Over many years, there has been a trend for independent repairers (IRs) to gradually eat away the market share of the franchised workshops (FWS) – i.e. generally the workshops of car dealers and authorised repairers who meet manufacturer-defined standards.
There are specific examples where IRs have pushed into repair and maintenance for newer cars, including fleets, such as Bosch Car Service across Europe and Halfords in the UK, and there are examples where the franchised sector has pushed into the independent market such as the Motrio chain established by Renault or the launch of IR sub-brands by some Dutch groups such as PON and their “De Garage” brand in the Netherlands. However, these are exceptions, and the scale and scope of IRs in general is more limited – the question is whether they can evolve to be a real threat across the board?
Scope
IRs can be broadly split into one of six categories – independent garages (typically owner-operated), multibrand franchises (which may still include owner-operators, but with some centrally provided services), auto centres, fast-fits, tyre specialists and bodyshops.
The average independent garage and multi-brand franchised repairers cover service work and the replacement of wear and tear parts, as well as mechanical repairs, as its core business, optional tyre and body repair services are included in their portfolio as a diversification. Depending on the skills of the technicians and the available equipment, few are specialised in body and paint repairs and/or auto glass replacement. The latter have mainly evolved from a true body repair workshop or auto glass garage into a mechanical repair workshop, or at least for changing wear and tear parts as well and doing service work.
Auto centre and fast fits chains are characterised by their own parts logistics and specialise on “basic” services such as car service, replacement of wear and tear parts as well as tyres. Depending on their individual business strategies most auto centres also diversify offering some mechanical repairs. Few of the auto centres we investigated also offer auto glass repairs as an additional service.
Tyre specialists are more or less only focused on their core competence. We recognise however the diversification towards car service, wear and tear replacement and MOT, and additionally they are increasingly working with fleets for tyre change. The centrally driven franchised tyre specialists are targeting the mechanical sector to try and gain car service or replacement jobs. The challenge is and will be to satisfy the customer that a skilled and qualified technician will be carrying out the work in the right time and to the right standard.
Most players however seek some level of diversification towards new profit sources due to decreasing repair volume and margins. This is forcing the workshops to compensate and win more work to achieve a higher utilisation of their facilities. This all leads to new challenges for the technicians – the repairers are no longer only focussed on their core business.
Scale
Another key difference is the scale of the IRs. There are clearly revenue differences driven by the age of the car visiting the workshop, but a useful guide to size is the number of technicians employed. The average number of staff at the different types of IAM workshops is fairly similar across Europe: 3 to 5 technicians at multi-brand franchised garages, 4 to 7 technicians at auto centres, 3 to 4 technicians at fast fits and 2 to 5 technicians at truly independent workshops and tyre specialists. This compares to 8 technicians in an average franchised dealer, ranging up into 20 or more in larger metro area dealers.
In smaller workshops, the technicians also need to take on broader responsibilities – which has both positive and negative aspects. The workshop owner is likely to be “hands-on”, and there may not be a separate service advisor on the front desk or a parts store person. From the customer’s point of view this may provide some positives such as being able to speak directly to the person working on their car, but it can also introduce some inefficiencies in terms of the productive time of the technician.
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Potential Evolution
As the technical demands of repairs increases across all repair types, putting more emphasis on diagnosis, parts identification and sourcing, training and specialist tools, the demands on repairers will increase. Less structured repairers, auto centres, fast-fits and tyre specialists are not sufficiently well-organised to face these challenges and the new diversification has an impact on the overall efficiency of their business – they have to deal with internal parts ordering, managing different suppliers and logistics for even the most basic repair. Businesses need to be able to deal with this organisation efficiently to be successful.
Operators have differing levels of investment in equipment and training available to their technicians in order to be able to guarantee their offer to the customer and they need to ask themselves if they are in a position to be able to achieve this? A well-managed and efficient working operator will be the winner and have a more profitable and successful business.
We therefore see the nature of the competition between FWS and IRs changing. The number of competitors will reduce, but the professionalism of all will increase.
WRITTEN BY RENE HERRMANN
Quelle: www.icdp.net
