” an estimator who is one of nine employees at a shop in eastern Pennsylvania said.

 

Shop optimism had also rebounded a bit from what it was in the spring. In the second half of April, 15% of shops said they were “very” or “extremely” concerned about their business surviving even just the next month, and 25% felt that way when they looked out three months. By June, those rates were cut by about half, with just 8% worried about the next month and 14% worried about making it into the fall.

 

In April, only half of shops said they were not very, or at all, concerned about being in business next spring; in June that had nudged up to three in five shops, with just 16% saying they are “very” or “extremely” concerned about still having their doors open a year from now.

 

“People are using their cars as safety bubbles to go out and explore,” a survey respondent in Texas said. “Collisions will continue.”

 

Across a total of 151 shops that reported February to May monthly revenue figures in June, the combined total monthly revenue fell from $39 million in February---an average of $261,000 per shop---to $38 million in March, $27 million in April and $23.5 million in June---an average of $156,000 per shop, and a cumulative loss of more than $29 million.

 

Interviews with some shops this summer offered anecdotal evidence that revenue patterns vary widely by market.

 

“For whatever reason, in our area we’re usually about 30 to 45 days behind other businesses,” said Tim Cockrell, owner of two Cockrell’s Body Shop locations in Alabama. “March and April and May were down 15% or 20%, but all of a sudden in June, it went down to 50%."

 

Richard Fish, owner of six Fix Auto USA franchises in Southern California, saw things turn in the opposite direction, but also vary by location.

 

“In June, we were at 78% of our baseline sales. So we’ve seen some rebounding,” Fish said. “At our worst [this spring], we were close to 50%."

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