Survival of the Fittest

A recent article in ABRN asked the question, “Has State Farm Started A Revolution?” The shots have been fired, the revolution is on and it may be good for the survivors, but many will not survive. It will be truly a survival of the fittest.

The article said, “State Farm just gave the collision repair industry its greatest opportunity”(and I agree). It also just gave the industry our biggest challenge. State Farm is reducing its number of direct repair shops by as much as half, according to some projections. This is also going to affect the total number of collision repair shops left in business. State Farm's program may take place quickly, but until the number of shops comes down and the discounts go away, it will not only be challenging to make a profit it will be challenging to survive.

This is not all going to happen overnight and it will be a slow and painful death as more and more shops are forced to close their doors. For some this will be a good thing, for others it will be a disaster that changes the way they make a living forever.

If shortly after the American Revolution you had asked an American was the revolution a good thing, the answer would have been, "Yes, it was great for the country." If you had asked an Englishman the answer would have been, "No, we lost the colonies and a great source of income." Both sides did survive and both sides suffered great hardships and loss of life, but there could only be one winner. The decisions we make really could be life or death for our business -- more so today than at any other time I can remember.

Some experts in article seem to think State Farm's program will eliminate the discounts. I hope so. I believe shop owners or managers will do whatever they can to stay alive. While some shops struggle to survive, weather they do or they don’t, it will hurt the industry until the battles are over and the revolution is won.

The next year will be a rocky road for most of us. The Revolution may be a good thing for the collision repair industry, but there will be a price to pay. Position yourself for the long haul and I hope to see you in business after the revolution.

Jim Patrick
Collision Repair Manager
Langs Chevrolet
Beavercreek, Ohio
[email protected]