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Outlook for SAMBRA

There will be some significant changes for the motor body repair (MBR) sector in 2020.
It’s not going to be business as usual says Richard Green, National Director of the South African Motor Body Repairers’ Association (SAMBRA), a proud association of the Retail Motor Industry Organisation (RMI) and the custodian of industry standards and sustainability in the sector.
SAMBRA, whose members are responsible for repairing over 80% of all insured repair claims in the country, interface with all the key players in the formal MBR sector including short term motor insurers; insurer intermediaries; OEM approval programmes; OEM and alternative part suppliers; paint and equipment suppliers and MBRs servicing that market.
Green anticipates a decline in intermediary participants in the short term insurance sector and an increase in direct motor insurance – potentially more effective business partners than intermediary-driven insurers.
“Direct insurance models better suit our industry, as the current system is administratively ineffective and expensive,” he says.
He also predicts OEM approval programmes will remain an integral part of the industry, though the form may change dramatically. “We must not lose the connection between our two industries, as the connection is essential to ensure continued skills development without it repair quality will suffer. SAMBRA will continue to focus on cost reduction of these programmes,” he says.
If OEMs wish to maintain the current part supply levels, they will need to seek more effective and production efficient mechanisms. “The cost of premium vehicle parts is currently not sustainable and alternative parts manufacturers have already made significant inroads into the genuine parts market. Unless OEMs produce creative and effective alternatives, the erosion of their market share will continue. An additional impact is the increase in effective repair technology which allows MBRs to repair panels that were previously replaced.
SAMBRA’S right of lien will, in our view, negate insurers’ parts purchase/ payment strategy,” says Green.
In the paint and equipment sector, more local production is a necessity as only a small percentage of paint and equipment supplied to the MBR market in South Africa is locally produced. “There has never been a better time to be in the collision repair industry – because of the opportunities arising through consolidation. There’s a five-year window, and the clocks have already been ticking for two or three years.
“OEMs need to encourage competition in the sector by approving a wider range of paints for application to their vehicles,” says Green.
Government needs to look at encouraging investment in this industrial sector. A fair, unrestricted and competitive business environment in the MBR sector will grow small businesses and stimulate employment. “As a sector we strongly reject any bias, no matter what form it takes and will robustly oppose any form of unfair business practice,” says Green.
But business growth won’t happen in the large MBR business sector. “We believe the real growth opportunity lies in small business sector that can remain agile in service offering, and will, in future, be multi-faceted under the same ‘roof’ focussing on Non-Structural Repair (NSR) MBR work and allied services. As an industry we are committed to working tirelessly with all of our business partners to ensure a sustainable trading environment.”
The MBR industry will need to regroup, regain sector independence and focus on production efficiencies by developing skill and using of best available repair technology to maximise profit margins. “We owe our customers the best possible level of repair quality and service and we owe ourselves the correct levels of ROI. We will achieve this by declining to work at unsustainable rates; by securing working capital by exercising our right of lien and by eradicating the senseless invoice discounting practices,” concludes Green.