Your questions posed to our experts - with Gordon Grant, Accident Exchange.
Q. Will the recession change the way credit hire companies operate?
A. In essence, no. The principle function and financial benefits of credit hire remain the same – to provide customers with continued mobility and valued assistance when they need it most.
Commercially, fleet residual values were hit, but then they appreciated and have now started to stabilise. However, that didn’t really impact operational challenges in real-time.
If anything the recession amplified how important an individual dealer’s application and approach is to the success of a proactive accident management service.
It’s a fact underlined by the introduction of our ‘Together We Can Beat It’ consultancy programme. Launched in response to dealer lethargy and distraction in the face of diminishing new car sales, rather than focusing on existing customer car parc, the campaign has seen the average dealer record a 28% uplift in profit from the service during the last quarter. Indeed, some sites increased revenue by as much as 300%.
In simple terms, the current economic landscape has seen credit hire operators make sure dealers get back to basics so that they can look at ways of thriving rather than just surviving the recession.
Q. How has Accident Exchange and accident management helped dealers in the
A. The fact that too many dealers became obsessed with finding customers in a depressed market, rather than concentrating staff efforts on maximising the opportunities from their existing car parc, prompted us to launch the ‘Together We Can Beat It’ consultancy programme.
Working in tandem with senior dealer management we gained unrestricted access to body repair estimates, call logs and staff interaction with customers at participating sites. On a dealer by dealer basis, best practice methods were agreed and rigorously implemented in order to maximise revenue from customer’s involved in accidents.
Seven months on and the average participating dealer has recorded a 28% uplift in activity from accident management services. During the last quarter alone, some sites have recorded a 300% rise and have experienced the knock on benefits that include incremental business to the bodyshop and new car sales.
As a ‘from the top down’ initiative, the results speak for themselves with dealers benefiting hugely from a more purposeful approach to the importance of post-accident care throughout the dealership.
Q. Apart from referral revenue, what else can accident management offer my dealership?
A. Accident Management provides your customers with a service at a time when they need help the most, following an accident. The knock on benefits include customer retention, satisfaction and loyalty which are invaluable to your business during these testing times.
It not only provides significant business gain for your dealership and also benefits bodyshops,
manufacturers and insurers. Repairs will deliver an average of £1,800 in OE parts, sold hours and materials. Total losses (circa 20% of cases) will provide instant vehicle sales prospects and 40% of customers who have their vehicle repaired will change it within the next 12 months.
Customer satisfaction is a fundamental cornerstone on which to build the business for the
future and accident management provides an opportunity to provide consistently high levels of service at a time of genuine customer need.
Everyone in the business needs to be familiar with the benefits of accident management.
Regular training across all departments helps to maintain customer education, and with it improved satisfaction and sustainable business growth.
Q. How important is it to educate your customers about your accident management service?
A. It is crucial for the well- being of a dealership to fully educate their customers about the variety of services that they offer including their legal rights in the event of an accident.
The role of frontline staff to keep hammering home key revenue generating messages has a very real impact on your P&L line. Accident management falls directly into this area.
Dealers must educate their customers about their rights if they are involved in an accident, otherwise the customer will continue to be educated by the insurance sector who don’t always have the customers’ best interests at heart.
We estimate that dealers lost in excess of £100m profit in the first quarter as staff failed with the most basic of "information tasks". Staff trained in delivering the right messages and who are motivated to do so, will make a real difference to the bottom line.
Accident Exchange puts the customer at the centre of everything and consistently delivers against their post accident needs in line with their legal entitlement.
In doing so we are able to help you to drive income to your bottom line, but your customers must call us first, and therefore need to be continually reminded of the benefits associated with doing so, and the potential risks if they don’t.
Q. What can bodyshops and insurers do for each other to ensure their relationship runs smoothly?
A. Accident management companies have a legal duty to mitigate costs on behalf of the insurer. Unfortunately, the traditional ‘one size fits all’ approved repair network is actually “cost inefficient” and working against insurers.
