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Thursday, 30 June 2005 17:00

Reach into your circle of service providers to get more biz

Written by Tom Franklin

Recently I spoke with a shop owner who gave me the same line I've heard dozens of times: "To do well in the body shop business, you need insurance DRP (Direct Repair) status with several companies. Otherwise you'll never make it!" 

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But we know this isn't true. I've dealt with hundreds of shops during the past fifteen years, and can attest that many of them were doing fine with absolutely no DRP relationships at all. What people who say this are actually saying is, "I don't want to have to work at bringing in business. I want to just sit here while someone else refers and sends me the business."

It is true that it takes far more work to generate an adequate volume of business without a powerful referral source like a major insurance company. But one of the benefits of doing it yourself is not having to make radical concessions demanded by an insurance company to get that business.

Future business from current customers

I've noticed that one of the most neglected sources of additional business is the current customer. If a customer is happy with the repairs on his or her vehicle, the time to obtain another job from this customer is when he or she picks up the vehicle.

We did a special "Thank You" card for one shop that was designed to bring in vehicles from his or her friends, family and -- perhaps more importantly -- employer or company. Here is the text on that card:

"We appreciate your business

As our way of saying "thank you" for being a customer of Anytown Auto Collision Center, we have arranged to provide you with a free rental car for up to three days - if you have damage on your vehicle again and bring it back to Anytown Auto Collision Center for repairs.

If you already have rental car coverage, we will treat this "thank you" as a $75.00 coupon that you can use as a credit against your deductible, to be deducted from a self-pay repair amount. Or you can reduce any towing charges that are not covered by your policy.

Additionally, if you refer a friend or family member for a repair, we will honor this "thank you" coupon for them on your behalf. If you or your company have company vehicles, we will further extend this coupon offer to the first three vehicles that are brought in to us. This will apply to the repair and refinish of any scratches, dents or dings on the vehicles that could be giving the company a bad image on the street.

Again, thank you for being our valued customer. We are pleased to offer these return visit and referred visit rewards. When you are in need of our services, call us toll free at (800) 555-1234. For towing, call (555) 123-1234.

At Anytown Auto Collision Center, we appreciate your business and look forward to continuing to provide you with excellent service.


Andy Shopman, Owner

Anytown Auto Collision Center"

Notice that a "thank you" message of this kind is designed to prompt further business. When he saw this card, one skeptical owner said 99% of his customers wouldn't even read it. They would simply throw it in the trash on the way out. This indicates that this shop doesn't employ sales-oriented estimators. Any estimator whose pay is based partially on performance and who has the slightest idea about how to sell a job can turn this card into a tool to generate future business.

To begin with, a sales-oriented estimator who is expected to follow a job from start to finish -- contacting the customer along the way and delivering the car when it's finished -- will not rely on the customer to read this "thank you" message. He or she will read the key parts to the customer, explaining the fact that the free rental car bonus, or $75 (or $100) credit can be applied to friends, family, or company cars. This way there is no confusion or misunderstanding what the incentive bonuses are.

The estimator already knows if the customer has rental car coverage or towing, so this is an opportunity to ask if a friend or someone in the family could use the discount to get some old damage repaired. Also, the estimator might mention that the term, "friend," could apply to anyone the customer knows: his barber, her hairdresser, doctor, lawyer, dentist, and pharmacist, among others.


Personal web of connections

Each of us has our own personal circle of service providers: hairdressers, barbers, auto mechanics, auto dealerships, appliance repair people, stock brokers, bankers, dentists, doctors, optometrists, other health service providers, home maintenance people, insurance providers and agents, entertainment and sports contacts, and more. And these don't even include an employer, fellow employees, an employer's customers, and other business contacts. On average, most people probably have several dozen regular or occasional repeat contacts.

When you think about word-of-mouth referrals, all of these contacts are referral prospects. Why aren't more of your prior customers continually referring at least some of these contacts to your shop all of the time? Probably the biggest reason is that accidents are random events and it would only be by chance that one of a prior customer's contacts would mention vehicle damage in time to prompt a referral.

So what can you do to capture more of the potential business that exists in your prior customer's web of contacts? This simple "Thank You" sale, when a customer's vehicle is delivered, provides an ideal, but brief window of opportunity.

Generating your own referral sources

When I suggested this "Thank You" sales strategy to another client, he said, "I'm not interested in retail. I only want wholesale referrals." We did put a lot of effort into getting insurance people to come look at his shop and succeeded with a few.

Unfortunately, his shop didn't really measure up to the quality of many competitive shops in the area. In this area, insurance company direct repair coordinators can choose from shops with multiple spray booths, multiple frame machines, multiple high-speed spot welders, offices as big as some hotel lobbies, and many spotless, covered work bays. A couple of insurance people who did come look at this shop weren't impressed with his ancient cross-draft spray booth, one frame machine, no spot welder, and a half-dozen messy work bays.

In his area, he had little chance of getting a DRP relationship. He should have been excited about a program with a high potential for developing a lot more "retail" business by capitalizing on every customer's connections. Promoting new business is more difficult for a body shop where people only come when they have a damaged vehicle, but "difficult" doesn't mean impossible. Mortuaries only get customers when people die. If they can generate business, there's no reason why a body shop can't do as well when it has the advantage of selling to people who are still alive. It just means the shop owner, manager, or estimator has to look at each customer's potential worth and recognize when he or she has a "live one."

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.


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