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Tag Archives: bodyshop supplies

Is “buying” bodyshops business by paint companies sustainable?

After rubbing the shoulders with businesses involved in car refinishing for more than 15 years, I can surely state that certain paint companies implement aggressive market share acquisition as their main growth strategy. In practice, a paint supplier invests in the potential customer -bodyshop- by offering equipment, tools, spray booths and even cash money against the long term binding supply contracts. This is a very common practice in many countries, especially in developed and mature markets, where the growth in organic way is difficult.

Acquisitions, aggressive growth strategies and buyouts are not new in our business environment. In fact, it is very common in some industries. However, I would like to elaborate on this subject in the light of the automotive refinishing industry.

How does it work?

If you are not familiar with the above-mentioned contracts, let me describe them in a few words. Imagine a bodyshop with good or growing business, or even, a new, but promising collision repair shop. Any bodyshop needs primarily two groups of suppliers: spare parts supplier(s) and paint related materials supplier(s). If you are a potential supplier of paint materials, you have a lengthy road to go through in order to get the desired account. You have to prove that you have better product, prices that are more competitive, superior service and unmatchable technical support.  Sounds like very hard thing to do, and it is very hard indeed. There is another way though. If your company has plenty of “free” cash, you can offer the potential customer very tangible, benefits upfront. The size of the investment depends largely on the perceived amount of sales a soon-to-be paint supplier projects. From my experience, the investment may comprise from free spray guns, sanders, polishers, free load of toners to the mixing machine to brand new spray booth and a lump sum of cash into account. Looks very promising indeed.

Possible pitfalls.

I do not want to criticize the paint companies.  Not at all. In fact, this strategy though might hide certain risks and pays off. Otherwise, highly skilled managers wouldn’t proceed with this. The risks are definitely well calculated. On the other hand, if I were a bodyshop owner, I would have considered a number of risks for my business.

Firstly, everyone should understand that multinational companies, and big automotive paint manufacturers are no exemption, are businesses with very well-tuned profit generating machines. Every investment, big or small, is planned to deliver cash to its stakeholders. Therefore, initial cash infusion in any form will be certainly calculated into the prices charged in the future.

Secondly, binding contracts limit a bodyshop owner in the choice of suppliers, thus new products and technologies from other brands would be beyond your reach. Some of those contracts are very strict, meaning that you must buy everything through a given channel, appointed by that paint company.

Third, in case you would like to sell business, any binding contract would be considered as a liability, which will decrease significantly the sales price.

In any case, any decision of undertaking restrictive obligations must be very carefully analyzed. Remember, sweetness of free stuff will be gone quickly, but bitter taste of obligations burden will stay for a long time.

 

What traits that successful car paint store owners have in common?

By Alexander Aslamazis

I am lucky with my job. I will never stop repeating this. Travelling is a big part of my business, while meeting new people in different countries is probably the best part of business travelling. Without a doubt, I primarily get in touch with people from our trade: car paint experts, manufacturers, body and paint shop owners, paint sprayers, and, of course, jobbers (or else called factors, paint suppliers or simply “paint guys”). It is difficult to underestimate the importance of paint retail shop. In fact, every body shop has one key supplier, whose role is to satisfy needs for paint and consumables without interruptions.

As in all businesses, you can identify the jobbers, who are above average, very successful and standing out of the crowd. After twelve years on the road, visiting paint supplies stores and acquainting their owners and managers, I realized that the top of them have some traits and characteristics in common. Apparently, I have distinguished 8 traits, which best performing traders have.

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  1. Successful jobbers really love what they do. Trust me, to be successful in our industry without enjoying paint smell and shiny appearance of newly refinished vehicles is not possible. It must be in your blood.
  2. Successful jobbers are experts in color matching. Sometime ago I wrote an article in Etalon Refinish Blog on this subject. The absolute majority of all car body professionals consider poor color matching their biggest problem. This is why giving a solution for difficult-to-match colors is vital problem to be solved by the paint suppliers, which defines success.
  3. Successful jobbers know in depth all the products he or she has on their shelves. Profound knowledge of every brand and material, its competitive advantages, as well as the capacity to communicate this knowledge to customers, define prosperous paint and body supplies professionals.
  4. Successful jobbers are early adopters of industry’s novelties. They embrace new technology before most of their peers do. Whether it is about new tool, material or concept, successful paint supply business will always find space in his shop for it. The same applies to newcomers, fresh and innovative, but unknown brands.
  5. Successful jobbers are likeable. As I read in a recent article in “Entrepreneur” magazine, being likeable is under your control, and it is a matter of emotional intelligence (EQ). Studies revealed that top adjectives, which describe likeable person, are sincerity, transparency, and capacity for understanding.
  6. Successful jobbers don’t spend all their time in their shop. Let’s put it straight, you can not understand the needs of your customer without spending time in a bodyshop.
  7. Successful jobbers always invest in stock. Without a doubt, having your warehouse full is a key for success. Even if you have some minor products missing, you are opening doors to your competitors. Availability of products is crucial.
  8. Successful jobbers never stop learning. The biggest mistake one can make is to think that he knows everything. Car refinishing industry develops very fast. New paint systems, spraying equipment, tools and application methods appear all the times. Believe me, old training certificates and years of experience are not enough to succeed today. Visit seminars, trainings, exhibitions and trade shows. Be ahead of your competition by continuous self-education.

Certainly, this list is not exclusive. And what do you think? What are the traits of successful paint supplier?

shiny car

 

 

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