Transcript Starting a Collision Center

Starting a Collision Center
Presented by:
Concept Overview
Overview
 What is your justification for starting a
Collision Center?
 What will your collision center do that is,
Better, Faster, or at a Lower Cost than
your competitors?
 This is normally laid out in the overview
section of your business plan.
Concept Overview
Example:
This facility is designed to utilize assembly
line production concepts, and hourly paid
technicians combined with quarterly
production bonuses. Specialty teams in each
area of the repair process include a team
leader, craftsmen, skilled technicians, semiskilled technicians and apprentices.
Concept Overview
Target Performance Parameters
 Facility staffed and equipped to handle
3,000 to 4,000 plus repair orders per
year.
 Organization with reputation and
integrity that will facilitate becoming a
direct repair shop for all major insurance
companies in the market.
 Capable of delivering quality repairs
sufficient to maintain customer
satisfaction levels of 95% plus.
Concept Overview
Target Performance Parameters

Turn light repairs around in 1-2
weeks

Turn medium repairs around in 2-3
weeks

Turn heavy repairs around in 4-6
weeks
Concept Overview
Facility Benefits
A properly configured facility operated
with the most advanced collision shop
management techniques can produce
significant additional benefits, including:

Lower cost labor through the use of
hourly technicians.

Lower acquisition cost for supplies
and materials through increased
buying power.
Concept Overview
Facility Benefits



Increased production capacity through
increased proficiency.
Improved facility utilization through the
use of assembly line concepts.
Economy of scale in support staff and
office administration.
Concept Overview
Target Market

Insurance companies write the checks
for 89% of all collision repair work
performed in the industry.
Concept Overview
Target Market
In many respects the insurance industry
and the vehicle owner have similar
interests:


They both want the process to be
convenient.
They both want the vehicle repaired
to pre-collision condition or better.
Concept Overview
Target Market



They both do not want to bring the
vehicle back for warranty repairs or
to install trim items.
They both want to have the least
amount of down time possible.
They both do not want a conflict
with the repair facility.
Sales Process
Customer Service Representatives
(CSR’s) Job Duties
This plan will employ a customer service
representative with each estimator. These
CSR’s will be responsible to:



Greet Customers
Handle customer concerns about the
insurance company
Keep customer appraised of repair progress
Sales Process
Customer Service Representatives
(CSR’s) (cont’)

Assisting estimator(s) with ordering parts, writing
repair orders, obtaining supplement
authorizations, and booking completed jobs.
 Informing each dealership when one of their
customers is at the collision shop, the progress
of the repairs and the customer
rating/satisfaction with the completed repairs.
Sales Process
Estimators’ Job Duties





Write good, quality estimates
Coordinate with all the different
insurance companies
Work with insurance appraisers and
adjusters
Coordinate appointments and time
promises with the production manager
Act as final quality control checker
Sales Process
Estimators (cont’)
 Upon completion of the repairs, the
estimator will be responsible for
performing a final walk-around and
drive inspection to assure the vehicle is
restored to pre-accident condition.
Facility Plan

Current market share potential dictates
a facility that can employ 17 to 25
technicians operating at 170%
proficiency. With plans to grow market
share, we will need to design a facility
that is capable of employing 25 to 30
technicians. This will require a 25,000
square foot facility based upon our
current design.
Facility Plan
 E&A’s experience is that a U-shaped
facility with offices in the center and
repair stalls around the center offices
works best in a high production facility.
Facility Plan Location

A properly located, designed and laid
out facility will enhance image and
reduce advertising costs over the
long-term.
Business Plan Objectives
Short-Term
 By developing from the ground up a
properly structured administrative staff,
streamlining work flow, and state-ofthe-art work distribution methods, you
should be able to have a facility that
generates a higher net operating profit
on sales and achieves a more
significant return on investment.
Business Plan Objectives
Short-Term
 Control the customer buying cycle.
We envision a sales system that
assigns estimators to dealership sales
reps. The estimators will be
responsible for keeping the designated
sales person informed of the
customer’s vehicle progress.
Business Plan Objectives
Short-Term
 Having an asset that can be easily
valued. With a collision shop
operation included in the dealers’
financial statements, it is extremely
difficult to place a value on this
operation. It is envisioned that having
a separate stand-alone facility will
provide the owners an asset that is
much easier to value.
Business Plan Objectives
Long-Term
 Control the major share of the
collision repair market. Market studies
indicate that the repair market is
approximately an $8-$9 million market.
Currently, dealers are getting about 46%
of this business. The plan is to build a
facility that is capable of producing $6-$7
million in annual sales. Ultimately, this
business should be built to have
sufficient capacity to achieve a 75%
market share at full potential.
Business Plan Objectives
Long-Term
 Improve the customer’s perception of a
collision repair and the dealership that
referred him/her to your shop. Your shop
is not just another collision shop. It will
truly be state-of-the-art in every aspect,
from location, reception area, production
areas, management and support space,
to work procedures and methods.
Other Issues
There are several items/issues that are
not addressed in this plan. They include:



