The global financial crisis has proved advantageous for the automotive parts industry, meanwhile the motor vehicle repair industry’s restructure over the past five years has contributed to its profit making potential.
Research company IBISWorld predicts the parts industry will enjoy an annualised growth of 3.0 percent over the five years to 2013-14.
This is primarily the result of economic downturn, whereby rather than purchase a brand new car, motorcycle or scooter consumers have been more inclined to repair their existing mode of transport.
Despite the economy beginning to improve, industry outlook is bright. According to IBISWorld’s Motor Vehicle Parts Retailing in Australia industry report, consumers are now simply able to choose between brand new or used parts for their vehicles.
“Industry retailers are forecast to exhibit steady annualised growth in revenue of 2.2 percent over the next five years, to reach $6.3 billion in 2018-19,” the report reads.
“Consumer demand for parts in the automotive aftermarket is likely to be driven by disposable income, consumer sentiment, the average age of motor vehicles and the overall number of vehicles in Australia.”
Another facet of the sector is the motor vehicle repair industry, which according to IBISWorld’s Motor Vehicle Body, Paint and Interior Repair in Australia industry report is expected to continue to undergo a restructure over the next five years and post 6.93 billion in revenue through 2017-18.
This sector of the industry relies heavily on vehicle crashes for its success, and over the past five years a number of factors have contributed to the industry’s ability to post a profit.
The report states: “Improved consumer confidence and increased household disposable income supported revenue growth. This occurred as households started driving longer distances more often, which increased the likelihood of a crash.”
The number and age of vehicles, as well as the age of drivers on the road has also played a part. “Probationary and inexperienced drivers, often found in the 18 to 25 age group, are more prone to motor vehicle accidents than older, more experienced drivers. The number of Australians in this age group rose over the past five years.
“The size of the motor vehicle fleet is estimated to increase at an annualised 2.8 percent over the past five years. The more cars on roads contributed to the increased probability of a collision,” the report reads.
TOUCH UP GUYS
Paint and bumper bar repair is the focus at Touch Up Guys, which has franchises in both Australia and New Zealand.
“We can repair anything to do with a damaged bumper bar including plastic welding tears and rips and heat reshaping dents,” says the brand’s franchise sales manager, Peter Darnell.
The brand offers a number of other services, which Darnell believes sets it apart from the rest.
“We have the capacity to provide bumper repair, alloy wheel repair and safety reversing sensor installation in addition to painting and buffing and polishing, and so have created a unique position for ourselves in the market.”
Touch Up Guys offers customers added convenience by virtue of the brand’s mobile nature, Darnell explains.
“Customers no longer have to lose their vehicles to panel shops for days at a time while minor repairs are undertaken. Touch Up Guys come to the customer’s home or workplace and complete most jobs in just a few hours.”
He adds customers are likely to save on automotive repair services when they choose Touch Up Guys.
“As mobile operators without the expense of premises and staff to maintain, we are always more than competitive on price and the customer does not need to worry about the expense of hiring a replacement vehicle or paying for taxi fares to and from a panel shop.”
New franchisees take up residence at the brand’s national training centre in Burleigh Heads for a three week training program prior to entering their business, and ongoing support is available thereafter.
“We teach [them] all the technical skills needed to do the work so at completion they are ready to start making money. We also teach business skills with a focus on selling, marketing, customer service, database management and maintaining business records.
“Upon conclusion of the program a national office trainer accompanies the new franchisee back to their territory and spends another week helping them to get established,” Darnell says.
Touch Up Guys does not require that franchisees have a background in the automotive industry, as its training program covers all they need to know to run a successful business.
“We look for people who want to work outdoors, are comfortable working with their hands, have good communication skills, a reasonable level of fitness and are motivated to be successful business people.”
According to Darnell, the past six years has seen Touch Up Guys’ customer base expand to include private consumers, which means more business for franchisees.
“This has been achieved by the implementation of a range of integrated marketing strategies aimed at maximising internet presence and the use of tightly targeted print and electronic media to attract potential customers to the Touch Up Guys website,” he explains.