The much-hyped PAS125 standard is certainly a positive step forward, but still a generic approach. The technology utilised in today’s motor vehicles can leave generic repairers well short of the mark. A nationwide network of specialist body repairers, focusing on a selected marque or marques will ensure improved competence and capability through controlled and targeted investment. Parts will be more readily available and repair cycle times will be reduced.
By definition, specialist repairers will be more likely to fix a vehicle correctly first time, reduce the time and expense associated with rework and generate a positive impact on the whole customer experience.
Our manufacturer approved bodyshop partners all fall into this category, which allows them to exercise more control on costs and ultimately, deliver increased profitability which can be shared with the insurer.
The insurance industry is always looking to take out as much cost as possible, so any initiative that improves efficiency should be music to their ears.
Q. Is this a time to cut back on marketing spend, stick with the knitting or consider different sales channels with a view to the future?
A. It’s been proven time and again that businesses who continue to create noise in a recession, emerge stronger. It’s like a marathon. First out of the blocks will seize the lead and go on to increase the gap over the competition as they dither. Over time it gets tougher for your rivals to regain lost ground when the pace picks up again.
But, survival should not be blinkered to “where is the next car sale coming from?” Dealers need to focus their marketing activity – which doesn’t always mean spend – equally on customer retention and customer acquisition. They go hand-in-hand. The former requires common sense and processes, the latter financial spend. It’s easy to forget that an existing customer can generate revenue – servicing, body repair, MoT, future sales and recommendations.
Don’t be blinded by the lack of footfall from traditional activity but focus on the sources of income and profit that you have previously taken for granted. Ramp up your marketing activity to your existing customers, they are still there and represent a better proposition today than they did six months ago.
More from Gordon Grant
In the current economic climate the biggest hurdle facing manufacturers and their franchised networks is “face time” with customers.
Every time a customer does come through the door, it is critical that they enjoy a quality service and experience. The net result is improved revenue and, of increasing importance in today’s economy, advocacy.
At accident management and business solutions provider, Accident Exchange, Gordon Grant assists the Company’s manufacturer and dealer partners to tick both boxes through a suite of innovative services and products.
As part of his role as Manufacturer Account Director, Grant delivers strategic and practical advice to manufacturers and dealers, firstly, by making sure accident repair work from existing customers is retained within the business, and secondly, by delivering a positive and consistent brand integrated customer experience.
At the heart of the Accident Exchange offering is a simple truth: that, unfortunate as it is, accidents do happen.
Indeed, 16 percent of a manufacturer and therefore franchised dealer’s car parc will suffer an incident this year. Ten percent of that number will be written off by the insurer to leave the owner on the hunt for a new vehicle. Of those in for repairs , only a minority percentage will find their way into the manufacturer approved network.
The numbers don’t stop there according to Grant.
“Research by independent bodies, suggests that 40 percent of customers involved in a fault or non-fault accident will change their vehicle within twelve months of the incident. That’s a further revenue opportunity if handled appropriately,” he explains.
Grant comments, “The accident repair sector presents an excellent and relatively untapped opportunity for manufacturers and their dealers to improve customer satisfaction, retention and advocacy, improve revenue streams and network profitability whilst simultaneously demonstrating a proactive duty of care. Adopting this approach will make manufacturer approved networks the customer’s natural choice in the event of an accident.
Formerly a Business Unit Director at Carter & Carter, Grant managed and developed Accident Repair programmes for Bentley, General Motors, Jaguar, Land Rover, Peugeot, Toyota and Volkswagen Group.
Manufacturers and dealers who understand the benefits of a proactive, holistic accident repair programme generate more car sales, improved customer satisfaction, higher penetration of OE parts and materials and a significant uplift in sold hours in the workshop.
As part of its business solutions identity is the design and implementation of Body & Paint Programmes for manufacturers.
Under Grant, Accident Exchange is already responsible for the provision of strategic and resource support for the on-going development of the Bentley Motors Global Paint & Body Network.
“From defining and assessing standards, to people, process and performance improvement, our role is to ensure that the network understands, embraces and delivers against the brand vision and objectives,” says Grant.