How to address union/labor issues
both transitional and on-going
Skills assessments and other
processes to judge and move people
from existing operations
Parts supply alternatives
Other Issues


Other business adjunct opportunities
1. Accessories
2. Service
Insurance company relations
1. Potential pilots
2. On-going marketed activity
Other Issues



On-going support and measurement
provided by E&A
Reporting issues among vehicle
market groups…any?
Level of original equipment parts
usage and other policies
Defining the Repair Process
Repair Process
Customer Service Rep
Customer Service Rep
Customer Calls
Customer Drives In
Listen & Learn
Friendly Meeting &
Greeting
Verify Needs
Restate
Customer
Concerns
Estimate Write-up and
Approval
Determine If They
Were Referred by A
Dealer Or Other
Source
Arrange
Appointment
For An
Estimator
Give
Directions To
The Shop
Listen & Learn
Log Customers
Name In Referral
Source Log
Get All Pertinent
Info Logged On
Appointment Log
Verify Needs
Restate
Customer
Concerns
Verify Who Will Pay
For The Work If
Estimate Is
Approved
Give To Estimator
To Write Estimate
Offer To Fax A
Map
Review Estimate
With Customer
Call 4 Hours
Before
Appointment
Time & reconfirm
Obtain Power of
Attorney From
Customer To
Repair Vehicle
Sell Features,
Advantages &
Benefits
Defining the Repair Process
Departmental
Responsibilities
Compare Estimate
And R/O To
Vehicle
Have The Correct
Parts Been Ordered?
Send Info To
Parts To Reorder
Parts
No
Yes
Locate
Manufacturer's
Paint Code
Dismantle Department
Expedite
Parts
Reorder
Send New Est.
Date Of Parts
Arrival To Control
Contact Customer
If Finish Date
Changes
Production
Manager
Appraisers
Remove Parts To
Be Replaced So
Repairs Can Be
Made
Send Paint
Code To Paint
Dept.
Place Removed Parts On
Parts Storage Rack & Load
All Replacement Parts On
Same Rack
Any Additional Parts
Needed That Are Not
On The R/O Or Est.
Yes
Start
Supplement
No
Transfer Vehicle To
Next Dept. In
Repair Progress
Send To
Frame If
Needed
Notify Insurance Co Of
Supplemental Being
Started
Notify
Production
Manager Of
Transfer
Defining the Repair Process
Departmental
Responsibilities
Compare R/O
Estimate,
Reports And
Supplements
To Vehicle
Were All Repairs
Completed To The
Highest Quality
Quality Control Review
Yes
No
Determine What
Section Was
Responsible And
Reject Vehicle To
That Dept.
Followed By A
Report
Check All Fluids Make
Adjustments
Drive Vehicle
Notify
Production
Manager
Check Promise Time
And Notify Estimator
Estimator Notify
Customer Of New
Completion Time
Notify
Dealership That
Their customers
Vehicle Is
Complete
Perform Final Check List,
Sign Q/C Report And Pass
Vehicle
Send All Reports, Check Lists,
Supplements & R/O To Control To
Close Repair
Notify
Production
Manager Of
Closing
Park Vehicle In
Designated
Area
Defining the Repair Process
QUALITY CONTROL CHECK LIST
VEHICLE IDENTIFICATION NUMBER ______________________________
REPAIR ORDER NUMBER____________
MANUFACTURERS PAINT CODE_______________
DATE R/O OPENED___________ DATE CLOSED_____________
ESTIMATED ARRIVAL OF PARTS________________
START REPAIR DATE_____________
TARGET FINISH DATE AND TIME_____________
SUPPLEMENT AUTH. NUMBER__________________________
PINSTRIPE COLORS AND NUMBER______________________
PASSED/FAILED
Quality Control Checklist
DISMANTLE SECTION
Initials
__________ Ensure that the R/O and vehicle match.
___________ Wash vehicles underside and exterior if needed.
___________ Fill in the information at the top of this check list.
___________ Retrieve the new and salvage carts for this vehicle from the
parts department.
___________ Compare parts list to the vehicle damage and verify.
___________ Notify the paint department. with the manufacturers paint
code and color via e-mail.
