G&C Auto Body was founded in Santa Rosa, CA, in 1972 by Gene Crozat and Leo Gassell. Two satellite locations were opened in the 1990s. When the business was handed down to Crozat’s children, they decided to ramp up the growth. It now has 42 locations in 14 counties in Northern California.
Patrick Crozat, Gene’s son and the current COO of G&C Auto Body, appeared on The Collision Vision podcast, hosted by Cole Strandberg and driven by Autobody News, as part of its “Insurance Talk: Navigating Insurance and Repairs” series, to talk about how Direct Repair Program (DRP) agreements with insurance companies have fueled his family business’ explosive growth.
What is a DRP?
Crozat said DRPs have been a part of the collision repair industry since he got into it 22 years ago.
He described them as “contractual agreements where in turn for referrals from that insurance partner, you're going to make concessions where you're going to look out for the cost of the bill for them, and provide customer service.”
He said DRPs are valuable to insurance companies because they help foster a relationship with a body shop, which is the “face” of the repair process for the customer, while giving the insurance company some control over the customer’s experience.
“To ease the process between the claim and the body shop and the insurance company, I see a lot of benefits to the programs,” Crozat said.
DRPs have been “crucial” to G&C Auto Body’s growth, Crozat said. “I think it would be very, very hard for any body shop owner to grow to multiple locations without DRP relationships. I think it's always been that way,” he added.
It’s difficult to run multiple stores in the same niche, Crozat said, whether it’s going after luxury brands or referrals from a local dealership.
Crozat said his dad was always an advocate for DRPs. “He wanted it to be a symbiotic relationship between the body shop and the insurance company, and that we're both working towards taking care of our customer,” he said.
Pros and Cons of DRPs
DRPs require a lot more administrative paperwork, and usually include a discount on the shop’s stated labor rate.
“You are focusing on pleasing a second customer in a way,” Crozat said, referring to the insurance company.
There are often multiple body shops in an area with the same DRP, leading to competition for the insurance company’s referrals.
“I love competition. I think competition is always needed and it drives businesses to excellence,” Crozat said. “If someone owns the market and they don't have to work hard for it, they don't have to try and earn it every day. Human nature. I think people will get very complacent and they wouldn't give the best job that they could do.”
Technology has made it easier to track shops’ KPIs and other metrics, meaning insurance companies now make referrals based on performance. “That's what's going to drive profitability for the insurance company, and that's going to drive better CSI and lower rental days,” he said.
That has helped G&C Auto Body excel, Crozat said, as it performs well in terms of cycle time and CSI, so insurance companies want to establish a DRP at any shop the company opens.
Strandberg asked if G&C’s DRPs are leading to it being pulled into some of the markets it is growing into.
Crozat said there have been instances of an insurance company asking about G&C’s growth plans, and then encouraging entry into a particular market.
“In those conversations they’ll be like, ‘Hey, you know what? We could really use a shop in that area. So let's start looking at it,’” he said.
Crozat said his company prefers to open locations within a certain distance of each other, to support each other and build out markets. Insurance companies can provide data on how many competitor shops already exist in a set radius.
“It would have been really scary back in the day to do something like that, if you didn't know if you could get the insurance companies and have that business,” Crozat said.
What Does a DRP Relationship Look Like?
Most of G&C’s DRP partners like to have sit-down meetings with management at least twice a year to review the business, Crozat said. A large MSO like G&C Auto Body then disseminates any information to all of its locations.
G&C has a DRP account manager, who has nine employees under them, each with a specialization. The company has a training website with every DRP’s individual processes, to serve as a reference for employees, and holds monthly training sessions on each DRP for any new hires or anyone who needs a refresher.
Strandberg asked what advice Crozat could give owners of smaller companies looking to build infrastructure like that.
“It all starts with one step,” Crozat said. “It can be overwhelming to look at the big picture.”
Crozat’s wife, Tara Crozat, joined G&C Auto Body as a customer support representative. She was then promoted to a clerical lead and then a writer. Now she manages the service writer program, which includes building SOPs and maintaining the training website. She also implemented a training program for new hires interested in becoming estimators.
“She was the most thorough, detailed writer,” Crozat said. “I would look internally at who is a writer in your organization that is on top of everything -- very detail-oriented, process-driven and organized.”
The Future of DRPs vs. OEM Certifications
Crozat said he thinks DRP agreements will largely remain the same, but maybe with some tweaks.
“I don't think I've seen too much evolution with insurance partner relationships over the years,” he said.
G&C Auto Body has at least six DRPs per facility; some longer-serving locations have up to 13.
“We've always been an advocate of having every DRP that we can get in our locations, so that we're not hoping that all of our business comes from one insurance company all the time,” Crozat said. “I would recommend going towards having more DRP partners and growing your business to be able to meet all their needs.”
As more OEMs demand their vehicles are repaired only at certified facilities, it is restricting other repairers from being able to get parts for those manufacturers. Crozat said that led G&C Auto Body to get Tesla certifications at 11 locations, since there are so many Teslas in the MSO’s California markets.
He said when going after an OEM’s certification, form strong relationships with the local dealerships who the vehicles for repair. But it is also key to advertise OEM certifications directly to consumers, in the event of personnel changes at the dealership.
Measuring Your Shop’s DRP Success
G&C Auto Body updates a “scorecard” weekly showing each shop’s performance in the metrics important to each DRP agreement at that shop.
If a store isn't hitting certain metrics, its estimates are reviewed centrally until they meet the standard, Crozat said.
“It's continuous coaching until people understand the program and how to win with that insurance contract,” he said.
Overcoming Challenges with DRPs
There have been instances where an insurance company hasn’t wanted to pay for a part of the repair process.
“You're not always going to get what you want with an insurance partner. And that's what is -- it's a partnership, and a partnership is everyone gives and takes,” Crozat said.
He recommended maintaining good communication with DRP partners, as it increases the likelihood they’ll work with a shop if a part of the agreement is harming their business.
“Be open and honest and share the numbers with them,” Crozat said. “Maybe they'll make a concession with you and work with you on it.”
Crozat also recommended talking to them regularly about how the shop can “be a better partner” for the insurance company.
“How am I doing currently? Where could I improve? How can I earn more of your business? And how can I grow with you? See if you can chart that path with the insurance partner,” Crozat said.
“If that path isn't there, go looking to add maybe more insurance partners, where then you have enough business to be able to open a second location, or to take the building over next door down the street,” he added.
Abby Andrews