Competing with MSO Consolidation

Competing with MSO Consolidation

“The 3 Vital Behaviors of the Best of the Best Shops”

There are shops that are located in heavily MSO consolidated markets that instead of becoming a victim, became a beneficiary! I call these shops “positive deviants.” When many shops in these parts of the country are struggling or selling out, the positive deviants are actually doing quite well and in many cases outperforming the consolidators! One of these best of the best shop owners told me they have all four big MSOs (Caliber, Gerber, ABRA, Service King) within a five mile radius of his shop!  So I am prompted to starting asking the question, what are these guys doing differently than the independents that are struggling in the same markets?

After speaking to many positive deviant shops, and asking them what they do to get great results, I got many of the usual answers that you would expect from a successful organization. Good leadership, high quality work, good customer service, great employees, bla, bla, bla. But these things anymore are kind of a “given.” Even to be a mediocre business you need to have some level of these qualities.

So I searched deeper to distill the findings into what I call the Vital 3 Behaviors.

  1. Culture of Learning
  2. Participation in a peer group or network
  3. Measure the Right KPIs

All the positive deviant shops strongly display these 3 Vital behaviors, struggling shops don’t!

Vital Behavior 1 – Culture of Learning

These businesses crave knowledge! If you don’t believe me, look at the in-depth I-CAR study on the subject. (Check it out at ) I-CAR contends that A Learning Culture is at the very foundation of all the super successful shops they studied. The very understanding of things such as proper business management, leadership skills and process development skills stem from the leaders desire to learn.

They seek their knowledge from sources such as I-CAR, Webinars, and Clinics. They typically read books regularly, and are continuously looking for new sources of education.

Vital Behavior 2 – Participation in a peer group or network

Some of the positive deviants are very involved with their associations such as ASA, others join franchise organizations, and many get involved in round table groups that their paint manufacturers host.

Shops that feel like they are alone on an island, can’t and probably won’t succeed. There is power in numbers far beyond the sum of its individual members. Some of the benefits that participation in a group includes…

  • Mastermind principal – a group of like-minded individuals with the same challenges working together to achieve great things
  • Friendly competitive spirit between members
  • Accountability to one another
  • Massive knowledge resource. When you are on the island you only have your own knowledge, in a group, you can have everyone’s!
  • Leadership skills – by participating in a group of people trying to better themselves and their shops, skills such as leadership are enhanced, you learn to present, become a more professional and rounded person.
  • You learn to “See beyond you own walls” so to speak.

Vital Behavior 3 – Measure the right key performance indicators

The third vital behavior was Measure KPIs, but I was reminded by one of the positive deviant shops that it is important to measure the “right ones.” He was right, there are some shops that become immersed in the minutia of meaningless metrics. It’s important to identify which numbers will truly guide your business to success and then you have to look at them daily, not at the end of the month when it’s too late, but every day or as often is required to make course corrections.

Positive deviant shops know that you cannot improve what you do not measure. These shops try to get a little better each day, each week, and each month and they know their numbers!

In order for independent shops to continue to be successful in today’s challenging marketplace it is critical that we learn by carefully studying the habits that make best of the best positive deviant shops successful. It is also advisable to study the administrative processes that give the MSO consolidators the ability to grow at such a rapid pace while still performing repair jobs with amazing timeliness and consistency. Independents can in fact remain very relevant with both customers and insurers, but you may have to do things a little different and perhaps a little better.

About the Author:

Dave Luehr
Dave shares his experience from over 30 years as a collision repair industry leader in leadership, lean and Theory of Constraints. Once the owner of a body shop himself, Dave draws on the realities of a real world collision repair shop in his consulting, writing and keynote speeches.

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