___________ Notify the appraisers department. if a need for a supplement
is required via e-mail.
___________ Ensure that all the required parts and panels were removed,
placed in their proper bins, to facilitate the repair of the
vehicle.
_______________________________ Section team leaders signature of
quality controlled compliance
FRAME SECTION
Initials
___________ Ensure that the last section has done the required repair.
___________ Is frame repair needed? Yes ______ No ______
___________ Ensure that the R/O and vehicle match.
___________ Computer software package number. ___________________
___________ Ensure that the estimators were notified of any additional
repairs.
___________ Ensure that before and after measurements are attached to
the R/O.
Quality Control Checklist
SHEET METAL SECTION
Initials
___________ Ensure that the R/O and vehicle matches.
___________ Ensure that all the parts that were installed match.
___________ Ensure that the proper part cut ins were completed.
___________ Were all of the repairs and replacements completed.
___________ Is the filler finished to 180 grit standards or better.
___________ Does the filler adhere to the proper appearance.
__________________________________ Section team leader signature of
quality control compliance.
PRE PAINT SECTION
___________ Were all prior repairs conducted to give the appearance that
the vehicle was not damaged.
___________ When repairs are fine sanded, are they free of all
imperfections.
___________ Did all panels that are to be refinished receive a solvent wash.
___________ Are all primered and sealed areas free of imperfections.
___________ Is the vehicle masked properly.
___________ Are all repaired areas covered with a primer or sealer.
___________ Is the vehicle ready for refinishing.
__________________________________ Section team leaders signature of
quality control compliance.
Quality Control Checklist
REFINISHING SECTION
Initials
___________ Check the R/O to the vehicle to insure that they match.
___________ Are all the repair areas covered with primer or sealer.
___________ Is the vehicle covered properly to refinish.
___________ Are all repairs free of imperfections.
___________ Have you found the pre-mixed amount of paint and is it
enough to refinish the repairs.
___________ Is the refinishing of the vehicle complete and free of
imperfections.
___________ Have you disposed of the hazardous waste properly.
___________ Has the vehicle been put into the booth.
__________________________________ Section team leader signature of
quality control compliance.
DETAIL SECTION
Initials
___________ Check the R/O to the vehicle to insure that they match.
___________ Have you repaired any and all imperfection in the finish.
___________ Has the masking been disposed of properly.
___________ Have all the lights been checked and are they operating
properly.
___________ Have all moldings and decals been installed.
___________ Is vehicle ready to transfer to the next section of repair.
__________________________________ Section team leader signature of
quality control compliance
Quality Control Checklist
MECHANICAL SECTION
Initials
___________ Check the R/O to the vehicle to ensure that they match.
___________ Have you made all repairs and adjustments that are required.
___________ Check the engine oil add if needed. How many pts. ________
___________ Check the power steering fluid make the adjustments. How
many pts. _______
___________ Check the automatic transmission oil add if needed. How
many pts. _______
___________ Check the brake fluid make the required adjustments.
___________ Check the air in the tires; make the proper adjustments.
___________ Check vehicle inspection has it or will it run out soon, contact
control if so.
