In an era when body shops have become a drag on dealership operations, the DarCars Automotive Group in Maryland has turned its collision shops into a significant profit maker.
In 2005, the group's 10 collision shops brought in more than $33 million in body shop revenue, led by its Silver Spring Toyota store, which ranks 61st on this year's Ward's 500 and second in body shop revenue with nearly $14.7 million, repairing an average of 740 vehicles a month.
Nearly 40% of that revenue goes right to the bottom line, says Patrick Power, the group's body shop manager.
The group began focusing on its body shops 10 years ago, says Vice President Tamara Darvish, who believes that, to be successful, dealers must understand that part of the business.
She spent several months working in the body shop doing all of the different jobs, and says, “Now when I manage it, my managers don't look at me like I'm crazy.”
DarCars has put together a strong management, with one person responsible for the retail part of the business and another who handles the business from insurance companies. Both managers report to Power, who works closely with Darvish.
Close relationships with the insurance companies are critical, says Darvish.
“One in five people who buy a car will wreck it,” she says. “And the insurance companies have a lot of power of where they send that business. That's why it is important for the dealer principal to be involved.”
Power or Darvish talk daily with the insurance companies. Meanwhile, most insurers have adjusters with their own offices on site.
Also critical are the right processes. DarCars learned many of its processes from Toyota Motor North America Inc. and even from one of its insurance companies, which demanded certain processes to manage customers better and repair vehicles faster.
Vehicles are in DarCars' body shops for an average of four days. The industry average is 14 days. “It's all about beating the clock,” Darvish says.
Power says the group has become creative with its parts-cutting booths to reduce time vehicles are in the shop. The company also is painting vehicles 24 hours a day to reduce down time.
“We can fix a car in a day now,” he says.
Top 10 Body Shop Revenue
|Overall Rank||Dealership||Body Shop Rev|
|2||Fletcher Jones Motorcars||$15,082,073|
|467||Larry Miller Dodge||$11,611,303|
|353||Voss Chevrolet, Inc.||$11,073,852|
|108||Suburban Motors Co., Inc||$9,344,680|
|415||Huffines Chevrolet Subaru||$9,010,895|
|31||Al Serra Auto Plaza||$7,892,048|
|221||Fletcher Jones Toyota||$7,656,682|
|161||Larry H. Miller Chrysler Jeep Dodge||$7,006,687|