After meeting with hundreds of auto body shop owners and General Managers over the past several years, it seems there are some similar reasons why people don’t participate in 20 groups. Some of the primary reasons seem to include:
#1: “I don’t have time.” This one actually breaks down into several “sub excuses.” The first is “I’m afraid.” Afraid of not knowing my numbers. Afraid my numbers aren’t good enough. Afraid other people will ask me questions I can’t answer. Afraid I won’t want to do what others suggest. Afraid of becoming a business owner rather than a shop owner. The second is “I’m staffed to work in my business, not on my business. These folks, rather than focusing on investing to grow, are just keeping up with paying the bills. Many of these reasons are valid, but it’s important that we see the forest through the trees and truly understand the long term value 20 groups offer.
#2: “It costs too much money.” With continued margin compression, on the surface this excuse seems more reasonable. However, you have to really quantify the cost/benefit analysis. One of the best things a good 20 group can do is help you better manage your margins. So let’s say you run a $1M shop and your current gross profit margin is 40 percent, or $400,000. Let’s say you participate in a 20 group that can help you identify 3 new strategies that will help you grow your margin by a small 1 percent to 41 percent or $410,000. The average 20 group can cost several thousands of dollars a year, so that means it’s likely that at least some of that 1% margin improvement will drop directly to your bottom line. It pays to put this analysis down on paper, so that you can actually measure the return you are getting for your investment. Again, investment is the key here.
#3: “I was in a 20 group a long time ago.” It’s easy for all of us to think we’ve maxed out our learning. But it’s rare to find anyone in this business who doesn’t have anything they could do to improve their overall operational or financial performance of their business. And frankly the longer we are all in this industry, the more we think we know it all. But every time one of us old timers gets back into a group, they almost never walk away without at least a small handful of new ideas they can try back home. And our industry is changing so rapidly, that getting constant exposure to new, best-of-class practices makes good sense.
Understanding the value
So what do 20 groups do?
- Share best practices — it’s impossible to keep track of all the new technology, materials, processes and procedures at play in today’s collision industry. You need to stay current, and 20 groups are an excellent way to do that.
- Hold yourself accountable — 20 groups force you to articulate goals you want to achieve and the process/projects you will need to implement to achieve those goals. If you do this process on your own, it’s easy to backtrack and let yourself off the hook. When you lay out your plan to your 20 group, and then update them at the next meeting, you put yourself on the hook to be accountable for making progress.
- Leverage the resources of your partners — many of the major paint suppliers run 20 groups, and franchise organizations like CARSTAR offer them as part of their overall services. If these partners are already paying part or all of the costs of 20 groups, use them to your advantage.
- Make lifelong friends — while this is a tertiary benefit, many of us have seen the deep, personal relationships that form after years of participating together in 20 groups. The trick here is not to get too tied to a group, as it helps to “mix it up” with different groups so that you get exposure to different ideas all the time.
So the next time you decide to pass on 20 group participation, rethink whether your best interests and your future are at stake.