WASH SECTION
___________ Is the vehicle clean inside and out.
___________ Have all warranties and flyers been placed in the vehicle.
___________ Have all fluids been checked (use mechanics section check
list).
___________ Is the vehicle ready for the final inspection and for delivery to
the customer.
__________________________________ Section team leaders signature of
quality control compliance.
Quality Control Checklist
FINAL OUT QUALITY CONTROL CHECK LIST
R/O # __________________________
VIN # ________________________________________________
SUPPLEMENT # ______________________________________
DATE AND TIME _____________________________________
ALL ITEMS ON THE LIST WILL BE CHECKED AND ENSURE THAT
THEY OPERATE OR PERFORM AS REQUIRED
Initials when checked
____
____
____
____
____
____
____
____
____
____
____
____
____
____
____
____
____
____
____
____
____
Engine oil
Transmission oil
Power steering oil
Washer fluid
Radiator fluid
Tire pressure
Brake fluid
All doors, hoods, deck lids, lift backs, locks, and windows operate
correctly
All lights operate and are adjusted correctly
Interior is clean and free of all dirt and glass particles
Exterior is clean and free of all repair dust and compounds
All repairs were completed
All repairs and finishes are free of imperfections
All warranties and flyers are located in the vehicle
All appropriate sections have completed their inspections
All glass is clean
Vehicle gives the appearance of having not been damaged
Finish color matches the original finish
All reports have been attached to the R/O
All supplements have been sent back to the estimators
Notified the production manager as to the vehicle being completed
and ready for delivery
Inspectors Name __________________________________________
Clock #
___________________________________________
Date / Time
___________________________________________
Notes and recommendations
________________________________________________________________
Organizational Structure
Collision Center
General
Manager
Production
Manager
Dismantle
Team Leader
Dismantle Team
Frame
Team Leader
Frame Team
Metal Team Leader
Metal Team
Paint Team Leader
Paint Team
Detail Team
Quality Control
Estimator
Sales Manager
Office Manager
Customer Service
Representative
Payables
Administrator
Customer Service
Representative
Receptionist
Organizational Structure
Management Staff Structure
Base Salary
General Manager
Production Dept.
Production Manager
Sales Dept.
Sales Estimate Rep.
CSR
Quality Control Mgr.
Detail Trim Techs
Parts Manager
Parts Dispatch
Office Admin.
Office Manager
Receptionist/Operator
Payables Admin
Incentive
$60,000
$40,000
Total Potential
Compensation
$100,000
$35,000
$7,000
$42,000
$30,000
$21,000
$5,000
$4,000
$35,000
$50,000
$30,000
$21,000
$25,000
$0
$0
$0
$30,000
$21,000
$25,000
Organizational Structure
Technician Needs Assessment
Start-up
Potential
R/Os
R/Os
Avg.
Total
per
per
Revenue Weekly
week
year
per R/O Sales
60
3,120
$1,500
$90,000
70
3,640
$1,500 $105,000
80
4,160
$1,500 $120,000
90
4,680
$1,500 $135,000
100
5,200
$1,500 $150,000
110
5,720
$1,500 $165,000
Total
Annual
Sales
$4,680,000
$5,460,000
$6,240,000
$7,020,000
$7,800,000
$8,580,000
Organizational Structure
Technician Needs Assessment (cont’)
Annual
Techs @ Techs @ Techs @
Labor
150%
170%
200%
Revenues Efficiency Efficiency Efficiency
Start-up $2,199,600
20
17
15
$2,566,200
23
20
17
Potential $2,932,800
26
23
20
$3,299,400
30
26
22
$3,666,000
33
29
25
$4,032,600
36
32
27
Capital Cost Analysis
Office Department Description
Model
Quantity
Cost per Unit
Total Cost
Computer System-Client Server Design
with 20 work stations
Custom Built to Spec
1
$ 35,000.00
$ 35,000.00
Estimation Software
ADP / Mitchell / CCC
1
$
$
Management Operating Software
