It’s easy to get in the mindset that bigger is better. As humans, we’re wired to think that size is equal to power and status – the more we have, the more we can do. It makes sense, right?
Not always.
When we asked industry expert Louie Sharp, owner of Sharp Auto Body in Island Lake, Illinois, how much harder it was for smaller independent shops to compete with larger MSOs in their area, he gave me a very blunt answer.
“I think your terminology is AFU – all f***ed up,” Sharp says. “It’s just the opposite. I think it's much harder for the consolidators to compete with the independents. I don't think it's hard to compete against them.”
We posed the same question Joe LaBruno, owner of two-shop operation First Aid Collision in Arden and Asheville, North Carolina. Again, a similar refrain.
“It's not as hard,” LaBruno says. “I think it's actually easier.”
So why is that? Sharp says there are several advantages that independents carry over their larger regional competitors, but ultimately it comes down to one thing.
“It's the speedboat/aircraft carrier analogy,” he says. “You can turn a speedboat on a dime … and head in a completely different direction. It takes you miles to turn around an aircraft carrier. The bigger the ship you're going to turn around, the more energy and time it's going to take. An MSO is going to take longer to implement new strategies than an independent shop. And for a consolidator, it's like an act of Congress.”
The ability to make decisions and implement changes in your shop, whether those are team policies or new repair procedures, quickly and efficiently provides a shop that is up-to-snuff on new trends and tools a huge leg up over MSO competitors.
LaBruno says on top of quick decision-making, smaller independent shops have a level of personal connection with their customers that MSOs just can’t match.
“We know they have all the shops – and don’t get me wrong, they pour a lot of money into what they've become – but their service is just not that great,” he says. “One of the things we strive to do is create good customer service and take care of our customers. In my opinion, that's what makes it easier.”
If independent shops play to their strengths, they can successfully take on MSOs and be the top shop in their area. However, just because independent shops have inherent advantages, they can’t rest on that alone – they need to build strong teams with keen attention to customer service to stand out from the rest.
Be the hometown hero
For a long time, shops were able to operate under a mantra very similar to the famous adage from Field of Dreams and see success.
Sharp says those days are long gone. Shops have to actively work to position themselves as the expert in their area – both in regard to fixing cars and in taking care of customers.
“You've got to get out of the mindset that if you're there, people will come. It's not hard to position yourself as the expert,” Sharp says. “You become the expert in your market area by adding value.”
Most customers these days assume that most shops they take their car to, whether it's an MSO or an independent, will be able to do the repair work itself to a fairly competent level. Instead, Sharp and LaBruno say the best way to start building on your advantage and set yourself apart is to improve your customer service and presence in the community.
People trust their hometown shops. LaBruno has been in his community for almost 20 years, and in that time, he’s built relationships with the local high schools and technical colleges. And it’s more than just a financial contribution that many larger corporations also make. His shops host apprentice programs and other hands-on opportunities for students in the area.
Investing in things your customers care about – namely their community and their kids – and then backing up that investment with high-quality services will go a long way in building your shop’s local reputation.
“One of our biggest marketing tools is our customers' experience and word of mouth,” LaBruno says. “The perception of the company is out in the open for the customers.”
Sharp says that kind of investment in the community can also be the perfect opportunity to learn the needs and wants of your specific demographic, which can help you customize your customers’ experiences in a way that larger shops can’t.
“If you have an idea of the specific people you want to serve, as an independent shop it’s very easy to add features and services that add value to your ideal clients,” Sharp says. “I have loaner cars, free pickup and delivery, and I also have free on-site estimates. Can a consolidator do that? No, it's too difficult for them to have that.”
No ‘I’ in team
As most shop owners know, they can’t do everything by themselves. Sharp and LaBruno say that in order to make the most of your independent-shop advantage, you have to have a strong team in place.
“Your shop has to have values, and you have to build a really strong team. That comes from good leadership,” LaBruno says. “Without those things, you will always find challenges that prevent you from getting to the next level.”
It’s easy in a more corporatized structure for employees to get lost in the shuffle and feel like just a number. For smaller shops, LaBruno says it’s critical to make sure your employees are not just taken care of financially – such as good pay and benefits – but are also taken care of from the sense of personal and professional fulfillment. If they feel like you as a leader are invested in their professional development and personal success, they’ll be more willing to buy into the strategies your shop implements.
“Because of that [buy-in], we're able to build a strong feeling of being a team. If you just feel like you're a number and you're not part of a team, you don't perform very well,” LaBruno says. “Not only that, but eventually you're going to start looking to find that team.”
There’s a level of humanity and personal connection that independent shops can share with their customers that larger operations can’t. Building a strong, tight-knit team and offering more personalized services are the most effective ways to capitalize on your independent-shop advantage.
That, LaBruno says, is best for the customer.
“And if it's good for the customer, it's good for the company,” he says. “I try to ingrain that in my leaders, because at the end of the day, that's what it's going to come down to.”
