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Accident management income is "recession proof"

Despite the predicted economic slowdown, dealer's can guarantee at least a third of their profits from 2007 if they have an accident management programme.

That's the view of Steve Evans, chief executive of Accident Exchange, which generated over £250m worth of revenue for its dealer partners in 2007.

"New and used sales are directly linked to the health and wealth of the economy, but the revenue from accident management is recession proof," saidEvans.

"The business is not reliant upon consumer spending or sentiment. Even if you don't sell another car this year, 1 in 8 of your existing customers will have an accident and that's an opportunity."

The average dealer can generate a third of their annual profits from an integrated accident management programme, according to Accident Exchange data. A prestige model involved in a non-fault accident can generate £2,500 in revenue from credit hire commission, OE parts, bodyshop hours sold and materials.

Evans added: "The customer pool exists, the support role is there to be played, so dealers who blame the economy for lower margins in 2008 will be ignoring a major P&L line. Some of our dealer partners added £300,000 in credit hire commissions alone last year."

"The earning potential from accident management is guaranteed. You can't say the same about the rest of a dealer's business."

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