Mitchell / ADP / CCT
1
$ 10,500.00
$ 10,500.00
Fax Machines
Canon
5
$
$
Telephone System
ATT
1
$ 25,000.00
$ 25,000.00
Digital Camera
Kodak
2
$
500.00
$
1,000.00
Office Software
Microsoft
1
$
800.00
$
800.00
Manager's Office Furniture
Desk and Credenza
1
$
1,200.00
$
1,200.00
Mid-Level Manager's Office Furniture
Office Cube
10
$ 10,000.00
$ 100,000.00
File Storage
5 Drawer Lateral Files
10
$
350.00
$
3,500.00
Photo Copier
Xerox
2
$
4,500.00
$
9,000.00
Business Forms
Local Production
1
$
5,000.00
$
5,000.00
Document Retrieval System
Canon
1
$
7,500.00
$
7,500.00
7,000.00
400.00
7,000.00
2,000.00
Sub Total $ 207,500.00
Safety Department Description
Eye Wash Stations
Model
Quantity
5
Cost per Unit
$350.00
Total Cost
$1,750.00
Capital Cost Analysis
Fire Extinguishers
20
$165.00
$3,300.00
Safety Signage
1
$550.00
$550.00
Sub Total
Dismantle Department
Portable Lifts
$5,600.00
4
$1,500.00
$6,000.00
Hydraulic Jacks
Blackhawk
2
$250.00
$500.00
Jack Stands (Pairs)
Blackhawk
2
$35.00
$70.00
Parts Carts
IDEA
30
$350.00
$10,500.00
Air Impacts
Ingersoll Rand
3
$235.00
$705.00
Air Ratchets
Ingersoll Rand
3
$164.00
$492.00
Air Chisels
Ingersoll Rand
3
$68.00
$204.00
3
$350.00
$1,050.00
Air Hose Reels with 35 Feet Hose
Pressure Washer
Steam Jenny
1
$1,200.00
$1,200.00
Technician Tool Boxes
Snap-on,MAC, MATCO
2
$3,500.00
$7,000.00
Sub Total
Frame Department Description
Model
Quantity
Cost per Unit
$27,721.00
Total Cost
360 Degree, three station, full size frame
alignment station, drive through
World Rack 4000l or
Chief S-21 Series 30
2
$37,500.00
$75,000.00
Laser Frame Measurement System
Genesis II / Shark
1
$29,500.00
$29,500.00
Capital Cost Analysis
Air Impacts
Ingersoll-Rand
3
$235.00
$705.00
Air Ratchets
Ingersoll-Rand
3
$164.00
$492.00
Air Chisels
Ingersoll-Rand
3
$68.00
$204.00
Air Riveter
Ingersoll-Rand
3
$300.00
$900.00
Work Bench Stations
Shure
4
$250.00
$1,000.00
Mig Welders
Miller 110V/150Amp
2
$1,500.00
$3,000.00
Oxy/Acetylene Torch Set
Harris
2
$290.00
$580.00
Torch Carts
Marquette
2
$150.00
$300.00
Bench Grinder
Bld
2
$200.00
$400.00
5
$350.00
$1,750.00
3
$3,500.00
$10,500.00
Air Hose Reels with 35 Foot Hose
Technician Tool Boxes
Snap-on, MAC, Matco
Sub Total
Metal Department Description
Model
Quantity
Cost per Unit
$124,331.00
Total Cost
Central Vacumn System
Various
2
$14,000.00
$28,000.00
Portable Lifts
Dover Industries
6
$1,800.00
$10,800.00
Hydraulic Jacks
Blackhawk
4
$250.00
$1,000.00
Mig Welders
Miller 110V/150Amp
2
$1,500.00
$3,000.00
Jack Stands (pairs)
Blackhawk
4
$35.00
$140.00
Capital Cost Analysis
Air Chisels
Ingersoll-Rand
4
$68.00
$272.00
Work Bench Stations
Shure
4
$250.00
$1,000.00
Air Hose Reels with 35 Foot Hose
4
$350.00
$1,400.00
Bench Grinders
4
$200.00
$800.00
4 Ton Porta-Power
Blackhawk
1
$185.00
$185.00
10 Ton Porta-Power
Blackhawk
1
$290.00
$290.00
DA Sanders
Ingersoll Rand
6
$235.00
$1,410.00
Board Files
Ingersoll Rand
6
$270.00
$1,620.00
5
$225.00
$1,125.00
Lock Clamp Sets
$
433,598.00
7" Grinders
Milwaukee
4
$225.00
$900.00
4.5" Grinders
Milwaukee
4
$76.00
$304.00
Air Cut Off Tools
Ingersoll Rand
4
$65.00
$260.00
Spot Weld Drills
Ingersoll Rand
4
$395.00
$1,580.00
Heat Guns
Milwaukee
4
$90.00
$360.00
Technician Tool Boxes
Snap-on, MAC, Matco
4
$3,500.00
$14,000.00
Sub Total
$68,446.00
Capital Cost Analysis
Refinish Preparation Area Description
Prep Stations-2-Bay Design, Drive Through
Model
Accudraft
Masking Machines
Quantity
Cost per Unit
2
$41,000.00
$82,000.00
4
$170.00
$680.00
Total Cost
HVLP Primer Guns
SATA
3
$375.00
$1,125.00
Fresh Air Systems
SATA
3
$556.00
$1,668.00
Portable Infrared Dryers
IRT Systems
3
$3,300.00
$9,900.00
Anti static Guns
3
$200.00
$600.00
Safety Cans
4
$65.00
$260.00
Air Hose Reels with 35 Feet Hose
8
$350.00
$2,800.00
