Business? How s Your FEATURE

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1 FEATURE How s Your Business? AutoInc. asked ASA member-shops to complete a questionnaire about how their businesses were performing through the first six months of Here are some select figures that represent the highlights of what they told us. EDITOR S NOTE: Due to rounding, some percentages may not add up to 100 percent. In other cases, percentages greater than 100 percent may result if respondents were able to select more than one answer to a particular question. T his year s How s Your Business? survey once again provides you with vital information about how you and your peers are faring in key shop performance areas. We ve used the most current figures available from the United States Bureau of Labor Statistics to learn that as of 2014, when our most recent survey took place, the number of general automotive repair locations (mechanical) was 80,032 with 333,767 employees. January/February 2017 feat_janfeb2017_autoinc.indd 19 The number of collision repair locations (not including dealership body-shop locations) for 2014 was 33,809 facilities with 219,484 employees. With regard to estimating the current number of shop locations for 2016, we ve taken a conservative approach, basing our totals on overall economic conditions as 3 percent growth rate for mechanical shops and 1 percent for collision shops. General Automotive Repair Locations Collision Repair Locations 2014 Estimated: 80,032* 2014 Estimated: 33,809* 2015 Projected: 82, Projected: 34, Projected: 84, Projected: 34,488 *Source: U.S. County Business Patterns 19 12/16/16 3:13 PM

2 FEATURE Mechanical Demographics/Business Profile Number of operational bays at facility: PROFITS Sales compared with 2015 REPAIR ORDERS PER MONTH 3 or under 13% % or more 19% OWNERSHIP STATUS 24% 21% 55% No Change Decrease Increase 35% 28% 37% 98% Independent 2% Franchise/Network Consolidator/Dealership RESPONDENT S CURRENT POSITION ESTIMATED GROSS ANNUAL SALES FOR 2016 (single repair facility) 1% Under $100K 5% $100K-$250K $250K-$500K PRIMARY BUSINESS AFFILIATION NAPA 21% AutoCare 10% CARQUEST Tech Net 6% AAA 9% ASA 35% ASE Blue Seal 10% Bosch Service Center 9% 87% Owner 7% 3% 2% 1% Manager Technician Service Writer Administrator $750K-$1M $1M-$1.5M $500K-$750K 9% 8% 18% 21% $1.5M-$2M Over $2M 27% 20 AutoInc.org January/February 2017

3 PERCENTAGE OF WORK TYPES 56% 38% Repair Maintenance 12% Other AVERAGE TICKET CHARGES Under $200 6% $200-$250 10% $250-$300 13% $300-$350 14% $350-$400 $400-$450 13% $450-$500 7% Over $500 21% SALES PERCENTAGES COMPARED TO 2015 No Change 25% Decrease 55% Increase AVERAGE NUMBER OF VEHICLES SERVICED PER MONTH 8% Under 50 YES 75% 89% 61% IMPACTS ON BUSINESS OVER PAST SIX MONTHS NO Are customers regularly maintaining their vehicles? 25% Are customers purchasing major repairs? Are customers contemplating a new vehicle purchase? 39% HYBRID VEHICLE SERVICE PROVIDER SPECIALIZED REPAIR FACILITY 3% 4% 8% % No 62% Yes 76% No 24% Yes 9% More than 400 January/February

4 FEATURE Mechanical YES 28% NO Changes planned to service fewer models 80% Selling business within next five years 72% Member Profile Average age of respondents Average number of years in industry BIGGEST CHALLENGES 45% Technician Shortage Marketing 18% Profitability 6% Changes in technology Parts quality Family ownership YES 89% NO PRIMARY SOURCE FOR PARTS Aftermarket Dealership Mechanical Parts 92% 8% 77% want to know the manufacturer of private label parts Engine Performance 84% 82% want to know when the manufacturer of a line item has changed Electronic Components 56% 44% 22 AutoInc.org January/February 2017

5 See how your shop compares with other independents: Mechanical AVERAGE ANNUAL TRAINING HOURS PER TECHNICIAN EMPLOYEE 56% 17 or more 10% 17% 17% 26% AVERAGE ANNUAL LIVE HOURS TRAINING VS. ONLINE PER TECHNICIAN EMPLOYEE 22% 14% 38% More than 17 AVERAGE ANNUAL LIVE HOURS TRAINING VS. ONLINE PER FRONT-OFFICE EMPLOYEE AVERAGE ANNUAL TRAINING HOURS PER FRONT-OFFICE EMPLOYEE 41% 23% 27% 9% More than 17 36% 17 or more 30% 13% 21% AVERAGE ANNUAL TRAINING HOURS PER OWNER/MANAGER 58% 17 or more 15% January/February

6 How s Your CollisionBusiness? Mechanical and Survey Respondents Share Their Thoughts Business has been great, especially the past 3-4 years, about 40 percent growth in the past three years. We went from eight bays to 12 and have pretty much grown out of that space. Finding a good in-city location and finding good employees are the biggest challenges I face. Coaching and mentoring is the key to success. You should have one, and you should be one. The inability of independents to perform recall repairs and download recall software hurts the ability of the public to get their cars fixed. Most recall repairs are very simple and easy to do. Manufacturers should open the gate [and] let others do recall repairs. I live in an area where it can be over 100 miles to a dealership for a recall. Not a good situation at all. Business outlook for the future is good for shops like ours that invest in the tooling and training necessary to repair the high-tech systems in today s cars. My biggest problem this year was employee life issues: serious injury, custody battle, divorce. All these issues Business is up this year, we have changed some marketing programs and concentrated on finding and selling maintenance items. pushed production way down. Business for 2016 has been above and beyond what we expected. I feel that with ASA and all of the talent that we have in ASA, we will continue to grow by leaps and bounds over the others. It s important that we get some new blood in the industry. If no new blood is coming in, profits will get lower because of pay scales. Insurance compensation for needed repairs is insufficient to keep qualified technicians in our industry. When you say technician shortage, I think it s more like a passion-for-our-business shortage. I do not see the younger technicians with a 5-year or 10-year plan. The intrusion of insurance companies trying to set industry standards and their control of rates through their DRPs are killing independent shops. Costs of training, equipment, materials and insurance keep rising, while rates stay the same. January/February