PDR: a lucrative niche?

Smart repairs

Are you losing business to paintless dent repair specialists? Isn't it about time you found out how to take these guys on at their own game?
Paintless dent repair (PDR) is big business in the US with companies such as Dent Wizard highly successful in this lucrative niche. Australia is not far behind, with specialist companies such as Dent Masters, Dent Force, Ausdent, Dent-Oway, Dent Maestro and Dent Wizard Australia taking the lion's share of this market.
Bodyshops should be, and in some cases are, taking advantage of their existing marketing network to reap the rewards from this sector. A survey by a major US PDR specialist last year found that even in America's crowded market, there are opportunities. The report highlighted five key work providers for PDR:

1. Dealers. The most popular target for new PDR businesses, not the best or biggest but easy to locate and market to. Most used car departments are highly competitive but by using existing contacts or work contracts in other departments, gaining work from these yards is possible.
2. Rental agencies. A growing PDR market segment. Again, panel shops with existing contracts will have a foothold already.
3. Car auctions. Although hard to market to due to the high turnover of customers, this market is large and relatively easy to service.
4. Hail damage. This market has become popular in the past few years and specialists have been known to send techs interstate to meet demand. Sydney-based Dent Force for instance, sent five techs to East Gippsland over Christmas 2001 to repair hail damage after a severe storm, setting up operations in a converted shed. Although hard to market to and tough to service (hail damaged cars can average 8-16 hours each), it is lucrative. Private and insurance customers make up by far the largest portion of the segment and provide the best returns. In the US, insurers are adjusting most hail damage at PDR rates, not conventional rates, which means panel shops are being shut out if they do not use PDR. Insurers like PDR because it gives lower costs and quicker turnaround times which in turn reduces hire car costs, gives faster finalisation of claims and reduce minor claims because minor repairs using PDR usually cost less than policy excesses.
5. Private work. The largest market, with low penetration from any one company. Hard to market to but easy to service.

The survey estimated the US PDR market in 2000 was worth $US10 billion, with only 15 per cent realised. It concluded that the market is still in a strong growth cycle with years of growth to come. This is even more true of the Australian market. Although you as a bodyshop owner might not see much PDR work come into your shop, this may be because you don't market yourselves to take advantage of the work out there. Just because you don't see much work coming through the door does not mean it is not out there.
Many PDR specialists offer franchise opportunities for mini-entrepreneurs who set themselves up in business with little more than a van, some basic training and a set of tools. Utilising existing work provider contacts and with training and a little investment, bodyshops should be able not only to avoid losing out to PDR specialists but gain extra work in the process.
Training in PDR techniques has been limited in Australia, with NRMA Insurance contracting some NSW TAFEs to train its assessors and equipment suppliers providing on-site training.
After discussions with the VACC, Garry Edwards, manager of the auto body and refinish centre at Kangan Batman TAFE in Victoria is looking to set up a course in paintless dent repairs, open to the general trade. Still in the initial planning stages, Edwards hopes to partner with an equipment supplier in this area and aims to set up the short courses some time this year. "It's an important area of specialisation and panel shops need to be able to perform these sorts of repairs," he said.
Perhaps with training soon to be available, repairers will not have to resort to sub-contracting PDR specialists at low margins in an effort to avoid losing valuable business. By being able to perform any type of repair, from small dings through to heavy hits, body repairers are at a marketing advantage when talking to large work providers such as insurers, fleets, rental agencies, auction houses and dealerships.