Work Bench Stations
Shure
6
$250.00
$1,500.00
DA Sanders
Ingersoll Rand
5
$235.00
$1,175.00
Paint Technician Boxes
Snap-on, MAC, Matco
4
$2,000.00
$8,000.00
Sub Total $109,708.00
Capital Cost Analysis
Paint Department
Description
Down Draft Spray/Bake
Model
Spraybake/Nova/Vera/
Blow Therm/Accudraft
Paint Mixing Room
Built into building
Air Hose System
Quantity
Cost per Unit Total Cost
2
$53,000.00
$106,000.00
4
$0.00
$0.00
4
$200.00
$800.00
HVLP Spray Guns
SATA Jet-90
4
$385.00
$1,540.00
Fresh Air Systems
SATA
4
$556.00
$2,224.00
Portable Infrared Dryers
IRT Systems
4
$3,300.00
$13,200.00
Roller Jacks
Go-Jack
16
$190.00
$3,040.00
Smart Head Scale
1
$5,000.00
$5,000.00
Paint Mixing System and Racks
1
$9,000.00
$9,000.00
Paint System Software (Shopwatch)
1
$12,500.00
$12,500.00
1
$2,000.00
$2,000.00
Solvent Recycler
2
$2,500.00
$5,000.00
Primer Gun Washers
1
$1,200.00
$1,200.00
4
$250.00
$1,000.00
Base Gun Washer
1
$1,200.00
$1,200.00
Clear Gun Washer
1
$1,200.00
$1,200.00
4
$2,000.00
$8,000.00
Paint Computer Work Station
Work Bench Stations
Paint Technician Tool Boxes
As per Office System
Shure
Snap-on, MAC, Matco
Sub Total $172,904.00
Capital Cost Analysis
Trim and Detail Area Description
Model
Quantity
Cost per Unit
Total Cost
Variable Speed Buffers
Milwaukee
2
$225.00
$450.00
Pressure Washer
Star 1500 PSI
1
$900.00
$900.00
Safety Cans
4
$65.00
$260.00
Air Hose Reels with 35 Feet Hose
6
$350.00
$2,100.00
Tools Carts
4
$75.00
$300.00
Work Bench Stations
4
$250.00
$1,000.00
Shop Vacuums
2
$225.00
$450.00
4
$2,500.00
$10,000.00
Technician Tool Boxes
Snap-on,MAC,Matco
Sub Total $15,460.00
Capital Cost Analysis
Mechanical Shop
Description
4 Wheel Alignment Rack and Computer
Model
Bear
Quantity
1
Cost per Unit
$17,500.00
Rim Clamp Tire Machine
Coates
1
$3,500.00
$3,500.00
Wheel Balancer
Coates
1
$2,500.00
$2,500.00
R-134/R-12 A/C Evac/Recharge Station
RTI
1
$4,500.00
$4,500.00
Anti-Freeze Recycler
RTI
1
$3,500.00
$3,500.00
Air Hose Reels with 35 Feet Hose
4
$350.00
$1,400.00
Tool Carts
6
$75.00
$450.00
4
$250.00
$1,000.00
4
$200.00
$800.00
Work Bench Stations
Shure
Bench Grinders
Total Cost
$17,500.00
Air Impacts
Ingersoll Rand
2
$235.00
$470.00
Air Chisels
Ingersoll Rand
4
$68.00
$272.00
Air Cut Off Tools
Ingersoll Rand
4
$65.00
$260.00
Mig Welders
Miller 110V 150Amp
0
$1,500.00
$0.00
Oxy Acetlyene Torch Set
Harris
0
$290.00
$0.00
Vise 6"
4
$125.00
$500.00
Strut Compressor
2
$225.00
$450.00
Diagnostic Tools
Various
2
$4,750.00
$9,500.00
Technician Tool Boxes
Snap-on,MAC,Matco
4
$5,000.00
$20,000.00
Sub Total $97,522.00
Capital Cost Analysis
Air System
Description
Model
Rotary Air Compressor
Quincey 25 HP
Air Dryers
Piping and Fittings
Misc.
Quantity
Cost per Unit
Total Cost
2
$5,400.00
$10,800.00
2
$2,500.00
$5,000.00
0
$0.00
$0.00
Sub Total $15,800.00
Total $844,992.00
Facility Layout & Design
Overview
Processes have been broken down into:
 Dismantle and estimate validation
 Frame measuring and repair
 Metal replacement and alignment
 Paint prep
 Final paint
 Trim-out
 Detail and final quality control
Facility Layout & Design
Overview
 This facility is unique in that the
technicians do not own their tools and
they do not have pre-assigned work
stalls. Our technicians work in groups
comprised of varying skill levels
assigned to a single vehicle.
Facility Layout & Design
Overview
 A highly skilled craftsman is assigned
to each group and oversees each
group’s work. Groups move from
vehicle to vehicle in their pre-assigned
work areas as needed.
Facility Layout & Design
Overview
 This concept provides high productivity
by eliminating wasted time and high
efficiency by having the same
technicians performing the same types
of repairs over and over.
Facility Layout & Design
Architectural Design



All of the offices, restrooms, storage areas,
and customer spaces are located in the
center of the facility to allow easy access.
Mechanical repair is located in the rear of
the building and is separated by walls to
keep airborne contaminates associated
with mechanical repairs from contaminating
the painting process.
Parts are located in the rear of the building
and are designed to provide ease of
access to both the metal repairs,
technicians and the paint and detail
technicians.
Facility Layout & Design
Architectural Design

Estimating and customer delivery is located
in the front of the building.
 Also, the facility is designed to incorporate
an insulated shop ceiling so that the entire
facility can be heated and air-conditioned.
Overhead doors are located strategically
down each side of the building so that
vehicles can be taken in or out of the
assembly line during each stage of the
repair as needed.
Operating Statement
Assumptions
The following Pro-forma is solely designed to build a
framework for analysis. Certain assumptions are
hypothetical and have yet to be subjected to proper
verification methodology. This will occur when the
business plan is developed.
Total Sales
Projected volume based upon target of 50% market share
st
and 70% market share. This allows you to see 1 year
versus full potential.
Labor Sales
Calculated from Repair Collision Component Analysis.
Labor is projected at 47% of average repair order.
Labor Cost
Calculated from Production Staff Structure @ 150%
Efficiency assumes everyone starts at minimum salaries
and assuming full incentive payout.
Parts Sales
Calculated from Repair Order Component Analysis. Parts
are projected at 42% of average repair order.
Parts Cost
Assumptions of minimum achievable margins of 34%.
Available margins may exceed this amount but may also
be reduced through negotiation in insurance contracts.
Paint & Material Sales
Calculated from Repair Order Analysis. Projected at 5%
of average repair order. Paint & Material sales generally
run at $20.00 per paint hour labor. Due to the practice of
splitting paint hours into both paint with materials as well
as paint with no materials and the practice of capping total
materials insurance companies, we have assumed an
80% capture rate or approximately $16.00 per paint hour.
Paint & Material Cost
Projected based upon E&A guideline of 65%
Sublet Sales
Calculated at 5% of labor sales
Operating Statement
Assumptions
Sublet Cost
Based upon current Insurance Company
guidelines for allowable markup for sublet
operations of 25%.
Support Personnel
Expense
Brought over from Management Staff Structure,
assuming all incentives paid.
Vehicle Expense
Calculated for vehicles assigned to General
Manager only. Expenses @ $0.30 per mile, 1500
miles per vehicle.
Technician Benefits
Projected at 19.5% of Technician payroll
Office Supplies
Projected at 1.0% of Sales
Support Personnel Benefits
Projected at 19.5% of payroll cost
Advertising
Projected at 1.5% of Sales
Computer Software
Expense
Based upon 3 database updates at a cost of
$400.00 per vendor per month.
Building Maintenance
Based upon 1.0% of building value. Assume
$1,250,000 building value.
Telephone Expense
Projected at flat $1,675.00 per month
Rent/Lease Expense
Assumption of $1.25mm building and $.4mm land
value with a 10% rent factor.
Equipment Lease
Expenses
Projected at 7 years, 0% residual @ 9.0% on total
of equipment purchased. Note: this might be lower
based upon equipment assumed from current
dealership operations.
Electricity
Based upon experience from comparable sized
building in another market.
Gas
Based upon experience from comparable sized
building in another market.
General Liability Insurance
Based upon blind quote from local insurance
agency.
Depreciation
Based upon an estimate of $126,000 in owned
Business Plan Pro Forma
Total Sales
50% Market Share
$4,200,000
70% Market Share
$5,900,000
Total Labor Sales
Technician Labor Cost
Labor Gross
100%
35%
65%
$1,974,000
$690,900
$1,283,100
47%
100%
30%
70%
$2,773,000
$831,900
$1,941,100
47%
Total Parts Sales
Total Parts Cost
Total Parts Gross
100%
66%
34%
$1,764,000
$1,164,240
$599,760
42%
100%
66%
34%
$2,478,000
$1,635,480
$842,520
42%
Paint & Material Sales
Paint & Material Cost
Paint & Material Gross
100%
55%
45%
$210,000
$115,500
$94,500
5%
100%
55%
45%
$295,000
$162,250
$132,750
5%
Sublet Sales
Sublet Cost
Sublet Gross
Total Gross Profit
100%
75%
25%
$210,000
$157,500
$52,500
$2,029,860
5%
100%
75%
25%
5%
48.33%
$295,000
$221,250
$73,750
$2,990,120
50.68%
Operating Expenses
Support Personnel
Technician Benefits
Support Personnel Benefits
Vehicle Expense
Office Supplies
Advertising
Computer Software Expense
Building Maintenance
General Liability Insurance
Gas
Electricity
Telephone
Total Semi Fixed Expense
$303,000
$90,399
$66,398
34,151
20,089
30,133
15,066
12,500
15,066
5,022
20,089
$20,089
$632,002
14.9%
4.5%
3.3%
1.68%
1.0%
1.5%
0.7%
0.6%
0.7%
0.2%
1.0%
1.0%
31%
$445,528
$179,407
$86,713
$50,832
$29,901
$44,852
$15,549
$12,858
$22,426
$7,475
$23,921
$23,921
$943,383
15%
6.00%
2.90%
1.70%
1.00%
1.50%
0.52%
0.43%
0.75%
0.25%
0.80%
0.80%
32%
Bldg. Rent / Lease
Equipment Lease
$165,900
$64,702
3.95%
3.20%
$165,200
$64,900
2.80%
1.10%
Depreciation Expense
Total Fixed Expense
$12,600
$243,202
0.30%
7.45%
$12,980
$243,080
0.22%
4.12%
$3,650,441
$549,559
86.92%
13.08%
$5,094,650
$805,350
86.35%
13.65%
Total Expenses
Net Profit Before Taxes
Add Depreciation
Cash Flow
$12,600
$562,159
$12,980
13.38%
$818,330
13.87%
Financial Analysis
Estimated Capital Investment
Leased Equipment as per list
$718,922
Owned Equipment as per list
$126,000
25,000 Sq. Ft. Building @ $50.00 / Sq. Ft.
Land 4 Acres @ $100,000 / Acre
Total Capital Investment
$1,250,000
$400,000
$2,494,922
Return on Investment
30%
Gross Margin
48.33%
Net Margin
12.71%
Gross Profit Per Technician
$96,600
Net Profit Per Technician
$25,422
Gross Profit Per Employee
$72,495
Net Profit Per Employee
$19,066
Business Plan Review
1. Concept Overview
•
Sales Process
•
Facility Plan
•
Business Plan Objectives
•
Other Issues
Business Plan Review
2. Defining the Repair Process
•
Repair Process Flowchart
•
Departmental Responsibilities
•
Quality Control Checklist
Business Plan Review
3. Organizational Structure
•
Organizational Structure
•
Technician Needs Assessment
4. Capital Costs
•
Equipment Description
•
Equipment Budget
Business Plan Review
5. Facility Layout & Design
•
Overview
• Architectural Design
6. Pro Forma Operating Budget
7. Financial Analysis
8. Notes
For More Information
Contact Edwards & Associates at:
5615 Harrisburg Industrial Park Dr.
Charlotte, NC 28075
(Phone): (800) 979-9904
(Fax): (704) 454-5213
Or
Email:[email protected]